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Jewell argues for more focused leasing Says that targeted approach, recognizing areas where it makes sense to develop oil and gas, improves predictability for industry Alan Bailey Petroleum News
During a March 17 speech at the Center for Strategic and International Studies, Secretary of the Interior Sally Jewell said that Interior is reforming its oil and gas lease sale programs, to engage with the public in figuring out where it does or doesn’t make sense to develop oil and gas resources.
“We saw how a ‘drill everywhere’ plan doesn’t work very well if nearly half of the lease sales are challenged or later overturned in court,” Jewell said, according to prepared notes for her speech. “Through smarter planning, we’re seeing reduced conflict and litigation and more certainty for industry.”
BLM’s plan for the National Petroleum Reserve-Alaska provides an illustration of this targeted “landscape level” approach to leasing, with the agency making nearly 12 million acres available for leasing while also protecting sensitive habitat, Jewell said. And it is important to recognize areas such as Utah’s national parks and the Arctic National Wildlife Refuge that are too special to drill, she said.
New standards Jewell also commented that her agency had “raised the bar” on safe oil and gas development through new drilling standards and an overhaul of the federal oversight program. Interior’s reform agenda has three goals: safe and responsible development, good government and encouragement for innovation, she said.
In terms of safety “if we don’t have the right measures in place to protect the communities in which we live, the air we breathe and the water we drink, we all lose,” Jewell said.
Recent and continuing initiatives include new regulations for the hydraulic fracturing of wells; updated standards for the reduction of methane emissions; pending new regulations for oil well blowout preventers; and proposed regulations for Arctic offshore drilling.
“I strongly believe that these reforms are not only achievable with modern technology and science, but are also absolutely critical to upholding public trust, enabling industry to responsibly develop our natural resources,” Jewell said.
Better government In terms of good government, the federal government must improve the way it does business, giving the American taxpayer a fair return for the use of natural resources on public lands, Jewell said. Reforms under consideration include modernization of the federal coal program and consideration of more flexible royalty rates for oil and gas from federal lands, she said.
To counter shortfalls in government funding for permitting and inspection programs, President Obama’s budget proposes partial funding through user fees, Jewell said. And the landscape level, targeted approach to oil and gas leasing will improve predictability for industry, she said.
Similarly, a planned landscape-level approach to the permitting of solar and wind projects is speeding up permitting times for these types of energy development, Jewell said.
When it comes to technical innovation, the Department of Energy has been a key player in research and development for the directional drilling tools that have spurred a recent revolution in energy production. Today the government needs to be providing incentives for new energy industries such as wind and solar power, Jewell said.
Tectonic shifts Jewell said that “tectonic shifts” in the energy industry are forcing governments at every level to face questions around how to adapt to the rapidly changing environment and how to modernize energy programs, helping the United States lead the world when it comes to energy.
Since 2008 U.S. oil production has surged from 5 million to 9 million barrels per day, reducing the country’s dependence on foreign oil. Use of solar energy has increased 10-fold, and wind energy usage has tripled in that same time period. At the same time, automobiles have become more fuel efficient, Jewell said.
Jewell said that, with her responsibility towards her grandchildren at the top of her mind, she is determined to make energy development safer and more environmentally sound, with new protections for land and water, and with more done to reduce greenhouse gas emissions - President Obama has singled out climate change as the world’s most pressing energy and environmental challenge, she said.
“I share the president’s belief that America should lead the world on energy, climate and conservation,” Jewell said. “And to accomplish this, we need to encourage innovation, provide clear rules of the road and make balanced decisions.”
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