During its annual State of American Energy event on January 10, 2024, API called on policymakers to focus on a long-term energy plan that bolsters energy independence, seizes America’s energy advantage and accelerates energy innovation.
This U.S. trade association, which represents the oil and gas industry, also presented its ‘Lights on Energy’ campaign, which aims to educate voters and policymakers on “the fundamental truths” around American energy and the path toward “an affordable, reliable and cleaner future,” according to API.
While discussing what it would take to maintain America’s energy production advantage, Mike Sommers, API President and CEO, said: “We produce more energy than any country in the world. This benefits our economy, our national security and is our insurance in a volatile time. This is our American energy advantage.
“It didn’t happen overnight, and it can’t be sustained without the right policies from Washington. To maintain America’s energy advantage going forward, policymakers must increase energy leasing in federal lands and waters, approve permits in a timely manner, and remove barriers to developing American energy.”
Following brushes with the law due to more than one lawsuit, the controversial oil and gas Lease Sale 261 for acreage in federal waters in the Gulf of Mexico was held under the Biden administration in December 2023. This lease sale gathered close to a whopping $382.2 million in high bids, which is the largest amount such a lease sale has collected in almost a decade or rather in the last eight years.
The top five bidders, which submitted the lion’s share of bids during the lease sale, are Shell (65 high bids) Anadarko Petroleum Corporation (49 high bids), Repsol (45 high bids), Chevron (28 high bids), and BP (24 high bids). While Anadarko made the largest bid at $25.5 million, Shell is by far the highest bidder in this lease sale, when it comes to the total number of bids made by a single company.
Lease Sale 261 is the final one mandated by the Inflation Reduction Act (IRA). This will most likely be the last offshore sale until 2025, as the final program for 2024-2029 offshore oil and gas leasing in the Gulf of Mexico comes with the lowest number of lease sales in U.S. history, encompassing a maximum of three potential oil and gas lease sales in the Gulf of Mexico area, which are slated for 2025, 2027, and 2029, respectively.
Bearing this in mind, API underscored three “core” pillars of a long-term energy plan, which it believed to be needed to change course. These entail energy access, national security, and American infrastructure. According to the American Petroleum Institute, the record U.S. oil production is largely due to policies from previous administrations, but “Washington can and should unite around American energy from diverse sources – including continued access to oil and natural gas.”
While emphasizing that geopolitical tensions underline “the critical role” of reliable energy for national security, the U.S. trade association points out that “short-sighted” federal policies, which prioritize still-developing energy systems over proven ones, risk “weakening our energy advantage.” API also outlines that lifting barriers to “modern, innovative infrastructure development is critical” not only to meet long-term energy demand but also to speed up climate progress.
The American Petroleum Institute and International Association of Oil and Gas Producers (IOGP) recently released an analysis from Rystad Energy, showing that despite progress in fortifying energy security following the Ukraine crisis, Europe could still face “a looming natural gas supply gap” in the coming decades.
“Our leaders are placing the American energy advantage at risk for future generations. Together, Republicans, Democrats and Independents can provide a better way … one that restores a bipartisan approach to energy. A strategy that increases access to resources, bolsters our infrastructure, and strengthens our security,” added Sommers.