Today’s Key Takeaways: Loss of people hurting energy agenda. Full steam ahead for AKLNG. U.S. losing critical minerals battle to China. Don’t reverse momentum Alaska.
OIL:
Musk’s Layoffs Shrink Workforce Needed for Trump’s Energy Dominance Agenda
Pipeline & Gas Journal, March 15, 2025
The Trump administration’s mass layoffs of federal workers have slowed the government’s ability to permit some new energy projects in a potential setback to President Donald Trump’s ‘drill, baby, drill’ agenda, according to state officials, lawmakers and agency representatives interviewed by Reuters.
The situation reflects one of the unintended consequences of the spate of firings spearheaded by Elon Musk’s Department of Government Efficiency, which are intended to slash wasteful public spending but current and former officials say are running counter to Trump’s vow to expand production of everything from oil and gas to power generation and electric transmission. That strategy was partly detailed in a series of executive orders signed by the president to open vast new areas of Alaska and offshore for new drilling.
The cuts since mid-February have hit employees at agencies that play a crucial role in the process needed to issue permits for new federal and tribal energy production, including the Bureau of Land Management, the Bureau of Indian Affairs, and the Bureau of Ocean Energy Management.
“Streamlining organization charts in an effort to make government more efficient will not impact the President’s Drill Baby Drill agenda, and any hyperventilating about cutting waste, fraud, and abuse is irresponsible,” said White House spokesperson Harrison Fields.
Permitting has slowed in some of the nation’s top-producing oil and gas states, like New Mexico and Alaska, as well as among Native American tribes that rely on fossil fuel extraction for revenue for public services like schools, Reuters reporting showed. While federal lands and waters account for nearly a quarter of total U.S. oil output and generate public revenue in the form of production royalties, it is not clear how much new production has been affected by the job cuts. Overall the U.S. produced an average of 13.23 million barrels per day (bpd) in 2024, according to the Energy Information Administration.
“I don’t understand these broad cuts,” said Mike Celata, who served as BOEM’s regional director for the Gulf of Mexico for seven years, including during Trump’s first term. “You’re talking about an agency that essentially has brought billions of dollars of revenue into the Treasury.”
The process of rigorous environmental reviews is critical to insulating government oil and gas auctions and drilling programs from litigation that can derail fuel producers’ plans, Celata added. Lawsuits on behalf of environmental groups have delayed or canceled many energy projects, leases and drilling auctions both onshore and offshore in recent years.
“You’ve got to follow that process,” he said. “Loss of people becomes a problem.”
GAS:
CERAWeek: Alaska LNG Pressing Full Steam Ahead
Julianne Geiger, OilPrice.com, March 14, 2025
Alaska’s LNG project is back in the spotlight with a new aggressive timeline: first exports by 2030. Bold? Absolutely. Realistic? Yes, according to Governor Mike Dunleavy speaking at CERAWeek.
The $44 billion venture would move 3.5 billion cubic feet per day from the North Slope down an 800-mile pipeline to an LNG terminal, shipping out to eager buyers in Asia. According to Dunleavy, interest is strong from Taiwan, South Korea, Japan, and Thailand—markets that have been hungry for stable, long-term LNG supply.
In February, for example, Taiwan expressed interest in buying Alaskan LNG as a way of avoiding tariffs—shortly after Japan—the world’s second-largest LNG importer—had done the same.
For now, the project has Washington in its corner. It got the go-ahead in Trump’s first term, made it through the legal wringer, and now Trump’s back, bringing fresh support. Energy Secretary Chris Wright is even dropping hints about federal loan guarantees.
It is the only federally permitted LNG export facility on the U.S. West Coast, offering direct, canal-free shipping via uncontested waters to Asian markets, the Alaska Gasoline Development Corporation has said.
President Trump said of an executive order he signed on Day 1 that it would unleash “Alaska’s extraordinary resource potential,” which includes prioritizing “the development of Alaska’s LNG potential, including the permitting of all necessary pipeline and export infrastructure related to the Alaska LNG Project, giving due consideration to the economic and national security benefits associated with such development.”
But will investors bite? The LNG market has had its ups and downs, and while Asian demand is solid, developers still need to justify the sky-high capex. Dunleavy’s optimism is one thing, but until the dollars start flowing, the 2030 target remains just that—a target.
MINING:
Why the U.S. Keeps Losing to China in the Battle Over Critical Minerals
Jon Emont, The Wall Street Journal, March 10, 2025
The West got its hands on one of the world’s best graphite mines—then things started going off the rails
When mining executive Shaun Verner first visited his company’s graphite deposit in Mozambique in 2017, he felt sure he had a winner.
His goal: to challenge China’s dominance over the world’s supply of a critical mineral used in everything from electric vehicles to submarine hulls.
Backed by more than a hundred million dollars of U.S. government financing, Verner and his Australia-based company, Syrah Resources, opened the Mozambique mine and built a graphite-processing plant in Louisiana, the first of its type in the U.S. It also signed a sales deal with Tesla, which has historically bought graphite for car batteries from China.
Then things started going off the rails.
China, which provides more than 90% of the world’s battery-grade graphite supply, jacked up its production, flooding the market and driving prices so low that Syrah couldn’t mine profitably. Last May, the Biden administration delayed new rules that would have penalized U.S. users from buying Chinese graphite. In Mozambique, farmers resettled from Syrah’s mine staged protests, shutting down the mining.
Syrah’s Louisiana plant, now open for a year, has yet to make its first commercial sale. Syrah’s stock has plunged by around 90% since the start of 2023.
POLITICS:
Don’t reverse momentum, Alaska
Joe Schierhorn, Jim Jansen
Alaska’s North Slope is finally booming with activity and Alaska is in the midst of an oil production revitalization. Several veteran and newer industry producers have spent billions on maximizing oil and gas recovery from legacy fields like Prudhoe Bay and on developing new major oil fields to the west such as Willow and Pikka.
In our view, the major reason Alaska is benefiting from these significant investments is that our oil and gas taxation system has remained stable for the past 12 years, giving the producers the tax predictability they need to make investment decisions. They already deal with the fluctuating price of oil, the risk of finding and producing economically viable oil fields, and the challenges of transporting that oil to market.
Why would we send a message to these companies who invest in our state that our tax policy is unstable and not competitive, thus adding to their list of risk factors? That is what SB 112 would do. Raising the production tax as proposed in SB 112 is the wrong thing to do if we want to continue to encourage more exploration and development.
Alaskans have consistently said no to oil tax increases at the ballot box over the past 11 years. We have responsibly decided that attracting investment requires fair and competitive taxes. We understand that investment in oil production is critical to our economic future.
Our current tax regime is the result of many years of work with detailed analysis by internationally recognized consultants and is working the way it was intended.
Over the next five or so years, new production will bring significant new revenue to state and local governments and maintain the viability of the Trans Alaska pipeline further into the future.
Things are going well for us now, and the last thing we want is to reverse the momentum that got us here!
Please reject SB 112 to avoid the inevitable reduction of oil production and economic losses to our State.
Joe Schierhorn, Chairman, Northrim Bank and Co-chair, Keep Alaska Competitive Coalition
Jim Jansen, Chairman, Lynden and Co-chair, Keep Alaska Competitive Coalition
The Keep Alaska Competitive Coalition is a broad-based group of Alaska Natives, Unions, businesses and individuals who care deeply about the economic future of our state and understand that Alaska’s future depends directly or indirectly on the economy created by a vibrant oil industry.