Trump budget promotes US oil, gas as it cuts oversight

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President Donald Trump is seeking more money to expedite permitting of oil and gas facilities and open federal acreage to drilling, even as he seeks billions of dollars in cuts to environmental oversight.

The White House budget proposal, released today, aligns with Trump's promises to increase oil and gas production as a way of supporting economic growth and creating jobs. But it immediately drew criticism for trying to spend taxpayer dollars on policies to help the oil and gas sector while simultaneously trying to cut spending on other programs, such as environmental enforcement, research and public welfare programs.

The US Bureau of Land Management, for example, is requesting an additional $16mn next fiscal year to ensure it has enough personnel to quickly process drilling and pipeline right-of-way applications on the federal land it oversees. The agency is working through a backlog of about 3,000 drilling permits. US interior secretary Ryan Zinke today said the agency was updating its internal processes for handling oil and gas permits applications.

The US Bureau of Ocean Energy Management, the division in the Interior Department that manages offshore oil and gas leasing, today asked for an extra $10.2mn next fiscal year so it can conduct a new five-year offshore leasing plan. Former president Barack Obama completed such a plan four months ago, but Trump requested more areas, such as the Arctic and Atlantic, be available to oil and gas drilling.

The White House budget also proposes to introduce legislation to open up the "section 1002" area of the Arctic National Wildlife Refuge, located in northern Alaska, to oil and gas drilling by holding lease sales as early as 2022. The refuge and surrounding areas could hold 10.4bn bl of oil and 8.6 Tcf of natural gas, according to the US Geological Survey.

The budget at the same time seeks to reduce non-defense funding by $54bn, or 10pc, in the next fiscal year, as the Trump administration's seeks to balance the budget within the next decade.

The hardest-hit agency would be the US Environmental Protection Agency (EPA), the budget of which would fall by 31pc to $8.2bn and see its enforcement budget decline by nearly $46mn, or 19pc. The oil and gas sector has been strongly critical of EPA, which under the Obama administration pursued tougher environmental oversight of the industry.

"Trump's slash and burn budget puts polluters first and the rest of us dead last," environmental group Natural Resources Defense Council president Rhea Suh said.

Oil and gas groups have generally supported Trump's energy plans, but not every part of the budget is getting a warm reception.

National Ocean Industries Association president Randall Luthi was critical of a plan to repeal a law that shares federal oil and gas royalties collected from the US Gulf of Mexico with Texas, Louisiana, Alabama and Mississippi.

"Eliminating Gulf state revenue sharing for offshore energy production would punish coastal states that support and host the development of home-grown energy and jobs, and would be a serious step backward in the quest for energy reliability and independence," Luthi said.

Source: 
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