NCPA - National Center for Policy Analysis

Congress: Permit Crude Oil Exports Now

April 17, 2015

States that are exploiting oil and natural gas drilling, which is mostly done on private land, have seen economic expansions. For example, North Dakota is at the epicenter of the drilling boom. Its unemployment rate is 2.7 percent, compared to 6.6 percent for the country. In addition, posting a 13.4 percent economic growth rate in 2012, the state's economy has grown five times faster than the national average.

Many of the states that have expanded their oil and gas production cannot find enough workers, especially blue-collar workers, so wages have gone up rapidly.

However, many states that would like to produce more energy are being left out of the boom because the federal government must approve drilling on federal land and offshore. According to the Congressional Research Service (CRS):

  • The federal government owns 28 percent of U.S. land.
  • 62 percent of Alaska is federally owned, as is 47 percent of 11 western states.

Energy companies would drill on much of that land, creating even more exportable commodities, but the Obama administration has denied, delayed and slow-walked drilling permits. According to a March 2013 CRS report:

  • It took an average of 307 days for all parties to process (approve or deny) an application for permit to drill on federal land in 2011, up from an average of 218 days in 2006.
  • Overall, U.S. natural gas production rose by 4 trillion cubic feet (tcf) or 20 percent since 2007, while production on federal lands (onshore and offshore) fell by about 23 percent, and production on non-federal lands grew by 40 percent.
  • On federal lands, there was an increase in [crude oil] production from fiscal years 2008-2009 and another increase in 2010, but then declines in 2011 and 2012, which brought production below 2007 levels.

It is time for the U.S. to become a crude oil and natural gas exporter. Closed, repressive, unstable and undemocratic countries are using oil and gas as a tool to keep those dependent on that energy in line.

Source: Merrill Matthews, "The Case for Permitting Crude Oil Exports," Institute for Policy Innovation, March 11, 2015. 

 

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