Today’s Key Takeaways: Emissions rose in 2021 but are still below 2019 levels. Oilfield services and equipment sector has recovered more than half of jobs lost to pandemic. American LNG may be the cure. Long lab turnaround times threaten 2022 mineral exploration in Canada and America. Alaska submits intent to apply for orphan well grants.
NEWS OF THE DAY:
From the Washington Examiner, Daily on Energy:
2021’S RISE IN EMISSIONS: Total U.S. greenhouse gas emissions rose by an estimated 6.2% in 2021, according to researchers with Rhodium Group, with a boost in coal-generated electricity “largely” responsible.
Coal-fired power generation increased 17% last year, making for the largest such increase year over year since 2014, per Energy Information Administration data.
Rhodium found the largest increase in emissions to have occurred in transportation — already the largest single sector emissions source — due to high demand for freight transportation of consumer products and an increase in passenger travel.
“In 2020, due to the economic impacts of the COVID-19 pandemic, emissions fell to 22.2% below 2005 levels. In 2021, US emissions ticked up to 17.4% below 2005 levels,” Rhodium said this morning in a note detailing the emissions estimates.
Importantly, despite the rise, emissions in 2021 did not reach 2019’s levels, although they set the nation back relative to President Joe Biden’s goal of cutting emissions by at least 50% by 2030.
Oilfield employment climbed in December despite cooling U.S. job market
World Oil, January 10, 2022
Employment in the U.S. oilfield services and equipment sector rose by an estimated 7,450 jobs in December, despite the slow hiring in overall U.S. jobs, according to preliminary data from the Bureau of Labor Statistics (BLS) and analysis by the Energy Workforce & Technology Council (Council). Gains were made in oil and gas extraction, as well as machinery manufacturing.
The 1.1% growth in December comes as overall U.S. job growth underperformed against analyst’s expectations. After hitting a peak of more than 109,000 pandemic-related job losses in February 2021, the oilfield services and equipment sector has regained an estimated 62,289 jobs, according to BLS data. This brings the total pandemic employment losses to 47,172 jobs, resulting in $5.6 billion lost in annual wages.
“As oil demand has pushed higher, it’s heartening to see continued job growth in the sector,” said Energy Workforce & Technology Council CEO Leslie Beyer. “The sector has recovered more than half of the jobs lost to the pandemic, and we expect continued growth in 2022.”
Using BLS data, the Council, in consultation with researchers from the Hobby School of Public Affairs at the University of Houston, found that reductions were heaviest in April 2020, when the sector shed 57,294 jobs — the largest one-month total since at least 2013. Sector employment grew at an average monthly rate of 0.6% in 2021 as companies have maintained focus on reducing debt, repaying investors, and investing in research and development.
The Council is the national trade association for the energy technology and services sector representing 600,000 jobs in the technology-driven energy value chain. More than 450 member companies are involved in energy equipment manufacturing, drilling, well completions, well services, pressure pumping, renewable energy technology and servicing, geothermal development, and more. The innovative men and women who comprise this sector are leaders in developing and deploying innovative technologies on a global scale that increase efficiency, improve environmental performance, and reduce greenhouse gas emissions.
Below are the top states for employment in the energy technology and services sector, and estimated job gains in December 2021 compared to the same month in 2020, according to BLS data:
- Texas — 321,304, +21,924 jobs
- Louisiana — 51,300, +3,757
- Oklahoma — 50,177, +3,424
- Colorado — 26,770, +1,827
- New Mexico — 24,660, +1,683
- California — 24,132, +1,647
- Pennsylvania — 23,869, +1,629
- North Dakota — 20,506, +1,399
- Wyoming — 15,297, +1,044
- Ohio — 10,945 +747
- Alaska — 10,220, +697
- West Virginia — 10,088, +688
Energy technology and services sector employment is estimated by analyzing data published by the U.S. Bureau of Labor Statistics and covers the economic activities of energy technology and services companies, which include oil and gas extraction, construction, and manufacturing. Total employment is estimated using the Quarterly Census of Employment and Wages, published by BLS, and jobs data reported by BLS monthly. Note: BLS data is preliminary for the two most recent months and is subject to revision. The Council incorporates monthly totals according to BLS corrections and updates the statistical model quarterly.
Note: BLS data is preliminary for the two most recent months and is subject to revision. The Council incorporates monthly totals according to BLS corrections and updates the statistical model quarterly.
American LNG and Polish Diversification of Supplies
Warsaw Institute, January 10, 2022
In December 2021, gas prices in Europe increased dramatically, even several times within a few days. The sudden change was caused, among others, by the reduction of the transit of the Russian gas via the Yamal gas pipeline, which runs through Poland and supplies Western Europe. The American LNG may turn out to be the cure for shortage.
On December 21, 2021, the January benchmark Dutch TTF contract hit €181 per MWh, while only a day earlier it reached €146.9. This was caused by significant cuts in gas supplies from the Russian Federation. At times, only 4% of the total volume of the Yamal pipeline was used – it stretches over 4,000 km (2,485 miles) and crosses the borders between Poland and Belarus as well as Poland and Germany. According to the Russians, it was necessary to replenish the storage, but the Kremlin is probably trying to influence European countries with the cuts, showing the real dependence of Europe on the supplies through the Nord Stream 2 pipeline, which is opposed by many interest groups across the European Union. Germany would become the main beneficiary of the pipeline, importing up to 110 billion cubic meters, or bcm, (3.88 trillion cubic feet, or tcf) from Russia annually. Poland’s western neighbors are willing to finish the project, mainly due to economic reasons, and are still at the impasse with the implementation of the Energiewende policy, which assumes the abandonment of nuclear and coal energy sources in favor of the “green” energy. The Nord Stream is a cause for concern not only due to the Russian influence on the European gas market, but also because of the political and strategic pressure. This situation is monitored by the White House, which is not happy with Putin’s moves, however, Biden’s counteroffensive was ineffective, and it is hard to consider any of the American moves as decisive.
Another action of the Russians took place on December 21. Supplies were halted and gas transit through the Yamal pipeline started in the other direction – from Germany to Poland. The real assumptions of the contract which caused this state of affairs remain unknown, but it is worth recalling the words of Andrzej Szczęśniak, a Polish fuel market and security expert, who argued on the RMF FM radio that the Russian Federation is in fact marginalizing the Yamal pipeline and that most probably it will be almost entirely abandoned after Nord Stream 2 is pushed through, thus becoming a backup infrastructure.
The US reacted very quickly to the gas price turmoil in Europe by sending there 10 LNG tankers, Bloomberg correspondent Stephen Stapczynski reported. The main reason that convinced the Americans to act in such a way was the favorable selling price in the upcoming month at the very least since the Russians announced that supplies would be limited also in January 2022. The scale of the energy crisis in Europe is well illustrated by the difference in gas prices – LNG is even 13 times cheaper in the United States than in Europe.
On December 30, one of the American tankers, containing an unspecified amount of LNG, docked at the Świnoujście gas port (Poland). According to 300gospodarka.pl, PGNiG (Polish Oil Mining and Gas Extraction) regarded the American delivery as an element of a long-term cooperation. “New, larger gas deliveries from the US will start in the following years. The contracts with American and Qatari companies guarantee the annual LNG deliveries of at least 12 bcm (0.42 tcf) after regasification.” Already in Q2 2021, PGNiG stated that as a result of annexes to the agreements, the volume of LNG deliveries from Venture Global Plaquemines LNG, LLC and Venture Global Calcasieu Pass, LLC will amount to 5.5 million tons of LNG on an annual basis, which translates into 7.4 bcm (0.26 tcf) of natural gas after regasification. The previous agreement provided for the delivery of two million less LNG every year, which indicates a strong growth under the new arrangements and a proper identification of an increased demand for gas. The extension of the agreements is a good sign of an effective implementation of the diversification of gas supplies. For example, in 2019, natural gas from the East accounted for 60.2% of the entire structure of PGNiG’s imports, while LNG imports amounted to 23.1%. The former figure constituted a decrease by as much as 6.6 percentage points compared to 2018.
In response to the existing supply problems, PGNiG gave a comment to 300gospodarka.pl: “It is clear (…) how year by year LNG imports are growing and imports from Russia are falling, although, according to the provisions of the so-called Yamal Contract, we are obliged to buy a certain amount of Russian gas on a take or pay basis.” The current Yamal Contract ends in 2022, which theoretically may cause certain problems for the Polish economy, however, alternative solutions are effectively being sought as a part of the diversification of supplies. The main initiative that may relieve Poland from the pressure of Russian suppliers is the Baltic Pipe, connecting Norway, Denmark, and Poland, but American supplies may become the remedy, at least partially. The Baltic Pipe is expected to have the capacity of 10 bcm (0.35 tcf) per year. According to PGNiG, Poland will benefit the most from this cooperation.
The growing demand for gas is linked to the energy transformation, PGNiG CEO Paweł Majewski pointed out in a press release. As the changes in the energy industry are pan-European and Russia remains the main supplier of gas in Europe, we can expect the escalation of pressure from Moscow. Nord Stream 2 may be both a geopolitically dangerous weapon and an unavoidable project for Western economies. The solution may be the increased activity of the decision-makers from gas producing countries in our region, the ones that are independent from Moscow. Nevertheless, it is doubtful whether Putin will abandon intrigues connected to the finalization of the gas pipeline.
Assays are still pending going into 2022
Shane Lasley, North of 60 Mining News, January 7, 2022
Historically long lab turnaround times threaten to weigh on 2022 mineral exploration across Alaska and Canada.
Assays are pending, the unofficial slogan of the 2021 mineral exploration season across Alaska and Canada’s North, is a phrase that continues to echo in a void left by the lack of drill results going into the new year.
“‘Assays pending’ has become one of the least popular phrases around the industry this year, given the painfully slow turnaround time at the labs,” Tectonic Metals Inc. President and CEO Tony Reda penned in a year-end update on the Vancouver, British Columbia-based exploration company and its Tibbs gold project in Alaska. “In some ways, the Tectonic team feels like kids eagerly anticipating Christmas as we wait for assays.”
And, like the kids who had gifts stuck on a ship adrift in the Pacific Ocean on Christmas morning 2021, the team at Tectonic and dozens of other companies exploring the mineral potential across the North of 60 Mining News coverage area enter 2022 awaiting the bulk of their assay results to be delivered.
“As I write towards the end of December, we are still waiting on Phase II results, 85% of our assay results from the past season,” Reda penned.
This slow-boat delivery of assays from North American assay laboratories creates numerous dilemmas for exploration companies that often depend on results to help guide drill targeting during the course of a five-month summer exploration season across Alaska, Northern BC, and the Canadian territories.
And these explorationists always rely on the lab analysis of the core drilled to demonstrate to financiers that millions of dollars invested in the past are turning up economically viable mineral deposits, and future investments are warranted.
The unprecedented slow assay turnaround times of 2021, however, are not just relegated to junior companies hoping to have a story to tell when global mining conferences such as the AME Roundup in January and PDAC in March arrive. When the calendar flipped to 2022, Victoria Gold Corp., operator of the largest gold mine in the Yukon, had yet to release any results from an exploration program that got underway in late May.
“Delayed laboratory results are an annual challenge in our industry. However, this year has been much worse than usual,” said Victoria Gold President and CEO John McConnell.
Now, with most companies still waiting on assays going into the new year, this extraordinarily long delay is threatening to create a domino effect that could weigh on the 2022 mineral exploration season across Alaska and northern Canada.
“Investors buy explorers for results. When those results are super slow, investors get impatient or even anxious – ‘Is the delay because the hole was actually a dud?'” Gwen Preston, better known as the Resource Maven, penned in an article on slow assay turnaround times. “The market also knows that the longer it takes to get results from a hole in Yukon or Alaska or Northern BC, the less time the company will have to drill follow up holes into a discovery.”
Backlogs at assay laboratories are nothing new for mineral explorers in the North of 60 Mining News coverage area. In fact, the ability to completely overwhelm the sample preparation facilities and assay labs with more samples than they can handle is a badge marking a robust exploration season.
While 2021 earned such a badge, the massive assay backlog goes beyond the more than 1 million meters (1,000 kilometers or 620 miles) of core from drilling mineral exploration projects across Alaska, Northern BC, Yukon, Northwest Territories, and Nunavut that was delivered to labs for analysis during 2021.
North America’s assay lab infrastructure, which has never been nimble enough to adjust to the fluctuations of mineral exploration driven by capital markets and the seasonality of exploration in Alaska and Northern Canada, was further hampered during 2021 by COVID-related restrictions and a chronic shortage of labor, especially at sample prep facilities.
At least one Alaska-focused junior exploration company, Nova Minerals Ltd., took the initiative to help relieve some of the pain caused by slow turnaround times by building an independently operated assay prep facility at its Estelle gold project.
“While assay lab turnaround times and supply chain disruptions continue to frustrate, the newly commissioned on-site prep-lab is already helping to alleviate some of the challenges in relation to assay turnaround,” said Nova Minerals CEO Christopher Gerteisen.
This proactive move has significantly lessened the wait for future-altering assay results.
By October, Nova announced that one hole drilled at its RPM discovery cut 373 meters averaging 3.8 grams per metric ton gold. The fact that the Australia-based gold explorer received assays from this, and five other holes drilled at RPM, four short months after drilling began at this discovery target, is nearly as impressive as the long section of robust gold encountered in this hole.
Shortly after receiving all the assays from 2021 RPM drilling, Nova published an inaugural 23.1 million metric tons of inferred resource averaging 2.8 g/t (1.5 million oz) gold for the newest deposit at Estelle.
“This has really changed the future for Nova and our shareholders,” said Gerteisen.
Beyond the inability to satisfy current and entice future investors, the yet-to-be-determined amount of time between sending a sample to the assay lab and receiving an analysis with the quantities of minerals in that sample left many exploration companies somewhat blind when it comes to deciding where to target drilling as the 2021 season progressed.
“Good results mean continuing to chase a target, ideally right away while the weather window is open (for seasonal projects) and to be able to follow up one good hit with another in short order,” Resource Maven penned in her article. “The ‘right away’ angle is just as important for bad results, as they tell a team that it’s time to move on.”
Even Freegold Ventures Ltd., which got a jump on most of its northern mineral exploration colleagues with a February start to the 2021 program at Golden Summit, is still waiting on the results from 70% of the resource upgrade and expansion drilling it completed at this intriguing gold project about 25 miles north of Fairbanks, Alaska.
“Freegold and most North American explorers experienced frustratingly long delays at the assay labs,” the exploration company inked in a year-end update.
For the Freegold exploration team, this frustration goes beyond the inability to inform markets of the success of its program – assay results are an important component of vectoring drilling at targets where gold and other minerals are widely disseminated and not always easy to see. Fortunately, the company has a solid understanding of the geology that is being reflected in the success of its targeting strategy for the more than 38,000 meters of drilling completed at Golden Summit last year.
“Mineralization at Golden Summit is not necessarily visually obvious, however, with an over 90% hit rate in holes reported we are very pleased with our targeting efforts which continue to confirm our interpretation,” the company reported.
The 2021 assay results reported thus far include holes that have hit wide sections of bulk tonnage mineralization, such as 421.6 meters averaging 1.11 g/t gold, and narrow sections of bonanza-grade gold, including one hole that cut 1.1 meters of 609 g/t gold.
Given the success so far, and with assays pending for another 48 holes drilled last year, Freegold “believes 2022 will be an exciting year.”
Hopefully, Freegold will have results from at least some, if not all, the outstanding holes before drills begin turning at Golden Summit again in February.
One hole does not a deposit make
Golden Summit serves as a microcosmic example of the state of mineral exploration in the North of 60 Mining News coverage area going into 2022 – while most assays are pending, the ones that have been delivered are encouraging and sometimes fantastic.
In fact, one hole drilled at HighGold Mining Inc.’s project in Southcentral Alaska landed number three on Streetwise Reports’ top five drill intercepts of 2021.
This hole, JT21-125, cut 56.6 meters averaging 18.69 g/t gold, 2.43% zinc, and 0.47% copper from a depth of 236.7 meters. The analysts at Streetwise were equally impressed with an “eye-popping” 32.9-meter subsection of this intercept running 31.69 g/t gold, 5.1 g/t silver, 1.82% zinc, 0.58% copper, and 0.47% lead.
This was an infill hole testing the lower reaches of the JT deposit, which hosts 2.14 million metric tons of indicated resource averaging 6.07 g/t (417,000 oz) gold, 5.8 g/t (397,000 oz) silver, 5.85% (275.3 million pounds) zinc, 0.57% (26.8 million lb) copper, and 0.71% (37.6 million lb) lead.
Though it did not make the Streetwise Report list, another hole at Johnson Tract cut 6.4 meters averaging 577.9 g/t gold, 2,023 g/t silver, 2.15% zinc, and 0.3% copper at the DC discovery zone about 2.5 miles northeast of JT deposit. This incredible intercept in hole DC21-010 included a 1.26-meter subsection averaging 2,860 g/t gold, 9,990 g/t silver, 5.04% zinc, and 0.88% copper.
“Without a doubt, this is a game-changing drill hole that firmly establishes the DC prospect as a second center of high-grade mineralization and validates our conviction in the multi-deposit potential at Johnson Tract,” said HighGold Mining President and CEO Darwin Green. “The bonanza grade intersection in hole DC21-010 represents the highest grade drilled to date on the JT project, which is a significant achievement given the number of outstanding drill intersections generated previously in the main JT deposit area.”
As spectacular as this hole was, it will take much more drilling to establish DC as another deposit that rivals JT.
“One hole does not a deposit make; no matter how good the numbers from a first hole, a discovery can’t establish credibility without multiple phases of follow-up holes,” Resource Maven reminded her readers. “If further drilling is also good the stock is off to the races; if not, the gains it made on the initial hit evaporate quickly.”
HighGold’s shares rocketed from C$1.01 to C$1.75 per share on the day it announced hole DC21-010 assay result but over the ensuing two months has settled to C$1.30.
In December, HighGold reported results from an additional six of the 17 holes that tested various targets across a 1,500- by 3,000-meter area at DC. While none were quite as spectacular as DC21-010, all encountered mineralization, including strong gold and silver intercepts in four.
And, of course, assays are pending from 25 of the 44 holes drilled at the JT deposit, DC discovery, and other targets tested during the 2021 exploration season at Johnson Tract.
With roughly C$25 million in working capital going into 2022, HighGold can afford to wait to see if any of the remaining 2021 holes hit the “eye-popping” mineralization tapped in some of the first 19 holes it has received assays for so far.
Pre-assay Benchmark investment
Much like HighGold, Benchmark Metals Inc. is still waiting for the majority of assay results from an enormous drill program at its Lawyers gold-silver project in Northern BC but is in no need of cash to execute its 2022 exploration plans.
At 83,570 meters of drilling during 2021, Benchmark had one of the largest programs in the North of 60 Mining News coverage area, and thus has one of the biggest backlogs of assay results.
“Benchmark awaits the majority of drill results from its large 2021 drill program to expand the gold-silver deposits and to delineate the potential at new discovery areas,” said Benchmark Metals CEO John Williamson. “The 2021 program has provided significant gold-silver mineralization that will support expansion of the existing deposits in all directions.”
Despite awaiting results from the majority of 2021 drilling carried out at Lawyers, Benchmark closed a C$40 million financing in December that included a substantial investment by Yamana Gold Corp.
“Following the offering we will have more than C$50 million available to explore and advance the Lawyers gold-silver project,” said Williamson. “The company is encouraged by the significant participation in the offering from existing shareholders and are pleased to welcome Yamana Gold as a new investor in Benchmark.”
By investing in Benchmark before the majority of 2021 assay results are published and incorporated into an updated resource estimate for Lawyers, Yamana and the other participants of the financing were able to establish and increase their position in the mineral explorer ahead of significant milestones ahead.
“The company is planning a significant C$30 million program in 2022 to advance engineering, permitting and add more near surface gold-silver ounces towards a preliminary economic assessment followed by a feasibility study,” the Benchmark CEO added.
Yamana’s strategy was confirmed by Executive Chairman Peter Marone.
“Yamana’s investment in Benchmark Metals recognizes the significant technical strengths of management and equally significant technical merits of its project along with an immediate value proposition, with upcoming milestones that will further enhance that value and future potential,” he said.
With plenty of cash in the bank and the technical merits of its project backed by the confidence of an invested gold producer, Benchmark is afforded the luxury of releasing its remaining 2021 assay results in batches that are associated with the various facets of its massive resource expansion, upgrade, and exploration drill program at Lawyers.
“Benchmark will distribute news as it becomes available from the laboratory with a specific focus on grouping drill-holes in areas that contribute to increasing gold-silver ounces,” Williamson added.
Rounding up assays before Roundup
Other companies exploring mineral projects across Alaska, Northern BC, Yukon, Northwest Territories, and Nunavut must determine their own strategy as they slowly receive partial results from holes drilled during the long days of summer.
With AME Roundup less than a month away, this strategic decision only becomes more critical for many of these exploration companies that can only hope that they have rounded up enough assay results to tell a somewhat cohesive tale of their 2021 programs ahead of the important exploration-focused mining convention.
Alaska and northern Canada exploration companies that still have assays pending from the majority of 2021 drilling when Roundup arrives will be put at a disadvantage when it comes to attracting investments and planning for the coming summer season.
This delay and the setbacks it could have on 2022 programs is frustrating for both the exploration companies and their investors.
The Resource Maven advises patience during this historic delay in assay results that is no fault of the companies trying to unlock the rich mineral potential across Alaska, Northern BC, Yukon, Northwest Territories, and Nunavut.
“With so much uncertainty elsewhere, explorers need to be able to rely on their labs … and right now they cannot. And there’s no answer in sight,” Preston penned in her newsletter. “My only takeaway is: be patient with companies in asking for results because – believe me – they are even more frustrated than you!”
You can read Resource Maven’s informative analysis of assay lab backlogs and what they mean for the mineral exploration sector at https://resourcemaven.ca/blog/why-so-slow-labs.
Alaska applies for grants to address orphan well clean up
Zack Budryk, The Hill, January 5, 2022
The U.S. has more than double the amount of abandoned oil and gas wells than previously thought, according to a preliminary analysis by the Interior Department.
In a memo Wednesday, the department said there are currently more than 130,000 documented abandoned, or orphaned, wells. Comparatively, a 2019 report from the Interior documented a total of 56,600 orphaned wells across 30 states. Across the entire country they found that the number of abandoned wells in that report ranged from zero to 13,226.
The bipartisan infrastructure bill President Biden signed into law in November of last year includes $4.7 billion to restore and plug orphaned wells. In December, the department released guidance on state applications for grants under the program.
Since then, the majority of states, 26, have submitted notices of intent to apply for the grants, according to the memo. Nearly every state documented contained orphaned wells.
States applying for funding included Alabama, Alaska, Arizona, Arkansas, California, Colorado, Illinois, Indiana, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Montana, Nebraska, New Mexico, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, Texas, Utah, West Virginia, and Wyoming, according to the memo.
The Interior Department is set to publish the full amount of grant funding each state is eligible to receive in the months ahead, according to the memo. On Thursday, the Bureau of Land Management will host a presentation on its orphaned-well reclamation program.
Plugging orphaned wells has been top priority for Interior Secretary Deb Haaland since her nomination. The White House’s budget request for fiscal 2022 also included a proposal to more than double the enacted 2021 budget for orphaned well cleanup and reclamation, which the administration said would create 250,000 union jobs.
The White House’s more ambitious climate and social spending bill — which has not passed either chamber of Congress — would also put $41 billion toward environmental remediation, including reclamation of orphaned wells.
Its path forward remains unclear after Sen. Joe Manchin (D-W.Va.) said in December that he would not back the package.
No Climate Warriors in Frozen Foxholes
The Editorial Board, The Wall Street Journal, January 9, 2022
Forty-one Democrats urge federal regulators to lower heating prices.
The climate warriors of the Democratic Party aren’t lacking for chutzpah, give them that. The latest example is a letter from 41 Members of Congress to federal regulators, fretting about “the effect that anticipated increases in heating and energy costs will have on our constituents this winter.” You don’t say?
The letter’s signers include Massachusetts Sens. Ed Markey and Elizabeth Warren, Bernie Sanders, and Rep. Pramila Jayapal, the head of the House progressive caucus. This gaggle of greens normally thinks oil is drilled straight from hell, but they’re now asking the Federal Energy Regulatory Commission to exercise its “power to influence retail rates for natural gas and electricity.”
Naturally, their theory is that higher costs are a result of “market manipulation,” “profiteering,” and “high oil and gas exports.” Maybe they should read—OK, their staffs should read—the underlying document cited by their own letter. “We expect households that use natural gas as their primary space heating fuel,” the Energy Information Administration says, “will spend $746 this winter, 30% more than they spent last winter.”
Part of that is a forecast for colder weather, but there’s also basic economics. “The main reason wholesale prices of natural gas, crude oil, and petroleum products have risen,” the EIA says, “is that fuel demand has increased from recent lows faster than production.”
The report cites record exports of liquefied natural gas, but selling energy to American allies should be counted as a win, both economically and strategically, since it reduces the leverage of players like Vladimir Putin. The U.S. has enough gas to go around, and abundance is the ultimate fix for high prices.
But President Biden, encouraged by the signers of this letter, has made clear that U.S. fossil-fuel production must be phased out. The Atlantic Coast Pipeline and the PennEast Pipeline were both canceled even after beating opponents at the Supreme Court. Getting gas to Mr. Markey and Ms. Warren’s Massachusetts is so difficult that sometimes it comes into Boston Harbor on a tanker from Russia. And they wonder why heating prices are high.