Letter to the Editor: Louisiana's energy future is in natural gas (published in The Advocate, NOLA.com and the Energy In Depth newsletter by the Independent Petroleum Association of America)

  • BY SKIP PEEL Jul 7, 2021 - 6:00 pm

After reading the opinion article by Steve Scalise and this newspaper's editorial, I am once again reminded of how the media and the industry work together to conflate Louisiana oil and gas with federal oil and gas.

The distinction is important considering that Louisiana oil, onshore and state waters including the three-mile limit in the Gulf of Mexico, and federal oil and gas, in the Gulf beyond the three-mile limit, are two very different cases. 

Louisiana has no control over federal production and the state does not receive lease bonuses, royalties or any form of direct revenue. What Louisiana does have is control over its state oil and gas production. Once the media starts reporting on the two as separate issues, there are two challenges that become obvious. 

Louisiana oil has been in decline for over two decades and at the current rate of annual decline would reach theoretical zero in ten years. This is not a problem with the price of oil, it is the fact that Louisiana is running out of oil. Geology is destiny. Although options will be limited on how to manage the decline of oil, the greater challenge is in fact how to safeguard Louisiana natural gas production. 

The Haynesville Shale and other gas-producing regions of the state are the future of the state oil and gas industry. Louisiana can be a major player in natural gas, LNG export and the chemical industry for decades to come but only if the state and the industry get clear-eyed about how that can happen and take substantive steps to monitor and reduce methane emissions. 

There are additional options to ensure long-term demand for natural gas that can be leveraged with federal dollars. I do not expect the industry, the media or elected officials to stop pushing back on federal energy policy but if we do not address state oil and gas, we will regret it for generations to come.

SKIP PEEL

consultant

Shreveport

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Replies to This Discussion

Skip, I agree oil will play a lesser role in the future with gas increasingly more important, if for no other reason than as a backup for renewable energy and as a bridge fuel to a potential renewable energy dominance in the coming decades.

The problem with too many people is the knee-jerk reaction they have to fossil fuels: it is either the absolute worst energy source or the greatest possible source ever.

Just as at one point the world used primarily wood as a fuel source, then coal, and then oil, even so, we are now, going to be switching more and more to natural gas and to renewables as the technology improves.

When things such as this get politicized, which seems to be happening to everything nowadays, rational thinking, alas, goes out the window.

Thanks, David.  I don't disagree with your opinions but for some time now I have been attempting to stimulate a Louisiana focused discussion of how we wind down state oil and protect/harden natural gas production and utilization.  What is needed is a debate and policies for mitigating oil related environmental issues while supporting the shrinking  number of jobs. The drastically lower state revenue is beyond help at this point.  The decades of natural gas demand will be determined by how successful we are on lowering fugitive emissions across the entire supply chain and increasing demand.  My letter is an attempt to disconnect the debate over national energy policy, which we have little to no control over and is highly politicized, from the more urgent situation with state oil and gas that we do have the ability to manage.

With the increasing technological ability to monitor and identify GHG emissions, it becomes obvious that methane emissions have been considerably greater than previously calculated.  One way to combat those knee jerk objections to fossil fuels is to take fugitive emissions seriously, pass legislation and create regulatory programs to drastically reduce them.  At the end of all discussions should be the admission that the climate threat is considerably greater than any, and indeed all, objections against taking substantive actions.

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