IER’s Hutzler Touts U.S. Resource Potential in Hearing Oil

Posted February 5, 2013 | folder icon Print this page

IER Distinguished Senior Fellow Mary Hutzler testified today before the House Subcommittee on Energy and Power, where she described the vast energy resource wealth of the United States and identified burdensome administrative and regulatory actions that inhibit development and economic growth. The transcript of her remarks follow:

Chairman Whitfield, Ranking Member Rush, and Members of the Subcommittee, thank you for the invitation to participate in today’s hearing.

I am Mary Hutzler, senior fellow for the Institute for Energy Research, a non-profit think tank that conducts research and analysis concerning global energy issues.

In the last several years, IER has monitored closely the boom in energy production that is taking place in the United States – primarily on private andstate lands.

IER also tracks regulations and policies that limit the potential to reduce our dependence on overseas oil regimes, hinder our ability to generate much-needed revenues, and harm efforts to foster an energy-based economic recovery that creates jobs.

Just this morning, we released a study on the economic effect of immediately opening federal lands onshore and offshore to energy production.

According to our analysis, immediately opening federal lands that are currently unavailable because of statutory or administrative action would result in an additional $14.4 trillion to our GDP over the next 37 years.

In light of the recent Commerce Department report that GDP shrank for the first time since 2009, our economy needs the lasting stimulus that robust energy development on federal lands and waterswould provide.

But today’s hearing is focused primarily on the resource availability and the potential under our feet and off our shores to achieve domestic energy goals almost unthinkable just a few years ago.

In fact, for decades Americans were asking the question, “Where will we get the energy we need to heat our homes, fuel our cars, and meet the demands of a strong, 21st century economy?”

Due to hydraulic fracturing and horizontal drilling technologies, we no longer question WHETHER we have the resources.

Rather, the question is WHETHER we will be able to develop them – and thus reap the nation-wide economic benefits such development would foster.

The myth of energy scarcity that has plagued our national conversation has been exposed.  Just in the last year, the misleading refrain that the U. S.only possesses 2 percent of the world’s oil reserves has been replaced by the mounting evidence of our nation’s resource abundance.

IER highlighted this in an inventory of North America’s energy resources.  Using government information, we catalogued the vast resources of the United States and our neighbors.

The U.S. has enough resources to provide reliable and affordable energy for centuries to come. The question is whether the federal government will permit us to access these abundant resources, andnot whether sufficient resources exist.

We can now unlock our shale resources using technology proven for more than 60 years in over one million wells without a single confirmed case of contamination.

Furthermore, while our use of fossil energy has dramatically increased over the last 50 years, our air quality has improved.  According to the EPA, emissions from the six criteria pollutants under the Clean Air Act have decreased 68 percent since 1970 even though our energy consumption has increased by 45 percent.

There are, however, troubling trends in policy thatthreaten to restrict access to our vast energyresources, which could make American-made energy less available, affordable and reliable.

Oil shale development has all but stopped because administration policy withdrew research andmuch-needed leasing activity that could bring these resources to market.

Increased oil sands imports from our northern neighbor, Canada, could free the U.S. from energy dependence on foreign countries where American workers face increasing threats of kidnapping by terrorists and even murder.

But, we need the transportation infrastructure to get it here, and the energy security that this infrastructure would provide.

Onshore development on federal lands – which is roughly estimated at 700 million acres of subsurface mineral estate – is extremely limited and is increasingly so. In 2009, for example, the current administration leased fewer onshore acres for energy development than in any preceding year on record.

Offshore development on 1.76 billion acres of mineral lands has suffered from a de-facto administration embargo, with lease plans cancelled, moratoria imposed, and cumbersome regulatory activity that serve to discourageexploration.

Today, permitting delays by federal regulators have driven the wait to more than 300 days beforedrilling can begin on federal lands, about twice as long as it took in 2005.  By contrast, states like North Dakota are now turning permits in 10 days;Ohio, 14 days; Colorado, 27 days.

Alaska’s energy resources lie dormant even thoughits pipeline has enough unused capacity to take twice the daily production of North Dakota.

Decisions made today about access to energy resources affect energy production for years and decades to come. The more areas accessible to energy production today increases the likelihood of domestic production tomorrow, and with it,increased jobs, government revenues, and economic activity.

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Author:
IER