American Oil and Gas Reporter - April 2022 - 76

Coalition Of Industry Associations
Writes To President Biden
To Explain Production Obstacles
WASHINGTON-A coalition of U.S.
independent oil and gas associations have
penned a letter to President Joe Biden,
urging him to adjust his rhetoric and
change his policies.
Rising gasoline prices and energy's
growing bite in voters' budgets have
added political urgency to the country's
energy situation, published reports note.
That pressure likely has prompted much
of the administration's 2022 messaging-
such as claims that oil and gas companies
are deliberately choosing not to drill on
federal leases to withhold production-
and policy decisions-such as the Biden's
announcement that it will release a historically
high volume of crude from the
country's strategic petroleum reserve.
The coalition letter, dated March 18,
identifies specific rhetorical distortions
and actions within the administration's
immediate power, but extends the president
a figurative olive branch with assurances
that the industry is willing to partner
with the federal government if Biden is
willing to do the same.
The letter argues that the country needs
a commitment to energy independence
that recognizes oil and gas are strategic
energy assets for energy security. " So,
despite the challenges and concerns outlined
in this letter, we believe the time is
now to work together to address our
energy and, indeed, national security
needs, " it relates. " To that end, we hope
that in the days and weeks ahead, you
will return to the spirit of your inaugural
address when you said: 'Let us listen to
one another . . . Show respect to one another
. . . And I pledge this to you: I will
be a president for all Americans.' "
The letter's signatories are the Independent
Petroleum Association of America,
Permian Basin Petroleum Association,
New Mexico Oil & Gas Association, North
Dakota Petroleum Council, Illinois Oil &
Gas Association, Western Energy Alliance,
U.S. Oil & Gas Association, National
Stripper Well Association, Mid-Continent
Oil & Gas Association and the Energy
Workforce & Technology Council.
Correcting The Record
The coalition's letter opens by acknowledging
the aggression being waged
by Russian President Vladimir Putin
76 THE AMERICAN OIL & GAS REPORTER
and expressing support for Biden's
" strong and punishing actions against
the Russian regime and its allies. " It
goes on to argue that the geopolitical
crisis has highlighted the United States'
need for energy independence through
diverse and plentiful resources.
" We strongly believe this is a moment
in time where we can, and should, come
together as one nation to fortify, deepen
and expand our energy capacity and capability, "
the letter states. " Indeed, we
have heard certain parts of your administration's
call for our industry to step up. "
The coalition goes on to assure Biden
that its members are eager to immediately
do what they can to help, noting that independent
oil and gas companies are no
strangers to firsthand consequences of
steeper costs.
" However, there is a key challenge
standing in the way of unity: the words
and actions of you and members of your
administration, " the letter continues. " In
particular, it's regrettable that you and
your White House team have continued
to mischaracterize facts regarding our industry-often
maligning our motives, and
frankly, in some cases, advance complete
and total falsehoods. "
One example to which the letter points
is Biden's comment earlier in March that
oil and gas companies " would rather take
those profits and buy back their own
stock(s) rather than take that money and
invest it in pumping new oil. "
The coalition responds with a question:
" With respect, Mr. President, how do
you know what motivates oil company
business decisions? "
Even so, the letter suggests, the deeper
issue remains even more basic. " Perhaps
the worst mischaracterization of all by
you and your administration is when you
said that you are doing nothing to hold
back energy production, " the coalition
assesses. " That is just not true.
" From the first day of this administration,
the very tone and tenor of your administration's
attitude toward oil and gas production
in the United States-and the people
who make it happen-has been consistently
and openly hostile, " it continues.
It goes on to suggest that Biden's efforts
to single out U.S. oil and gas production
as a primary driver in global
climate change has demonstrably chilled
the industry's activity, especially regarding
infrastructure investment. " Surely
in your over 40 years of government
service, you have learned that government
officials' words and deeds impact
business decisions, " the coalition maintains.
" In addition, your personal commitment
to conveying that chilling effect,
and sending the clear message that
energy companies, regardless of size,
and their employees are not longer welcome
in 'President Biden's America,'
began early. "
The letter cites the example of Biden's
moves on his first day in office, including
decisions to rescind the Keystone XL
Pipeline permit and enact a moratorium
on new leasing in public lands and waters.
" There should be no confusion: since the
time you first began campaigning for,
and since becoming, president, you have
expressed deep hostility toward the oil
and natural gas business-and by extension,
the thousands of very hardworking men
and women-union and non-in very good
paying jobs, who bring energy to the nation, "
it assesses.
Standing Ready
The coalition draws particular attention
to the administration's claims that oil
companies are opting to sit on leases,
noting that there are 37,496 onshore
leases, of which only 12,068 are not producing,
a 66% utilization rate. Moreover,
it explains, there are many reasons leases
go unused:
· Litigation from environmental
groups stymies many leases, with the
Western Energy Alliance, for example,
defending more than 2,220 leases in court.
· Companies must assemble a complete
leasehold before beginning work,
particularly on horizontal wells that can
cut across multiple leases.
· Mandatory National Environmental
Policy Act analyses and other permitting
considerations often take years
to complete.
· After exploratory work, lease owners
may determine a tract contains insufficient
quantities of oil and gas.
" There are 4,621 permits to drill awaiting
approval by the Department of the Interior's
Bureau of Land Management, "
American Oil and Gas Reporter - April 2022

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