The U.S. has more than 24 million acres under lease to oil and gas companies onshore close to half are not producing. At the end of 2021, there were 9,173 approved and available permits to drill on federal and Indian lands. Cohorn said subcontractors are so busy, they can only make it to wells like this every so often. Oil and gas companies are currently sitting on 23 million acres of unused federal leases, an area roughly the size of Indiana. Occidental has more than 500 unused federal permits. They could be drilling right now, yesterday, last week, last year.". According to the federal government's analysis, around 1.1 billion barrels of oil and 4.4 trillion cubic feet of natural gas could be developed as a result of this sale. In other words, 9,000 chances to increase the supply of oil and gas and drive down prices. It suggests American producers have been motivated by a desire to manipulate the market during the current crisis in Europe. 33701 You rely on Marketplace to break down the worlds events and tell you how it affects you in a fact-based, approachable way. Experts also suggested that drilling domestically is more costly than drilling overseas, which could further deter oil companies in the U.S. from upping production. Sign up for the daily Marketplace newsletter to make sense of the most important business and economic news. 20006, Florida Like when the president points out that some of his competitors are sitting on 9,000 federal land leases they havent drilled. These are the facts. It is time for the administration to end the finger-pointing and instead support American production with a comprehensive strategy for American energy development one that includes a final five-year program for offshore leasing and quarterly onshore lease sales.. Previously, he worked as a reporter for Axios, where he covered, Amy Sherman is a staff writer with PolitiFact based in South Florida. Ive Heard that Hydraulic Fracturing is Linked to Cancer. FOSSIL FUEL PROFITS ARE VITAL FOR GREEN ENERGY PROJECTS DEMS ROUTINELY TOUT, "Right now, the oil and gas industry is sitting on nearly 9,000 unused but approved permits for production on federal lands," Biden remarked in March 2022. He contended that the onus is on U.S. oil and gas companies that have permits to begin drilling, but havent started. ", Sen. Kyrsten Sinema "voted with the president 93% of the time. Biden has a point that the U.S. produced more during his first year than Trumps first year. center for media and democracy logo Thousands of unused permits are not uncommon in any presidential administration. All material subject to strictly enforced copyright laws. However, once the permit is approved, drilling doesnt start overnight. The average barrels of crude oil produced per day spiked during Trumps subsequent years, swelling to almost 12.3 million in 2019. When You Look For Resources You Find Them, Offshore Seismic Surveys: Safety, Science, and Research, API Occupational Safety and Health Standards, Oil Spill & Emergency Preparedness and Response, worlds leading producer of natural gas and oil. From a federal regulatory standpoint, once a permit is approved, industry can proceed. Some companies choose not to drill for corporate reasons because they can raise funds from investors by not drilling on leases with proven reserves. order signed by President Biden shortly after taking office did "direct the Department of the Interior to pause new oil and natural gas leasing on public lands and offshore waters, concurrent with a comprehensive review of the federal oil and gas program." . Is Biden sharing all the facts here? Photo of electric charging station powered by diesel generator is emblematic of the electric vehicle movement. ", "They are under pressure from the financial community to pay more dividends, to do more share buybacks instead of the proverbial 'drill, baby, drill,' which is the way they would have done things 10 years ago. Most importantly, it should complete work on a long-term plan for offshore oil and gas development, to replace the one that expires this summer. So you get the mineral position leased, then you have to go to the surface owner and negotiate good terms and a good understanding of how youre going to use his surface and make him happy, so that you can come out here and start doing all the stuff that we have to do to get to and from our wells, Cohorn said. First, drillers have to build roads to get the crews and equipment out there. Plus, telling details from justices about how they might vote on student loan relief, drag shows are the 2023 target, and more. Late last . A crew of roughnecks were on a platform sending metal pipes down the well to try to get it unclogged. Hes the CEO of a company called Tall City Exploration III. PolitiFact: Biden right oil industry has over 9,000 permits to drill. Our only agenda is to publish the truth so you can be an informed participant in democracy. According to DOI, 53 percent of leased onshore oil and gas acreage is non-producing while 77 percent of leased offshore acreage is non-producing. Patrick Cohorn, operations manager at a family-owned energy company called Henry Resources, headquartered in Midland, Texas, drove me out to a stretch of land just north of the town of Rankin. Oil and gas companies can raise funds from investors by not drilling on leases with proven reserves, said Hugh Daigle, an associate professor at the University of Texas Hildebrand Department of Petroleum and Geosystems Engineering. And is it Joe Bidens fault? And the bottom line is, if people like Mike Oestmann and Patrick Cohorn could drill more, they would. "Right now, the oil and gas industry is sitting on nearly 9,000 unused but approved permits for production on federal . "Companies sometimes hold leases as a bit of a mind game with their competitors, or even just because they didnt properly assess the production potential prior to leasing due to lack of data or that sort of thing. Biden said the oil industry has 9,000 permits to drill now. Please read our Terms & Conditions, Cookies Policy and Privacy Policy before using the site. ", "By the way, one thing I want to say about the oil companies: They talk about how we have they have 9,000 permits to drill," he added months later. The DOI has delayed issuing a congressionally five-year plan for offshore drilling and is weighing a complete block on such leasing through 2028. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you. During Bidens first year in office, the U.S. produced an average of about 11 million barrels of crude oil per day compared to Trumps 9 million barrels per day in his first year. (AP). So this is a map of our acreage, he said, referring to an area between 6,000 and 7,000 acres in size. . Is Biden sharing all the facts here? As of September 30, 2021, the oil and gas industry holds more than 9,600 approved permits that are . Lets address two claims heard about American natural gas and oil production amid the ongoing Russia-Ukraine crisis. The first, by some members of the Biden administration, including White House Press Secretary Jen Psaki on Thursday, is that American oil and natural gas producers are sitting on hundreds of unused federal leases and thus do not need access to more. That's enough to last the industry another 10 years, by one estimate . "So, I would suggest you ask the oil companies why they're not using those, if there's a desire to drill more. ", "I got a list of 20 jurisdictions that defunded the police to the tune of over $1 billion total. Douglas Holtz-Eakin, an economist and president of the American Action Forum, a center-right think tank, said firms are trying to assess the durability of the global rebound. USd/gal. ", "They are under pressure from the financial community to pay more dividends, to do more share buybacks instead of the proverbial 'drill, baby, drill,' which is the way they would have done things 10 years ago. some 40% of the mineral acreage leased by companies goes unused . forward with a plan to lock up even more of our state's land in unused oil and gas leases. So, I took a trip out to ground zero for domestic oil and gas production Texas Permian Basin to hopefully bring some back. American Petroleum Institue February 27, 2023. Back in March, as Russias invasion of Ukraine was sending the price of oil sky-high, President Joe Biden noted that the oil and natural gas industry has 9,000 permits to drill that it isnt using. Biden said that companies pumped more oil in the U.S. during his first year in office than during his predecessors first year and that we were on track for record oil production next year. rate fact-checks based on evidence available at the time. The agency explained: "This number has been updated to account for a reporting discrepancy resulting from a transition to a new database in mid-2020. All last summer, the administration called on OPEC+, the oil cartel, to increase its production more rapidly in the face of rising energy costs, bypassing American producers. Technically, theres some truth there because, indeed, increasing American oil and gas production will not help Ukraine today. All Rights Reserved. In his quest to shift blame for rising gas prices, President Joe Biden accused oil companies of "sitting on nearly 9,000 unused but approved" drilling permits. [Follow me on Twitter at @EnergyAbsurdity] During Monday's latest gaslighting exercise the White House likes to refer to as a 'press briefing,' spokesperson John Kirby rolled out the handy '9,000 unused permits' talking poi Companies have to contract rigs to drill the wells, and build a sufficient inventory of permits before rigs are contracted, said Jennifer Pett, a spokesperson for the Independent Petroleum Association of America, a trade group that represents oil and natural gas producers. Biden's Interior Department quietly updated its list of unused permits to reflect a much lower figure: 6,600, E&E News reported Monday. This is what we mean by American energy leadership: using abundant American energy as a positive influence that benefits Americas friends. Thomas Catenacci is a politics writer for Fox News Digital. Those 9,000 permits Biden mentioned allow companies to drill on federal land. "The record profits oil companies made in 2022 and the thousands of approved but unused drilling permits they are sitting on shows that there is nothing getting in the way of increasing oil production except Big Oil's own decision to funnel their profits into the pockets of shareholders and executives," an official told Fox News. Support responsible news and fact-based information today! At the end of 2021, there were 9,173 approved and available permits to drill on federal and Indian lands. But a Biden administration official downplayed the alteration Monday, saying the number of unused oil and gas permits remains high. . In addition to Biden, top administration officials such as National Security Council spokesman John Kirby and former White House press secretary Jen Psaki have used the 9,000-permit talking point to argue that the oil and gas industry has "plenty of opportunities to drill here in the United States." Oil production on federal lands fell to 12.28 . They could be drilling right now, yesterday, last week, last year.". However, the unused drilling leases represent a fraction of the active permits, many of which are being used by the private sector to produce oil and gas daily, industry groups said. "They have to be sure that the costly investment (and time) that it takes to turn a lease into a producing well is worth it.". The Biden administration has also dragged its feet on oil and gas lease sales, only holding sales when directed by either federal courts or the Inflation Reduction Act. "Despite the administrations inaccurate and misleading numbers, the reality is that the U.S. natural gas and oil industry is confronting the global energy crisis by continuing to work to meet the energy needs of U.S. consumers and our allies abroad," Frank Macchiarola, the American Petroleum Institute's senior vice president of policy, economics and regulatory affairs, told Fox News Digital. A shale well, for example, could cost about $7 million to drill. Jewish Students Reported a Professor for Anti-Semitism. Before drilling can occur, the leaseholder has to get a federal permit. They have 9,000 to drill onshore that are already approved. Thousands of unused permits are not uncommon in any presidential administration. Does Fracking Cause Flaming Water Faucets? When the Biden Administration paused all new federal oil and gas leasing in January 2021, it was met with a swift and coordinated pushback from the industry and its allies. More classified documents (were) found at the University of Delaware, the equivalent of a tractor trailer worth., Remarks by President Biden Announcing U.S. Ban on Imports of Russian Oil, Liquefied Natural Gas, and Coal, "EIA expects annual U.S. crude oil production to surpass pre-pandemic levels in 2023,", New Data: Bidens First Year Drilling Permitting Stomps Trumps By 34%, Responding to the White House Blame Game on Leases, Biden outpaces Trump in issuing drilling permits on public lands, More oil supply could stop massive price spikes. There is actually an incentive for the companies not to develop these resources because for publicly traded companies, these reserves get reported and influence market valuation, Daigle said. Fossil Fuels From a federal regulatory standpoint, once a permit is approved, industry can proceed. API President and CEO Mike Sommers, in an op-ed on Fortune.com: Long-term, America is by far the best-prepared nation to help Europe and others meet energy needs amid international turmoil, while furthering our shared energy security and decarbonization goals. President Joe Biden said that his policies have not made the U.S. less equipped to withstand the impact of the ban on Russian energy imports. For more than a year it has halted new federal leasing key to future energy investment and production. The president suggested the onus is on the industry to start drilling. "Theyre not drilling. earlier this month on the Senate floor, blasting the industry for "squatting" on Americans' land to drive up prices to make . Said, referring to an area roughly the size of Indiana the daily Marketplace newsletter make. To publish the truth so you can help sustain Marketplace so we can keep reporting the... 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