Chris Mathews, senior editor of shale and A&D, Hart Energy: Hi, my name's Chris Mathews, senior editor of shale and A&D at Hart Energy, and we're here at the CERAWeek by S&P Global 2024 conference, and I'm joined by Anne Bradbury, CEO of the American Exploration & Production Council (AXPC). Anne, thank you so much for taking time to join us.

Anne Bradbury, CEO, American Exploration & Production Council: Great to be here, Chris. Thanks for having me.

CM: It's a busy start to the week, but I'm curious if we can lay out maybe some of the council's top objectives for this year's CERAWeek.

AB: Yeah, so CERAWeek is a great opportunity to meet with so many of our stakeholders that are here in Houston at CERA at the same time, both from Washington stakeholders and policymakers, as well as a lot of our companies as well. And as part of that, we're doing a lot of media outreach as well to kind of talk about our priorities and the impact of some of the policies in Washington on our companies.

CM: Well, there is a litany of different regulatory considerations coming down the pipelines. What are some of the biggest concerns from U.S. producers when it comes to the regulatory landscape?

AB: I would actually say that given even the number of uncertainties right now in the global landscape, that the regulatory tsunami is probably one of, if not the top priority of American energy producers. For the last three years, we've seen a number of different policies and development from agencies like the EPA, DOI, BLM, the SEC, that are really either now being finalized and implemented or on the cusp of being finalized. And these have significant implications for how oil and gas companies evaluate risk, evaluate capital allocation, how they're going to spend their money, operational implications. And so making sure that companies understand what all those policies are and what the prospects are for mitigation moving forward is a huge priority of ours. I would say EPA is a place we spend a lot of our time, but also the DOE’s LNG Pause is a huge concern. The SEC's climate disclosure rule and policies out of DOI are additional concerns as well.

CM: The Biden administration's LNG pause has been discussed here early this week. I'm curious if you can sum up maybe some of the positions by U.S. producers on the pause.

AB: So we're extremely concerned about the pause. I think the word we've used most is nonsensical, right? We know that LNG is good for the climate. We know that LNG is good for the American economy, and we know that there's bipartisan support for American LNG exports as a force for good in the world. Unfortunately, some extremist activists who are really anti all fossil fuels have been trying to slow down LNG exports, to stop LNG exports. And unfortunately, election year politics came into play and there was an LNG export approval pause announced recently while they study the issue and look for more information. So we'll be weighing in heavily with those studies and with that evaluation, it's expected to take a little more than a year to ensure that U.S. LNG exports continue to play the leading role in global security and in global climate leadership that we have played for the last several years that will continue to do that.

CM: You mentioned the SEC's climate disclosure rules that came out recently. I'm curious if you can maybe talk about the council's position on that and how it might impact companies, the biggest of the big producers, all the way down to some of the smaller public producers that would be impacted by something like this.

AB: Sure. So every public producer is impacted. It has a lot of implications for how you talk about sustainability goals, what you publish and how you publish it in terms of sustainability and transparency. First, I'll say AXPC is very pro-transparency when it comes to talking about emissions profile and as well as setting goals and that sort of thing. We actually have our own template. Unfortunately, the SEC Climate Disclosure rules will have a number of unintended consequences that will actually have a stifling impact on a lot of those really important efforts. And one of our concerns is that we don't believe it has strong legal standing, and we recently saw a stay in the Fifth Circuit. And so it seems that the courts agree with us in terms of some of the concerns that we've raised.

CM: One of the biggest stories in recent months was U.S. production coming up a record high of around 13.3 million barrels, I believe it was last December. I'm curious what you're hearing from producers in terms of their runway this year and where production might go. And also, just one of the themes that's emerged this week is kind of the bullish long-term demand that we're seeing globally for oil and gas and refined products, what have you, going forward into the future. I'm curious what the industry thinks about that moving forward.

AB: Yeah, so first I will say that when you look at global demand and who is meeting that global demand, American producers continue to lead the way in global production of both oil and natural gas. And in terms of barrels being added onto the marketplace every year, we are the overwhelming majority of that additional capacity every year. A lot of that is from a lot of the innovations that our companies continue to deploy to get more out of every single well, and that's been really exciting to see. I think this year we'll probably continue to see incremental growth from independent E&P companies, and over the long term, most of the forecasts I've seen have been quite bullish. Whether you're looking at it from a power sector demand perspective of this significant increase in demand from electric and hybrid vehicles, from AI, or whether you're looking at it from a global perspective from either the global south, less developed countries as they become more industrialized and more developed, the demand that will go along with that. I think that there's a really bullish perspective on the future of oil and gas globally and the importance of American producers in helping to meet that growing global demand.

CM: Yeah, I lead coverage of our mergers and acquisitions.

AB: Hot topic.

CM: It is, I was going to say it is in the E&P space, it's been a key theme of the past year, is consolidation in the upstream and the shale patch really here in the U.S. I'm curious, you think that that's a good thing for the industry, whether we need more competition, and this opens up opportunities for new E&Ps to come into the fray, and kind of your outlook for upstream consolidation in America.

AB: Yeah, so overall, I think it's a really healthy trend. I think that a healthy, robust, well-capitalized industry is good for American oil and gas production. And so from that perspective, it's certainly a beneficial thing. There's always a little bit of heartburn that comes with this sort of M&A and churn as companies sort of go through the process. And that's always a little bit hard to watch from a personal perspective is you see a lot of really great legacy companies that become merged with other companies. At the same time, I think it's a net benefit for the industry, and it's going to make industry stronger in the long term.

CM: Got it. Anne Bradbury, thanks so much for taking time to speak with us today. That's all the time we have for this Hart Energy exclusive interview.