OTC: Stakeholders need to find compromises, panel says

Uchenna Izundu
OGJ International Editor

HOUSTON, May 4 -- As the oil and gas industry struggles to manage its public image and progress is made getting legislation passed through Congress, various stakeholders can improve dialogue through expanded forums and televised debates, delegates said May 4 during a panel discussion at the Offshore Technology Conference in Houston.

The panelists, who represented energy consumers, academia, oil companies, and government, debated the challenges facing the energy industry and its stakeholders.

Consumers, in particular, are underrepresented in the energy policy debate, some delegates said, and with consumers worried about energy prices and security, politicians are finding it difficult to build an overarching framework for a comprehensive, balanced national energy policy.

"The public is very busy," said Jason Grumet, executive direction of the National Council on Energy Policy. "There is a limited bandwidth to engage the public and the price of gasoline matters to them." He called on industry participants to improve communications among themselves as well as with the public.

The industry is rapidly changing with the cost of carbon dioxide now a major factor, the electrification of transportation, the growth of the middle class in emerging economies, and the demise of coal. One panelist, US Senator Lisa Murkowski, called for increased domestic production in the US, arguing that $1.7 trillion of revenues could be generated if operators could access areas that are currently off limits. "If we don't produce oil, prices will go up and more jobs [will move] overseas. We need to share revenues with states that allow drilling. There is a scarcity of will to produce our own oil," she said.

Panelists agreed that stakeholders have more in common that one would think, but that rhetoric continues to undermine these commonalities. "People are talking past each other and there is no constructive debate going on because there are misconceptions on both sides," added Roger Ballentine, president of Green Strategies Inc.

Jack Gerard, president and chief executive officer of the American Petroleum Institute, said it was important to establish with the public the perceived role that industry would play in supplying future energy resources. He said consumers had failed to understand certain realities: For example, when polled, 67% of the public felt the nation's energy problems could be solved through conservation and energy efficiency, but when consumers suffered $4/gal gasoline last year, their attitude changed. After the gasoline price spike, 67% of the public then called for development of the country's resources on the Outer Continental Shelf.

"We don't want the government to pick winners and losers in the power and fuel debate," said Bill Graves, president of American Trucking Associations. "We need to appreciate the complexity of the transition to different fuels."

Although there is increasing public pressure to move to renewables to address climate change and sustainability, this alone will not fill the gap in meeting energy demand, delegates said. Different forms of energy are discussed within vacuums, which ignores their interconnectivity. Delegates agreed that expanding US oil and gas production, alternative energy, and nuclear power were the necessary steps over the next 8 years to increase energy supplies.

Grumet said, "We're in the midst of a transition and we all want to get there, but the challenge is that we don't have a long-term goal articulated. Climate change is a step in the right direction, but people are not sure what energy independence means; what does the transition look like? We need to identify goals to have productive dialogue."

Contact Uchenna Izundu at [email protected].