Today’s Key Takeaways: Shale producers hold back drilling in response to Biden’s war on fossil fuels. Underinvestment in oil and gas is dangerous. Ireland denies LNG port. Mining needs Gen Z. Meet Senator Feinstein’s replacement.
NEWS OF THE DAY:
U.S. SHALE PRODUCERS VOW TO HOLD BACK DRILLING, EVEN AS OIL PRICES RISE: U.S. shale producers have vowed to hold back on drilling even if oil prices surpass $100 per barrel, an extraordinary commitment that comes in the face of rising prices and as a response to what company leaders described last week as President Joe Biden‘s “war” on fossil fuel production.
At an energy conference last week in Oklahoma City, many companies cited the Biden administration’s recent decisions to limit drilling as the primary reason they’re lowering their investments—as well as ongoing permitting delays and sometimes hostile rhetoric from the administration.
“The US is blessed with amazing natural resources but we are walking away from them,” Chuck Duginski, CEO shale driller Canvas Energy, told the Financial Times.
U.S. shale companies reinvested roughly 65% of their capital in production this year, according to data from Rystad Energy. Rystad projects U.S. companies will continue to reinvest at slightly lower rates of 50% for the next several years.
Continental Resources founder and oil tycoon Harold Hamm argued that the administration is more focused on putting companies “out of business” than responding to high prices or boosting U.S. energy security.
“It’s political power. They believe that is what their base wants. But, I’m sorry, a lot of those people want to buy gasoline at decent prices and heat their homes,” Hamm told FT.
Their remarks come as the number of active U.S. oil rigs has dropped by 16% this year compared to the same point in 2022, according to data from Baker Hughes, and far below the peak of the U.S. shale revolution in 2014, which saw 1,609 active oil rigs nationwide.
From the Washington Examiner, Daily on Energy
Head of OPEC warns of a ‘dangerous’ lack of investment in oil
Anna Cooban, CNN, October 2, 2023
The head of the Organization of the Petroleum Exporting Countries — a group of the world’s major oil producers — told CNN Monday that a lack of investment in the oil industry posed a danger to global energy security and could send crude prices to $100 a barrel.
Worldwide, a total investment of at least $12 trillion is needed in the oil industry between now and 2045 to prevent a spike in energy prices, Haitham Al Ghais, OPEC’s secretary-general, toldCNN’s Becky Andersonat the ADIPEC energy conference in Abu Dhabi.
Underinvestment in the oil sector is “dangerous,” he warned.
Ireland Makes Rare Decision to Deny LNG Port for Climate Reasons
Anna Shiryaevskaya , Jennifer Duggan, Bloomberg, October 2, 2023
The country’s top planning body turned down a proposal for a liquefied natural gas import facility, which would have helped keep the island hooked on fossil fuels for years.
Amid Europe’s angst over energy security, Ireland has made one of the boldest moves of any nation on the continent in the name of climate action: It rejected a new fossil fuel import facility.
The country’s planning authority last month refused a proposal for a liquefied natural gas import terminal on the Shannon estuary and a related gas-fired power plant, after taking into consideration policies outlined in Ireland’s energy and climate action plan. The strategy calls for the country to reduce greenhouse gas emissions annually by 7% on average between 2021 and 2030.
American mining needs Gen Z
Rich Nolan, Alaska Journal of Commerce, September 28, 2023
By 2030, Gen Z will be 30% of the American workforce. This tech-savvy generation has strong ideas about the places and cultures in which it wants to work. And one of the reoccurring opinions heard from Gen Zers is the longing to get out from behind the desk, to find a place where collaboration is key and where the work is impactful. Gen Z, here’s an idea for you: American mining.
Mining needs you. Mining needs your skillset and energy, and it may be exactly what you’re looking for, even if you don’t yet realize it.
The opportunity is extraordinary. By 2029, with a tsunami of retirements on the horizon, fully half of the nation’s mining workforce — some 221,000 workers — needs to be replaced. This great changeover is coming just as demand for mined materials is poised to soar.
EMILY’s List head Laphonza Butler picked to fill Feinstein’s Senate seat
Andrew Solender, Axios, October 1, 2023
California Gov. Gavin Newsom has selected Laphonza Butler, the president of EMILY’s List, to fill the U.S. Senate seat held by late Sen. Dianne Feinstein, his office confirmed to Axios.
Why it matters: The swift appointment, first reported by Politico, means Senate Democrats will be back to full strength headed into battles over spending and judicial appointments this week.
- In appointing Butler — whose group raises money to help elect Democratic women who support abortion rights — Newsom is emphasizing the importance that abortion rights will have in Democrats’ 2024 election strategy.
What they’re saying: “Reporting is accurate,” Newsom spokesperson Izzy Gardon said of the Politico report. “Statement and more information to come.”
Zoom out: The appointment comes just three days after Feinstein’s death at age 90, which left Democrats with just a one-seat majority and vacancies on key panels including the Senate Judiciary Committee.
Between the lines: Butler’s appointment fulfills Newsom’s pledge to appoint a Black woman to the seat — and could douse complaints about him picking a placeholder to hold the Senate seat only until the 2024 election.
- Rep. Barbara Lee (D-Calif.) who is running for the seat in 2024 along with Rep. Katie Porter (D-Calif.) and Adam Schiff (D-Calif.), blasted Newsom last month for saying he would only make an “interim” appointment.
- But Butler, who is in her mid-40s and has significant experience in political strategy and fundraising, conceivably could run for a full six-year term next year.
Zoom in: Born in Mississippi and an alum of Jackson State University, Butler worked as a union organizer and was president of SEIU Local 2015, the largest homecare workers’ union in the country.
- She also was an executive at Airbnb, an adviser to Uber, and was a senior adviser to now-Vice President Kamala Harris’ 2020 presidential campaign.
- Butler, who is openly lesbian, will be the state’s first openly LGBTQ senator.
The intrigue: Federal Election Commission records indicate Butler lives in Maryland, but Gardon told Axios that Butler is “a longtime California resident and homeowner.”
- Butler moved to the D.C. suburbs when she became president of EMILY’s List in 2021, but she owns a house in California and will re-register as a California voter before being sworn in, according to Newsom’s office.