2016IADC, Regulation, and LegislationSeptember/October

‘Keep It in the Ground’ advocates fail to recognize energy reality, industry advances

Jason McFarland
Jason McFarland, IADC President

As we enter the latter half of the year, it is quite clear that 2016 has been an across-the-board difficult year for the global oil and gas industry. Rig counts are down, oil prices are down, and companies are still fighting to weather the downturn. It can feel like a never-ending wave of dismal news.

We know that this industry is cyclical, and the upturn will happen. It must, because our industry fuels the global economy. To put it simply, without oil and gas, there is no power. No power means an inability to get from place to place in cars, trains or planes. No power to produce the endless variety of everyday products like football helmets, pots and pans, kayaks, tires, flip-flops, cosmetics, electronics and medical equipment, all of which are impossible to make without petroleum products.

And, yet, the general public lags behind in understanding the ways in which their lives would be significantly disrupted, different and harder were it not for our industry. Nowhere is this more plainly obvious than with those who campaign to “Keep It in the Ground.” These environmental groups advocate for keeping all fossil fuels – coal, oil and natural gas – in the ground, with no drilling activities offshore, in the Arctic or on land, anywhere in the world.

Like any other heavy industry, ours is one in which safe operations and environmental damage is closely scrutinized. In the past 30 years, we have made significant advances in reducing incident rates and have put in place policies and procedures that aim to protect the environments in which we operate.

For instance, according to the US Energy Information Administration (EIA), the US energy-related carbon dioxide (CO2) emissions in 2015 were 12% below their 2005 levels. The decrease can be attributed to the decreased use of coal and the increased use of natural gas for electricity generation.

Environmentalists and activists campaign against hydraulic fracturing on land. In the US, multiple states have implemented legislation barring it from their states. But the reality is, in the US, the practice accounts for about half of current domestic crude oil production. In 2015, the number of hydraulically fractured wells in the US was estimated at 300,000, with production of more than 4.3 million barrels per day.

To put that number into perspective, in 2015, the US alone consumed a total of 7.08 billion barrels of petroleum products, which averages 19.4 million barrels per day. The reality is, at least for the US, hydraulic fracturing brings the country closer to the goal of achieving energy independence.

Often cited by those who wish to cease all oil and gas activities are our industry’s incident and fatality rates. As with all heavy industries, ours has a not-so-stellar reputation among the general public when it comes to protecting worker safety. The reality, however, is far more impressive. The latest IADC Incident Statistics Report for 2015 showed a 20% improvement over 2014 in worldwide recordable incident rates. Over the course of the last 47 years, the industry’s lost-time incident rate has decreased by over 98%, a significant achievement. Read more about the 2015 IADC ISP here. 

IADC members are particularly interested in improving safety and environmental stewardship, showing this commitment time and again by participation on committees and in workgroups, at conferences and in meetings on Capitol Hill and by requiring the completion of rigorous training by all personnel. We aren’t simply talking about ways we can improve; we have invested in new technology and new personnel training, and our hard work and efforts over the last several decades are reflected in government facts and figures.

While 2016 has been an especially difficult year, our industry has bright spots that remain. The statistics prove that year over year, even in tough market conditions, we have become better at drilling for energy safely, with a focus on environmental stewardship. Until alternative fuel sources are found that are both reliable and cost effective to obtain and use, “keeping it in the ground” is simply an unfeasible proposition. DC

“The reality is, at least for the US, hydraulic fracturing brings the country closer to the goal of achieving energy independence.”

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