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Anadarko's Hackett Calls for 'Informed' Debate on Domestic Energy

August 27, 2012
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Anadarko Petroleum Corp.'s Jim Hackett, who traded the CEO chair for that of executive chairman in May, said the country needs to have an "informed and constructive debate" on the national energy policy to ensure natural gas and oil can continue to be developed under "very strong and appropriate" environmental protections.

Hackett, who also is the current chairman of the National Petroleum Council, was keynote speaker at the Colorado Oil & Gas Association's Rocky Mountain Energy Epicenter in Denver, which was held earlier this month. He also was part of a panel discussion with Colorado Gov. John Hickenlooper and Jim Martin, the Region 8 administrator for the U.S. Environmental Protection Agency (EPA).

"The greatest near-term opportunity is natural gas," said Hackett. "If you set aside domestic oil, which is an incredible story, and just focus on the natural gas equation, it's a remarkable change in my lifetime...It's out there; years of supply and [an avenue] of what we can do as a diplomacy vehicle as a nation is incredible...

"In terms of what it does for the United States in terms of policy options...on not having to depend on one or two countries for energy supply is a huge dynamic. The holy grail is to get transportation fuel diversity. Natural gas gives us that."

Hackett said the United States also should be using its scientific might to explore the oceans for more energy, which offer the next best opportunity after natural gas. "Renewables are a great answer but they're not affordable or scalable in today's science. But we haven't tapped the oceans yet and we have a lot of that...It's the next big opportunity."

An energy policy won't happen without making informed choices, said the Anadarko executive. Knocking down misleading information about natural gas drilling and hydraulic fracturing has to be met with truth, he said.

"Let science lead the way and insist through various stakeholders that industry has proven what it can do. It's about whether to be led by science or to be led by politics and fear. A lack of informed courage will kill options for us."

Hackett said, "A less partisan political tone allows things to get done. Increasing the contact between industry and the public creates questions and concerns. The public wants to be assured of the quality of their air and water...We need to continue to listen, to continue to respond to concerns, to inform the public and allow them to parse what is hyperbole."

The state of Colorado has a "track record" that could provide a blueprint for the nation to follow, said the Anadarko executive. "We place very significant, long-term capital into natural resource development" in the state and "we have built upon active engagement. It's a continuous effort that requires each of us to act within informed courage. The long-term success of communities and the nation all depend on engaging responsibly."

Hackett praised EPA officials for the work they have done to ameliorate industry and conservation efforts. EPA has a mandate from Congress and it's required to protect the air and water, he noted.

"The legislature has empowered and entrusted EPA with doing a certain list of things. They literally have to do that list of things. If we don't like them, then we have to work to change them...

Moves by some groups to enact more layers of bureaucracy at the local level, "unaccountable groups" should be off the table, said Hackett. State regulators and EPA regional officials are handling drilling permits ably, Hackett said.

"We're better off as a country with less duplication, less regulation that doesn't make good economic or environmental sense...There are a significant number of factors that affect industry outside of air and water emissions...How much below the state level can you go? Do you create at the municipal and county level? That's a very dangerous slope to go down as well."

Hackett said the industry has to do more to build public trust. Three years ago the industry became "very active, increased educational budgets, put commercials on TV on what energy does, the jobs it creates, the taxes it produces...Speaking to those benefits, by the way, didn't do a terribly good job."

The industry then began "spending a lot more time engaging with people on what they were concerned about." Independent producers through America's Natural Gas Alliance, the Independent Petroleum Association of America and others pushed to enact fracfocus.org to voluntarily disclose hydraulic fracturing fluids.

"We pushed fracfocus.org to be a national disclosure mechanism to give citizens comfort," said the Anadarko chief. The citizens said, "'If you can't tell me what's in it, I don't want it in the ground.' Can you blame them?"

In Hackett's opinion, it's about "education, engagement and evolution...We've spent an inordinate amount of time meeting with and getting engagement with various EPA districts. On evolution, if new issues come up, we are quick to get on those issues, and make sure science leads us to policy instead of hyperbole and fear."

The Anadarko chief said it was a an opportune time to enter the energy industry. "It's a magical field," he said. "Our society, for some unknown reason, made it like selling tobacco...like we should apologize...I never intend to apologize. I say, get in it, get passionate, and let your voice be heard."

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