Category: Business News
Now that the dust has settled after Donald Trump’s unexpected, earth-shattering win on Nov. 8 and 9 in the U.S. presidential election, we’re beginning to see more clearly the shape that his administration’s oil and gas policy may take.
Soon to be gone are the anti-industry stands and actions of Barack Obama, which the defeated Democratic nominee, Hillary Clinton, had clung to during the campaign. T
his has been a collection of policies that includes aggressive global warming regulations, support of the Paris climate agreement, opposition to offshore and Arctic drilling, opposition to fracing, precluding the building of the Keystone XL pipeline, rapid phase-out of fossil fuels in favor of much-more-expensive renewables, and a host of other industry-stifling proposals.
In its place, we will see a much more oil-and-gas-friendly set of policies from Mr. Trump. As our Contributing Editor for Washington, Roger Bezdek, stated so succinctly in his pre-election article in World Oil’s October 2016 issue (p. 57), President-elect “Trump’s energy platform is almost a mirror image of Clinton’s.”
And as Roger reminded us, Trump first released his “An America First Energy Plan,” in a May 2016 speech in North Dakota. In that speech, he stated, “America’s incredible energy potential remains untapped. It is a totally self-inflicted wound. Under my presidency, we will accomplish complete American energy independence.”
Out on the campaign trail, Trump had said numerous times that as President, he would approve the Keystone XL pipeline, noting that it would create and support more than 42,000 jobs, and not impact the environment significantly.
He also enjoyed pointing out that Obama’s own State Department had concluded that Keystone XL would be the safest pipeline ever built in the U.S.
Outlining his vision on the campaign stump, Trump said this his energy plan will “make America wealthy again, and American energy dominance will be declared a strategic economic and foreign policy goal of the United States.”
Trump stated, “We will become, and stay, totally independent of any need to import energy from the OPEC cartel or any nations hostile to our interests. At the same time, we will work with our Gulf allies to develop a positive energy relationship as part of our anti-terrorism strategy. We will use the revenues from energy production to rebuild our roads, schools, bridges and public infrastructure.”
Trump noted further, that “cheaper energy will also boost American agriculture. We will get the bureaucracy out of the way of innovation, so we can pursue all forms of energy…
The government should not pick winners and losers. Instead, it should remove obstacles to exploration.” Using his own words, we expect that a Trump administration “will focus on real environmental challenges, not phony ones,” which he said were a cornerstone of Clinton’s poverty-expansion agenda.”
Accordingly, we know that the President-elect has a 100-day slate of action items that he intends to implement throughout his administration. And as a sub-component of that list, he also has a 100-day action plan for oil and gas that includes the following:
• Fostering a business climate of encouraging expansion of hydrocarbon production
• Rescinding all of Obama’s executive actions, including the CPP and the Waters of the U.S. rule.
• Scrapping any oil and gas regulations that are outdated, unnecessary, bad for workers, or contrary to the national interest
• Stopping the practice of using the EPA, BLM and Endangered Species Act as methods of barring E&P activity
• Asking TransCanada to renew its permit application for the Keystone XL Pipeline.
• Lifting moratoriums on energy production on specific federal lands.
• Revoking policies that impose unreasonable restrictions on new drilling technologies.
• Providing regulatory certainty, and putting more responsibility for oil and gas regulation with state and local officials.
• Subject any future regulation to a simple test: Is this regulation good for the American worker? If not, don’t approve it.
• Ensuring that policy decisions are public and transparent.
Trump has insisted that his energy reforms will create trillions in new wealth. Lifting the restrictions on American energy, he says, will create a flood of new jobs, increase annual economic output over the next 30 years by nearly $700 billion; increase annual wages by more than $30 billion over the next seven years, and, over the next four decades, add more than $20 trillion in additional economic activity and $6 trillion in new tax revenue.
Just who will lead these efforts for Mr. Trump at the Departments of Energy and Interior remains speculative at this point, although a few names have been mentioned. On the short list for the Energy Secretary post are Oklahoma oil producer/billionaire Harold Hamm (Continental Resources), North Dakota Republican Congressman Kevin Cramer (an early Trump supporter), venture capitalist Robert Grady, who worked in the administration of President George H. W. Bush, and Donald Hoffman, the founder, president and CEO of Excel Services Corporation, a nuclear engineering and consulting firm.
Over at Interior, the names for that post have included former Alaska governor, and former 2008 Republican vice presidential nominee, Sara Palin, as well as Forrest Lucas, co-founder of California-based, oil products company Lucas Oil. Lucas is a native of Indiana, who, along with his wife, has given a combined $50,000 to the gubernatorial campaigns of vice president-elect Mike Pence, who has served nearly the last four years as Indiana governor.
Last, but not least, President-elect Trump’s pursuit of his oil and gas agenda will be made far easier by the fact that the Republican party has managed to hold on to majorities in both the Senate and House. As of today, the GOP holds a 51-48 (including two independents caucusing with the Democrats) edge in the Senate, with a Louisiana seat to be decided on Dec. 10. In the House, Republicans hold a 239-192 majority, with four seats still not called for winners.
Source: World Oil