Episode Transcript
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Speaker 1 (00:01):
Welcome to the nationally syndicated Energy Mix radio show produced
by the Energy Network Media Group. The Energy Mix Radio
show will give you an inside look at the energy
industry and how it affects you by talking with industry leaders, experts,
and government officials on the Energy Mix Radio Show.
Speaker 2 (00:17):
Welcome to the Energy Mix.
Speaker 3 (00:18):
I'm Robert ray Pier, editor in chief of Shale Magazine
and senior energy contributor at Forbes. Today we welcome to
the show Kenny Stein, who is the vice president of
policy for the Institute for Energy Research and the American
Energy Alliance.
Speaker 2 (00:32):
Kenny has written a lot about.
Speaker 3 (00:33):
The implications of this year's election, and that is going
to be much of our focus today.
Speaker 2 (00:37):
Kenny, welcome to the show.
Speaker 4 (00:39):
Thanks for having me.
Speaker 2 (00:40):
You bet.
Speaker 3 (00:41):
For those listeners who don't know who you are, could
you take a minute and tell us about your background
and the organizations you're affiliated with.
Speaker 2 (00:48):
Sure.
Speaker 4 (00:48):
So, I've been at the Institute for Ingury Research in
the American Energy Alliance for about seven years now and
where the ire is a free market energy think tank
in the Washington work on energy policy and the environmental
policy that affects energy. Myself, before I was at IER,
I had some time working on Capitol Hill for Senator
(01:09):
Ted Cruz, and I've been law school before that. And
I'm actually from Texas originally.
Speaker 3 (01:15):
Okay, I went to school to Texas A and M.
So I've lived in Texas for a long time.
Speaker 2 (01:19):
There you go.
Speaker 3 (01:20):
So you wrote a recent article Election twenty twenty four
voters become American Energy Champions. You discussed results of this
year's election, emphasides that the election results in a strong
message about voter support for reliable and affordable energy. Can
you elaborate on how you interpret this sentiment and its
implications for the incoming administration's energy policies. Sure?
Speaker 4 (01:41):
Well, the energy policy actually was a significant topic in
the debates in the discussion of the actual election, which
is not always the case in every cycle. A lot
of times what goes on in energy policy is kind
of ignored, it's not really made a big issue. But
for instance, the Senator Harris's or Vice President Harris's past
(02:04):
positions on banning fracking was a major major issue in
the campaign, especially in Pennsylvania. Some of their energy policies
with regards to electric vehicles were also very very significant
discussion points in the swing states like Michigan. So the
the the energy policies and environmental policies of this administration
(02:24):
were a major issue in the in the campaign, and uh,
it was one of those things that when when polling
went around, it was something that people people understood about
that this this administration and by implication, a future Harris administration,
was quite radical on energy policy, with a lot of
a lot of mandates, a lot of interference in markets.
(02:47):
And uh, people generally were not fans at that. So
it it was, it was a significant issue, and you
can you can certainly in some states I think it
was it was a deciding factor. We particularly thinking about Pennsylvania.
Speaker 3 (03:02):
Yeah, I've written a lot about the claims that the
various candidates, even going back to Bernie Sanders when he
was running for president and he was claiming he would
ban fracking. That none of these guys can ban fracking,
but the sentiment that they would like to do that,
I think that really worked against her, you know, in
some of those states like Pennsylvania. As you say, so
(03:23):
there were also some ballot measures like Berkeley's measured gg
in Washington State's measured twenty sixty six. Is that right,
were notable. Those measures were notable in their focus on
natural gas. Can you describe those measures and do they
what are the election results reveal about public sentiment towards
energy transition or alliance on natural gas?
Speaker 2 (03:45):
Sure?
Speaker 4 (03:46):
So both both of those ballot measures were came up
because of efforts by legislatures or in the case of
Berkeley City Council's efforts to basically to outlaw natural gas
hookups for homes, for businesses, and there's even there's a
(04:07):
movement in California. There's some restaurants that are really upset
about potentially not having access to natural gas. So it's
this has been something that not just those two states
are happened to vote on it this year, but this
is something that has been discussed in Washington, d c.
Federal mandates. There's other other states and localities that are
attempting to ban natural gas usage and that's something that
(04:29):
is extremely unpopular. And that's why these ballot measures came up,
is that these were the voters saying they have got
these got these measures on the ballot as reperendums on these.
In the case of Washington, there was actually a law
already passed and this was to repeal that law. So
it's that's another point where we say that the voters
(04:52):
are paying attention to this sort of thing, because it's
one thing to ask, like do you care about the environment? Sure,
everyone says that. But then when you say, well, can
you not have natural gas in your house to you know,
to say, to produce climate and the CO two emissions,
people say no to that. People aren't willing to make that.
(05:12):
They're that kind of sacrifice.
Speaker 3 (05:14):
Well, the other thing is I've noted before that over
the past fifteen years, the United States has had the
largest decline in carbon emissions of any country in the world.
And the reason, the main reason is that coal was
displaced by natural gas. So all this anti natural gas
stuff overlooks the fact that natural gas is the reason
we've had a huge decline in our carbon emissions because
(05:37):
you know, it emits a lot less carbon dioxide than
coal does, and you know, all the fracking has produced
all this cheap gas and that's been a big benefit,
you know, carbon emissions wise around the country.
Speaker 4 (05:49):
Sure, yeah, exactly. And it's and it's also it's price wise.
It's a price kind of man too, So it's it's
cheaper and cleaner.
Speaker 3 (05:55):
Right, So in your article, you mentioned a philosophical divide
ring parties on energy policy, and that's something I've noted
many times, that they have very different ways of looking
at things. Can you discuss how this divide might influence
the legislative and regulatory landscape over the next four years?
Speaker 4 (06:13):
Sure?
Speaker 2 (06:13):
Yeah.
Speaker 4 (06:14):
And it's interesting because there are certainly plenty of policy
issues where the divide between the parties is not super clear,
like there's you know, even on things like terroriffs, like
there's people in both parties that are in favor of terrorists.
But on energy policy, there really is a very stark divide.
And the way I described it is that energy policy
is one of those things that actually unites Republicans, whereas
(06:35):
there's other you know, healthcare policy are some of these
other issue areas that actually divide Republicans. So it because
of that division is so stark, it actually makes the
likelihood of action much higher, especially when you talk about
the sort of margins that both in the House and
the Senate the Republicans are going to have. They're very
narrow margins. It's only going to be a couple of votes.
So the issue policy areas that divide Republicans aren't the
(06:59):
type of thing that are going to be all the
past Congress. It's just not going to work because you
won't have the votes. But something that ategy policy, where
there is pretty strong agreement on a lot on you know,
ninety percent of the issues, there's actually a chance of
getting some actual legislation pass things like things like dialing
back some of subsidies in the from the Inflation Reduction Act,
(07:20):
maybe making some changes to some of the environmental regulations
that strangle the energy infrastructure in this country. There's real
opportunities for that because this is because Republicans are going
to have the House, the Senate, and the presidency. Things
that unite Republicans are the type of things that can move.
Speaker 3 (07:41):
So, I mean, you're predicting significant reversals of some of
the Biden administration's energy policies under President Trump. What do
you see as the top priorities for the Trump administration
in the first year.
Speaker 4 (07:53):
Well, so, the first thing is is, honestly, the Biden
administration created a template for it. On right at the
beginning of the Biden administration, they did an executive order
to go review a whole list of regulations that the
Trump administration had put out and to replace them with
Biden versions of those regulations. I would expect that from
(08:13):
the Trump administration within for the first few weeks, and
now the actual reversal and replacement of all those regulations
will take time because you have to go through the
administrative procedure and have noticed in comment periods. But things
like the various components of the Biden ev mandates, the
Biden power Play, it rules, the methane regulations. There's there's
(08:36):
a lot of rulemakings that the Biden administration has ruled
out that have been have been quite radical. Frankly, some
of them are legal, have some legal weaknesses too, But
that's going to be an immediate turnaround. And then there's
other things that the Biden administration did just purely by
executive order that the Trump administration will be able to
refers very quickly. Some of the the the including climate
(08:59):
requires in government contracting that can be reversed very quickly.
Some of the money that is going out of the
door to to subsidize environmental eng os, UH, some of
that money can be clawed back. The Department of Energy
loan programs those can be UH don't have to continue
that they can they can hold, they can pull that
money back. So there's there's opportunities for them to do
(09:20):
things immediately, and then there's other things that obviously are
going to take some time. And then obviously congressional action
is always dependent on the vagaries of Congress.
Speaker 3 (09:29):
Yeah, so someone recently asked me about the loan program,
and I guess money that hasn't been dispersed can be stopped.
But you know, contracts that are in place, I guess
some of that money is already agreed that it will
go out over time.
Speaker 4 (09:46):
Yeah, it depends on It depends on where in the process,
because just because the loan has been agreed upon, if
the paperwork hasn't been signed and you know finished, Uh,
that doesn't mean it's you know it. But yes, but
once once you have a signed agre that money is obligated.
But there's but there's still often conditions on getting the
money that you have to meet certain benchmarks or what
(10:08):
have you. And those will be opportunities in the future
to end and potentially end alone or to not disperse
because they often come in tranches of funds and you
might say, oh, well, you haven't met the requirements of this,
We're not going to give you the next trunch. So yeah,
but yes, some of that money is already obligated, but
(10:28):
there's tens of billions of dollars that are not obligated yet.
Speaker 3 (10:32):
Right, So on a on a bill like the Inflation
Reduction Act, which I've said before was a miss and
Olmer that was really a climate bill. You know, I
don't remember what the value of the bill was, but
do you have a sense on how much of that
can be clawed back?
Speaker 4 (10:47):
Well, So, the the cost estimate of it actually has
exploded since it was passed. When Congress voted on it,
I think the estimate was around three hundred and sixty
billion in spending over ten years. The CBO did a
rescore of it about about a year ago. I think
that had around five hundred billion. There's been non government
(11:09):
estimates from people places like I believe Morgan Stanley did
one that have have the cost us been in the
trillions of dollars, And that's of course the way budgeting
works in Washington, DC. That's over only over ten years.
A number of the subsidies that are in the Inflation
Reduction Act are indefinite. They don't have an end date,
so they will continue on into the future of many
trillions dollars. More So, there's a huge, huge pot of
(11:31):
money that the IRA created that is very ripe for
being used as pay fors for the things that Republicans
want to do, especially extending some of the tax cut
legislation that the Trump administration passed in their first term.
Speaker 2 (11:46):
Okay, we need to take a quick commercial break.
Speaker 3 (11:48):
There After the break, I want to get into some
more of the legislative changes that we might expect with
the new Trump administration. So I'm Robert ray Pier with
the sweet guest Kenny Stein.
Speaker 4 (11:58):
I'll be right back after the break.
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Speaker 3 (13:02):
Welcome back to the Energy Mix Radio. I'm Robert ray
Pere with this week's guest, Kenny Stein. Kenny, how do
you expect federal land policies regarding all the gas exploration
to change under this administration? I know Biden had put
certain areas off limits, so I'm curious to hear your
thoughts about what will happen to open up new lands.
Speaker 4 (13:21):
Sure, and that's going to be a place that we're
gonna it's going to be a complete one eighty there.
There's there's no question that the Biden Department of Interior
has been extremely aggressive and again frankly a bit illegally
aggressive about trying to shut down energy development on federal lands. Uh,
they've put a bunch of areas of Alaska off off
(13:43):
limits as offshore leasing. Actually for for the first time ever,
they didn't have an offshore leasing plan for an extended
part of their the administration. Uh. They and they've recently
started allowing started doing leases again, but a very small
amount of land. They've also included new fees and rules
(14:03):
on on development, on drilling on federal lands. And they've
also made it more difficult to things building things like
pipelines across federal lands. They've bardbore permits, they've delayed things.
So all these things are areas where the Trump administration
is going to change things, and they'll probably do it
very quickly because again, this is another area that most
(14:24):
of those actions were administrative. They weren't passed by Congress,
so they can be reversed by presidential order pretty quickly.
So i'd expect them to open up return to some
of those areas in Alaska to leasing. The Congress has
actually mandated that in the in anwar, they're supposed to
be leasing, and the Biden administration has been refusing to
(14:46):
do so. So I would expect them to start doing
some leasing in ant war in the Natural Petroleum Reserve
in Alaska. I'd expect them to start leasing again offshore
in a big way, and then there's plenty of there's
plenty of leasing and development that's going on lands that
the permitting could be sped up, and you'll have an
attitude shift. Where right now the Department of Interior is
(15:08):
anti oil and gas development on federal lands, so everything
they do is anti Whereas you're going to have a
new administration that is going to always be pro oil
and gas development on federal lands, so that that changes
the whole outlook for what you can do and what
people might be willing to invest in. Right now, most
companies aren't really interested investing on federal lands because they
(15:31):
know it's going to be a hard slog to get
through a hostile administration. And that changes once you have
a pro development administration of pro development Secretary of Interior.
Speaker 3 (15:44):
So do you have a feel for what areas might
be most promising? Are there are all companies you know,
licking their chopped over specific areas.
Speaker 2 (15:53):
Well.
Speaker 4 (15:54):
I know there are areas of the Gulf of Mexico that,
especially the big the oil majors, would like to would
like to have more leasing and it's usually areas that
are adjacent to areas that are already developing, so they know,
they know there's resources there, they know how to get it,
they know the geology, so they're they're very interested in
doing and drilling in those areas because they already know
what's there. There's also there's already The one area that
(16:16):
has continued to have a lot of activity even in
spite of the bid administration has been the parts of
the Permian that are in New Mexico that are on
federal lands and that the I know that there has
been leasing there. But that's another place that oil companies
are very interested in investing because again they know the
resources that are there because they cross you know, they
(16:38):
have a lot of they've done a lot of work
in Texas and New Mexico on those resources. They know
they're there. And then there's some other areas that uh
that are more a little more speculative, in in Colorado,
in Utah that they're there. Again, they know there's resources there,
but the cost of getting them out and transporting them
is raised because they've got on federal lands and there's
(17:01):
a little bit further to move it. So those are
actually areas where the costs imposed by federal federal, federal
foot dragging actually make a big difference. In in you know,
in New Mexico, Uh, they can still make money even
with a hostile Department of Interior because there's enough oil there,
there's enough infrastructure already there, they can still make money.
(17:23):
But in places in Colorado and Utah, uh, it because
they need to build infrastructure as well as uh drill
the holes and develop the resources. Those added costs compound
and it makes it hard. That makes it unfavorable to
invest there. There's also some areas of Alaska that definitely
are ripe for investment. Some areas like the like offshore
(17:46):
Alaska is a little bit harder sell because it is
very expensive, but there's some onshore lands that are There's
definitely interest. So again, and part of the interest also
is going to depend on the oil price. Like if
if prices suddenly fall, then some of these projects people
are going to be interested in anymore.
Speaker 3 (18:07):
Yeah, I was going to ask that question about what
do you feel like the right price is for them
to go and you know, drill a bit more. I
think they're kind of in a spot now where they're
trying to see, Okay, where's it going from here? And
I don't know if they're going to do a lot
of expanded drilling at the current price. And what you're
feeling about.
Speaker 4 (18:26):
That, Well, yeah, that's definitely true. I mean, the price
where it is now is you know, is somewhat low,
especially especially for federal development, because federal development is more
expensive because of the regulatory hurdles. And the thing is
right now, there are plenty of options of where to drill,
Like you can go drill in the permium in Texas
(18:47):
quite easily, and you can you can make money at
current prices, so that that does limit the interest in
some of these more expensive federal areas at current prices.
And the thing is is that there's not I don't
think there's much expectation of much higher prices coming soon,
and absent something like is reel bombing around export terminals
(19:12):
or something, absent absence some sort of you know, geopolitical risk.
As far as just demand, global demand and global demand growth,
there's there's probably gonna there's gonna be some growth, but
it's going to be gradual. It's you know, it's places
like India developing that sort of thing. So there's not
a huge need for a bunch of investment to surge
(19:33):
production right now, so that that limits Now, that doesn't
mean that companies won't necessarily bid on leases on federal
land because especially for federal products, especially offshore, but even
on shore federal projects, they take a long time to
come to fruition five ten years, so they're thinking kind
of down the road on this too.
Speaker 3 (19:53):
Okay, So we'll take a quick breaker out there. After
the break, I want to get into you mentioned poplines.
I want to get into probably the most famous pipeline,
the one everybody's heard of, Keystone XL and see if
you think anything is going to happen there. And I've
got a feeling out what you're going to say there,
but we'll talk.
Speaker 2 (20:08):
About that after the break.
Speaker 3 (20:09):
With that, I'm Robert Ray Pierre to be wrapped back
with Kenny Stein on an interage mixed radio show.
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Speaker 3 (21:22):
Welcome back to the Energy Mix Radio. I'm Robert Rapier
with this week's guest, Kenny Stein. Kenny, you mentioned pipelines earlier.
I wanted to ask about the most famous pipeline, the
Keystone XL, which has been on again off again since
Obama's president. You know, Obama threw down some barriers. Trump
signed an executive order.
Speaker 2 (21:39):
To speed it up.
Speaker 3 (21:40):
Biden threw down barriers and canceled it, and I think
TC Energy at the time said Okay, we're done, We're out,
and I think Trump on the campaign trail said, hey,
I'd like to get that going again.
Speaker 2 (21:50):
What are your thoughts on that.
Speaker 3 (21:51):
I mean, I think it's dead, but you know, people
still ask me about it all the time.
Speaker 4 (21:56):
Sure, yeah, Bill, it became a political football, you know, unfortunately,
but yeah, it's almost certainly dead again. As you said,
the company behind the pipeline has said they're done with it.
They there's many billions of dollars that they've redirected, and
that's not just sitting there waiting to complete the project.
The other thing is that the American sections of the
(22:17):
pipeline were all built and completed and our in use,
so there's not the economic need for it is not
necessarily as clear cut today just because things have changed.
US production has has surged all nearly doubled I think
since the pipeline was first proposed, So it's a different
(22:38):
landscape today. But there are the thing is and the
other problem is that you have the ongoing problem of
needing a permit to cross the border, in the international border,
and unless Congress fixes that problem, I'm not sure there's
any company that's going to ever want to risk that
kind of that kind of permit being withdrawn again the
way Biden, which is what Biden did when he came
into office. So Congress and the really needs to fix
(23:00):
that underlying problem. But there are other pipelines that cross
the US Canada border. There's a fight in Michigan, I believe,
about basically repairing an old pipeline, trying and trying to
upgrade it to modern standards, and that's getting caught up
in this cross border permit fight too. So even though
the Keystone pipeline itself most likely is never going to
(23:20):
come to fruition, it is it is emblematic of the
problems of building pipelines between the US and Canada and
US and Mexico, which all three countries are major energy producers,
and having an integrated energy system between all three it
helps with efficiency, it helps with economic growth for all
of us, and it's a good thing. But to Keystone
(23:41):
has just sort of showed how a hostile administration two
different hostile presidents can interfere with the functioning of that market.
Speaker 3 (23:51):
So on the flip side, do you think Trump is
going to be able to clear some of those barriers
out and get those problems resolved?
Speaker 4 (23:58):
Certainly some of them, some of them, you know, the
the permitting issues on federal land, that is something he
can change immediately. Obviously he can. He can grant cross
border permits when he's president. But then you need he'd
probably if the Republicans in Congress can you know, get
themselves organized, they can, they can change that underlying law,
and I'm sure he'd sign, you know, he'd sign uh
(24:18):
legislation that fixed that cross border permitting issue. But there
are some permitting issues that are not necessarily subject to
easy fixes, even no matter how much the Trump administration
would want. One of the big problems with pipelines is
that is state opposition. So the like for instance, New
York State will not allow a gas pipeline to be
built across the state from Pennsylvania to New England, even
(24:41):
though New England has a huge need for natural gas.
And that is that the ability for states to block
that is kind of written into federal statute. Now that's
kind of how the Clean Water Act is meant to work.
States are supposed to be the primary regulators. So there
are some there are some regulatory opportunities that the Trump
Mission administration can try to do to to make it
(25:03):
clear because the thing is under the clean water states
aren't supposed to just say no, they're really they're really
supposed to. They can say you need to do X,
Y and Z to make sure our water is kept clean,
but they're not really supposed to be able to ban
things crossing the state. This isn't that becomes an interstate
commerce issue. So there's a regulatory opportunity to clarify that
and make it like force these states to say why
(25:27):
instead of just like refusing to do anything, they have
to say, you know what can be done to fix
whatever their objection is. But you're still fundamentally if this
state resistance, the state is allowed to resist some of
these things. And that that is a big problem with
pipelines in this country. And you know that's a that's
(25:48):
a persuading the voters of these states that pipelines are
are beneficial in help.
Speaker 2 (25:53):
Okay, we need to take a quick break.
Speaker 3 (25:55):
There after the break, I want to talk to you
about your organizations and what you do. And you know
what your priorities are over the next four years. I'm
Robert Rapier with Energy Mix radio show. I'll be right
back with Kenny Stein.
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Speaker 3 (27:22):
Welcome back to the Energy Mix Radio. I'm Robert Rapier
with this week's guest, Kenny Stein. Kenny, let's talk a
little bit about the organizations you're affiliated with. How do
you plan to influence energy policy over the next four years.
What specific initiatives will you prioritize.
Speaker 4 (27:37):
Yeah, So the our organization, one is the C three,
and one is a C four, And so that's just
in irs terms. The C three is more of think
tank and does research and education, whereas a C four
actively in luck gets itself involved in, uh, you know,
supporting specific legislation or that sort of thing. So, uh,
when when we talk about those two organizations, obviously what
we're doing is different depending on the the capabilities of
(28:01):
the organizations, but just in general, it's that there's gonna
be a couple a couple major things that we've We've
been very focused on the Biden administration's attempts to subsidize
and mandate electric vehicles. So there's there's several interlocking regulations
that that into that combined we refer to as the
ev mandate, even though each individual one isn't necessarily a
(28:23):
mandate together the way they work. So that's the fuel
economy standards, that's California waivers UH for their clean Cars program,
and then the tailpipe emission standards. So getting those regulations
UH basically withdrawn and replaced is going to be a
major focus for us UH. We've already talked about pipelines,
(28:43):
but fixing some of the permitting issues that affect not
just pipelines, but but all development on federal lands. And
it's especially talking about the National Environmental Policy Act, which
makes it hard to build really anything. It's not just
not just energy. You know, highways, homes are harder to
build because of NEPA, So getting some sort of reform
out of that, which that probably needs congressional action. And
(29:06):
then there's also just we've talked about the improving the
environment for investment on federal lands. That is that is
a huge part of what we hope and will be
encouraging the Trump administration to fix because a lot of
damage was done in a short period of time by
the Biden administration. So are there particular.
Speaker 3 (29:26):
Radiatory barriers which you believe need urgent reform to promote
energy innovation and affordability.
Speaker 4 (29:32):
Well I mentioned in NEPAY the National Environmental POSSEAC. That
is enormous, especially because the NEPA legislation that was actually
passed by Congress is only a few sentences. It's very vague.
It just means you need to think. It just says
you need to think about environmental impacts of things that happen.
But we have this huge body of judicially created law.
(29:52):
This is judges and appeals courts creating all sorts of
standards and rules and requirements for environment assessments. There's this huge,
massive regulatory burden that again is on any any anything
you want to build in the United States. This is
what Trump was referring to a couple of days ago
when he said, if you have a billion dollar project,
you should be exempted from NEPA regulations. That it's a
(30:14):
it's a huge problem for everything, for semiconductor plants, for
you name it. So reforming that is would be huge.
It would make enormous difference for just the entire economy.
And again, it's not just energy that NEPA effects. It
affects affects anything you want to build in the United States.
So it's it's a major it's major, and it's major
league damaging.
Speaker 3 (30:34):
So what do you think is going to happen with
the current efforts on decarinization and addressing climate change?
Speaker 2 (30:40):
You see that all going by the wayside. Is some
of that going to continue? How do you think Trump's
going to approach this?
Speaker 4 (30:46):
Well, there's there's The Trump administration obviously is not interested
in pursuing any of that stuff, and we'll toss most
of it. But the great, uh, the interesting thing that
at least for me to see in the last year
or two is that the private sector is also abandoning
many of these things because of the demand growth in
electricity demand, particularly from data centers in AI. All these
(31:08):
big investment firms, all these tech firms that for years
had been talking about one hundred percent renewables, we want
to go green. These utilities that we're saying we're going
to eliminate coal by twenty thirty or twenty thirty five,
suddenly that everybody's dropping these pledges because what they need
is reliable, abundant electric electricity supply, and the only place
(31:28):
to get that from is natural gas. So I've actually
I think a lot of the climate hysteria that has
been whipped up for it's been ten plus years now
that this has been going on, I think a lot
of that is going to fall by the wayside, because ultimately,
if you want to have these data centers in the
(31:49):
United States, if you want to build more manufacturing, or
build these the battery plants even that are being subsidized
by the Inflation Reduction Act, all those things require and
normal amount of energy, an enormous amount of electricity. And
the way you get that in the United States is
from our using our cheap natural gas to do it.
Speaker 3 (32:09):
Yeah, I agree.
Speaker 2 (32:10):
I think you know.
Speaker 3 (32:12):
I'm somebodyho's worried about carbon emissions for sure, But at
the same time, I recognize where they're coming from increasingly
is Asia Pacific that region, and we can hamstring ourselves
and that's not going to help produce carbon emissions because
the reason they're climbing is Asia Pacific is steadily steadily rising.
(32:32):
So yeah, I'm on board there. I've looked at a
lot into Chris Wright's position, Donald Trump's secretary nominee for
Secretary of Energy, because he was called a climate denier
and I dug into that a little bit and I
found out his position basically the same as mine. You know,
he acknowledges rising carbon emissions and says there's not a
lot we can do about it with the situation as
(32:53):
it is with you know, Asia and you know Chinese
cold consumption cloud every year right well.
Speaker 4 (33:01):
And also the other thing is that for whatever negative
emission neggative outcomes there may be from rising temperatures, what's
the better way to tackle that to be a wealthier
society that is able to afford mitigation managures, or to
harm our economy and be poorer and still face the
negative consequences of rising temperatures. So like that that rising
(33:23):
prosperity and rising wealth helps us tackle whatever might come
from those rising temperatures.
Speaker 3 (33:30):
So what do you see any areas for backpartisan cooperation?
I mean, are there are there democratic priorities that Republicans
would get on board with or some Democrats get on
board with some of the Republican priorities.
Speaker 4 (33:41):
So there's not a lot. As I said at the
start of the top of the program, there this is
a very very polarized by party area of policy. There's
there's a few places that the there are some Democrats
that acknowledge some of the permitting issues that I've that
I've already talked about the problems there, and there are
open to some changes. Now how significant they're willing to
(34:04):
agree to, I don't know. But then there's also areas
of like electricity transmission. I know there's some bipartisan sentiment
on that, but even where it's bipartisans, it's a few
a handful of Democrats, it's not a lot.
Speaker 3 (34:18):
Okay, we need to take a quick break route there
and going into our final segment. Got a few questions about,
you know, oil production records and what you expect to
see oil production laves over the next four years. So
we'll be right back with Kinni Stein on the Energy
Mixed Radio show.
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Speaker 3 (36:12):
Welcome back to the Energy Mix Radio. I'm Robert ray
Pere with this swek's guest Kenny Stein. Kenny, it looks
like we're about to set a new old production record
for the second straight year. Natural gas also should be
at a record high, but in recent months it looks
like production gains for both are slowing. I think the
EIA has said recently that they see that flattening out.
(36:32):
What are your expectations for next year production wise, and
how will this be affected in the short term by
anything President Trump can do or will this be affected
by anything he can do?
Speaker 2 (36:43):
Yeah?
Speaker 4 (36:44):
Sure. The one thing to say at the start is
that that both oil and natural gas in the United
States have have kind of separated. Their prospects are different now.
In the past they moved together, but because because of
the huge growth of domestic natural gas production and the
growth of LGX sports, the prospects for natural gas have
changed versus oil. So, you know, I certainly see oil
(37:07):
production flatateauing a bit in the United States, but that's
partly because our our growth has been like so astronomical
the last couple of years. That's impossible to state it's
a state because global global demand just is not rising
at that rate. So in the United States, you know,
at some point we get to the point where we're
not our oil production is not can't can out compete.
(37:31):
You know, oil is going to continue to be very
cheap to produce in Saudi Arabia. You know, we we
can produce cheaper than in Venezuela or Brazil or some
of the other places. But we're not going to take
over one hundred percent of the global oil market. We
can't produce that cheaply. So eventually, at some point we
hit a we hit a ceiling where we were producing,
you know, a certain percentage of the global demand. Natural gas.
(37:54):
On the other hand, I would expect it to continue
to rise just because the the cheap natural gas domestically
is helping to boost demand for natural gas. We already
talked about the electricity needs of natural gas data centers.
That's that's how these companies are planning to power data
centers in the short term is more natural gas generation.
(38:15):
They'd like to have nuclear, but that's you know, in
the future, it takes many years to get there, so
they're going to need natural gas for that development. There's
also been industrial investment in the United States that has
come here because of our cheap natural gas, that's going
to continue to drive demand. And then you also have
the growth of LG export capacity that's going to continue
(38:35):
to drive demand growth to production growth in the United
States because any that is not used here has a
ready export market, especially Asia, but also to a lesser extent, Europe.
So I'd expect natural gas to continue to grow in
an oil at some point oil is going to plateau
just because of the realities of the global oil market
(38:56):
and the way the way things move. As far as
the Trump administrations impact on that, the it'll it'll, it'll depend.
But the thing is most oil and natural gas production,
most of that production growth we've seen in the last
ten years has been on state in private lands, so
the federal government doesn't have that much control over that,
other than some of the regulations that the Trump that
(39:18):
the Biding administration is trying to impose, for example, all
the method regulations that I mentioned earlier that raises the
costs of domestic productions. So fixing some of those problems
could make it a little bit cheaper to produce the
United States, but it's probably not going to have enormous impacts.
The one thing that the Trump administration could have, and
this is a bit because global oil prices are to
(39:41):
a certain extent are kind of set by vibes like
actual production matters, but expectations of future production, expectations of
you know, future demand, drive a lot of the price movements.
And having a new administration come in that is affirmatively
pro oil development, that can affect future expectations of oil prices,
(40:03):
and it could dry it could you know, it's not
going to drive down oil prices massively. I know the
President Trump and the campaign said he wanted to reduce
gas prices by half. That's not really realistic, but a small,
a small decrease in the oil price because of the
expectation the United States is going is going to be
easier and cheaper and faster to produce in the United
States if there ever is a price spiker, there ever
(40:26):
is a demand need, that can materially affect oil prices
and bring them down slightly. Now, of course, as we've said,
low oil prices aren't necessarily great for domestic oil production.
But again, if the the what the president, what the
administration can do is clear out some of those barriers
so that when oil prices move, US producers can respond
(40:49):
quickly to it, rather than you know, it taking five
years to get a permit to drill on federal lands.
Speaker 3 (40:56):
So several people have asked me about what's going to
happen with the electric be and I typically I would say, well,
I don't think there's going to be as much support
for them, But Elon Musk is kind of the wild
card here with Trump's ear, I don't really have a
good feel for how that's all going to play out.
Do you have any thoughts on that?
Speaker 4 (41:13):
Well, what's interesting is that Musk has already said that
he doesn't mind eliminating the electric vehicle tax credit. And
this is he because he thinks that Tesla will outcompete
his competitors in the absence of that credit, So he
actually has said he doesn't mind eliminating that. Now, when
it comes to some of the other components of the
Biden's ev mandate, the tailpipemission standards and the fuel efficiency things,
(41:37):
I don't know that he'd be that enthusiastic about eliminating those,
because that's where a lot of Tesla advantage comes from.
Tesla Tesla makes a lot of its profits from selling
credits in the California Emissions vehicle emissions trading system. So
you know, if he's not probably not going to want
to go after the California waiver. So yes, he is.
(41:58):
He's very much the wild card. But the the he
there's there is a pretty broad consensus in the Republican
party as I was talking about where consensus is, the
Republicans dislike anything that's macs of an electric vehicle mandate.
So there's there's a consensus of going after that stuff
and dialing it back. And look, electric vehicles aren't going anywhere.
(42:21):
They they are a part of the market and for
for a certain type of person, certain types of uses,
they make a lot of sense, but they're they're a
niche product there. They're not going to be one hundred
percent in anything resembling a free market. They're not going
to be one hundred percent of of of either passenger
vehicles or certainly not trucks. But you know, you know,
ten percent of the market, fifteen percent of the market
(42:42):
that I think that's very very should absolutely expect that
regardless of government policy.
Speaker 3 (42:49):
You know, I never hear Trump talk much about nuclear power.
Speaker 2 (42:52):
Do you see them doing anything.
Speaker 3 (42:54):
There is there any appetite for you know, stripping away
uh you know red type there and get nuclear power
plants built.
Speaker 4 (43:01):
Well, that's actually something I didn't mention before we were
talking about bipartisan opportunities. There's actually there are both Democrats
and Republicans who aren't who want nuclear power to play
a bigger role because because for people who care about
greenhouse gas emissions, nuclear has no greenhouse gas emissions. For
people who want reliable power, nuclear is perfect for reliable power. So, uh,
there's definitely there is bipartisan consensus. There's actually some legislation
(43:24):
that's just passed to try and try and fix the
Nuclear Regulatory Commission a little bit. But that's definitely an
area where you could see some more legislative and regulatory
action for sure. Okay, Kenny, we have about a minute left.
Speaker 3 (43:37):
Can you tell us for anybody who wants to know
more about what you're riding, what you're working on, where
people can find you.
Speaker 4 (43:44):
Yep, the website websites EASi, it's is it TWOE for
Energy Research dot org?
Speaker 2 (43:48):
And what stories you're working on right now? What issues?
Speaker 4 (43:52):
Well, the big thing, like I said, it's electric vehicles
is the big thing because the new incoming administration, there's
a lot. We just issued a report about the limitations
of the electric fitforced electric vehicle transition that we hope
will influence on some of the regulatory actions that the
new administration is going to take.
Speaker 3 (44:09):
Okay, excellent, Well that's all about all the time we
have the show. Excellent conversation. Appreciate your insights. I want
to thank this week's guest Kenny Stein, for being on
the Energy Mix Radio and we would love to have
you back again sometime.
Speaker 4 (44:22):
Thank you for having me.
Speaker 1 (44:23):
The Energy Mix Radio show is where we explore topics
that affect us all in the oil and gas industry.
Every week, our host will interview the movers and shakers
in this fast paced industry. You'll hear from industry experts,
elected officials, and many more on the Energy Mix Radio Show.
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Welcome to the nationally syndicated Energy Mix radio show produced
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Speaker 2 (00:17):
Welcome to the Energy Mix.
Speaker 3 (00:18):
I'm Robert ray Pier, editor in chief of Shale Magazine
and senior energy contributor at Forbes. Today we welcome to
the show Kenny Stein, who is the vice president of
policy for the Institute for Energy Research and the American
Energy Alliance.
Speaker 2 (00:32):
Kenny has written a lot about.
Speaker 3 (00:33):
The implications of this year's election, and that is going
to be much of our focus today.
Speaker 2 (00:37):
Kenny, welcome to the show.
Speaker 4 (00:39):
Thanks for having me.
Speaker 2 (00:40):
You bet.
Speaker 3 (00:41):
For those listeners who don't know who you are, could
you take a minute and tell us about your background
and the organizations you're affiliated with.
Speaker 2 (00:48):
Sure.
Speaker 4 (00:48):
So, I've been at the Institute for Ingury Research in
the American Energy Alliance for about seven years now and
where the ire is a free market energy think tank
in the Washington work on energy policy and the environmental
policy that affects energy. Myself, before I was at IER,
I had some time working on Capitol Hill for Senator
(01:09):
Ted Cruz, and I've been law school before that. And
I'm actually from Texas originally.
Speaker 3 (01:15):
Okay, I went to school to Texas A and M.
So I've lived in Texas for a long time.
Speaker 2 (01:19):
There you go.
Speaker 3 (01:20):
So you wrote a recent article Election twenty twenty four
voters become American Energy Champions. You discussed results of this
year's election, emphasides that the election results in a strong
message about voter support for reliable and affordable energy. Can
you elaborate on how you interpret this sentiment and its
implications for the incoming administration's energy policies. Sure?
Speaker 4 (01:41):
Well, the energy policy actually was a significant topic in
the debates in the discussion of the actual election, which
is not always the case in every cycle. A lot
of times what goes on in energy policy is kind
of ignored, it's not really made a big issue. But
for instance, the Senator Harris's or Vice President Harris's past
(02:04):
positions on banning fracking was a major major issue in
the campaign, especially in Pennsylvania. Some of their energy policies
with regards to electric vehicles were also very very significant
discussion points in the swing states like Michigan. So the
the the energy policies and environmental policies of this administration
(02:24):
were a major issue in the in the campaign, and uh,
it was one of those things that when when polling
went around, it was something that people people understood about
that this this administration and by implication, a future Harris administration,
was quite radical on energy policy, with a lot of
a lot of mandates, a lot of interference in markets.
(02:47):
And uh, people generally were not fans at that. So
it it was, it was a significant issue, and you
can you can certainly in some states I think it
was it was a deciding factor. We particularly thinking about Pennsylvania.
Speaker 3 (03:02):
Yeah, I've written a lot about the claims that the
various candidates, even going back to Bernie Sanders when he
was running for president and he was claiming he would
ban fracking. That none of these guys can ban fracking,
but the sentiment that they would like to do that,
I think that really worked against her, you know, in
some of those states like Pennsylvania. As you say, so
(03:23):
there were also some ballot measures like Berkeley's measured gg
in Washington State's measured twenty sixty six. Is that right,
were notable. Those measures were notable in their focus on
natural gas. Can you describe those measures and do they
what are the election results reveal about public sentiment towards
energy transition or alliance on natural gas?
Speaker 2 (03:45):
Sure?
Speaker 4 (03:46):
So both both of those ballot measures were came up
because of efforts by legislatures or in the case of
Berkeley City Council's efforts to basically to outlaw natural gas
hookups for homes, for businesses, and there's even there's a
(04:07):
movement in California. There's some restaurants that are really upset
about potentially not having access to natural gas. So it's
this has been something that not just those two states
are happened to vote on it this year, but this
is something that has been discussed in Washington, d c.
Federal mandates. There's other other states and localities that are
attempting to ban natural gas usage and that's something that
(04:29):
is extremely unpopular. And that's why these ballot measures came up,
is that these were the voters saying they have got
these got these measures on the ballot as reperendums on these.
In the case of Washington, there was actually a law
already passed and this was to repeal that law. So
it's that's another point where we say that the voters
(04:52):
are paying attention to this sort of thing, because it's
one thing to ask, like do you care about the environment? Sure,
everyone says that. But then when you say, well, can
you not have natural gas in your house to you know,
to say, to produce climate and the CO two emissions,
people say no to that. People aren't willing to make that.
(05:12):
They're that kind of sacrifice.
Speaker 3 (05:14):
Well, the other thing is I've noted before that over
the past fifteen years, the United States has had the
largest decline in carbon emissions of any country in the world.
And the reason, the main reason is that coal was
displaced by natural gas. So all this anti natural gas
stuff overlooks the fact that natural gas is the reason
we've had a huge decline in our carbon emissions because
(05:37):
you know, it emits a lot less carbon dioxide than
coal does, and you know, all the fracking has produced
all this cheap gas and that's been a big benefit,
you know, carbon emissions wise around the country.
Speaker 4 (05:49):
Sure, yeah, exactly. And it's and it's also it's price wise.
It's a price kind of man too, So it's it's
cheaper and cleaner.
Speaker 3 (05:55):
Right, So in your article, you mentioned a philosophical divide
ring parties on energy policy, and that's something I've noted
many times, that they have very different ways of looking
at things. Can you discuss how this divide might influence
the legislative and regulatory landscape over the next four years?
Speaker 4 (06:13):
Sure?
Speaker 2 (06:13):
Yeah.
Speaker 4 (06:14):
And it's interesting because there are certainly plenty of policy
issues where the divide between the parties is not super clear,
like there's you know, even on things like terroriffs, like
there's people in both parties that are in favor of terrorists.
But on energy policy, there really is a very stark divide.
And the way I described it is that energy policy
is one of those things that actually unites Republicans, whereas
(06:35):
there's other you know, healthcare policy are some of these
other issue areas that actually divide Republicans. So it because
of that division is so stark, it actually makes the
likelihood of action much higher, especially when you talk about
the sort of margins that both in the House and
the Senate the Republicans are going to have. They're very
narrow margins. It's only going to be a couple of votes.
So the issue policy areas that divide Republicans aren't the
(06:59):
type of thing that are going to be all the
past Congress. It's just not going to work because you
won't have the votes. But something that ategy policy, where
there is pretty strong agreement on a lot on you know,
ninety percent of the issues, there's actually a chance of
getting some actual legislation pass things like things like dialing
back some of subsidies in the from the Inflation Reduction Act,
(07:20):
maybe making some changes to some of the environmental regulations
that strangle the energy infrastructure in this country. There's real
opportunities for that because this is because Republicans are going
to have the House, the Senate, and the presidency. Things
that unite Republicans are the type of things that can move.
Speaker 3 (07:41):
So, I mean, you're predicting significant reversals of some of
the Biden administration's energy policies under President Trump. What do
you see as the top priorities for the Trump administration
in the first year.
Speaker 4 (07:53):
Well, so, the first thing is is, honestly, the Biden
administration created a template for it. On right at the
beginning of the Biden administration, they did an executive order
to go review a whole list of regulations that the
Trump administration had put out and to replace them with
Biden versions of those regulations. I would expect that from
(08:13):
the Trump administration within for the first few weeks, and
now the actual reversal and replacement of all those regulations
will take time because you have to go through the
administrative procedure and have noticed in comment periods. But things
like the various components of the Biden ev mandates, the
Biden power Play, it rules, the methane regulations. There's there's
(08:36):
a lot of rulemakings that the Biden administration has ruled
out that have been have been quite radical. Frankly, some
of them are legal, have some legal weaknesses too, But
that's going to be an immediate turnaround. And then there's
other things that the Biden administration did just purely by
executive order that the Trump administration will be able to
refers very quickly. Some of the the the including climate
(08:59):
requires in government contracting that can be reversed very quickly.
Some of the money that is going out of the
door to to subsidize environmental eng os, UH, some of
that money can be clawed back. The Department of Energy
loan programs those can be UH don't have to continue
that they can they can hold, they can pull that
money back. So there's there's opportunities for them to do
(09:20):
things immediately, and then there's other things that obviously are
going to take some time. And then obviously congressional action
is always dependent on the vagaries of Congress.
Speaker 3 (09:29):
Yeah, so someone recently asked me about the loan program,
and I guess money that hasn't been dispersed can be stopped.
But you know, contracts that are in place, I guess
some of that money is already agreed that it will
go out over time.
Speaker 4 (09:46):
Yeah, it depends on It depends on where in the process,
because just because the loan has been agreed upon, if
the paperwork hasn't been signed and you know finished, Uh,
that doesn't mean it's you know it. But yes, but
once once you have a signed agre that money is obligated.
But there's but there's still often conditions on getting the
money that you have to meet certain benchmarks or what
(10:08):
have you. And those will be opportunities in the future
to end and potentially end alone or to not disperse
because they often come in tranches of funds and you
might say, oh, well, you haven't met the requirements of this,
We're not going to give you the next trunch. So yeah,
but yes, some of that money is already obligated, but
(10:28):
there's tens of billions of dollars that are not obligated yet.
Speaker 3 (10:32):
Right, So on a on a bill like the Inflation
Reduction Act, which I've said before was a miss and
Olmer that was really a climate bill. You know, I
don't remember what the value of the bill was, but
do you have a sense on how much of that
can be clawed back?
Speaker 4 (10:47):
Well, So, the the cost estimate of it actually has
exploded since it was passed. When Congress voted on it,
I think the estimate was around three hundred and sixty
billion in spending over ten years. The CBO did a
rescore of it about about a year ago. I think
that had around five hundred billion. There's been non government
(11:09):
estimates from people places like I believe Morgan Stanley did
one that have have the cost us been in the
trillions of dollars, And that's of course the way budgeting
works in Washington, DC. That's over only over ten years.
A number of the subsidies that are in the Inflation
Reduction Act are indefinite. They don't have an end date,
so they will continue on into the future of many
trillions dollars. More So, there's a huge, huge pot of
(11:31):
money that the IRA created that is very ripe for
being used as pay fors for the things that Republicans
want to do, especially extending some of the tax cut
legislation that the Trump administration passed in their first term.
Speaker 2 (11:46):
Okay, we need to take a quick commercial break.
Speaker 3 (11:48):
There After the break, I want to get into some
more of the legislative changes that we might expect with
the new Trump administration. So I'm Robert ray Pier with
the sweet guest Kenny Stein.
Speaker 4 (11:58):
I'll be right back after the break.
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Speaker 3 (13:02):
Welcome back to the Energy Mix Radio. I'm Robert ray
Pere with this week's guest, Kenny Stein. Kenny, how do
you expect federal land policies regarding all the gas exploration
to change under this administration? I know Biden had put
certain areas off limits, so I'm curious to hear your
thoughts about what will happen to open up new lands.
Speaker 4 (13:21):
Sure, and that's going to be a place that we're
gonna it's going to be a complete one eighty there.
There's there's no question that the Biden Department of Interior
has been extremely aggressive and again frankly a bit illegally
aggressive about trying to shut down energy development on federal lands. Uh,
they've put a bunch of areas of Alaska off off
(13:43):
limits as offshore leasing. Actually for for the first time ever,
they didn't have an offshore leasing plan for an extended
part of their the administration. Uh. They and they've recently
started allowing started doing leases again, but a very small
amount of land. They've also included new fees and rules
(14:03):
on on development, on drilling on federal lands. And they've
also made it more difficult to things building things like
pipelines across federal lands. They've bardbore permits, they've delayed things.
So all these things are areas where the Trump administration
is going to change things, and they'll probably do it
very quickly because again, this is another area that most
(14:24):
of those actions were administrative. They weren't passed by Congress,
so they can be reversed by presidential order pretty quickly.
So i'd expect them to open up return to some
of those areas in Alaska to leasing. The Congress has
actually mandated that in the in anwar, they're supposed to
be leasing, and the Biden administration has been refusing to
(14:46):
do so. So I would expect them to start doing
some leasing in ant war in the Natural Petroleum Reserve
in Alaska. I'd expect them to start leasing again offshore
in a big way, and then there's plenty of there's
plenty of leasing and development that's going on lands that
the permitting could be sped up, and you'll have an
attitude shift. Where right now the Department of Interior is
(15:08):
anti oil and gas development on federal lands, so everything
they do is anti Whereas you're going to have a
new administration that is going to always be pro oil
and gas development on federal lands, so that that changes
the whole outlook for what you can do and what
people might be willing to invest in. Right now, most
companies aren't really interested investing on federal lands because they
(15:31):
know it's going to be a hard slog to get
through a hostile administration. And that changes once you have
a pro development administration of pro development Secretary of Interior.
Speaker 3 (15:44):
So do you have a feel for what areas might
be most promising? Are there are all companies you know,
licking their chopped over specific areas.
Speaker 2 (15:53):
Well.
Speaker 4 (15:54):
I know there are areas of the Gulf of Mexico that,
especially the big the oil majors, would like to would
like to have more leasing and it's usually areas that
are adjacent to areas that are already developing, so they know,
they know there's resources there, they know how to get it,
they know the geology, so they're they're very interested in
doing and drilling in those areas because they already know
what's there. There's also there's already The one area that
(16:16):
has continued to have a lot of activity even in
spite of the bid administration has been the parts of
the Permian that are in New Mexico that are on
federal lands and that the I know that there has
been leasing there. But that's another place that oil companies
are very interested in investing because again they know the
resources that are there because they cross you know, they
(16:38):
have a lot of they've done a lot of work
in Texas and New Mexico on those resources. They know
they're there. And then there's some other areas that uh
that are more a little more speculative, in in Colorado,
in Utah that they're there. Again, they know there's resources there,
but the cost of getting them out and transporting them
is raised because they've got on federal lands and there's
(17:01):
a little bit further to move it. So those are
actually areas where the costs imposed by federal federal, federal
foot dragging actually make a big difference. In in you know,
in New Mexico, Uh, they can still make money even
with a hostile Department of Interior because there's enough oil there,
there's enough infrastructure already there, they can still make money.
(17:23):
But in places in Colorado and Utah, uh, it because
they need to build infrastructure as well as uh drill
the holes and develop the resources. Those added costs compound
and it makes it hard. That makes it unfavorable to
invest there. There's also some areas of Alaska that definitely
are ripe for investment. Some areas like the like offshore
(17:46):
Alaska is a little bit harder sell because it is
very expensive, but there's some onshore lands that are There's
definitely interest. So again, and part of the interest also
is going to depend on the oil price. Like if
if prices suddenly fall, then some of these projects people
are going to be interested in anymore.
Speaker 3 (18:07):
Yeah, I was going to ask that question about what
do you feel like the right price is for them
to go and you know, drill a bit more. I
think they're kind of in a spot now where they're
trying to see, Okay, where's it going from here? And
I don't know if they're going to do a lot
of expanded drilling at the current price. And what you're
feeling about.
Speaker 4 (18:26):
That, Well, yeah, that's definitely true. I mean, the price
where it is now is you know, is somewhat low,
especially especially for federal development, because federal development is more
expensive because of the regulatory hurdles. And the thing is
right now, there are plenty of options of where to drill,
Like you can go drill in the permium in Texas
(18:47):
quite easily, and you can you can make money at
current prices, so that that does limit the interest in
some of these more expensive federal areas at current prices.
And the thing is is that there's not I don't
think there's much expectation of much higher prices coming soon,
and absent something like is reel bombing around export terminals
(19:12):
or something, absent absence some sort of you know, geopolitical risk.
As far as just demand, global demand and global demand growth,
there's there's probably gonna there's gonna be some growth, but
it's going to be gradual. It's you know, it's places
like India developing that sort of thing. So there's not
a huge need for a bunch of investment to surge
(19:33):
production right now, so that that limits Now, that doesn't
mean that companies won't necessarily bid on leases on federal
land because especially for federal products, especially offshore, but even
on shore federal projects, they take a long time to
come to fruition five ten years, so they're thinking kind
of down the road on this too.
Speaker 3 (19:53):
Okay, So we'll take a quick breaker out there. After
the break, I want to get into you mentioned poplines.
I want to get into probably the most famous pipeline,
the one everybody's heard of, Keystone XL and see if
you think anything is going to happen there. And I've
got a feeling out what you're going to say there,
but we'll talk.
Speaker 2 (20:08):
About that after the break.
Speaker 3 (20:09):
With that, I'm Robert Ray Pierre to be wrapped back
with Kenny Stein on an interage mixed radio show.
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Speaker 3 (21:22):
Welcome back to the Energy Mix Radio. I'm Robert Rapier
with this week's guest, Kenny Stein. Kenny, you mentioned pipelines earlier.
I wanted to ask about the most famous pipeline, the
Keystone XL, which has been on again off again since
Obama's president. You know, Obama threw down some barriers. Trump
signed an executive order.
Speaker 2 (21:39):
To speed it up.
Speaker 3 (21:40):
Biden threw down barriers and canceled it, and I think
TC Energy at the time said Okay, we're done, We're out,
and I think Trump on the campaign trail said, hey,
I'd like to get that going again.
Speaker 2 (21:50):
What are your thoughts on that.
Speaker 3 (21:51):
I mean, I think it's dead, but you know, people
still ask me about it all the time.
Speaker 4 (21:56):
Sure, yeah, Bill, it became a political football, you know, unfortunately,
but yeah, it's almost certainly dead again. As you said,
the company behind the pipeline has said they're done with it.
They there's many billions of dollars that they've redirected, and
that's not just sitting there waiting to complete the project.
The other thing is that the American sections of the
(22:17):
pipeline were all built and completed and our in use,
so there's not the economic need for it is not
necessarily as clear cut today just because things have changed.
US production has has surged all nearly doubled I think
since the pipeline was first proposed, So it's a different
(22:38):
landscape today. But there are the thing is and the
other problem is that you have the ongoing problem of
needing a permit to cross the border, in the international border,
and unless Congress fixes that problem, I'm not sure there's
any company that's going to ever want to risk that
kind of that kind of permit being withdrawn again the
way Biden, which is what Biden did when he came
into office. So Congress and the really needs to fix
(23:00):
that underlying problem. But there are other pipelines that cross
the US Canada border. There's a fight in Michigan, I believe,
about basically repairing an old pipeline, trying and trying to
upgrade it to modern standards, and that's getting caught up
in this cross border permit fight too. So even though
the Keystone pipeline itself most likely is never going to
(23:20):
come to fruition, it is it is emblematic of the
problems of building pipelines between the US and Canada and
US and Mexico, which all three countries are major energy producers,
and having an integrated energy system between all three it
helps with efficiency, it helps with economic growth for all
of us, and it's a good thing. But to Keystone
(23:41):
has just sort of showed how a hostile administration two
different hostile presidents can interfere with the functioning of that market.
Speaker 3 (23:51):
So on the flip side, do you think Trump is
going to be able to clear some of those barriers
out and get those problems resolved?
Speaker 4 (23:58):
Certainly some of them, some of them, you know, the
the permitting issues on federal land, that is something he
can change immediately. Obviously he can. He can grant cross
border permits when he's president. But then you need he'd
probably if the Republicans in Congress can you know, get
themselves organized, they can, they can change that underlying law,
and I'm sure he'd sign, you know, he'd sign uh
(24:18):
legislation that fixed that cross border permitting issue. But there
are some permitting issues that are not necessarily subject to
easy fixes, even no matter how much the Trump administration
would want. One of the big problems with pipelines is
that is state opposition. So the like for instance, New
York State will not allow a gas pipeline to be
built across the state from Pennsylvania to New England, even
(24:41):
though New England has a huge need for natural gas.
And that is that the ability for states to block
that is kind of written into federal statute. Now that's
kind of how the Clean Water Act is meant to work.
States are supposed to be the primary regulators. So there
are some there are some regulatory opportunities that the Trump
Mission administration can try to do to to make it
(25:03):
clear because the thing is under the clean water states
aren't supposed to just say no, they're really they're really
supposed to. They can say you need to do X,
Y and Z to make sure our water is kept clean,
but they're not really supposed to be able to ban
things crossing the state. This isn't that becomes an interstate
commerce issue. So there's a regulatory opportunity to clarify that
and make it like force these states to say why
(25:27):
instead of just like refusing to do anything, they have
to say, you know what can be done to fix
whatever their objection is. But you're still fundamentally if this
state resistance, the state is allowed to resist some of
these things. And that that is a big problem with
pipelines in this country. And you know that's a that's
(25:48):
a persuading the voters of these states that pipelines are
are beneficial in help.
Speaker 2 (25:53):
Okay, we need to take a quick break.
Speaker 3 (25:55):
There after the break, I want to talk to you
about your organizations and what you do. And you know
what your priorities are over the next four years. I'm
Robert Rapier with Energy Mix radio show. I'll be right
back with Kenny Stein.
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Speaker 3 (27:22):
Welcome back to the Energy Mix Radio. I'm Robert Rapier
with this week's guest, Kenny Stein. Kenny, let's talk a
little bit about the organizations you're affiliated with. How do
you plan to influence energy policy over the next four years.
What specific initiatives will you prioritize.
Speaker 4 (27:37):
Yeah, So the our organization, one is the C three,
and one is a C four, And so that's just
in irs terms. The C three is more of think
tank and does research and education, whereas a C four
actively in luck gets itself involved in, uh, you know,
supporting specific legislation or that sort of thing. So, uh,
when when we talk about those two organizations, obviously what
we're doing is different depending on the the capabilities of
(28:01):
the organizations, but just in general, it's that there's gonna
be a couple a couple major things that we've We've
been very focused on the Biden administration's attempts to subsidize
and mandate electric vehicles. So there's there's several interlocking regulations
that that into that combined we refer to as the
ev mandate, even though each individual one isn't necessarily a
(28:23):
mandate together the way they work. So that's the fuel
economy standards, that's California waivers UH for their clean Cars program,
and then the tailpipe emission standards. So getting those regulations
UH basically withdrawn and replaced is going to be a
major focus for us UH. We've already talked about pipelines,
(28:43):
but fixing some of the permitting issues that affect not
just pipelines, but but all development on federal lands. And
it's especially talking about the National Environmental Policy Act, which
makes it hard to build really anything. It's not just
not just energy. You know, highways, homes are harder to
build because of NEPA, So getting some sort of reform
out of that, which that probably needs congressional action. And
(29:06):
then there's also just we've talked about the improving the
environment for investment on federal lands. That is that is
a huge part of what we hope and will be
encouraging the Trump administration to fix because a lot of
damage was done in a short period of time by
the Biden administration. So are there particular.
Speaker 3 (29:26):
Radiatory barriers which you believe need urgent reform to promote
energy innovation and affordability.
Speaker 4 (29:32):
Well I mentioned in NEPAY the National Environmental POSSEAC. That
is enormous, especially because the NEPA legislation that was actually
passed by Congress is only a few sentences. It's very vague.
It just means you need to think. It just says
you need to think about environmental impacts of things that happen.
But we have this huge body of judicially created law.
(29:52):
This is judges and appeals courts creating all sorts of
standards and rules and requirements for environment assessments. There's this huge,
massive regulatory burden that again is on any any anything
you want to build in the United States. This is
what Trump was referring to a couple of days ago
when he said, if you have a billion dollar project,
you should be exempted from NEPA regulations. That it's a
(30:14):
it's a huge problem for everything, for semiconductor plants, for
you name it. So reforming that is would be huge.
It would make enormous difference for just the entire economy.
And again, it's not just energy that NEPA effects. It
affects affects anything you want to build in the United States.
So it's it's a major it's major, and it's major
league damaging.
Speaker 3 (30:34):
So what do you think is going to happen with
the current efforts on decarinization and addressing climate change?
Speaker 2 (30:40):
You see that all going by the wayside. Is some
of that going to continue? How do you think Trump's
going to approach this?
Speaker 4 (30:46):
Well, there's there's The Trump administration obviously is not interested
in pursuing any of that stuff, and we'll toss most
of it. But the great, uh, the interesting thing that
at least for me to see in the last year
or two is that the private sector is also abandoning
many of these things because of the demand growth in
electricity demand, particularly from data centers in AI. All these
(31:08):
big investment firms, all these tech firms that for years
had been talking about one hundred percent renewables, we want
to go green. These utilities that we're saying we're going
to eliminate coal by twenty thirty or twenty thirty five,
suddenly that everybody's dropping these pledges because what they need
is reliable, abundant electric electricity supply, and the only place
(31:28):
to get that from is natural gas. So I've actually
I think a lot of the climate hysteria that has
been whipped up for it's been ten plus years now
that this has been going on, I think a lot
of that is going to fall by the wayside, because ultimately,
if you want to have these data centers in the
(31:49):
United States, if you want to build more manufacturing, or
build these the battery plants even that are being subsidized
by the Inflation Reduction Act, all those things require and
normal amount of energy, an enormous amount of electricity. And
the way you get that in the United States is
from our using our cheap natural gas to do it.
Speaker 3 (32:09):
Yeah, I agree.
Speaker 2 (32:10):
I think you know.
Speaker 3 (32:12):
I'm somebodyho's worried about carbon emissions for sure, But at
the same time, I recognize where they're coming from increasingly
is Asia Pacific that region, and we can hamstring ourselves
and that's not going to help produce carbon emissions because
the reason they're climbing is Asia Pacific is steadily steadily rising.
(32:32):
So yeah, I'm on board there. I've looked at a
lot into Chris Wright's position, Donald Trump's secretary nominee for
Secretary of Energy, because he was called a climate denier
and I dug into that a little bit and I
found out his position basically the same as mine. You know,
he acknowledges rising carbon emissions and says there's not a
lot we can do about it with the situation as
(32:53):
it is with you know, Asia and you know Chinese
cold consumption cloud every year right well.
Speaker 4 (33:01):
And also the other thing is that for whatever negative
emission neggative outcomes there may be from rising temperatures, what's
the better way to tackle that to be a wealthier
society that is able to afford mitigation managures, or to
harm our economy and be poorer and still face the
negative consequences of rising temperatures. So like that that rising
(33:23):
prosperity and rising wealth helps us tackle whatever might come
from those rising temperatures.
Speaker 3 (33:30):
So what do you see any areas for backpartisan cooperation?
I mean, are there are there democratic priorities that Republicans
would get on board with or some Democrats get on
board with some of the Republican priorities.
Speaker 4 (33:41):
So there's not a lot. As I said at the
start of the top of the program, there this is
a very very polarized by party area of policy. There's
there's a few places that the there are some Democrats
that acknowledge some of the permitting issues that I've that
I've already talked about the problems there, and there are
open to some changes. Now how significant they're willing to
(34:04):
agree to, I don't know. But then there's also areas
of like electricity transmission. I know there's some bipartisan sentiment
on that, but even where it's bipartisans, it's a few
a handful of Democrats, it's not a lot.
Speaker 3 (34:18):
Okay, we need to take a quick break route there
and going into our final segment. Got a few questions about,
you know, oil production records and what you expect to
see oil production laves over the next four years. So
we'll be right back with Kinni Stein on the Energy
Mixed Radio show.
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Speaker 3 (36:12):
Welcome back to the Energy Mix Radio. I'm Robert ray
Pere with this swek's guest Kenny Stein. Kenny, it looks
like we're about to set a new old production record
for the second straight year. Natural gas also should be
at a record high, but in recent months it looks
like production gains for both are slowing. I think the
EIA has said recently that they see that flattening out.
(36:32):
What are your expectations for next year production wise, and
how will this be affected in the short term by
anything President Trump can do or will this be affected
by anything he can do?
Speaker 2 (36:43):
Yeah?
Speaker 4 (36:44):
Sure. The one thing to say at the start is
that that both oil and natural gas in the United
States have have kind of separated. Their prospects are different now.
In the past they moved together, but because because of
the huge growth of domestic natural gas production and the
growth of LGX sports, the prospects for natural gas have
changed versus oil. So, you know, I certainly see oil
(37:07):
production flatateauing a bit in the United States, but that's
partly because our our growth has been like so astronomical
the last couple of years. That's impossible to state it's
a state because global global demand just is not rising
at that rate. So in the United States, you know,
at some point we get to the point where we're
not our oil production is not can't can out compete.
(37:31):
You know, oil is going to continue to be very
cheap to produce in Saudi Arabia. You know, we we
can produce cheaper than in Venezuela or Brazil or some
of the other places. But we're not going to take
over one hundred percent of the global oil market. We
can't produce that cheaply. So eventually, at some point we
hit a we hit a ceiling where we were producing,
you know, a certain percentage of the global demand. Natural gas.
(37:54):
On the other hand, I would expect it to continue
to rise just because the the cheap natural gas domestically
is helping to boost demand for natural gas. We already
talked about the electricity needs of natural gas data centers.
That's that's how these companies are planning to power data
centers in the short term is more natural gas generation.
(38:15):
They'd like to have nuclear, but that's you know, in
the future, it takes many years to get there, so
they're going to need natural gas for that development. There's
also been industrial investment in the United States that has
come here because of our cheap natural gas, that's going
to continue to drive demand. And then you also have
the growth of LG export capacity that's going to continue
(38:35):
to drive demand growth to production growth in the United
States because any that is not used here has a
ready export market, especially Asia, but also to a lesser extent, Europe.
So I'd expect natural gas to continue to grow in
an oil at some point oil is going to plateau
just because of the realities of the global oil market
(38:56):
and the way the way things move. As far as
the Trump administrations impact on that, the it'll it'll, it'll depend.
But the thing is most oil and natural gas production,
most of that production growth we've seen in the last
ten years has been on state in private lands, so
the federal government doesn't have that much control over that,
other than some of the regulations that the Trump that
(39:18):
the Biding administration is trying to impose, for example, all
the method regulations that I mentioned earlier that raises the
costs of domestic productions. So fixing some of those problems
could make it a little bit cheaper to produce the
United States, but it's probably not going to have enormous impacts.
The one thing that the Trump administration could have, and
this is a bit because global oil prices are to
(39:41):
a certain extent are kind of set by vibes like
actual production matters, but expectations of future production, expectations of
you know, future demand, drive a lot of the price movements.
And having a new administration come in that is affirmatively
pro oil development, that can affect future expectations of oil prices,
(40:03):
and it could dry it could you know, it's not
going to drive down oil prices massively. I know the
President Trump and the campaign said he wanted to reduce
gas prices by half. That's not really realistic, but a small,
a small decrease in the oil price because of the
expectation the United States is going is going to be
easier and cheaper and faster to produce in the United
States if there ever is a price spiker, there ever
(40:26):
is a demand need, that can materially affect oil prices
and bring them down slightly. Now, of course, as we've said,
low oil prices aren't necessarily great for domestic oil production.
But again, if the the what the president, what the
administration can do is clear out some of those barriers
so that when oil prices move, US producers can respond
(40:49):
quickly to it, rather than you know, it taking five
years to get a permit to drill on federal lands.
Speaker 3 (40:56):
So several people have asked me about what's going to
happen with the electric be and I typically I would say, well,
I don't think there's going to be as much support
for them, But Elon Musk is kind of the wild
card here with Trump's ear, I don't really have a
good feel for how that's all going to play out.
Do you have any thoughts on that?
Speaker 4 (41:13):
Well, what's interesting is that Musk has already said that
he doesn't mind eliminating the electric vehicle tax credit. And
this is he because he thinks that Tesla will outcompete
his competitors in the absence of that credit, So he
actually has said he doesn't mind eliminating that. Now, when
it comes to some of the other components of the
Biden's ev mandate, the tailpipemission standards and the fuel efficiency things,
(41:37):
I don't know that he'd be that enthusiastic about eliminating those,
because that's where a lot of Tesla advantage comes from.
Tesla Tesla makes a lot of its profits from selling
credits in the California Emissions vehicle emissions trading system. So
you know, if he's not probably not going to want
to go after the California waiver. So yes, he is.
(41:58):
He's very much the wild card. But the the he
there's there is a pretty broad consensus in the Republican
party as I was talking about where consensus is, the
Republicans dislike anything that's macs of an electric vehicle mandate.
So there's there's a consensus of going after that stuff
and dialing it back. And look, electric vehicles aren't going anywhere.
(42:21):
They they are a part of the market and for
for a certain type of person, certain types of uses,
they make a lot of sense, but they're they're a
niche product there. They're not going to be one hundred
percent in anything resembling a free market. They're not going
to be one hundred percent of of of either passenger
vehicles or certainly not trucks. But you know, you know,
ten percent of the market, fifteen percent of the market
(42:42):
that I think that's very very should absolutely expect that
regardless of government policy.
Speaker 3 (42:49):
You know, I never hear Trump talk much about nuclear power.
Speaker 2 (42:52):
Do you see them doing anything.
Speaker 3 (42:54):
There is there any appetite for you know, stripping away
uh you know red type there and get nuclear power
plants built.
Speaker 4 (43:01):
Well, that's actually something I didn't mention before we were
talking about bipartisan opportunities. There's actually there are both Democrats
and Republicans who aren't who want nuclear power to play
a bigger role because because for people who care about
greenhouse gas emissions, nuclear has no greenhouse gas emissions. For
people who want reliable power, nuclear is perfect for reliable power. So, uh,
there's definitely there is bipartisan consensus. There's actually some legislation
(43:24):
that's just passed to try and try and fix the
Nuclear Regulatory Commission a little bit. But that's definitely an
area where you could see some more legislative and regulatory
action for sure. Okay, Kenny, we have about a minute left.
Speaker 3 (43:37):
Can you tell us for anybody who wants to know
more about what you're riding, what you're working on, where
people can find you.
Speaker 4 (43:44):
Yep, the website websites EASi, it's is it TWOE for
Energy Research dot org?
Speaker 2 (43:48):
And what stories you're working on right now? What issues?
Speaker 4 (43:52):
Well, the big thing, like I said, it's electric vehicles
is the big thing because the new incoming administration, there's
a lot. We just issued a report about the limitations
of the electric fitforced electric vehicle transition that we hope
will influence on some of the regulatory actions that the
new administration is going to take.
Speaker 3 (44:09):
Okay, excellent, Well that's all about all the time we
have the show. Excellent conversation. Appreciate your insights. I want
to thank this week's guest Kenny Stein, for being on
the Energy Mix Radio and we would love to have
you back again sometime.
Speaker 4 (44:22):
Thank you for having me.
Speaker 1 (44:23):
The Energy Mix Radio show is where we explore topics
that affect us all in the oil and gas industry.
Every week, our host will interview the movers and shakers
in this fast paced industry. You'll hear from industry experts,
elected officials, and many more on the Energy Mix Radio Show.
Speaker 6 (44:40):
Farmers and ranchers are the hardest working people on Earth
and deserve a side by side vehicle that works just
as hard. That's why Yamaha mixed the Viking in all
new Viking six, the world's first true three and six
person UTVs assembled.
Speaker 1 (44:54):
In America, ranked number one in drive train durability Viking
outworks and out classes the competition, and features comfort and
off road capability. For more, visit Yamaha Viking dot Com.
Speaker 6 (45:06):
Most dependable claim based on a twenty thirteen Yamaha Source
side by side owner study
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