President Trump's "Industry First" Energy Plan
President Trump claims his plans for the Atlantic are part of an "America First" energy plan, but the truth is, this is an "Industry First" energy plan and here is why.
Atlantic Drilling Isn't About Energy Independence
Only 4% of U.S. oil reserves are estimated to be off the Atlantic Coast. Photo credit: agmrc.org
The Atlantic Federal Waters only contain enough oil to supply the U.S. for an estimated 7 months.
The Bureau of Ocean Energy Management (BOEM) estimates the Atlantic Federal Waters in the Mid and South Atlantic contain about 2.92 billion barrels of oil. This may seem like a lot, but the US uses 6.89 billion barrels per year, meaning that even if the entirety of the Atlantic oil supply was drilled, it would only fuel the U.S. for several months.
The Bureau of Ocean Energy Management (BOEM) estimates the Atlantic Federal Waters in the Mid and South Atlantic contain about 2.92 billion barrels of oil. This may seem like a lot, but the US uses 6.89 billion barrels per year, meaning that even if the entirety of the Atlantic oil supply was drilled, it would only fuel the U.S. for several months.
Atlantic natural gas reserves only make up a sliver of the available natural gas supply in the US. Photo credit: agmrc.org
The Atlantic Federal Waters only contain enough natural gas to supply the U.S. for an estimated 14 Months.
BOEM estimates the Atlantic Federal Waters in the Mid and South Atlantic contain 25.56 trillion cubic feet (Tcf) of gas. The US currently uses about 27.5 Tcf of natural gas per year, meaning the Atlantic basin only contains enough gas to fuel the U.S. for a little less than a year.
BOEM estimates the Atlantic Federal Waters in the Mid and South Atlantic contain 25.56 trillion cubic feet (Tcf) of gas. The US currently uses about 27.5 Tcf of natural gas per year, meaning the Atlantic basin only contains enough gas to fuel the U.S. for a little less than a year.
President Trump Proposes to Allow Crude Exports and Sell Off Our Oil Strategic Reserve
Congress recently voted to allow the export of crude oil. This is a departure from U.S. energy policy for nearly the last 40 years. The reason for this change is due to an surplus of domestic oil production. Moreover, President Trump's draft FY 2018 Budget proposes to sell-off strategic oil reserves. As Mick Mulvaney, Director of the Office of Management and Budget says, "We think it's the responsible thing to do. We don't need to take this much of our money to bury it in the ground out in West Texas for domestic security and national security reasons when we have domestic supplies like we do." Clearly, drilling in the Atlantic is not needed for energy independence.
Congress recently voted to allow the export of crude oil. This is a departure from U.S. energy policy for nearly the last 40 years. The reason for this change is due to an surplus of domestic oil production. Moreover, President Trump's draft FY 2018 Budget proposes to sell-off strategic oil reserves. As Mick Mulvaney, Director of the Office of Management and Budget says, "We think it's the responsible thing to do. We don't need to take this much of our money to bury it in the ground out in West Texas for domestic security and national security reasons when we have domestic supplies like we do." Clearly, drilling in the Atlantic is not needed for energy independence.
It's Not About Jobs
The Quest Report
The creation of jobs is one of the pillars of the argument to open our coast to offshore drilling. Proponents of drilling in the Atlantic often cite job figures from a report commissioned by the American Petroleum Institute and National Ocean Industries Association published in 2013 known as the Quest Report. There are several flaws with this report:
The creation of jobs is one of the pillars of the argument to open our coast to offshore drilling. Proponents of drilling in the Atlantic often cite job figures from a report commissioned by the American Petroleum Institute and National Ocean Industries Association published in 2013 known as the Quest Report. There are several flaws with this report:
- The report assumes the entire Atlantic would be open to offshore oil and gas development. This is highly unlikely. If the Atlantic is open at all to offshore drilling, it would most likely be in a limited portion. This would greatly reduce the number of jobs created.
- The report assumes the price of oil to be $120 per barrel. This is nearly 3 times the current price of a barrel of oil which is not expected to rise anytime soon. The drastic difference between the actual price of oil and that used by the study seriously erodes any credibility of the figures put forth by the Quest Report.
- The Quest Report fails to take into account a significant portion of the jobs and economic activity created would go to the Gulf Region which has the existing infrastructure and skilled workforce to support the industry.
Jobs Created Would Be Short Term
Another figure left out of the Quest Report is just how long an Atlantic oil industry would last. The American Petroleum Institute estimates production in the Atlantic could reach 1.3 million barrels of oil per day or about half a billion barrels of oil per year. If we take the most ambitious estimates of 9.23 billion barrels of oil in the entire Atlantic, it becomes evident that the Atlantic oil industry would only last approximately 20 years. Is a 20 year industry worth the risk?
Another figure left out of the Quest Report is just how long an Atlantic oil industry would last. The American Petroleum Institute estimates production in the Atlantic could reach 1.3 million barrels of oil per day or about half a billion barrels of oil per year. If we take the most ambitious estimates of 9.23 billion barrels of oil in the entire Atlantic, it becomes evident that the Atlantic oil industry would only last approximately 20 years. Is a 20 year industry worth the risk?
This Energy Plan Is About Corporate Profits
