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Zinke Supports More U.S. LNG Exports, Touts Energy Dominance

While plugging his ongoing efforts to reorganize the U.S. Department of Interior (DOI) and revise its regulatory agenda to be more energy industry friendly, Secretary Ryan Zinke on Wednesday offered unequivocal support for more domestic exports of liquefied natural gas (LNG).

In delivering a keynote address to the Williston Basin Petroleum Conference (WBPC) following similar bullish remarks by Continental Resources Inc. CEO Harold Hamm, Zinke told a supportive industry audience in Bismarck, ND, that the United States has a moral obligation to pursue a strategy of global energy dominance as outlined by President Trump.

"Today this country produced 10.6 million b/d of crude oil and for the first time is exporting LNG," said Zinke during an address that emphasized energy development as part of the nation's environmental stewardship.

Of energy development, he said, "Nobody does it better than America, and it's better to produce the energy here under reasonable regulations than to watch it be produced overseas under no regulation." 

Energy is a global advantage for the United States, and the Trump administration's strategy for being "energy dominant" is the morally correct policy, Zinke said. He delivered his remarks as part of a four day swing through the state that included meetings with tribal and government representatives wrestling with permitting issues on the Fort Berthold Reservation, where a third of North Dakota's oil production takes place.

Zinke noted that the oil and gas industry has increasingly moved onshore, where the risks are fewer and infrastructure is closer.  While being interrupted once briefly by an environmental activist who was escorted from the meeting hall, he said even more supermajors, such as ExxonMobil Corp, are returning to the onshore.

"There is no doubt that offshore oil and gas is now more risky," said Zinke, noting that the Trump administration's largest offshore lease sale ever earlier this year for Gulf of Mexico blocks drew little interest from the industry. "The trend is moving onshore with Exxon, Continental, Oasis and other large companies investing there because it is safer.

"I agree with Harold Hamm that one of the opportunities for this country is the export of natural gas. We have an amazing amount of LNG, but we need to build the infrastructure to get it to market."

Zinke said the DOI should assist industry in the infrastructure buildout, drawing loud applause from the 2,400 attendees at the WBPC. "DOI shouldn't be in the position of being an adversary," he said, noting that there is currently a lot of distrust of government throughout the nation. 

In pledging to eliminate that distrust, Zinke reiterated his mantra that the Interior Department needs to be more engaged with states and the industry. Calling himself a geologist (his undergraduate major), Zinke said he is committed to revising and making more flexible DOI regulations.

"We're going to reorganize and redefine government so it works for the people."

Separately, Hamm recalled all the work it took to get the U.S. crude oil ban lifted in 2015, and how many economic benefits are flowing as a result. He expects similar benefits to develop from growing LNG exports.

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