IMG.gif

Manchin Eyes Defense Act to Boost US Energy Flows

Copyright © 2022 Energy Intelligence Group All rights reserved. Unauthorized access or electronic forwarding, even for internal use, is prohibited.
Washington,,Dc,Usa,1,6,2021,Joe,Manchin,Is,An

Sen. Joe Manchin (D-West Virginia) said he is looking at ways to rapidly increase US domestic energy production, including using the wartime Defense Production Act (DPA), in order to support Europe’s need to diversify away from Russian oil and natural gas.

“I would love to use the Defense Production Act right now where we can,” Manchin told a press conference at CERAWeek by S&P Global in Houston.

Enacted in 1950 during the Korean War, the DPA can be invoked by a US president to intervene in areas such as product pricing and direct private companies to manufacture certain critical products.

Manchin admitted that it is not entirely clear where the DPA could be applied to boost US energy production.

“There are places where I think they can and they can’t because of the way the code is written,” he said. “I have our attorneys working on it now and I was told before we came here that there are going to have to be areas that have to be redefined, if you will.”

Earlier in the week, four members of Congress sent a letter to President Joe Biden asking him to invoke the DPA to try to help increase US energy production to support Europe, but also to bolster the US economy.

Manchin did not give any specific examples of areas in which he thought the DPA could be applied. He did point to two controversial pipeline projects — the canceled Keystone XL oil pipeline and the stalled Mountain Valley natural gas line — as examples of stymied projects that could have increased the resiliency of the US energy system.

But more broadly, he said he was using the rapid mobilization possible through the DPA as a “comparison” to the type of rapid response he wants to see to boost US energy supplies, both for domestic use and for export.

“We’re just not fast-tracking what we’re doing,” Manchin said. “The quicker we can get a backfill [of energy] to our European allies and friends, the better we can stabilize things.”

Manchin said he hoped the US could boost its oil production to 15 million-16 million barrels per day. It currently sits at around 11.6 million b/d, according to the US Energy Information Administration.

Manchin’s call for a redoubling of efforts to boost domestic oil and gas supplies was echoed earlier in during CERAWeek by Sen. Lisa Murkowski (R-Alaska).

Murkowski pointed to support in the recently passed Senate Infrastructure Bill for a natural gas pipeline in Alaska that could enable LNG liquefaction of the state’s large reserves as one example of the ways the US can advance a broad energy security agenda.

“Alaska could bring our volumes on line to our neighbors in Asia,” she told the CERAWeek audience. “To put that into the global pipeline, if you will, think about how that can help us over in Europe.”

Manchin, who has blocked key clean energy components of Democrats' now-stalled spending package, was cautiously optimistic about the potential for broader bipartisan consensus on energy.

US Energy Secretary Jennifer Granholm earlier in the week called on domestic oil and gas producers to boost output to the greatest extent possible, but said increases should not come at the expense of the country's larger climate goals.

Topics:
Policy and Regulation, Oil Supply, Ukraine Crisis
#
Oil futures maintained their momentum on Tuesday, underpinned by resilient product demand and no new supply capacity in sight.
Tue, Jun 28, 2022
Political divisions between London and Edinburgh could hit confidence in the UK energy sector just as operators commit to large-scale upstream and transition spending.
Tue, Jun 28, 2022
The region is proving to be a fertile ground for CCS projects as operators aim to strike a balance between production and decarbonization targets.
Tue, Jun 28, 2022