The American Petroleum Institute will use "every tool at its disposal" to fight president-elect Joe Biden if he goes ahead with plans to restrict oil and gas drilling on federal lands, the chief executive of the industry group told Reuters in an interview.
There have been multiple reports referring to a "fracking ban" proposed by Biden, and President Donald Trump accused his Democratic rival in the November elections of wanting to end fracking on the campaign trail.
Yet a fact-check from CNN notes that despite the confusing remarks Biden has made about fracking there is no written plan in his camp of banning hydraulic fracturing. There is a proposal for "banning new oil and gas permitting on public lands and waters," but it does not specifically mention fracking.
This does not sit well with the American Petroleum Institute either.
"This would be a far-reaching proposal that would undermine American natural and energy security to the detriment of the American people," CEO Mike Sommers told Reuters.
"We would be very concerned about those kinds of proposals coming out of the Biden administration," he added. Related: Norway Opens New Arctic Oil Blocks For Exploration
The actual proposal of the president-elect states, as follows:
"Protecting America's natural treasures by permanently protecting the Arctic National Wildlife Refuge and other areas impacted by President Trump's attack on federal lands and waters, establishing national parks and monuments that reflect America's natural heritage, banning new oil and gas permitting on public lands and waters, modifying royalties to account for climate costs, and establishing targeted programs to enhance reforestation and develop renewables on federal lands and waters with the goal of doubling offshore wind by 2030."
Although the wording does not contain "fracking," a ban on new permits would result in less fracking on federal lands, which has the industry worried about job losses and production declines, as it would, according to Sommers, undermine national energy security.
By Irina Slav for Oilprice.com
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So will the API also do everything in its power to fight Biden’s plans to limit methane emissions from fracking? If that is the case, then the API is already declaring its opposition to Biden’s re-joining the Paris Climate Agreement. Trump saw tackling global warming as a threat to the economy. He has promoted fossil fuels and rolled back scores of environmental protections and climate regulations.
President Trump has championed the US shale oil industry claiming credit for the steep rise in US oil production during his 4 years in the White House when in fact that rise started under former President Obama and former Vice President Biden and accelerated under Trump.
And while President-elect Biden has greener goals for US energy, he will still ensure that no one will undermine the US shale oil industry on his watch for two reasons. The first is that Biden is fully aware of the importance of the US shale oil industry to the US economy and the geopolitics of the United States. The second reason is that any reduction in US shale oil production will translate into increasing US crude oil imports from the current 9 million barrels a day (mbd) to 12-13 mbd in the next few years thus widening the US budget deficit. However, he may increase regulation of the sector by limiting methane emissions and fracking on federal land.
A Biden administration would push greener fuels. Biden is promoting an ambitious $2 tn plan to cut emissions.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London