Energy industry swipes back at Psaki ‘red herring’ comment on oil and gas leases
Fox News outlines the falsity within Jen Psaki’s inane statement regarding oil and gas leases.
Energy industry representatives pushed back on a comment from White House Press Secretary Jen Psaki Monday regarding unused oil and gas leases, accusing the Biden administration spokesperson of misleading Americans with a “red herring.”
Fox News asked Psaki Monday why President Biden won’t resume new oil and gas leases on federal lands. She responded that the United States is already producing oil “at record numbers” and said “there are 9,000 approved drilling permits that are not being used.”
“So, the suggestion that we are not allowing companies to drill is inaccurate,” she added. “I would suggest you ask the oil companies why they’re not using those if there’s a desire to drill more.”
But, industry representatives at the CERAWeek energy conference sponsored by S&P Global Monday said the answer is not as simple as Psaki suggested.
“That accusation is a complete red herring,” American Exploration & Production Council (AXPC) CEO Anne Bradbury told FOX Business. “It’s really a distraction from the fact that this administration has paused leasing on federal lands, something that we’re concerned about and something that we think needs to continue right away,”
Bradbury also said the Biden administration is “required under the law” to sell oil and gas leases on federal lands.
“The fact is that industry is producing at a higher level on existing leases on federal lands than in the last 20 years and these leases take many years to explore, to develop and produce on,” Bradbury added.
“This represents a fundamental misunderstanding as to how this process works,” American Petroleum Institute (API) president and CEO Mike Sommers told FOX Business when asked about Psaki’s comments. “Once you lease land there is a whole process that you have to go through. First you have to actually discover whether actually there is oil and gas in that land. Second of all, you have to get a permit to actually develop that land.”
(Read more at Fox News)
Nine thousand in a nation of over 9.6 million square miles and a population of 331 million (not counting Biden’s illegals)?
If there are 9,000 approved drilling permits across America, unless they are all on formations like the Permian Basin or the Bakken Formation or maybe even an undiscovered equivalent of Spindletop — this miniscule number of permits will not constitute a drop in the bucket.
Still, I would challenge Psaki’s contention that there are 9,000 approved drilling permits not being used. However, if there are, a drilling permit does not guarantee success. You can have a dry hole.
Don’t forget that Obama set aside more than ten times more land as federal land as had been previously designated
As reported by a 13 February 2016 UPI article, Obama started with 2.6 million acres of federal land (to which he protected an additional 265 million acres during 7 years).
At that time, 2.6 million acres of public lands had been permanently protected during the Obama administration by both the president and Congress. Of that, 186,000 acres were protected by the president using administrative authorities under the Antiquities Act, which allows the president to declare a national monument without congressional approval.
In his seven years in office, Obama has established 22 national monuments and expanded others to set aside more than 265 million acres of land and water.
The designations Friday were the single most significant action to preserve California desert in more than two decades, forming one of the largest desert conservation reserves in the world, said David Lamfron, director of California Desert and National Wildlife Programs.
“Local communities, businesses, and organizations have worked for years to preserve these critical lands, and tens of thousands of [National Parks Conservation Association] members and supporters have petitioned the president and their members of Congress to make these monuments a reality. This is not just a win for the desert—it’s a win for the people who live in and love this unique part of the country,” he said.
With the uptick in federally protected status for some lands comes criticism that the federal government is overstepping its bounds.
Rep. Bob Bishop, R-Utah, chairman of the House Committee on Natural Resources, said in a statement: “This is presidential bullying. The intent of the Antiquities Act is not to act as the president’s magic wand to commandeer land. In order to be good stewards of our environment, we need to allow people to have a say in how they recreate and conserve their land. This doesn’t. It’s an authoritarian act that ignores people under the guise of preservation. The land will not be better protected and people will be harmed.”
(Read more at UPI)
However, there is much more to drilling than what Psaki and even Fox intimate
Biden has restricted the ability of oil and gas firms to get financing
The White House provides happy talk on how the Biden regime discouraged banks from lending to American energy ventures other that are other-than-electric.
SECRETARY KERRY: What it means is that we’re going to be investing. This is not an ex- — you know, this is not a throwaway. This is an investment in new ways of getting energy to people that’s more efficiently delivered; that’s lower cost, in the long run; and that it’s — it’s really going to open up a whole group of employment opportunities that we know — that are beginning to be seen in America today.
And it’s not because the government is directing those things to happen; the marketplace is doing this. You can’t build a coal-fired power plant in the United States with a bank funding it, and no individual is going to throw their money down there.
Same thing in Europe today. Now starting in other countries — you just heard Korea to say, “We’re not going to fund any external coal.”
So there’s a transition that the market has undertaken, well before anybody proposed the program or anything. This is a transition that’s taking place. And we’ve historically always gone through these periods when, in America, we innovate, and we do the R&D, and we come up with a new product of some kind or another.
You know, I lived and represented for years — had the privilege of representing communities like Lowell and Lawrence and Brockton and plenty of places — you know, Fall River — that have these huge mills that were, you know, teeming with people working in the early 1900s, and then that changed. And it went south in our America — in our country, and then it went abroad.
Because that’s the transition in economies. And it happened in the Industrial Revolution, it happened in the revolution of technology in the 1990s, and it’s going to happen now. We always replace it with a different kind of — or some, you know, new opportunity.
And I don’t think it’s going to mean that much dislocation, frankly. It’s going to mean some greater opportunity.
Just as Obama discouraged banks from lending to gun marketers and manufacturers, Biden has cut off bank funding of oil
The biased press does not like to report Biden’s effort to strangle oil at the banks, but they would report Obama’s efforts to strangle gun sales at the banks (as found in an 18 May 2014 Washington Times article).
Gun retailers say the Obama administration is trying to put them out of business with regulations and investigations that bypass Congress and choke off their lines of credit, freeze their assets and prohibit online sales.
Since 2011, regulators have increased scrutiny on banks’ customers. The Federal Deposit Insurance Corp. in 2011 urged banks to better manage the risks of their merchant customers who employ payment processors, such as PayPal, for credit card transactions. The FDIC listed gun retailers as “high risk” along with porn stores and drug paraphernalia shops.
Meanwhile, the Justice Department has launched Operation Choke Point, a credit card fraud probe focusing on banks and payment processors. The threat of enforcement has prompted some banks to cut ties with online gun retailers, even if those companies have valid licenses and good credit histories.
“This administration has very clearly told the banking industry which customers they feel represent ‘reputational risk’ to do business with,” said Peter Weinstock, a lawyer at Hunton & Williams LLP. “So financial institutions are reacting to this extraordinary enforcement arsenal by being ultra-conservative in who they do business with: Any companies that engage in any margin of risk as defined by this administration are being dropped.”
A Justice Department representative said the agency is conducting several investigations that aim to hold accountable banks “who are knowingly assisting fraudulent merchants who harm consumers.”
(Read more at the Washington Times)
The following Obama failure might be hindering the press from reporting Biden’s effort to kill oil financing
The reluctance of the press to report on this Biden suppression of oil through the banks might be based on how the courts ruled that Obama could not use the banking system to suppress gun manufacturers or marketers (as reflected in the following excerpt from a 15 January 2021 Washington Free Beacon article).
The Trump administration adopted a new rule to prevent big banks from denying services to gun manufacturers and other industries in a rebuke of an Obama-era financial program.
The Office of the Comptroller of the Currency (OCC) rule, which was finalized on Thursday, will instruct large financial institutions to only deny services to specific clients on a case-by-case basis instead of making industry-wide blacklists. The regulation came as a rebuke to Operation Choke Point, which sought to pressure big banks to cut ties with businesses disfavored by the Obama administration, including the gun and payday lending industries.
Operation Choke Point—coupled with public pressure from gun-control activists—led some of the biggest lenders in the country to drop their clients in the gun industry. Citibank and Bank of America cut ties with gun businesses after warnings from the operation that they could face reputational harm from doing business with legal but disfavored industries.
“It’s the banking version of cancel culture,” Dave Kopel, research director at the Independence Institute, told the Washington Free Beacon.
The Trump administration ended Operation Choke Point in 2017. In its waning days, the White House is attempting to prevent future presidents from restoring the Obama-era program.
(Read more at the Washington Free Beacon)
So you have your permit and $20 million in funding. With Biden’s inflation issues, steel (a major part of drilling operations) gets more expensive daily
As one industry outlet attests (Gaubert Oil), there is almost a symbiotic relationship between oil and steel. Hence, when one gets more expensive, so does the other.
Since the beginnings of the Industrial Revolution, the oil, gas and steel industries have been intertwined. These industries depend heavily on one another, as they each possess materials that the others need. This shared reliance has frequently been put to the test over the decades, the most recent being the drop in oil prices. Let’s discuss how the industries are connected today.
OIL AND GAS’ DEPENDENCE ON STEEL
According to Zach’s Investment Research, the energy sector accounts for 10% of United States steel consumption. Steel mills make components called oil country tubular goods (OCTGs), which are steel tubes and fittings used in oil and gas rigs. The International Molybdenum Association(IMOA) divides these goods into three categories:
Due to the oil and gas boom in the United States, the OCTG business has been one of the most profitable in the steel industry.
Other metals are added to steel alloys, adding functionality to components used throughout the oil and gas industries. The Houston Chronicleexplains that nickel alloys are used in the valves and pipes that go over a wellhead. Chromium increases adds heat resistance to pipe used in deep oil wells. Molybdenum serves as a catalyst in oil refining to help derive environmentally friendly fuel sources. Titanium alloys are used in tubing and compressor parts, and are resistant to seawater and low temperatures.
STEEL’S DEPENDENCE ON OIL AND NATURAL GAS
- Casing pipe lines boreholes
- Drill pipe rotates drill bits and distributes drilling fluids
- Tubing captures oil and gas from the wellbore
While steel is vital to oilfield drilling equipment, steel isn’t dependent on oil as a vital energy source.
According to the United States Energy Information Administration (EIA), steel’s top four energy consumption sources as fuel are coke and breeze, electricity, natural gas and “other.” The “other” category consists primarily of blast furnace and coke oven gases. In particular, natural gas contributes 33% of steel energy fuel consumption, the highest of all energy sources.
(Read the whole report at Gaubert Oil)
Add to that Biden’s supply chain problems, and you might have a perfect storm in the making.
Biden’s inflation kicks up the cost of hiring new employees. Additionally, you will probably have to pay a premium to get employees who will work in extreme weather, in the backwoods areas of the country, often in areas that have no paved roads, in conditions where they will be sprayed with drilling mud or crude oil (unprocessed petroleum as it comes out of the ground). Finally, you will probably want to pay extra for employees who know how to use the tools of the trade.
Then don’t forget that Biden’s OSHA requires you to provide Transgender-sensitivity training to all employees. Obama’s Affordable Care Act requires you to subsidize health insurance for your employees.
What’s more, don’t forget that Biden will not allow your drilling vehicles (even your pickup trucks) to cross federal lands in order to get to your drilling permit. Therefore, if you have a drilling permit in New Mexico, Colorado, Utah, Montana, or anywhere West of those states, you had better have a helicopter.
And though the price of oil will benefit you as soon as you can start pumping it — before that, you will use copious amounts of diesel to power the generators that will power the systems to lift the two-ton drill bits and strings of pipe that descend a mile or so into the earth.