Episode Transcript
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(00:00):
But now a lot of stuff justhappened in Colorado, including a big supposed
compromise for oil and gas between democratsand players in the industry. And joining
me now from the American Petroleum Instituteis the president of that organization, Mike
Summers. Mike, welcome to theshow. Mandy. Great to be with
(00:20):
you. And put me down astacos not being a sandwich. Well,
there's a judge in Indiana who disagreeswith you strongly, Sir. I'm just
saying we'll come back to that.You know, the oil and gas industry
here in Colorado has been under attack, relentless attack, I would say,
since about twenty nineteen. And thisyear we were told there was a grand
(00:43):
compromise and everything's going to be greatand everybody's going to sit around and sing
Kumbaya. What did your industry doto work with government on this? And
why? Well, Mandy, asyou know, as you point out that
we've been in these wars for memany years, and I think both sides
have decided that it's time to putthe weapons down and sought a compromise this
(01:07):
year in the Colorado legislature. Andit's really a pivotal moment for Colorado oil
and gas, and we're excited thatwe're going to be able to at least
for the next three years or so, keep those weapons down and allow America's
best producers, the producers here inthe great state of Colorado, to continue
to produce oil and gas. SoI do think we've reached a detante,
at least for the short term,because I think both sides have understand how
(01:33):
important oil and gas is going tobe for the future of Colorado in this
great state. We want to continueproducing here, and we think this compromise
came at the right time. AndI do give Governor Pola's credits for helping
us get to this point. Solet me ask you this in the last
we'll just go as twenty twenty four, right, and let's go last five
(01:53):
years. Has our industry in Coloradogrown, gotten smaller or stayed the same
so here in the state, Unfortunately, it continues to go down. We're
about stable production right now, butwe want to see that production continue to
expand there are three major operators herethat have committed to continue to grow in
(02:15):
the state. Occadental Petroleum, Chevronand Civitas have both said all three of
them have said that they want tocontinue to grow production, but the reason
that they cannot is because of aregulatory environment and a legislative environment that has
really put a wet blanket on topof production over the course of the last
few years. What we're hoping withthis compromise is that now we have really
(02:38):
a three year reprieve in terms ofwhat the legislature is going to do to
the Colorado oil and gas industry,and we're hopeful that as a consequence of
that, it gives us some certaintyand we can continue to grow production in
the Centennial State. Well, Iappreciate that. Where were what was it
in the compromise? What is theindustry agreed on? What is being inflicted
(03:01):
by the state? What are welooking at here? Well, first and
foremost, what the compromise does isit says that for three years, there
aren't going to be any punitive measuresagainst the oil and gas industry from the
Colorado legislature. Second, it saysthat there aren't going to be any punitive
measures against the oil and gas industryon the ballot. Because we've been fighting
(03:23):
these wars for many, many years. Both sides have spent a lot of
money, you know, on theseballot initiatives. And then in addition to
that, the industry has agreed thatto one of Governor Polus's priorities, which
is to fund some light rail fromFort Collins to Denver, you know,
to meet some of his public transportationgoals. So we're hopeful that both sides
(03:47):
got what we needed to give ussome certainty to continue to grow production in
the state and continue to provide thoseneeded budget revenues to the state, because,
as you know, a lot ofrev for the state of Colorado comes
from the oil and gas industry,and it's because of the production that's here
and the resource that is here thatwe're able to continue to fund schools and
(04:09):
public transportation and public safety, whichis really going to be important, particularly
during this time of high prices andincreased crime. We need to continue to
fund those things through the oil andgas industry, but we can't fund them
if we don't have production here.And we want to grow production here in
the state, and we have operatorsthat are committed to do that. Well,
(04:30):
I'm glad to hear that because Ihave listeners over the last five years
who have sent these texts saying youknow, I have loved listening to your
show, but I'm on my wayto Texas where there were oil and gas
jobs. So I do know thatwe have lost people and jobs over the
years, and I'm hoping we don'tlose any more of those because these tend
to be very high paying jobs.It's not just about the tax revenue.
(04:51):
It's about, you know, thejobs that people actually have that can actually
provide for a family here in Colorado. So let me ask you about the
nation's the sort of national you know, situation with the Biden administration. And
I'll just vent my spleen for asecond if I could, Mike, one
of my biggest frustrations with us beinginvolved in Ukraine and in the Middle East
(05:15):
is that if we just unleashed ourown oil and gas industry here in the
United States, we can have afar bigger impact on the war in Russia
because we could bankrupt them by byhaving gas prices be at a at a
level where they cannot fuel their waranymore. And yet the Biden administration doesn't
seem to make that connection. Sowhere are we with the Biden administration and
(05:38):
oil and gas production. Well,let's first of all, think about where
American consumers are right now. Highgas prices, high electricity prices, concerns
about reliability of the nation's electric grid. Is there anything that the Biden administration
is doing to address these problems.The answer is absolutely not, And in
fact, every single week it seemslike we're dealing with a new regulation,
(06:00):
a new costly regulation on our industrythat isn't doing anything to advance American oil
and gas, and Manny, youhave put your finger on it. The
fact of the matter is that Americanproduction can continue to supply the world with
inexpensive oil and natural gas, whichwe're going to need for decades and decades
to come. And unfortunately, everypolicy decision that this administration has made has
(06:24):
gone in the exact opposite direction.So every week we have a new regulation,
whether it's on new regulations on messaneor new regulations that are advancing electronic
vehicles. Rather than allowing Americans tobuy the car and truck that they want
to buy, this administration believes thatevery American should be in an ev even
if it doesn't make sense for thelife that they live. So we as
(06:47):
an industry are standing up and sayingit is time to reverse course time to
advance American oil and gas. Andwe have to do it because you and
I both know that if we don'tdo it here in the United States,
where is that production going to comefrom, Right, It's just going to
go to other countries that are hostileto American interests. And that's been my
biggest frustration. When you look acrossthe world, oil and gas consumption is
(07:11):
not dropping anywhere. I mean,there's nowhere that's using less oil and gas
than they were before, and yetwe're not allowing our producers to go ahead
and tap into all of our massiveresources here in the United States too.
I'm just going to say it almostuse it as a weapon against bad actors
around the world. I'm not ahuge fan of Saudi Arabia. I'm not
(07:32):
a fan of Venezuela. I'm nota fan of Russia, and yet they
are all allowed to keep driving theireconomy using the oil and gas that we
should be using supply to keep downprices to cripple them. And that's the
part. From a security standpoint,it's very frustrating for me. So I
can only imagine it must drive youguys crazy. Oh it does. But
(07:54):
let's let's put some numbers on it. You know, before the pandemic,
the world was using you know,one hundred million barrels of oil every single
day, right, and now afterthe pandemic, we're using one hundred three
million barrels of oil every single day. Demand is going up, not down.
And the only question that policy makersshould be asking is where is that
(08:15):
oil and gas going to come from? Right, That's the only question they
should ask, because demand is onlygoing up, not down. And if
you want that production to come fromus from a place like the United States,
where we drill in the most environmentallyresponsible way, where those revenues from
oil and gas actually fund the needsof the American people, or do you
want that production to go to placeslike Iran or Russia? Because demand isn't
(08:39):
going away. So policy makers herein the State of Colorado and in the
United States Congress should be answering thatquestion, and unfortunately they're answering completely different
questions that are not based on energyreality as we see it today. Mike
Summers from the American Petroleum Institute,he's the President. I appreciate you making
time for us today. Obviously,this is a topic that affects all of
(09:00):
our lives every day. And herein Colorado, we're about to get reformulated
gas because our governor welcomed the EPAdowngrade on ozone in twenty nineteen, and
now the chickens are coming home toroost, so I can hardly wait to
see what's coming down the pike forus on that one. Madd it was
great to be with you today andit's great to be here in the state
But now a lot of stuff justhappened in Colorado, including a big supposed
compromise for oil and gas between democratsand players in the industry. And joining
me now from the American Petroleum Instituteis the president of that organization, Mike
Summers. Mike, welcome to theshow. Mandy. Great to be with
(00:20):
you. And put me down astacos not being a sandwich. Well,
there's a judge in Indiana who disagreeswith you strongly, Sir. I'm just
saying we'll come back to that.You know, the oil and gas industry
here in Colorado has been under attack, relentless attack, I would say,
since about twenty nineteen. And thisyear we were told there was a grand
(00:43):
compromise and everything's going to be greatand everybody's going to sit around and sing
Kumbaya. What did your industry doto work with government on this? And
why? Well, Mandy, asyou know, as you point out that
we've been in these wars for memany years, and I think both sides
have decided that it's time to putthe weapons down and sought a compromise this
(01:07):
year in the Colorado legislature. Andit's really a pivotal moment for Colorado oil
and gas, and we're excited thatwe're going to be able to at least
for the next three years or so, keep those weapons down and allow America's
best producers, the producers here inthe great state of Colorado, to continue
to produce oil and gas. SoI do think we've reached a detante,
at least for the short term,because I think both sides have understand how
(01:33):
important oil and gas is going tobe for the future of Colorado in this
great state. We want to continueproducing here, and we think this compromise
came at the right time. AndI do give Governor Pola's credits for helping
us get to this point. Solet me ask you this in the last
we'll just go as twenty twenty four, right, and let's go last five
(01:53):
years. Has our industry in Coloradogrown, gotten smaller or stayed the same
so here in the state, Unfortunately, it continues to go down. We're
about stable production right now, butwe want to see that production continue to
expand there are three major operators herethat have committed to continue to grow in
(02:15):
the state. Occadental Petroleum, Chevronand Civitas have both said all three of
them have said that they want tocontinue to grow production, but the reason
that they cannot is because of aregulatory environment and a legislative environment that has
really put a wet blanket on topof production over the course of the last
few years. What we're hoping withthis compromise is that now we have really
(02:38):
a three year reprieve in terms ofwhat the legislature is going to do to
the Colorado oil and gas industry,and we're hopeful that as a consequence of
that, it gives us some certaintyand we can continue to grow production in
the Centennial State. Well, Iappreciate that. Where were what was it
in the compromise? What is theindustry agreed on? What is being inflicted
(03:01):
by the state? What are welooking at here? Well, first and
foremost, what the compromise does isit says that for three years, there
aren't going to be any punitive measuresagainst the oil and gas industry from the
Colorado legislature. Second, it saysthat there aren't going to be any punitive
measures against the oil and gas industryon the ballot. Because we've been fighting
(03:23):
these wars for many, many years. Both sides have spent a lot of
money, you know, on theseballot initiatives. And then in addition to
that, the industry has agreed thatto one of Governor Polus's priorities, which
is to fund some light rail fromFort Collins to Denver, you know,
to meet some of his public transportationgoals. So we're hopeful that both sides
(03:47):
got what we needed to give ussome certainty to continue to grow production in
the state and continue to provide thoseneeded budget revenues to the state, because,
as you know, a lot ofrev for the state of Colorado comes
from the oil and gas industry,and it's because of the production that's here
and the resource that is here thatwe're able to continue to fund schools and
(04:09):
public transportation and public safety, whichis really going to be important, particularly
during this time of high prices andincreased crime. We need to continue to
fund those things through the oil andgas industry, but we can't fund them
if we don't have production here.And we want to grow production here in
the state, and we have operatorsthat are committed to do that. Well,
(04:30):
I'm glad to hear that because Ihave listeners over the last five years
who have sent these texts saying youknow, I have loved listening to your
show, but I'm on my wayto Texas where there were oil and gas
jobs. So I do know thatwe have lost people and jobs over the
years, and I'm hoping we don'tlose any more of those because these tend
to be very high paying jobs.It's not just about the tax revenue.
(04:51):
It's about, you know, thejobs that people actually have that can actually
provide for a family here in Colorado. So let me ask you about the
nation's the sort of national you know, situation with the Biden administration. And
I'll just vent my spleen for asecond if I could, Mike, one
of my biggest frustrations with us beinginvolved in Ukraine and in the Middle East
(05:15):
is that if we just unleashed ourown oil and gas industry here in the
United States, we can have afar bigger impact on the war in Russia
because we could bankrupt them by byhaving gas prices be at a at a
level where they cannot fuel their waranymore. And yet the Biden administration doesn't
seem to make that connection. Sowhere are we with the Biden administration and
(05:38):
oil and gas production. Well,let's first of all, think about where
American consumers are right now. Highgas prices, high electricity prices, concerns
about reliability of the nation's electric grid. Is there anything that the Biden administration
is doing to address these problems.The answer is absolutely not, And in
fact, every single week it seemslike we're dealing with a new regulation,
(06:00):
a new costly regulation on our industrythat isn't doing anything to advance American oil
and gas, and Manny, youhave put your finger on it. The
fact of the matter is that Americanproduction can continue to supply the world with
inexpensive oil and natural gas, whichwe're going to need for decades and decades
to come. And unfortunately, everypolicy decision that this administration has made has
(06:24):
gone in the exact opposite direction.So every week we have a new regulation,
whether it's on new regulations on messaneor new regulations that are advancing electronic
vehicles. Rather than allowing Americans tobuy the car and truck that they want
to buy, this administration believes thatevery American should be in an ev even
if it doesn't make sense for thelife that they live. So we as
(06:47):
an industry are standing up and sayingit is time to reverse course time to
advance American oil and gas. Andwe have to do it because you and
I both know that if we don'tdo it here in the United States,
where is that production going to comefrom, Right, It's just going to
go to other countries that are hostileto American interests. And that's been my
biggest frustration. When you look acrossthe world, oil and gas consumption is
(07:11):
not dropping anywhere. I mean,there's nowhere that's using less oil and gas
than they were before, and yetwe're not allowing our producers to go ahead
and tap into all of our massiveresources here in the United States too.
I'm just going to say it almostuse it as a weapon against bad actors
around the world. I'm not ahuge fan of Saudi Arabia. I'm not
(07:32):
a fan of Venezuela. I'm nota fan of Russia, and yet they
are all allowed to keep driving theireconomy using the oil and gas that we
should be using supply to keep downprices to cripple them. And that's the
part. From a security standpoint,it's very frustrating for me. So I
can only imagine it must drive youguys crazy. Oh it does. But
(07:54):
let's let's put some numbers on it. You know, before the pandemic,
the world was using you know,one hundred million barrels of oil every single
day, right, and now afterthe pandemic, we're using one hundred three
million barrels of oil every single day. Demand is going up, not down.
And the only question that policy makersshould be asking is where is that
(08:15):
oil and gas going to come from? Right, That's the only question they
should ask, because demand is onlygoing up, not down. And if
you want that production to come fromus from a place like the United States,
where we drill in the most environmentallyresponsible way, where those revenues from
oil and gas actually fund the needsof the American people, or do you
want that production to go to placeslike Iran or Russia? Because demand isn't
(08:39):
going away. So policy makers herein the State of Colorado and in the
United States Congress should be answering thatquestion, and unfortunately they're answering completely different
questions that are not based on energyreality as we see it today. Mike
Summers from the American Petroleum Institute,he's the President. I appreciate you making
time for us today. Obviously,this is a topic that affects all of
(09:00):
our lives every day. And herein Colorado, we're about to get reformulated
gas because our governor welcomed the EPAdowngrade on ozone in twenty nineteen, and
now the chickens are coming home toroost, so I can hardly wait to
see what's coming down the pike forus on that one. Madd it was
great to be with you today andit's great to be here in the state
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