Arctic offshore energy development could add 27 billion barrels of oil and 132 trillion cubic feet of natural gas
As Arctic countries like Norway ramp up their northern drilling programs, the American Petroleum Institute is calling on Washington for more “forward-looking energy policy” that includes the Arctic.
API Executive Vice President Louis Finkel addressed “flaws” in the Bureau of Ocean Energy Management’s 2017-2022 Outer Continental Shelf Oil and Gas Leasing Program during a press briefing ahead of the Senate Energy and Natural Resources Committee hearing.
“The United States needs forward-looking energy policy. The U.S. has become the number one producer of oil and natural gas in the world thanks to development that has taken place mostly on private and state lands. At the same time, thanks to industry efforts, methane emissions are down significantly as well as carbon and other air emissions, all while energy production has been going up,” said Finkel.
Today, 87 per cent of federal offshore areas remain off limits to oil and natural gas production.
The Department of the Interior removed the Atlantic portion of the leasing program during the draft portion of the program development earlier this year, leaving only offshore Alaska as the area with the most potential for new oil and natural gas resources.
However, the plan is not yet finalized, and leasing areas have not been confirmed.
“Leaving out offshore Alaska would put the U.S. at a serious global competitive disadvantage, considering that Russia, Iran, Norway and other countries are moving rapidly to develop oil and gas resources,” said Finkel. “We must continue to think ahead, explore and develop new areas to protect U.S. energy security for generations to come.
Last week Norway awarded 10 oil licences to energy companies in the Arctic, opening new acreage for exploration for the first time in two decades and granting access to an offshore zone bordering Russia.
Norway is hoping the new areas will help boost a sector that has been shedding projects, costs and jobs due to a 57 percent decline in crude prices since mid-2014.
Western Europe’s largest oil and gas producing country is also keen to award licences in new acreage to maintain its overall production level, as output in the mature North Sea declines.
“This will contribute to employment, growth and value creation in Norway,” Norwegian oil and energy minister Tord Lien said in a statement.
Finkel says Arctic offshore energy development could add 27 billion barrels of oil and 132 trillion cubic feet of natural gas to America’s proven energy portfolio and create more than 54,000 jobs across the country, according to recent studies.
“American consumers, American businesses and future generations need energy programs from the Interior Department to align with today’s energy realities,” he said.
With files from Reuters.