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Obama sets goal of reducing US oil imports by 1/3 by 2025; domestic and Western Hemisphere production, natural gas, biofuels, electric vehicles, fleet purchases

30 March 2011

Warning that “there are no quick fixes” and that “we will keep on being a victim to shifts in the oil market until we get serious about a long-term policy for secure, affordable energy”, US President Barack Obama announced a goal of cutting US oil imports by one-third by 2025 from the 2008 level of 11 million barrels of oil per day. Obama was delivering a speech on energy policy at Georgetown University.

Meeting the goal of cutting US oil dependence depends largely on two things, Obama said: finding and producing more oil at home, and reducing dependence on oil with cleaner alternative fuels and greater efficiency. While he noted that imported oil will remain an important part of the US energy portfolio for quite some time, Obama pointed to the potential to partner with countries such as Canada, Mexico, and Brazil (earlier post, i.e., an emphasis on regional and Western Hemisphere sources) “which recently discovered significant new oil reserves, and with whom we can share American technology and know-how”.

Increasing US oil supply. Obama noted that last year, US oil production reached its highest level since 2003 and that for the first time in more than a decade, imported oil accounted for less than half the liquid fuel consumed. To increase domestic supply, Obama said:

  • The Administration is encouraging offshore oil exploration and production—as long as it’s safe and responsible. He said that the Administration has already approved 39 new shallow water permits, and an additional 7 deepwater permits in recently weeks. For onshore drilling, the Administration approved more than two permits last year for every new well drilled.

  • The Administration is pushing the oil industry to produce on leases already held. A newly released Department of the Interior (DOI) report shows that more than 70% of the tens of millions of offshore acres under lease are inactive, neither producing nor currently subject to approved or pending exploration or development plans. This includes almost 24 million inactive leased acres in the Gulf of Mexico, which potentially could hold more than 11 billion barrels of oil and 50 trillion cubic feet of natural gas.

    For onshore leases, the review found that approximately 45% of all leases and approximately 57% of all leased acres are inactive. That means that out of a total of over 38 million leased onshore acres, almost 22 million leased onshore acres that are not being used.

That’s why part of our plan is to provide new and better incentives that promote rapid, responsible development of these resources. We’re also exploring and assessing new frontiers for oil and gas development from Alaska to the Mid- and South Atlantic.

But let’s be honest—it’s not the long-term solution to our energy challenge. America holds only about two percent of the world’s proven oil reserves. And even if we drilled every drop of oil out of every one of those reserves, it still wouldn’t be enough to meet our long-term needs. All of this means one thing: the only way for America’s energy supply to be truly secure is by permanently reducing our dependence on oil. We have to find ways to boost our efficiency so that we use less oil. We have to discover and produce cleaner, renewable sources of energy with less of the carbon pollution that threatens our climate. And we have to do it quickly.

—President Obama

New sources of energy. The President pointed to US natural gas as one of the options for new sources of energy.

Another substitute for oil that holds tremendous promise is renewable biofuels—not just ethanol, but biofuels made from things like switchgrass, wood chips, and biomass. If anyone doubts the potential of these fuels, consider Brazil. Already, more than half—half—of Brazil’s vehicles can run on biofuels. And just last week, our Air Force used an advanced biofuel blend to fly an F-22 Raptor faster than the speed of sound. In fact, the Air Force is aiming to get half of its domestic jet fuel from alternative sources by 2016. And I’m directing the Navy and the Departments of Energy and Agriculture to work with the private sector to create advanced biofuels that can power not just fighter jets, but trucks and commercial airliners.

So there’s no reason we shouldn’t be using these renewable fuels throughout America. That’s why we’re investing in things like fueling stations and research into the next generation of biofuels. Over the next two years, we’ll help entrepreneurs break ground on four next-generation biorefineries—each with a capacity of more than 20 million gallons per year. And going forward, we should look for ways to reform biofuels incentives to make sure they meet today’s challenges and save taxpayers money.

—President Obama

The President also emphasized the need to reduce consumption of oil through increased fuel efficiency standards for cars and trucks, an pointed to the upcoming first round of efficiency standards for heavy-duty trucks and the second round of CAFE new CAFE standards for light-duty vehicles.

To achieve our oil goal, the federal government will lead by example. The fleet of cars and trucks we use in the federal government is one of the largest in the country. That’s why we’ve already doubled the number of alternative vehicles in the federal fleet, and that’s why, today, I am directing agencies to purchase 100% alternative fuel, hybrid, or electric vehicles by 2015. And going forward, we’ll partner with private companies that want to upgrade their large fleets.

—President Obama

To leverage the existing work being done on developing electric vehicles and a supporting infrastructure, Obama said that the government needed to offer more powerful incentives to consumers, and to reward communities that pave the way for adoption of these vehicles.

The President also emphasized the need for cleaner, renewable sources of electricity, and said that while today two-fifths of US electricity comes from clean energy sources, including nuclear, he thought that could be doubled.

That’s why, in my State of the Union Address, I called for a new Clean Energy Standard for America: by 2035, 80 percent of our electricity will come from an array of clean energy sources, from renewables like wind and solar to efficient natural gas to clean coal and nuclear power.

Now, in light of ongoing events in Japan, I want to say another word about nuclear power. America gets one-fifth of our electricity from nuclear energy. It has important potential for increasing our electricity without adding carbon dioxide to the atmosphere. But I’m determined to ensure that it’s safe. That’s why I’ve requested a comprehensive safety review by the Nuclear Regulatory Commission to make sure that all of our existing nuclear energy facilities are safe. We’ll incorporate those conclusions and lessons from Japan in designing and building the next generation of plants. And my Administration is leading global discussions towards a new international framework in which all countries operate their nuclear plants without spreading dangerous nuclear materials and technology.

—President Obama

March 30, 2011 in Biomass, Electric (Battery), Fuel Efficiency, Fuels, Hybrids, Policy | Permalink | Comments (17) | TrackBack (0)

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The United States consumed 18.8 million barrels per day of petroleum products during 2009, making us the world’s largest petroleum consumer. The United States was also third in crude oil production at 5.4 million barrels per day.

http://www.eia.gov/energyexplained/index.cfm?page=oil_imports

US oil imports decreased from 14 million barrels per day in 2006 to 12 million barrels per day in 2010 see http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MTTIMUS2&f=A

This is caused by a combination of increased US domestic oil production stimulated by high oil prices, increased ethanol production and increased conservation efforts.

US domestic production of crude oil and other petroleum products increased from 6.7 million barrels in 2008 to 7.5 million barrels per day in 2010 see http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MTTFPUS2&f=A

US ethanol production is now almost 1 million barrels per day see http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=m_epooxe_ynp_nus_mbbld&f=m

>
Since 2010 oil prices has gone further up and this will lead to even more drilling and higher production so if the oil prize stay above 100 USD per barrel in the coming years I expect the US to slash 1/3 of their daily import of oil far sooner than 2025. It could become reality by 2017 with more drilling (2M bpd) more ethanol (1M bpd) and more conservation (1M bpd).
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For a statistic about US and global drilling activity see http://www.wtrg.com/rotaryrigs.html

That statistics shows that global drilling activity is skyrocketing and it can explain why global production of oil increased by almost 84 million barrels per day in Q1 2009 to 88 million barrels per day by Q1 2011 see http://omrpublic.iea.org/

Note also that 3 of the 4 million barrels per day of oil production increase is coming from countries outside of OPEC.

More of the same nonesense. There is no more efficient, fair and quicker acting solution to our outrageous petroleum habit than taxing the hell out of gas and diesel used by private non commercial vehicles.
Until we have a serious national dialog uncorrupted by big oil, big auto and big aviation, we won't get there and the result will be much more painful than it could be .

Henrik

You are dead wrong, the 84 millions to 88millioms are all liquids including biofuel and NGL, if you look at the crude oil only, the curve of worlwide production is flat since 2004

http://www.msnbc.msn.com/id/26315908/ns/msnbc_tv-rachel_maddow_show/#42278768

Oh look, there's Obama opening his mouth and spewing even more worthless CO2 into the atmosphere. By this time next year, everyone will have conveniently forgotten whatever promises the Prez made in his speech.

Obama's speech, as reported by mainstream media and GCC: "Blah blah blah Libya blah blah blah whateveryouwantedtohear blah blah nothingconcreteinthisstatement blah blah blah nowturntotheothertelepromptersoyouappearengaged blah blah blah Japan is melting blah blah blah butyoullbeOKfolks blah blah economy blah blah morestuffyouwantedtohear blah blah..."

As opposed, of course, to GW's average speech, which went like this: "Blah blah mispronouncedword blah blah terrorism blah blah hesitateandforgetthephrase blah blah blah accidentalFreudiansliplettingyouknowthetruth blah blah terrorsts will win blah blah blah withusoragainstus blah blah blah Al Quaeda.."

I thought it was a good speech, I wish more people had a chance to hear it. In the first minute he set up the situation perfectly.

It was an excellent speech and it will have a positive impact on energy use in the USA. Just the directive to the agencies (people resistant to Presidential direction)to purchase alternative fuel vehicles - is a very good precedent.

JerseyGeoff somehow forgot to include the biggest consumer of petroleum - the US military. Who BTW are working on alternatives, to their credit.

MacAaron's speech differs little from his Bush/Obama speeches.

Fascinating to watch the weasels writhe when their nestegg is threatened. Electrification is here and those supporting it are galactic compared to planetary. I'll go with the galactic force.

Treehugger

A modern refinery can make gasoline, diesel, plastic and other needed chemicals from many sources of hydrocarbons including crude oil. Therefore, it is irrelevant that the percentage of crude oil is declining in the total raw production of liquid hydrocarbons.

On this planet there is plenty of both liquid and gaseous hydrocarbons to be drilled or mined for hundreds of years to come as the oil and gas industry keep expanding the scope for drillable and minable resources. I hope, as you know, that the Oil Age will finish long before the planet runs out of oil just like the Stone Age finished long before the planet ran out of stones. Indeed, the idea of imminent peak oil is utter nonsense.

Also there is no reason to fear that the oil price will go much higher than 120 USD per barrel as that is high enough to induce a much higher future production of petroleum outside of OPEC. In the next 50 years we may be hit by a global warming crisis affecting agricultural production and but not an energy crisis.

So the world's 2nd largest bank doesn't know what it's talking about when it says that affordable oil runs out within 50 years. Huh.
http://green.blogs.nytimes.com/2011/03/30/less-than-50-years-of-oil-left-hsbc-warns/

Obama's proposal looks like a reasonable mix of measures, but apparently does not include any demonstration project for making entirely artificial vehicle fuels (distinct from biofuels) using non-fossil raw materials and non-fossil energy sources. To find one such proposal google "green freedom gasoline". We need such things to make use of the trillions of dollars worth of existing vehicles and distribution infrastructure, and because there will never be enough raw material for biofuels alone.

"The point is the ups and downs in gas prices historically have tended to be temporary. But when you look at the long-term trends, there are going to be more ups in gas prices than downs in gas prices. And that’s because you’ve got countries like India and China that are growing at a rapid clip, and as 2 billion more people start consuming more goods -- they want cars just like we’ve got cars; they want to use energy to make their lives a little easier just like we’ve got -- it is absolutely certain that demand will go up a lot faster than supply. It’s just a fact."

http://www.whitehouse.gov/the-press-office/2011/03/30/remarks-president-americas-energy-security

The million barrel per day of locally produced corn ethanol is extremely costly to USA and most countries because it is responsible for doubling and tripling grain prices together with a 50% + increase in worldwide food prices.

If the next million barrel/day has the same effect, be prepared for more unrest and collective discontent in many more countries and in some parts of USA and EU.

No actualy what causes food prices to spike is that food had been subbed like freaking hell.. but alot of that was fuel subs and when oil got too spendy the subs couldnt keep the fuel costs low anymore. This combined with shipping costs going up is what causes food to rise.

As for the world getting pissed at high food costs.. tough bleep. Its gona spike again as oil starts to spike.

The recent rise in corn prices had more to do with speculation than ethanol.

Henrik,
This is mainstreem thinking of last decade. But the point is that this thinking was O.K. with oil price $19. With $100 we are captive customers and is to demaging for world economy especialy within present circumstances.

It is not like the world could not see prices rising the last 30 years. The only thing I can conclude is that no one was going to do anything about it until they had to.

Any goal that is beyond the presidents current and potential next term is somewhat hollow. It would depend on us having an agreed upon long term energy policy. However, agreement doesn't rile up the masses and doesn't get a person elected, and with the connections and experience you get from being a member of the house or senate, a congresspersons own personal enrichment depends on getting elected. So they push forward divisiveness, get the people riled up, get elected, and make lots of money. Saaaawweeeet!! And you thought they really cared about that social agenda.

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