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Released September 08, 2023 | SUGAR LAND
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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--The Biden administration doubled down on the energy transition by pulling drilling acreage in Alaska off the table while at the same time announcing capital commitments for domestic critical minerals.
Interior Secretary Deb Haaland canceled seven oil and gas leases awarded by then-President Donald Trump, pulling more than 13 million acres in the National Petroleum Reserve of Alaska off the table for drillers.
The administration said the move was ostensibly for climate protection.
"With climate change warming the Arctic more than twice as fast as the rest of the planet, we must do everything within our control to meet the highest standards of care to protect this fragile ecosystem," Haaland said.
The decision follows a nod for ConocoPhillips (NYSE:COP) (Houston, Texas) to proceed with the Willow oil project, which consultant group Wood Mackenzie (Edinburgh, Scotland) said marked the start of an Alaskan revival. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Project Database can click here for reports on the project.
Signing off on Conoco's so-called Alternative E, Interior allowed for a scaled-down version of the supermajor's initial plans for a five-pad development. Located in the National Petroleum Reserve in Alaska (NPR-A), the Willow project is estimated to produce 180,000 barrels of oil per day (BBL/d) at its peak, decreasing American dependence on foreign energy supplies in the process, Conoco said in welcoming the decision.
Interior's decision to eliminate further opportunities in Alaska, then, was met with outrage.
"It's bad enough to tear up legal contracts and renege on federal commitments," said Sen. Lisa Murkowski, a Republican representing Alaska. "But it's even more unconscionable that the Biden administration is penalizing Alaska right as it allows Iran to produce more of its oil and solicits the same from Venezuela."
Biden's energy policies are anything but popular, though necessity may be another matter given the mounting threats from climate change. July was the hottest month on record and natural disasters from Canadian wildfires to hurricanes are strengthened by human-related events.
To address that, the administration has pumped billions of dollars into everything from hydrogen to direct-air capture in an effort to address climate concerns. And with transportation accounting for the bulk of harmful emissions, the administration unveiled $150 million in funding to support the development of critical minerals in the domestic economy.
With most of those minerals coming from outside the country, Energy Secretary Jennifer Granholm said the funding is net positive for energy security.
"The investments announced today enhance national security by reducing our reliance on foreign sources--while strengthening an existing mining and energy workforce to develop sustainable sourcing for these vital materials right here in the U.S.A.," she said.
Those minerals are essential components of the energy transition, from solar panels to hydrogen fuel-cell vehicles.
Both sides of the energy sector are expensive, though the knee-jerk reaction to headline economic activity may be difficult to overcome. That's especially the case with retail gasoline prices, one of the more ubiquitous indicators of consumer-level inflation.
The recent decision by Saudi Arabia, therefore, to extend unilateral oil production cuts could easily create economic headwinds, though so too could a natural disaster that's made worse by climate change.
Alaskan oil production peaked at just 2 million BBL/d in the late 1980s, and it's leveled off at about 440,000 BBL/d. Commercial oil reserves, meanwhile, are depleted, and given the nature of the U.S. refinery sector, shale oil can only do so much.
Climate-related disasters are increasingly expensive so it's a difficult path ahead for any administration trying to thread the needle between the energy of today and the energy of tomorrow.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Interior Secretary Deb Haaland canceled seven oil and gas leases awarded by then-President Donald Trump, pulling more than 13 million acres in the National Petroleum Reserve of Alaska off the table for drillers.
The administration said the move was ostensibly for climate protection.
"With climate change warming the Arctic more than twice as fast as the rest of the planet, we must do everything within our control to meet the highest standards of care to protect this fragile ecosystem," Haaland said.
The decision follows a nod for ConocoPhillips (NYSE:COP) (Houston, Texas) to proceed with the Willow oil project, which consultant group Wood Mackenzie (Edinburgh, Scotland) said marked the start of an Alaskan revival. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Project Database can click here for reports on the project.
Signing off on Conoco's so-called Alternative E, Interior allowed for a scaled-down version of the supermajor's initial plans for a five-pad development. Located in the National Petroleum Reserve in Alaska (NPR-A), the Willow project is estimated to produce 180,000 barrels of oil per day (BBL/d) at its peak, decreasing American dependence on foreign energy supplies in the process, Conoco said in welcoming the decision.
Interior's decision to eliminate further opportunities in Alaska, then, was met with outrage.
"It's bad enough to tear up legal contracts and renege on federal commitments," said Sen. Lisa Murkowski, a Republican representing Alaska. "But it's even more unconscionable that the Biden administration is penalizing Alaska right as it allows Iran to produce more of its oil and solicits the same from Venezuela."
Biden's energy policies are anything but popular, though necessity may be another matter given the mounting threats from climate change. July was the hottest month on record and natural disasters from Canadian wildfires to hurricanes are strengthened by human-related events.
To address that, the administration has pumped billions of dollars into everything from hydrogen to direct-air capture in an effort to address climate concerns. And with transportation accounting for the bulk of harmful emissions, the administration unveiled $150 million in funding to support the development of critical minerals in the domestic economy.
With most of those minerals coming from outside the country, Energy Secretary Jennifer Granholm said the funding is net positive for energy security.
"The investments announced today enhance national security by reducing our reliance on foreign sources--while strengthening an existing mining and energy workforce to develop sustainable sourcing for these vital materials right here in the U.S.A.," she said.
Those minerals are essential components of the energy transition, from solar panels to hydrogen fuel-cell vehicles.
Both sides of the energy sector are expensive, though the knee-jerk reaction to headline economic activity may be difficult to overcome. That's especially the case with retail gasoline prices, one of the more ubiquitous indicators of consumer-level inflation.
The recent decision by Saudi Arabia, therefore, to extend unilateral oil production cuts could easily create economic headwinds, though so too could a natural disaster that's made worse by climate change.
Alaskan oil production peaked at just 2 million BBL/d in the late 1980s, and it's leveled off at about 440,000 BBL/d. Commercial oil reserves, meanwhile, are depleted, and given the nature of the U.S. refinery sector, shale oil can only do so much.
Climate-related disasters are increasingly expensive so it's a difficult path ahead for any administration trying to thread the needle between the energy of today and the energy of tomorrow.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
