NGI The Weekly Gas Market Report / NGI All News Access

Obama Puts Federal Government Squarely Behind Natgas Development

Singling out natural gas as an economic engine for the nation, President Obama Friday signed an executive order establishing a high-level, interagency task force to support and oversee the development of unconventional natural gas resources and associated infrastructure.

Natural gas production "creates jobs and provides economic benefits to the entire domestic production supply chain, as well as to chemical and other manufacturers who benefit from lower feedstock and energy costs," the president said. He pointed out that greater use of natural gas in transportation would help reduce the country's dependence on oil. "And with appropriate safeguards, natural gas can provide a cleaner source of energy than other fossil fuels."

The task force will coordinate the efforts of the various federal agencies to promote the clean and responsible development of the natural gas resource.

The Interagency Working Group to Support Safe and Responsible Development of Unconventional Domestic Natural Gas Resources will include representatives of eight cabinet-level departments: Defense, Interior, Agriculture, Commerce, Health and Human Services, Transportation, Energy, and Homeland Security. It also will include a handful of separate agencies, including the Environmental Protection Agency (EPA), the Council on Environmental Quality, the Office of Science and Technology Policy, the Office of Management and Budget, and the National Economic Council. It will be chaired by Cecilia Munoz, director of the Domestic Policy Council. She can invite other agencies or offices to sit on the task force.

The task force has been given the task of coordinating the Obama administration's policy efforts with respect to the production of natural gas, particularly shale gas, as well as sharing scientific, environmental and related technical and economic information.

"It is vital that we take full advantage of our natural gas resources while giving American families and communities confidence that natural and cultural resources, air and water quality, and public health and safety will not be compromised," the executive order said.

"Because efforts to promote safe, responsible and efficient development of unconventional domestic natural gas resources are under way at a number of executive departments and agencies, close interagency coordination is important for effective implementation of these programs and activities," it said.

Industry groups were widely supportive of the president's move. "President Obama highlighted the benefits of natural gas in his State of the Union address, and has been promoting responsible production and broader use of this domestic, abundant, affordable, clean and reliable energy source," said Dave McCurdy, president and CEO of AGA. "We are pleased to see this action today, which will help promote consistency between the Administration and policies that are put in place. This working group will foster improved government communication and coordination that will help our members continue to safely deliver this foundation fuel to 177 million Americans every day."

Jack Gerard, president of the American Petroleum Institute, added, "We're pleased that the White House recognizes the need to coordinate the efforts of the 10 federal agencies that are reviewing, studying or proposing new regulations on natural gas development and hydraulic fracturing. We have called on the White House to rein in these uncoordinated activities to avoid unnecessary and overlapping federal regulatory efforts and are pleased to see forward progress."

Independent Petroleum Association of America CEO Barry Russell applauded the order's intent of centralizing the many ongoing reviews of hydraulic fracturing policies and proposals. "We hope this order provides the administration with a more comprehensive understanding of the federal government's increasing regulatory grasp on the industry," he said. "A key mission of this new coordination effort should be to reach out to the state agencies who already regulate hydraulic fracturing and the industry's other practices."

Interior Department's Bureau of Land Management reportedly is close to issuing a rule that would require companies drilling for natural gas on public lands to disclose the chemicals used in their hydraulic fracturing operations. Several other federal agencies are working on shale gas and oil drilling rules.

And the EPA is scheduled to come out Tuesday with a final rule aimed at reducing air emissions from oil and natural gas operations.

"While natural gas production is carried out by private firms, and states are the primary regulators of onshore oil and gas activities, the federal government has an important role to play by regulating oil and gas activities on public and Indian trust lands, encouraging greater use of natural gas in transportation, supporting research and development aimed at improving the safety of natural gas development and transportation activities, and setting sensitive, cost-effective public health and environmental standards to implement federal law and augment state safeguards," the presidential order said.

In conjunction with the president's announcement, the Department of Energy, the EPA and the Department of the Interior jointly announced a formal partnership to better position the Obama Administration "to ensure that continued expansion of natural gas and oil production happens safely and responsibly as part of an all-of-the-above approach to American energy in which science plays a guiding and critical role."

The partnership said the primary goal of this effort will be to identify research topics where collaboration among the three agencies can be most effectively and efficiently conducted to provide results and technologies that support sound policy decisions by the agencies responsible for ensuring the prudent development of energy sources while promoting safe practices and human health.

"Science, research and innovation continue to play a vital role in our efforts to further expand oil and gas production in the United States and make sure it's done safely and responsibly," said Department of the Interior Deputy Secretary David J. Hayes. "Through a close collaboration across the government that reduces redundancy and streamlines our research, we are positioning the Obama Administration to best meet the critical need of increasing public understanding and public confidence of these critical technologies so that we can continue safe and responsible exploration and production for many decades to come."

EPA Deputy Administrator Bob Perciasepe said the country is moving into a "new era of American energy," one that can create jobs, strengthen energy independence and security, and cut pollution. "President Obama has created this interagency working group to ensure that these energy innovations happen safely and responsibly, without compromising the environment or the health of the American people. We will continue to rely on the best available science to oversee the responsible development of these energy sources."

©Copyright 2012 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

Comments powered by Disqus