API wants to 'change the conversation' under Trump, Pruitt

By Spencer Chase

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WASHINGTON, Jan. 4, 2017 - American Petroleum Institute CEO Jack Gerard sees 2017 as a big moment in the life of the energy industry, and he hopes he has allies in the incoming administration.

Speaking at API's annual state of American energy event in Washington, Gerard said the industry is poised to have a banner 2017, but only if Congress and the administration permit it.

“For the first time in our lifetime, we can now say that North America has the potential to become a net energy exporter,” Gerard said in his speech. “That's a revolutionary change, a significant shift from where we were just a few short years ago.”

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Gerard said for that to happen, the energy industry - oil and gas production in particular - will need help in the form of regulatory relief. He said there have been 145 “regulations and other executive actions” the industry has been subjected to in the “last few years,” but the new year and a new Congress provide “an opportunity to change the national conversation.”

“We need to look at the regulatory regimes be it the Endangered Species Act or (the National Environmental Policy Act), whatever it might be to determine what needs to be done to regulate smartly and with common sense, but yet achieve our potential as a world energy superpower,” Gerard told reporters after his speech.

One thing API will continue to fight into the future is the Renewable Fuel Standard, a policy requiring the increased use of ethanol and other renewable fuels in the American fuel supply. API and other oil and gas groups have been opposed to increases in RFS requirements, proposing instead to cap renewable fuel blending requirements at 9.7 percent of gasoline demand.

“At some point, it's got to be changed,” Gerard said of the RFS. API has long supported repeal or significant reform of the program, and Gerard said those efforts will not wane in 2017 and beyond.

Specifically, Gerard said he expected to see a bill similar to the Food and Fuel Consumer Protection Act of 2016 (H.R. 5180) reintroduced in the new Congress. The bill - which would have capped blending levels at 9.7 percent of gasoline demand - was introduced in May of last year, but never saw any action after it faced stiff opposition from biofuels groups. Growth Energy co-chair Tom Buis called it “incredibly flawed” and the Renewable Fuels Association called the 9.7 percent cap “a rather odd and precise number without any logic, other than it's the percentage the oil companies want.”

If API and other RFS adversaries hope to see programmatic changes, they could face opposition in the Trump administration. President-elect Donald Trump was supportive of the RFS on the campaign trail, and he has told supporters that his EPA pick - Oklahoma Attorney General Scott Pruitt - will follow suit. Pruitt has been a vocal critic of the RFS and other EPA efforts.

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Senate Agriculture Chairman Pat Roberts, R-Kansas, and a group of GOP senators representing biofuel-producing states will meet with Pruitt on Thursday to - among other things - press him on RFS issues. The other senators include Iowa's Joni Ernst and Charles Grassley, who will host the meeting in his office; Mike Rounds and John Thune of South Dakota; Deb Fischer of Nebraska; and Roy Blunt of Missouri. 

“We have assurances from the administration that they're committed to” the RFS, Thune told reporters on Wednesday. “I'm pretty confident that we're OK there, but it's something we'll be following.”

Pruitt also picked up a vote of confidence from the American Farm Bureau Federation, who offered him their endorsement in a letter to Capitol Hill officials on Wednesday.

(Philip Brasher contributed to this story)

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