Unconventional shale plays across the U.S. continue to bask in the spotlight, pushing the nation’s oil and gas production levels to new highs. Unfortunately, production and sales from federal and Indian lands are contributing little to the big picture. In a continuing trend, sales of fossil fuels from production on federal and Indian lands fell by 7% in 2013 compared to the previous fiscal year, according to a report released recently by the U.S. Energy Information Administration (EIA). The amount dropped from 17,230 trillion Btu in fiscal year 2012 to 15,942 trillion Btu in fiscal year 2013. The drop came despite what could be called a dismal increase of only 1% in sales of crude oil from federal lands. The EIA reported that sales of crude oil increased to 606 MMbbl last fiscal year, led by production from the federal Gulf of Mexico and Wyoming. Combined, these two areas accounted for 73% of all fossil fuels produced on federal and Indian lands in fiscal year 2013. The areas were followed by New Mexico, Colorado and Utah. However, the lackluster gain was wiped away when declining coal, natural gas and natural gas plant liquids (NGPL) were added to the mix. Here is how sales fared for fiscal year 2013 compared to the previous fiscal year, according to the EIA’s report. •Natural gas: dropped 10% to 109 Bcm (3,843 Bcf), with offshore and onshore sales decreasing at 13% and 8%, respectively. Production dropped two percentage points to 16%; • NGPL: dropped 13% to 103 MMbbl, following a downward trend that emerged after the fiscal year 2010 peak. Onshore production volumes plummeted 21%, while offshore volumes were “virtually unchanged;” and • Coal sales: dropped by 9% to 401 million short tons. Contributing most to the decline was Wyoming production. In all, “sales of fossil fuels from federal and Indian lands accounted for about 26% of total fossil fuel sales volumes in the United States in 2013,” the EIA said in the report. “Since FY 2003, sales of fossil fuels produced on federal and Indian lands have fallen 21%, driven by declines in natural gas production and coal production. From FY 2003 to FY 2013, total U.S. fossil fuel production increased by 14%, with a 34% increase in production from nonfederal, non-Indian lands offsetting the decline from federal and Indian lands.” More than 90% by some estimates of the domestic oil and gas production growth in the U.S. is happening on private or state lands, according to a blog post on the White House’s website. In the post, many of the industry’s strides were touted as was the president’s “all-of-the-above” energy strategy and a shorter processing time for onshore drilling permits (down from an average of 228 days in 2012 to an average of 194 days in 2013). But it’s time for the feds to contribute a bit more to turn some of these declining federal production and sales stats into positives. Contact the author, Velda Addison, at vaddison@hartenergy.com.
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