American Oil and Gas Reporter - January 2016 - 147

The Presidential Papers
knows it. Imagine how cleaner, cheaper
energy can lower the cost of living, and
which part of society will benefit most?
The positive aspects of American oil
and gas production often are unseen and
rarely recognized. Take, for example, the
help we extend to America's farmers. Energy in Depth, our communications and
rapid research program, reported how,
when California faced its worst drought
in memory, Governor Jerry Brown ordered
unprecedented water use restrictions.
According to EID, farmers in the state's
Central Valley normally rely heavily on
California's snowpack to sustain them
throughout the year, but the drought left
the snowpack dangerously low. So, Kern
County energy companies worked with
the local water district to provide more
than 10 billion gallons (31,658 acre feet)
of treated, produced water from oil production to replace local farmers' lost water
supply. Oil producers have been helping
farmers in this way for more than 15 years.
The list of positive impacts goes on
and on. And in 2016, IPAA will highlight
how American-produced oil and natural
gas enhances lives not only in the United
States, but across the globe. On our
website at www.ipaa.org, you can learn
more about our industry's important contributions by clicking on the "Enhancing
Life" section.
One significant victory was lifting the
unfair and outdated ban on American
crude oil exports. From a national security
standpoint, allowing the export of surplus
American production will slash our trade
deficit and reduce the need for the United
States and its allies to import oil from
volatile, distant regions. Given the increased security threats facing the nation
and its allies, the United States must
leverage its abundant energy resources
to further enhance its economic and national security. From a consumer standpoint, Energy Information Administration
estimates show U.S. crude oil exports
actually will help reduce gasoline prices,
allowing American families to pocket
more of their hard-earned dollars instead
of paying more to fill-up their cars.
Restricted Potential
Nevertheless, bad policies-political
infighting in both the government's legislative and regulatory branches-continue
to threaten these positive outcomes and
undermine the potential to create new

promises and enrichments worldwide.
Congressional gridlock and President
Obama's unrelenting threat to veto good
legislation has yielded very few new laws
that can help our industry. Instead, the
Obama administration has a track record
of going around Congress and using its
regulatory authority to threaten our industry's meaningful progress. But, IPAA
is fighting back.
Consider that more than a dozen federal
agencies are looking into new hydraulic
fracturing rules. The most restrictive regulation comes from the Department of
Interior's Bureau of Land Management.
Last year, BLM released its final rule
regulating hydraulic fracturing activities
on federal lands. This rule requires preapproval for hydraulic fracturing operations,
and regulates well integrity, fracturing
fluid chemical disclosure and recovered
fluids storage. BLM never has made a
compelling case for the rule's necessity,
nor has it identified a state with insufficient
regulations for hydraulic fracturing activities on federal lands in their boundaries.
Complying with this rule will be difficult and costly, and BLM has no clear
plan on how to properly train field staff
to act on the new measure. The rule is
unnecessary and will add another burden
to independent producers already struggling
to navigate the complex and confusing
regulatory system governing federal lands.
IPAA, along with Western Energy Alliance and the states of Colorado,
Wyoming, North Dakota and Utah, are
challenging the rule in federal district
court in Wyoming, characterizing the federal government's rule making as unsubstantiated and duplicative of states' efforts.
Last summer, the judge in this case granted
IPAA's motion for preliminary injunction
and stated, "Congress has not authorized
or delegated to the BLM authority to regulate hydraulic fracturing and, under our
constitutional structure, it is only through
congressional action that the BLM can
acquire this authority." The case is pending.
Regulations Run Riot
IPAA's award-winning advocacy team
in Washington is monitoring many other
federal regulatory proposals, including
those dealing with:
* Endangered species listings and
critical habitat declarations;
* BLM onshore orders addressing site
security and hydrocarbon measurements;

* Venting and air quality;
* Civil penalties under the Office of
Natural Resources Revenue;
* Incorporating climate change considerations into National Environmental
Policy Act procedures;
* Oil field silica exposure;
* Crude oil transportation by rail;
* Tank gauging;
* Navigable waters of the United
States under the Clean Water Act;
* Effluent limitation guidelines;
* New source performance standards
and methane emissions;
* GHGs;
* The Toxic Substances Control Act
and chemical identification;
* Barging of shale gas wastewater;
* Hazardous wastes management;
* Toxic release inventory;
* Seismicity;
* Offshore well bonding;
* Well control;
* The Extractive Industries Transparency Initiative;
* Pipeline safety; and
* Financial reform.
As you can see, our industry faces
tremendous challenges-not least of which
are slumping oil and gas prices. That
said, energy development in America has
not been haphazard. States and the industry, alike, have made sure it has been
very well-planned. Local stakeholders
and state officials best understand their
own lands and have constructed carefully
a thoughtful approach, balancing conservation with critical energy and economic development.
My goal as chairman is to step up our
efforts to reach out to our adversaries
and avoid a political stalemate wherever
possible. Our industry has much to be
proud of. Although some will continue
to recognize us only for entertainment
value, I am honored to lead an organization
with accomplishments that enhance the
daily lives of every American and positively impact the global stage.
❒

Coming In February
The Official Convention Section
for the Texas Independent Producers
& Royalty Owners Association annual meeting, Feb. 22-23 at the
Grand Hyatt Hotel in San Antonio.
JANUARY 2016 147

American Oil and Gas Reporter - January 2016

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