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Salazar: Fracking, Collaboration Are Way Forward on Energy

Hydraulic fracturing is safe; it's a key component of the country's quickening pace toward energy independence, and the industry and government need to do more to educate citizens about the practice to dispel their fears, former secretary of the U.S. Department of the Interior Ken Salazar told a Houston audience Wednesday.

"There's not a single case where hydraulic fracking has created an environmental problem for anyone," Salazar said at the North American Prospect Expo (NAPE). "We need to make sure that story is told."

If the country's energy revolution is to continue at its current pace, Americans need to have confidence in the practice of fracking. Allaying their fears is not just the job of the energy industry but also business leaders, federal and state governments and the scientific community, he said.

Without fracking, Americans would be paying significantly more for oil and natural gas, as well as electricity, Salazar said. And without fracking, the country would not be on a steady march toward energy independence, importing less and less foreign oil as the years roll on.

Salazar recalled his early career during the early 1970s when the talk of energy independence for the United States began in earnest. At the time, the country was importing about 30% of its oil supply from abroad, he said. Fast forward to 2005 and that figure had grown to about 60%, and predictions at the time said it would grow to 70% in a few short years, Salazar recalled.

"And now today...we are now at a point where we are at 40% [based on 2012 data]," he said. "...The fact is we are in a very good place in the United States of America today.

"Today, somehow because of your wisdom and your technology and your investments...we're looking at importing only 25% of our oil from foreign countries [around 2016]..." Salazar told the energy industry audience. "Give yourselves a round of applause because you guys have made all this happen."

Fracking and advances in horizontal drilling technology aren't the only things driving the energy renaissance. The United States enjoys a leading position in deepwater exploration and production, both in know-how and in safety, which was burnished by the response to the blowout of BP plc's Macondo well in the Gulf of Mexico.

"There was a sense that we were going to be able stop that runaway well Macondo in a matter of hours or in a matter of days," said Salazar, who was Interior secretary at the time of the 2010 blowout. "We had not seen an incident like this...Some 87 days later, the cap was installed...Now today people ask me what do you think about all that. I think what happened there is that it was a very unfortunate accident, but the fact is when you look at it today from 2014, I think the legacy is a positive one."

One of the positive outcomes was the formation of the Marine Well Containment Company by ExxonMobil Corp., Chevron, ConocoPhillips and Shell with government collaboration, Salazar said. The industry now has the capability to arrest a runaway well incident to a degree it never had before, Salazar said.

"I think it made the Gulf of Mexico one of the very safest places to operate in the oceans in the entire world..." he said. "The lesson for the future is this: what happened in the Gulf of Mexico on April 20, 2010 could happen in other places around the world."

Collaboration between the energy industry and government has paid off on the environmental front, too, Salazar said. Workable protections for the dunes lizard created years ago helped to allow the ongoing development of the Permian Basin. The habitat conservation plan that was developed gave oil and gas operators the regulatory certainty they needed to move forward, he said.

The same thing is happening with the lesser prairie chicken, the former Interior secretary said. Late last month, oil and gas companies pledged 1.5 million acres in five states for conservation of the bird's habitat. Collaboration that is protecting the dunes lizard and the lesser prairie chicken can also help protect the sage grouse, Salazar said.

Collaboration is also called for among governments of the North American nations, Salazar said. The Keystone XL Pipeline deserves to win approval from the Obama administration and should be built, Salazar said. Without it, instead of consuming oil from its friendly neighbor Canada, the country will import more oil from overseas.

To the south, the pending opening of Mexico's energy sector to greater foreign participation holds great promise, he said. "The actions they have taken show how interested Mexico is in moving forward and capturing some of the energy revolution that is occurring in the United States. This concept of North American energy independence is something that we can share across the borders for the benefit of the three nations."

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