The Obameter

Expedite oil and gas drilling from domestic shale formations


Will "speed up the process of recovering oil and gas resources in shale formations in Montana and North Dakota; Texas and Arkansas and in parts of the West and Central Gulf of Mexico."


Sources:

Energy speech, Lansing, Mich. Aug. 5, 2008

Subjects: Energy, Environment

Updates:

Supporters, critics of drilling both find data to support their case

Updated: Thursday, December 20th, 2012 | By Louis Jacobson

The question of whether the Obama administration has promoted or hampered oil and gas extraction over the last four years was one of the most contentious issues of the 2012 campaign.

In 2008, Barack Obama promised to "speed up the process of recovering oil and gas resources in shale formations in Montana and North Dakota; Texas and Arkansas and in parts of the West and Central Gulf of Mexico." However, as we've noted in the past, the question of whether this pledge has been kept depends which benchmarks are used.

For instance, Mitt Romney charged during the second presidential debate that ”oil production is down 14 percent this year on federal land” (a claim we rated Half True). But earlier in the campaign, Obama had made the case that the U.S. has a "record number of oil rigs" and "more working oil and gas rigs than the rest of the world” (a claim we also rated Half True).

We found that the 14 percent decline Romney cited was real, but it relied on cherry-picking. In addition, it's possible to get a fuller understanding if you take a closer look at the data.
   
From 2009 to 2010, oil production from offshore sources rose by 14.9 percent. Prior to that, before Obama's presidency, the offshore volume fell for several years, and it was erratic even during a phase in which it rose, EIA figures show.
       
Yet onshore oil production generally rose on federally owned land -- and did again in 2011, by 3.7 percent. Offshore production that took the hit, falling 16.8 percent.
   
So the big story of the one-year dropoff in public production is the Deepwater Horizon oil spill of 2010. A six-month moratorium on exploratory drilling followed — though it by no means stopped gulf oil production— along with changes in regulation that forced the industry to adjust.
       
While the moratorium could have been more targeted, it wasn't a policy choice unique to Obama, said Jay Hakes, who directed the independent U.S. Energy Information Administration for seven years during the Clinton administration and the policy and research director for the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling. Bush had his own disasters to contend with: Hurricanes Katrina and Rita in 2005 also drove a decline the next year, said Shirley Neff, a senior adviser at EIA. And President Richard Nixon ordered a moratorium in the wake of a 1969 well blowout off the coast of Santa Barbara, Calif.
   
"Every president, if you have a blowout like that … is going to get a moratorium," Hakes said.

When we checked with a variety of advocacy groups to see what they thought about progress made on this promise, they cited statistics that only made the picture blurrier.

The American Petroleum Institute cited a report it commissioned to track oil and natural gas leasing, permitting, and drilling trends on lands managed by the Bureau of Land Management in Colorado, Montana, New Mexico, North Dakota, Utah, and Wyoming.

Using BLM data, the report found that the number of new federal oil and gas leases issued was down 44 percent between 2007-2008 and 2009-2010, while the number of new permits to drill and the number of new wells drilled on federal land both declined by 39 percent over the same period.

As for offshore sources, API said that permitting, while back to pre-moratorium levels, has been primarily for development wells rather than for exploration -- something that the group says presents a looming problem for future years because there will be fewer prospects for the next phase of development.

However, the Natural Resources Defense Council -- an environmental group that's concerned about the impact of both drilling and "fracking,” an effective but controversial method of extracting natural gas -- counters that the Obama administration has hardly been an obstacle for oil and gas production.

U.S. domestic oil production averaged 6.2 million barrels a day during the first 8 months of 2012, NRDC says, citing federal data. That's up 24 percent compared to the average for 2008, the year Obama was elected. Meanwhile, natural gas production is on track to hit an all-time record 29.6 trillion cubic feet this year -- up nearly 16 percent from 2008 levels.

"The gains in both gas and oil are being led by production from shale,” said NRDC spokesman Bob Deans. "Inarguably, domestic oil and gas production from shale is up. Way up.”

NRDC suggests that the drop in onshore permitting stems from industry preferences. "Companies are not seeking as many drilling permits as they have in years past, a reflection, in part, of low gas prices,” Deans said. This pattern may also explain a decline in public lands under lease for oil and gas production -- from 47.2 million acres in 2008 to 38.5 million acres in November 2011. (Though even the smaller amount in 2011 was roughly equal to the land area of Ohio and West Virginia combined, Deans said.)

Ultimately, the numbers can be framed in ways that can either support or weaken the case that Obama has sped up the process of developing oil and natural gas resources. We think both sides make some reasonable points, so we'll split the difference and call this a Compromise.

Sources:

Bureau of Land Management, "Oil & Gas Statistics," accessed Dec. 20, 2012

Interior Department, "Obama Administration Offers Over 20 Million Acres in Western Gulf of Mexico for Oil and Gas Exploration and Development" (press release), Nov. 28, 2012

Bureau of Safety and Environmental Enforcement, "Status of Gulf of Mexico Well Permits," accessed Dec. 20, 2012

American Petroleum Institute, "Employment, Government Revenue, and Energy Security Impacts of Current Federal Lands Policy in the Western U.S.," January 2012

PolitiFact, "Mitt Romney says 'oil production is down 14 percent this year on federal land,'" Oct. 16, 2012

PolitiFact, "Obama says the U.S. has a 'record number of oil rigs' and 'more working oil and gas rigs than the rest of the world,'” March 1, 2012

Email interview with Joel Darmstadter, senior fellow at Resources for the Future, Dec. 13, 2012

Email interview with Bob Deans, spokesman for the Natural Resources Defense Council, Dec. 12, 2012

New oil and gas drilling under the Obama administration

Updated: Monday, January 4th, 2010 | By Catharine Richert

Domestic energy production, including oil and natural gas, was a big part of Barack Obama's energy platform.
 
Part of the problem, he said, was that energy producers were often slowed down by bureaucratic red tape.
 
To speed up development, he said he would expedite oil and gas drilling from domestic shale formations.
 
So far, the administration has sent mixed messages on the issue. On Feb. 25, 2009, Interior Department Secretary Ken Salazar reversed a Bush administration decision to open thousands of acres for energy development in Colorado, Utah and Wyoming.
 
"We are not taking it off the table for the possibility of development, but we are going to be thoughtful and deliberative,” Salazar said, according to Grist , an environmental news Web site.
 
Nevertheless, on Aug. 19, the Interior Department announced it had offered up to 55 million acres of U.S. public lands -- including offshore in the Gulf of Mexico, in Utah and about 70,000 acres in North Dakota -- for energy development.
 
"The responsible development of oil and gas resources on U.S. public lands is an integral part of President Obama"s comprehensive energy strategy for the nation,” Salazar said.
 
In the meantime, Salazar has also talked about creating a "one-stop shop" to expedite permits on Native American reservation land.
 
In a Jan. 4, 2010, Associated Press article Salazar said he would soon be announcing reforms in how energy leases are issued, but he did not give further details.
 
So, the Obama administration has taken some steps to speed up the cultivation of oil and gas resources on local land, but there's been no formal overhaul of the process. For now, we'll move this pledge to In the Works.

Sources:

Dakota Gasification Company, Salazar says ND has big energy future , Nov. 10, 2009

The Department of the Interior, Offshore Lease Sale in Gulf Generates $115 Million; Onshore Energy Sale in Utah Attracts $1.1 Million , accessed Jan. 4, 2010

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