NPC studies crucial to long-term US strategy, White House says

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Sept. 14 -- Two studies under way by the National Petroleum Council will be crucial to developing a long-term energy, environmental, and economic strategy for the US, Obama administration officials told council members at the group’s Sept. 14 meeting.

US Sec. of Energy Steven Chu asked the council on Sept. 16, 2009, to evaluate new transportation fuel prospects through 2030, and to consider North American conventional and unconventional energy fuels and ways they can be responsibly developed.

Energy choices matter not only in terms of climate impacts, but also in competition for resources, US Deputy Energy Sec. Daniel B. Poneman told NPC nearly a year later. “We must work together to build an energy future which relies on clean domestic sources,” he maintained. “This transition will not happen overnight. We recognize this. We need to make sure we use our fossil resources wisely and safely.”

Changing the national energy paradigm will require “your technology, your global leadership skills, and your ability to quickly and effectively deploy resources,” he said in remarks apparently directed to the council’s oil and gas industry members. NPC has expanded to include representatives from US states, environmental organizations, and energy consuming industries, he noted.

Poneman said the administration is addressing the question of future fuels already by funding biofuels plant construction and vehicle battery research and development, as well as providing Ford Motor Co. $500 million to study ways to make the internal combustion engine more efficient.

‘Tremendous potential’
NPC’s North American energy resources study can help identify needs and expand insights for policymakers, he indicated. “We see a tremendous potential for natural gas to contribute, particularly with the growing discussions about shale gas resources,” Poneman said.

Energy unquestionably is a key element of the Obama administration’s long-term economic strategy, observed Michael B.G. Froman, a deputy assistant to the president and deputy national security advisor for international economic affairs. “We need to take advantage of shale gas opportunities, crack the code on economic development of alternatives, and use fossil fuels better by developing clean coal and other technologies,” he said.

The administration recognizes that it is impossible to develop an effective global climate change response without firm commitments from other major economies, and it has taken that message to G20 meetings and the global climate change conference in Copenhagen, Froman continued. “We anticipate a long and deep relationship with China, and are looking particularly at its energy investments and their possible effects,” he said.

Poneman said that technology transfer issues initially will need to be addressed among governments to stimulate commercial activity. “When we have conversations with our counterparts in China and India, that is always a part of the discussion,” he said, adding that establishing the sanctity of contracts is a key early consideration.

Traditional resources clearly will continue to play an important part, Froman said. “Reliable supplies of oil and gas are critical to our energy strategy, and to this country’s economic recovery,” he declared.

Future fuels study
Marathon Oil Corp. Chief Executive Clarence P. Cazalot Jr., who is chairman of NPC’s future transportation fuels study, said that 225 professionals are working on the complex and multifaceted effort. The stakes are high since the nation’s economic future will require efficient and inexpensive transportation, he continued. “Our intent is that the final product be clear and credible,” he said.

Linda A. Capuano, Marathon’s vice-president of emerging technology and chairwoman of the study’s coordinating subcommittee, said Chu’s original request was to address fuel demand, supply, infrastructure, and technology, and advise on policy options for integrating new fuels and vehicles into the marketplace.

The secretary asked an additional question in an Apr. 30 letter to the future fuels transportation committee about actions government and industry could take to stimulate technological advances and market conditions needed to reduce life-cycle greenhouse gas emissions in US transportation from 2005 levels by 50% by 2050 while enhancing domestic energy security and economic prosperity.

Capuano said the committee started by meeting with the chairmen of the committees that developed NPC’s “Hard Truths” report a few years ago to formulate guiding principles, which include a diverse set of participants to maximize points of view and acceptance of the study’s findings. Consensus-based leadership will be promoted, she added, but it won’t require unanimous agreement: “An 80% acceptance will allow minority opinions to be expressed.”

The committee will examine facts before it addresses environmental, economic, and security policies, she indicated. Communications and outreach will be emphasized throughout the study “so we can bring in more ideas and broaden the debate,” she said. Members also will coordinate with their counterparts on NPC’s resource appraisal and development study, Capuano said.

Resource evaluation
This second NPC study committee will assess the North American conventional and unconventional oil and gas resource base’s productive capacity through 2035, explain technology’s role in making these resources producible, describe US gas demand through 2035 and ways in which it can reduce GHG emissions throughout the economy, and outline industry operating practices and technologies to minimize environmental impacts, according to D. Clay Bretches, the resource study committee’s coordinating subcommittee chairman and Anadarko Petroleum Corp’s vice president of minerals and marketing.

The committee will provide Chu with recommendations for prudently developing North American oil and gas resources to reflect the Obama administration’s objectives of reducing GHG emissions, protecting the environment, sustaining economic growth and competitiveness, and promoting energy security, he continued. “We will not develop policy recommendations nor delve into policy issues until all the facts are on the table,” said Bretches.

He said efforts will be coordinated with the transportation fuels study with the examination of natural gas transportation demand, a high-level overview of oil demand, and infrastructure needed to bring unconventional supplies to refineries or the city-gate. The fuels study will address gas-to-liquids, upgrading, refining, and downstream infrastructure, he said.

Bretches said that the two studies have different completion targets, with the resource study due to be finished by the end of 2011’s first quarter and the transportation fuels study scheduled to be done six months later. The fuels study will need to provide the resources study its ranges of power demand for electric vehicles and gas demand for natural gas vehicles in time for inclusion in the resource study’s findings, he said.

The committee’s chairman, Anadarko Chief Executive James T. Hackett, said the committee also intends to address issues raised by the Macondo well blowout, rig explosion, and crude oil spill in the Gulf of Mexico. “Deepwater exploration and production was not prominently on our screen initially,” he said. “It is now.”

Officials of both committees emphasized that their work is in its early stages. “We are very pleased with the way both studies are progressing,” said DOE’s Poneman.

Contact Nick Snow at

Related Articles

PHMSA proposes pipeline accident notification regulations

07/02/2015 The US Pipeline and Hazardous Materials Safety Administration has proposed new federal oil and gas pipeline accident and notification regulations. ...

FourPoint Energy to acquire Anadarko basin assets from Chesapeake

07/02/2015 FourPoint Energy LLC, a privately owned Denver company, plans to acquire oil and gas assets from Chesapeake Energy Corp. subsidiaries Chesapeake Ex...

Puma Energy completes purchase of Murco’s UK refinery, terminals

07/02/2015 Singapore-based Puma Energy Group Pte. has completed its purchase of UK midstream and downstream assets from Murco Petroleum Ltd., a subsidiary of ...

BP to settle federal, state Deepwater Horizon claims for $18.7 billion

07/02/2015 BP Exploration & Production Inc. has agreed in principle to settle all federal and state claims arising from the 2010 Deepwater Horizon inciden...

MARKET WATCH: NYMEX oil prices plummet on crude inventory build, Iran deadline extension

07/02/2015 Oil prices plummeted more than $2/bbl July 1 to settle at a 2-month low on the New York market after a weekly government report showed the first ri...

API to issue recommended practice to address pipeline safety

07/01/2015 The American Petroleum Institute expects to issue a new recommended practice in another few weeks that addresses pipeline safety issues, but the tr...

Shell Midstream Partners takes interest in Poseidon oil pipeline

07/01/2015 Shell Midstream Partners LP has completed its acquisition of 36% equity interest in Poseidon Oil Pipeline Co. LLC from Equilon Enterprises LLC, a s...

MARKET WATCH: Oil prices decline as US crude inventories post first gain in 9 weeks

07/01/2015 Oil prices on July 1 surrendered much of their gains from the day before after the release of a government report showing the first rise in US crud...

FWS issues Shell letter of authorization on Chukchi Sea lease

07/01/2015 The US Fish & Wildlife Service issued Shell Gulf of Mexico Inc. a letter of authorization (LOA) related to the potential disturbance of polar b...
White Papers

Definitive Guide to Cybersecurity for the Oil & Gas Industry

In the Oil and Gas industry, there is no single adversary and no single threat to the information tech...

UAS Integration for Infrastructure: More than Just Flying

Oil and gas companies recognize the benefits that the use of drones or unmanned aerial systems (UAS) c...

Solutions to Financial Distress Resulting from a Weak Oil and Gas Price Environment

The oil and gas industry is in the midst of a prolonged worldwide downturn in commodity prices. While ...
Sponsored by

2015 Global Engineering Information Management Solutions Competitive Strategy Innovation and Leadership Award

The Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global...
Sponsored by

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by
Available Webcasts

Better Data, Better Analytics, Better Decisions

When Tue, Oct 27, 2015

The Oil & Gas industry has large amounts of data stored in multiple systems which are purpose built for certain tasks. However, good decisions require insights based upon the data in all of these systems. These systems in turn do not talk to each other. So the process of analyzing data, gaining insights, and making decisions is a slow one and often a flawed one. Good decisions require accurate analytics and accurate analytics require superior/sustainable data quality and governance. This webinar focuses on:

  • The importance of data quality and governance
  • How technological advances are making data quality and governance sustainable in order to get the accurate analytics to make solid decisions.

Please join us for this webcast sponsored by Seven Lakes Technologies and Noah Consulting.


Operating a Sustainable Oil & Gas Supply Chain in North America

When Tue, Oct 20, 2015

Short lead times and unpredictable conditions in the Oil & Gas industry can create costly challenges in supply chains. By implementing a LEAN culture of continuous improvement you can eliminate waste, increase productivity and gain end-to-end visibility leading to a sustainable and well-oiled supply chain.

Please join us for this webcast sponsored by Ryder System, Inc.


On Demand

Leveraging technology to improve safety & reliability

Tue, Sep 22, 2015

Attend this informative webinar to learn more about how to leverage technology to meet the new OSHA standards and protect your employees from the hazards of arc flash explosions.


The Resilient Oilfield in the Internet of Things World

Tue, Sep 22, 2015

As we hear about the hype surrounding the Internet of Things, the oil and gas industry is questioning what is different than what is already being done. What is new?  Using sensors and connecting devices is nothing new to our mode of business and in many ways the industry exemplifies many principles of an industrial internet of things. How does the Internet of Things impact the oil and gas industry?

Prolific instrumentation and automation digitized the industry and has changed the approach to business models calling for a systems led approach.  Resilient Systems have the ability to adapt to changing circumstances while maintaining their central purpose.  A resilient system, such as Maximo, allows an asset intensive organization to leverage connected devices by merging real-time asset information with other critical asset information and using that information to create a more agile organization.  

Join this webcast, sponsored by IBM, to learn how about Internet of Things capabilities and resilient systems are impacting the landscape of the oil and gas industry.


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!


Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected