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Mail
Magazine 24
Oil
and Gas Production Decline on
Federal Lands . . . Again
“I’m
proud of the fact that under
my administration, oil production is higher than it has been in a
decade or
more. President Obama, February 20, 2013
When
President Obama claims
responsibility for the increase in oil and natural gas production in
the United
States, it is important to know that he is referencing the energy
miracle that
is occurring on private and state lands, where his Administration has
little or
no say over what happens. In
fact, the
United States is the largest natural gas producer in the world, and
last year,
production of oil increased at the fastest annual rate since Abraham
Lincoln
was in the U.S. Senate. From
those lands
that the President oversees, however, oil and natural gas production
fell again
last year.
The
Office of Natural Resources
Revenue of the Department of Interior (ONRR) just released its sales
volume
data for fiscal year 2012 with the result that oil and natural gas
production
on federal lands dropped again in FY 2012.[i] Natural gas production on
federal
lands continues to fall and oil production on federal lands fell in
both fiscal
years 2011 and in 2012 ending two years of increase. Specifically:
Crude
oil production on federal
lands is 4 percent lower in fiscal year 2012 than in fiscal year 2011,
(a
smaller percentage than its reduction in fiscal year 2011 compared to
fiscal
year 2010 levels), with the total percentage reduction over the 2 years
at 15
percent.
Offshore
oil production in federal
waters is 8 percent lower in fiscal year 2012 compared to fiscal year
2011 with
the total percentage reduction over the past 2 years at 23 percent.
Natural
gas production on federal
lands is the lowest in the 11 years that data is available and is 7
percent
lower in fiscal year 2012 than in fiscal year 2011 with a total
percentage
reduction over the past 2 years of 15 percent.
Offshore
natural gas production in
federal waters is 20 percent lower in fiscal year 2012 compared to
fiscal year
2011 levels with a total percentage reduction over the past 2 years of
32
percent.
Oil
and Natural Gas Production on
Federal Lands
Crude
oil production on federal
lands decreased 15 percent over the past 2 years from 736 million
barrels in
fiscal year 2010 to 626 million barrels in fiscal year 2012. Production
of
crude oil on federal lands is dominated by offshore production, which
fell by
23 percent in fiscal year 2012 from fiscal year 2010 levels, mostly
notably due
to government actions taken following the oil spill in the Gulf of
Mexico in
2010. These actions include a moratorium on offshore drilling by the
Obama
Administration, followed by a permit moratorium, and withdrawal of
President
Bush’s 2010-2015 offshore lease plan, which would have opened
additional areas
to oil and gas production. These areas were made available when
President Bush
lifted the executive drilling moratorium and Speaker Pelosi and
Majority Leader
Harry Reid passed legislation lifting a 27 year old appropriations ban
on such
drilling in 2008. It was not until late in 2012 that the Obama
administration
released its draft 2012-2017 offshore lease plan that reduced the
number of
lease sale opportunities from prior plans and that removed areas that
the Bush
administration had made available to drilling (e.g. off the coasts of
the
Atlantic and Pacific oceans).
Natural
gas production on federal
lands decreased every year since fiscal year 2003, the earliest fiscal
year
data available. In fiscal year 2012, natural gas production on federal
lands
was 4,566 billion cubic feet, 15 percent less than in fiscal year 2010
when it
totaled 5.35 billion cubic feet. Offshore natural gas production
volumes have
been on a consistent downward trend for the last 11 years, and are 32
percent
less in fiscal year 2012 than in fiscal year 2010.
Conclusion
The
big picture is clear that
government policies undertaken by the Obama Administration have
produced a
significant decline in offshore oil production on federal lands over
the past 2
years. If it were not for hydraulic fracturing and horizontal drilling
on
private and state lands where oil and gas drilling regulation performed
by the
states is much more efficient than that on federal lands, the United
States
would not be increasing its domestic oil and natural gas production.
Americans
can only wonder how much more oil we could have produced if federal
policies
did not get into the way and how much lower gasoline prices might be if
positive actions were taken 4 years ago.
[i]
Department of Interior, Office
of Natural Resources Revenue, http://statistics.onrr.gov/
Source:
Institute for Energy
Research
View
four charts with this article
at Mail Magazine 24
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