0:00 Good morning.
0:03 Good morning, thank you all for being here. Welcome to the NAEP Summit Energy Business Conference. I am your current NAEP operators committee chairman, Julie Woodard. On behalf of our partners,
0:17 the American Association of Professional Landmen, Independent Petroleum Association of America, American Association of Petroleum Geologists, and the Society of Exploration Geophysicist, we are
0:28 excited to welcome you to the world's premier energy exposition. This year's conference features a dual track program of business and technical sessions, as you're likely used to, the technical
0:39 track is next door, presented by top industry leaders and innovators. Business track sessions will take place in this ballroom, B, and the technical trash will run concurrently next in ballroom A.
0:53 For a schedule of each track, please refer to the printed schedule on your table or NAIP's mobile app which is housed within the pre-yap app and can be unlocked using the code nape. This app also
1:04 includes speaker bios and session details. A special thank you to our Energy Business Conference sponsors, Cord Energy, Conoco Phillips, Expand Energy, and KEM Energy Inc. Your support makes
1:18 this event possible. Immediately following each presentation, join us in the QA breakout rooms located just outside the ballroom to the left for an opportunity to ask our speakers questions. Please
1:31 return promptly after each break for the continuation of the program. Our first session explores the elections impact on the oil and natural gas industry, what lies ahead. A very exciting time,
1:42 and we're all excited to hear from our panelists. Please welcome our distinguished panel moderator, Dan Nats, with COO and Executive Vice President of IPAA, and Bradbury, President and CEO of the
1:53 American Exploration and Production Council Kathleen Sagama, President of Western Energy Alliance. and check Yates, podcast host and industry commentator. Welcome panelists, the stage is yours.
2:05 Thanks.
2:12 Thank you, everybody. As Julie said, I'm Dan Knotts. I'm the Chief Operating Officer of the Independent Petroleum Association of America. IPWA is a partner with NAIP, has a long time partner
2:23 with NAIP and we value the relationship and are so happy you guys are here. We've got a great program and look forward to the next couple of days. As Julie outlined, the title of this session is
2:36 the elections impact on the oil and natural gas industry. The session is going to analyze the ramifications of the election on the industry, issues from policy challenges to regulatory shifts,
2:49 broader political realities. Everything is going to be on the table. So we want to have a vigorous discussion. We've got a great panel to do that. I was at a meeting yesterday and somebody said,
2:59 Dan, what's it been like in Washington? I'm based in Washington. And these first two weeks of the Trump administration honestly have felt like it's a year and a half. It's just been going at a
3:10 rapid pace. So, we'll, sorry I've got mics, we'll figure it out. But anyways,
3:22 it's been a lot of things coming at us all at once, we have a great panel to talk about that. So, I'm gonna introduce the panelists with the biles and then each of them will give an introduction
3:34 First, I wanna introduce Anne Bradbury, who's the president and CEO of the AXPC, which is a national trade association representing leading oil and natural gas exploration and production companies
3:45 in the United States, and is responsible for carrying out AXPC's mission of educating and advocating for constructive solutions that support responsible American oil and natural gas development and
3:56 promoting the inherent value of American produced oil and natural gas. Prior to AXPC and served as one of the top legislative strategists and technicians in Congress as a floor director for two
4:07 successive speakers of the House of Representatives and Deputy Floor Director in the office of both the majority and minority leader. And previously served as a partner at the Duberstein Group and as
4:16 a board member of the Congressional Institute.
4:21 Our next speaker is Kathleen Sagama, who's the president of the Western Energy Alliance. The Western Energy Alliance is a trade association dedicated to sustain environmental and responsible EMP of
4:32 oil and natural gas in the Western United States. Kathleen joined the Western Energy Alliance in March 2006. Previously, she spent 11 years in the information technology sector. And three years as
4:44 a military intelligence officer in the US Army, she holds a BS of political science and defense and arms control studies from the Massachusetts Institute of Technology and an MS in information
4:54 technology from Virginia Tech. Kathleen and I have worked for many years, longer probably than we care to admit, Kathleen, and I can tell you she is truly one of the foremost experts on federal
5:04 mineral policy in the United States.
5:08 Finally, Chuck Yates. Chuck and I have known each other for a while. This is from Chuck's, he's the galactic viceroy of the digital wildcatters. Chuck was previously co-head and managing partner
5:22 for the Energy Private Equity Group within Kane Anderson Capital Advisors. He's currently on the advisory board for Cottonwood Venture Partners. Mr. Yates began his career as Stevens Inc and
5:33 Integrated Merchant and Investment Bank. So we're gonna, I think really the perspectives that we'll talk about today, and then I'll turn it over to the panel. Ann has a perspective from her
5:44 members which are publicly traded independents. Kathleen, again, as knows so much about federal land, but also familiar with that interplay with the states, and then also nationally, what she's
5:54 seeing. And then finally, Chuck, with your great background on private equity markets, global. We'll talk about all that. So Ann, wanna turn it over to you. And I follow up here. Thank you.
6:06 Thanks, Dan. And huge thanks to NAIP and to IPAA, one of our great partners in DC, and to my esteemed panelists today It's great to be with you all at a high level. First, I'll take a moment to
6:19 just recognize that the inauguration of President Trump happened two weeks ago. And that's hard to believe given everything that has happened in these two weeks. We are really excited about the
6:31 opportunities that are ahead of us from a policy perspective, and I think it's important to remember that this is a really important moment in time, both from a perspective of administration policy
6:42 and regulatory policy, but also because there's full Republican control of Congress, and that unlocks a process known as reconciliation, where you can get really meaningful legislative work done,
6:54 which is much more durable than regulatory policy. We can talk a little bit later about what that means and the challenges that are associated with that. But at a very high level, I would say that
7:05 on behalf of my members, which are largely the larger independence, sort of leaning more to some of the public companies, three of the four companies, that are sponsoring this, and a lot of you
7:19 all in the room, One of the things that we're seeking is durable long-term policy, and so I think one of the challenges that this industry has faced over the last four and more years is this
7:33 pendulum swing of policy and trying to track all of that, especially for companies that make decisions on longer-term time horizons than a couple years So our sort of thematic approach is we want
7:51 better durable long-term policy, and that includes EPA, Department of Interior, you know, permitting reform that will last beyond, you know, one administration. So that's what we're seeking.
8:06 We think there is an incredible opportunity ahead of us that we are really excited about how to push forward working with a lot of our industry partners as well.
8:18 And I like that set up as that long-term durable policy, because you look at the Secretary of Orders and the executive orders and the Secretary of Orders that just came out yesterday from Interior.
8:34 They're listing all the things that need to be done. And I was kind of impressed with how thorough it is when it comes to the Department of the Interior.
8:43 But first of all, it's a lot of work to clear out that regulatory underbrush. But I'm not as optimistic about the ability to get things done in this Congress. We have a two-vote margin in the House.
8:57 You're gonna have some squishy Republicans from New York, suburbs of Philadelphia. And so we're gonna get some things done in Congress, but probably not a lot. So we're working on very good policy
9:14 proposals Hopefully get some of those passed in Congress. But looking at the agencies, they're doing the right things. Interior, they've got this regulation, leasing regulation, that increase
9:30 bonding amounts too high. The conservation rule, IMs, everything they're doing is really good in detail, but it's going to take a long time to clear out all that regulatory underbrush. But the
9:42 good news is we've got four years to do it, and we're super excited about Interior Secretary Bergum from North Dakota. We're really excited about Chris Wright, our homeboy in Denver. I'm in Denver.
9:56 He is one of the smartest people I know and can actually make the Secretary of Energy relevant. So we're looking forward to working with all of them and the staff as they get introduced and nominated
10:11 and really looking forward to the next four years and making things as durable as possible.
10:17 So, when I got booted back in April of 2020, somebody called my best friend, Fish. We've been best friends since college for more years than we care to remember. And they said, Oh my gosh,
10:30 what's Chuck going to do next? And Fish says, Chuck's going to go try to do what he's always wanted to do his whole entire life since I met him back at Rice. He wants to be a game show host And so,
10:42 in my quest to be a game show host and create some sort of energy game, I can't think of a better administration to try to do this under. The entertainment value that we're going to experience in
10:57 the next four years is just going to be epic.
11:02 Well, Chuck, I've got some ideas to be happy to talk to you about. I've always dreamt of being a game show host myself So one of
11:13 the other things, Kathleen brought up, which I also want to stress to everybody yesterday at dinner, somebody said. You know about the administration and one of the things I will tell you with
11:22 Secretary Bergam Secretary right also Lee Zeldin at EPA and the deputies that they have in there They brought in an outstanding energy team. There can be questions and some other folks said well What
11:36 about the other nominees and I said our job is focused on energy and I can tell you kind of top to bottom What what those three individuals and I and you may have worked with Lee Zeldin? We had not
11:47 worked a lot with them, but really solid at EPA which for us anymore if you're talking about methane and a variety of other issues really going to be important So I also told folks which is true.
11:58 We've actually talked to the Department of Interior more in the last two weeks than we did in the entire Biden Administration And and people say you know Dan there you're making excuses It's not they
12:09 really did not want to talk the Biden folks did not want to talk the industry very much. So that leads to the first question that I want to throw to the entire panel
12:19 about expectations for the Trump administration regarding energy. Energy has been talked about, the President's been talking about it throughout the campaign, even the nominees besides Bergman and
12:30 Chris Wright, the Treasury Secretary talked about energy. It's really front and center on so much of what's going on, the President, Congress, the nominees.
12:40 So as you're talking about this, and it seems like everyone is talking about energy, I would be interested to hear from all of you what would you like to see done first, and then we can follow it
12:50 up, but are the expectations too high? So Anne, why don't I start with you, and then we'll go down the line.
12:58 I'm going to talk about expectations from two perspectives. One is from industry and what can be accomplished in the short term, but the other I think is, you know, a lot of folks in the incoming
13:09 administration have talked a lot about what's It's going to happen to production and what's going to cost. happen to energy prices when we unleash American energy. And those expectations might need
13:18 to be a little tempered as well. From a policy perspective and an industry perspective, policy change takes a lot of time. We have seen a flurry of executive orders, which signal, in large part,
13:31 really important policy shifts and directional shifts, but to get those to a place where they are final takes months or years in many cases So this is a long game, not a short game. Any decisions
13:47 will also be litigated, which is one of the reasons we talk a lot about durability, because we expect legal challenge for any decisions that are made by this administration. And so they should be
14:01 done thoughtfully to avoid that pendulum swing that we've talked about. One of our early priorities, I would say, that we're very focused on is methane tax. And that is because it technically, it
14:17 hits this year. It was assessed on last year emissions to go and effect this year. Our, you know, perspective is that we should hopefully undo the implementing rules via CRA and then through the
14:29 reconciliation process eliminate the tax altogether. So that's one of our objectives that we are working towards in the short-term. Another I would just mention is lifting the LNG pause, which is
14:42 the approvals of new export facilities. That's already been lifted, but we still, it's gonna take some time to actually process those approvals that hopefully is in the month's timeframe, maybe
14:54 even weeks, not years timeframe. So looking to move forward on that, there's a lot of work that can be done on federal lands, both from a regulatory perspective but also a legislative perspective.
15:07 And last but not least on the tax front, this is really gonna be the tax code is open this year. This is something you're going to hear a lot more about, especially as we proceed throughout the
15:19 year. And so sound tax policy is a huge priority. Maybe a little
15:28 shifts towards the back end of the year, but a huge industry priority that hits every single company.
15:34 Kathleen? Getting the waste
15:39 emissions charge overturned is a really high priority as well, but I'm really nervous about its prospects with a two-vote margin. I'd be interested in you're in Dan's perspective on that.
15:52 We have been in court for the last eight years defending 6100 leases on federal lands, basically everything sold since 2015. In order to actually get through and clear up those 6100 leases, has
16:11 been sent into multiple rounds of National Environmental Policy Act NEPA analysis. It will take a lot of time for BLM to clear up those - do that analysis. Each NEPA document can take several months.
16:30 In a perfect world, they should be able to take a few months or so. But given all the different court rulings, it will take a while to clear that up But I think it's one of those areas where the
16:42 Trump administration could
16:46 address what it's trying to do, really move forward and ensure that production can continue into the future. Because without getting those leases done, you're squeezing the spigot of future
17:01 development on federal lands. So that's one thing that will tie up the Bureau of Land Management for a while, and then just redoing rules. that will take a lot of time as well. Chuck. My esteemed
17:16 colleagues up here are gonna be much better at talking through policy, government initiatives, and things industry can be doing to be proactive, to create a better state for our industry. I'm
17:30 gonna come at it from a cultural point of view. Guys, we have to get out and tell our stories. We have to educate people on energy, the great things we do. I mean, the people in this room are
17:44 the finest people on the planet. And I mean that from the bottom of my heart. And we've been a bunch of cowards. We've sat around and not, you know, talked and told our story while we cower in
17:56 the corner because Greta Thornberg is saying this and that. And we now have political cover that we can get out and talk. It's cool to be in energy again Silicon Valley wants to hang out with us.
18:10 So what we need to do as an industry is everybody in here has an iPhone. And what I want you to do is create content. I want you to go put it on social media 'cause we can get to everybody in the
18:24 world. And trust me, the world actually wants to hear this. Colin McCall and CEO of Digital Wildcatters about six months ago literally filmed a TikTok video on how a drill bit works 45 second video.
18:42 Three million people watched it. Yeah, some comments were like, oh, you're destroying the planet. But you know what the vast majority of the comments were? That's really cool. I had no idea how
18:53 it works. So we've got four years. If we don't all tell our stories every day, document, what you do, explain what this industry does to the rest of the world. If we get shut down and we get
19:06 canceled, we only have ourselves to blame.
19:14 Okay, that was kind of cool, thanks, I'm shallow, I need that.
19:19 There's a real opportunity with Chris Wright, and I think it's not only to talk about the benefits of oil and natural gas, because we've all heard him talk about how oil and natural gas, reliable
19:32 energy, nuclear coal, they actually better human lives, but he's able to discuss intelligently how climate change plays into this, why the net zero transition is not going to happen. He can
19:47 actually have an honest conversation about it, and he doesn't back down about it. So this is an opportunity to not just tell the story about oil and natural gas, but to actually talk about
19:59 realistic energy policy and how we're not going to be net zero by 2050. Like, we can start putting that crap aside I would just add, I think if you look back at November. In a lot of ways, this
20:12 was an energy election and the closest thing to an energy election we've had and everywhere that energy was on the ballot, energy one. And I think that that's really important and should give us all
20:22 a lot of confidence to be really proud of our story and to tell it loudly and proudly. So completely endorse that. And we've got, when I say energy was on the ballot and energy one, look at
20:33 Pennsylvania, which the president won resoundingly after making energy a central theme of that campaign And as a surprise win, the Senate seat flipped. Because Dave McCormick made that a central
20:47 part of his campaign as well. On the flip side, in Texas, you had some energy dems that were expected to lose that one. So kind of across the board, pro-energy candidates fared very well. And
20:59 hopefully that provides a little momentum for all of us to not be afraid to stick our heads up and talk about the importance of this industry in the world. So one of the things - since I've been at
21:12 IPWA 20 years and I know there's a lot of engineers in the room and I worked on Capitol Hill for 14 years before that. I'm not a press guy but I'm a legislative guy but I love engineers, I love what
21:23 you do but what tends to happen is engineers say ah shucks, that's what we do, just get it done which is positive. However, falling on what Chuck said, if we don't talk about what we do, if you
21:35 don't talk, I can tell you some funny stories about hydraulic fracturing. Again, right when I got there, I was telling this group,
21:43 it's kind of a weird name, hydraulic fracturing, and it's hard to sell on the hill and elsewhere. And the engineers looked at me and said, but that's what it is. And I said, I don't care,
21:52 that's what it is, call it water stimulation, call it anything. So, it's always a messaging. Again, we all have excellent press teams. Again, IPWA energy and depth gets out that message, but
22:07 we need to talk, and I know I speak for the whole group, as. constituents, even in Texas, where you have members of Congress go talk to them. They need to know. And Kathleen, myself, Chuck,
22:22 can go talk to policymakers, but we're national trades. You're their constituents. And when they hear from you about how important it is, that will push them along the lines much faster than
22:32 anything that we can do, so please do that. Along those lines, I do want to just follow up quickly about the expectations I don't even necessarily have to get into that, but I was struck by
22:41 Senator Kevin Kramer, who we all know well, he said, look, we need targets because energy is hugely important. But as you're talking, we'll talk a little bit about the CRA process, but there's
22:52 a lot going on. Energy isn't the only issue out there. I have a very good friend in the healthcare industry, and she laughed, and I said, well, we've got the CRA on methane. And she said, get
23:01 in the back of the line, pal, I've got six healthcare ones that I want to get done. They're not going to be able to do all of it So, and any thoughts on that or ways we should try to address that?
23:14 I think energy is kind of in pole position among other industries right now. And I think that's in part because I would just echo Kathleen's comments about like we hit the absolute lottery when it
23:27 came to nominees. We have very strong individuals leading all of the energy agencies and that's really exciting. And it's also a unifying issue for Republicans. Kathleen, to your point on the ways
23:42 to mission charge, I feel pretty bullish about, I don't feel bullish about Congress's ability to do a lot right now. And I think it's very possible that this could get caught up in larger issues
23:52 around can we pass a budget resolution and that might be a hamper, but on the methane tax, I feel pretty good about having the votes to repeal that if we can get to that point, which is a question.
24:04 And I think that Democrats are very energy curious right now. I think that they saw what happened in the election as well. They see the demand growth that is coming from the tech industry, from AI.
24:18 They see countries around the world that are asking for more American energy. And I think that there's a recalibration that's happening. And I think we need to take advantage of this moment and
24:28 educate folks about what this industry is and isn't because there are a lot of misconceptions But I think it's a unique and probably short-lived window of opportunity.
24:45 The thing I might say about expectations, and look, I'm not trying to be Debbie Downer on the industry, but at the end of the day, Trump likes low oil prices, likes low gasoline prices. And he's
24:60 going to go out and badger the Saudis and bribe the Saudis to pump more oil And for the first time in a long time, I actually think the Saudis do have excess capacity. They've throttled back. So
25:12 it's there. We're going to hit lower prices. We just are. Expectations are investor-based. Still doesn't want to see us drill, baby drill. They want capital coming back each quarter. They want
25:25 us actually making a rate of return. So at the end of the day, we're not going to hit the throttle there. I think the trade we need to get out of this is to be able to build a lot of stuff. We
25:37 need LNG export facilities covering up the entire United States. And let's put them all along the Great Lakes up in the north. We need power lines going everywhere, because at the end of the day,
25:51 if we don't have cheap electricity to power AI, and we see to AI to some other country, I mean, you think having a pandemic and not being able to get toilet paper was bad, we're going to be hosed
26:03 if we do that. So at the end of the day, I think expectation-wise, Four years from now, we come out of this, lower prices, lower profitability, but let's be careful with our capital, let's
26:17 make money, let's watch our balance sheets, but if we can get some permanent infrastructure in there, then you got 25, 30 years of being able to export all the natural gas we want to potentially
26:31 upgrade our refining capacity, et cetera. I think that'll be a good trade. We'll talk some more about AI in a little bit One of the things, and I don't want to get it, turn this into a political
26:42 science class, but I do think you'll hear a lot about reconciliation. Anne's talked about it, Kathleen's talked about it. It is a budget reconciliation bill. If you're hearing on the news, it's
26:53 a privileged motion in which they have to pass a budget resolution. It's got to be budget focused, but what has happened over the years, the beauty of it is the house is a simple majority, but so
27:05 is the Senate It's the one time where a Senate filibuster doesn't happen. So policy changes all the way from Obamacare were in budget reconciliation. The Trump tax cuts of 2017 were in budget
27:19 reconciliation. The IRA President Biden's was done, including implementation of the methane tax through budget reconciliation. It is a huge, huge issue that everybody's talking about right now.
27:33 The challenge is that you can do policy changes, and I think the Biden folks stretched it pretty far, but it has to have a budget book. And the other thing I'll tell you guys is they're looking for
27:45 money in an unbelievable way. The federal government is coming nowhere close to balancing the budget. I think last year, almost2 trillion deficit. The current national debt is35 trillion. So the
28:00 push from the Republicans to find dollars to pay for Trump's tax cuts and others are gonna be extreme. is spot on on that and again that's a very quick rundown on reconciliation but that's going to
28:13 be a push and pull you'll also see I just read this morning the Senate wants to do two bills one bill focused on policy one focused on taxes the house wants to do one big bill but as Kathleen said and
28:27 it's a great concern we have as well the two-vote margin in the house and so you've really got a got a push and they're gonna have to get together how they resolve that I don't know but you're gonna
28:38 hear a lot about reconciliation over the next next couple of months in addition to raising a debt ceiling in March in addition to finishing the FY 2025 appropriations bill all this comes together so
28:54 there's gonna be a huge amount of stress and push on all of this and so again I promised I wouldn't get into wonky politics but anybody have any thoughts on that You've been talking about the
29:04 challenges with reconciliation, anything else you want to say on that? No, you just told somebody's niece isn't getting married or somebody doesn't have the flu that day. I mean, that's what
29:15 comes - The numbers are very short in the house, yeah, so it's, but again, you're gonna hear policy changes, methane tax, and again, the question is how soon? I don't know, Ann, if you have
29:23 any thoughts on that? I would just add, I think reconciliation is an incredible opportunity. It is a very limited opportunity. It is generally limited to what you can do that has a significant
29:37 fiscal change and is fiscal in nature. So tax provisions can be taken care of in reconciliation. Things related to leasing on federal lands if there's a royalty change can be done in reconciliation.
29:51 The methane tax likely can be done in reconciliation, but things that we want like permitting reform, at least broadly, cannot be done in reconciliation. The spending bills cannot be done in
30:02 reconciliation, which means we are still, Congress is still going to need. bipartisan majorities to pass 99 of what they do. So, while there is a great opportunity, I also, especially when it
30:16 comes to what Congress can do, don't wanna overstate what can be done on a partisan basis because the vast majority of it, you still need 60 votes in the Senate, which means a bipartisan coalition
30:27 really in the House and Senate to get it done. And to Kathleen's point, the single vote margin in the House means you need unanimous support And for anyone that's been watching the House for the
30:37 couple of years, no, that's a challenge. Chuck, I'm gonna go to you on an interesting one, permitting reform, so hear me out. You talk to energy producers, not just in the oil and gas space,
30:48 you talk on your podcast, a lot of folks. Permitting reform, there was a great push, which I've been able to lay strongly supported to try to get a bill last time it fell short. One of the
31:00 frustrations was, as Ann has laid out, some of the House folks said, do it in reconciliation. no sooner do they get into the majority and they said we can't do permitting reform on budget
31:10 reconciliation. But that is what it is. I'll get over it at some point, but it still hurts. But from an energy standpoint, again, one of the things about permitting reform is it's beyond oil and
31:20 gas. It's renewables, it's the grid. What are you hearing as you travel around any thoughts on how you get not necessarily passed the bill, but how important it is to reform NEPA to do those type
31:32 of things. So if you look back in 1950
31:39 to the year 2000, the amount of electricity we used in the United States went up about 15x, right? We created a lot of cool stuff that used electricity, air conditioning, lighting, computers,
31:51 all that. And then from 2000 to about
31:56 a year ago, it was relatively flat. And what happened During that time, his machines just got really efficient. Lighting got really efficient. The cloud, the amount of computing power, went up
32:07 10x during the last 10 years, but only used about 10 more electricity. And the reason I bring that up is everything's going to be fired off electricity going forward. It just is. I tell everybody
32:23 out here, you're not in the natural gas business. You don't sell natural gas. You sell electrons. Go figure it out. Because if you look at our grid today, it's just tapped out I think the head
32:35 of MISO was on Maynard Holt's podcast six months ago and said we used to have 10 to 12 generating capacity. Now we have one
32:48 on a good day. We have brown outs and Texas, as we all know. Literally, if we did not have a rain storm in central Texas two summers ago, we would have had black outs the whole time. So the
32:59 grids tapped out. And unfortunately, with the grid, power lines go places where stupid animals like the blunt nose leopard lizards live and you get stuck up in quartz and so I think having Lee
33:14 Zeldin at EPA and being able to work through some of those issues and just hopefully getting some sort of rules in place so we can have a reasonable process to get things done in a timely basis What's
33:29 his face from West Virginia mansion had a bill up and it wasn't a very strong bill but at least it gave some insights into the troubles that people are going through but if we don't do that in the
33:43 next four years we're going to be in real trouble because our grid is just tapped out. Kathleen you know NEPA so well you know ESA so well what are your thoughts on that? I do think there's an
33:56 opportunity for NEPA reform just because everybody now recognizes
34:02 The far left is still going to weaponize NEPA and use it as a way to litigate every single project, but you have Democrats, renewables, industry, transmission, that understands that NEPA is
34:15 unworkable. So I do think there is bipartisan willingness to reform NEPA.
34:23 Will it go as far as it should? Probably not, because it will be compromised, but I do think there's opportunity for NEPA When we look at NEPA,
34:34 some of the single most important things are to reduce the ability to litigate under NEPA.
34:42 I also think that
34:45 the Supreme Court just took up a NEPA case, the first in 20 years.
34:51 It had oral arguments in December It involves a railway in the Uinta Basin of Utah.
35:01 In listening to that hearing, I don't know that the Supreme Court will rule as broadly as we'd like, but it should put some sideboards on NEPA litigation. And I think the Supreme Court might be
35:15 willing to take up another case in the near future, not wait another 20 years, that where they can really get to some of the more substantive NEPA issues. So I'm hopeful for that. I'm hopeful that
35:27 the court system, even without Congress passing NEPA reform, will have gotten the memo from the Supreme Court when they issue the ruling in June on this case that was heard in December. I'm hoping
35:39 that some sideboards of NEPA will go up and that we can, even without congressional action, move a little bit further down the field with NEPA. And you talk about the durable solutions and I agree
35:56 completely, What are your thoughts on permitting reform or how do you achieve that? Kathleen's outlined the legal challenges. What are your thoughts? I agree with everything Kathleen said. I
36:06 think it was spot on. I think there is some opportunities on the margins. I'm permitting reform that this administration can do. Again, on the margins. I think that there might be something on
36:18 the margins that Congress can maybe figure out through reconciliation, but really
36:24 it's going to take a wholesale change that is going to require either a bipartisan bill in both houses of Congress, which is a challenge. And it has to encompass all forms of energy, or perhaps
36:42 something from the Supreme Court that sort of fundamentally changes the way the law operates. So one of those two things has to happen, if not both
36:53 But it is a priority of this administration. You hear it a lot from Dems. All forms of energy are really being - challenged right now by our inability to build big things and that is going to come
37:06 to a head very soon. I think I couldn't agree more. I think one of the issues again on permitting reform, the reason it's gotten so much traction is it's bipartisan in nature. I mean I talked
37:17 about the renewables, the grid, Democrats are interested in it as well and what Chuck outlined, you just look at the numbers and it's not an oil and gas issue. So often in Washington now you get
37:28 compartmentalized and we always try to try to broaden the brand and this is a good one. However as Kathleen knows the battles over NIPA, National Environmental Policy Act are intense and the
37:44 litigation that goes on, the way to stop it also used to endanger species. Any thoughts on endangered species, Kathleen or anybody for the group?
37:55 It's a little unclear on ESA to me right now The Secretary will orders rightly identify ESA issues and some proposed listings recently as things to be looked at and reviewed. But the deadlines in the
38:15 ESA are so strict, I'm not sure it will be as easy to unwind ESA. I don't see the I mean, it's not being talked about even right now in Congress That's really NEPA, that's the target. So
38:32 unfortunately, we will be in the West stuck with redoing sage grouse plans for the next four years and the next four years after that and the next four years after that. We will be looking at the
38:47 Dune sage brush loser. I mean, we're just not getting out of ESA On the plus side, though, it would be great if the new assistant secretary who, at Interior, who deals with. ESA would start
39:01 looking at ways to delist, to designate habitat in accordance with Supreme Court rulings.
39:13 The ruling as simple as when you designate critical habitat, it must be habitat that the species can survive in and it must be critical. Like the Supreme Court actually ruled on that and the Biden
39:25 administration put out rules that ignored that. So there will be an opportunity to redo those rules. I'm optimistic on that. But getting out of theyes I do loop. I don't see that right away. Can
39:41 we just say for the record that the blunt-nosed leopard lizard is on the verge of being extinct because it's the single dumbest animal God put on the planet? We had an oil field. The leopard lizard
39:55 would literally run on its hind legs and jump into a truck And we had to do an autopsy on it to make sure that it truly died of natural causes. And so to some degree, it would be nice to have a
40:10 practical view of this animal, and whether it's justified its existence going forward. I'm just saying, those are the views of Chuck Yates, Digital Wildcat, or the rest of us are going
40:31 to stay out of that. Well, I'm still reeling from the fact that I just found out, because the Biden administration put out a proposed list, I think it was in December, that there is a Suckley's
40:35 Cuckoo Bumblebee. I
40:38 don't even know how you can have a Cuckoo Bumblebee that's also a Suckley. I don't even get what that is. But there are all kinds of divisions of species, and you've got specific plants that, like
40:56 oil shale, for example, in western Colorado. and then there's ways to divide your species down. You don't just have the greater sage grouse. You've got the gunnison sage grouse in Utah and
41:07 Western Colorado as well. So getting out of the do loop of the ESA will be a little bit harder. Apparently, the Trump administration, just like looking at the Defense Production Act, like just
41:20 pulling that out of the blue, they just pulled out the God Squad Committee, some
41:27 arcane, unused committee process under ESA that hasn't been used apparently from the 1970s. So they're gonna look at using that.
41:38 We'll see what sticks. So one of the things I, again, and all of this is absolutely true, but these have real-world impacts, and anybody who's operated offshore in the last administration, the
41:50 biological opinion on the rice whale, threatened to shut down production in the Gulf of Mexico. I even had some reporters say, you're not talking about shutting down all the production, the answer
42:02 is yes. They eventually came to a solution, but there are real world situations that if the Gulf of Mexico and the United States went offline, would have enormous impacts. So it is a tool that is
42:16 used. Again, everybody understands the importance of protecting species, but there has to be some common sense to this, but it has real world impacts on everything that we do for the country and
42:29 the economy. I'm going to shift a little bit now, a lot of discussions about tariffs this week.
42:37 My notes, I say thoughts on the Trump tariffs and impact on markets, but even again, I just read this morning, China put a 15 tariff on US. LNG, LNG exports to China last year were24 billion.
42:51 The impact on our industry, the impact on our members on steel, other issues. Why don't I, Anne, why don't I go to you first on what you want to talk about tariffs and we can go from there? Yeah,
43:05 first I'll say, broadly speaking, I think free and open trade has been an incredible benefit to this industry. We have only been exporting since 2016, I think, and now we are one of the biggest
43:20 oil exporters, the biggest exporter of LNG. Our products are global commodities, this has been incredibly important for this industry
43:30 At the same time, we have a president who thinks of tariffs as a strategic tool when it comes to international diplomacy, and both threatens to use the tool and uses the tool, both in a targeted
43:45 manner and in a much more sort of widely applied manner. And I think that is something that we are going to see for the next four years, and that, you know, has an impact both in terms of prices
44:03 of the commodities that we produce, but could also impact a lot of the equipment and things that we use like steel. And it could also have impacts like retaliatory tariffs on our products that could
44:19 be imported around the world. So this is a really important issue that every single company should be able to be paying attention to because it is going to continue to be a theme, I think, that we
44:34 see throughout this administration because this president has used both tariffs and the threat of tariffs to great success to carry out a lot of his agendas that may be sort of ancillary to the
44:50 tariffs themselves like with regard to border issues and things like that. Before I go to you, I will say, if you look at President Trump's views on tariffs, all the way back, he was talking
45:05 about tariffs and immigration in the 1980s. People often ask me, you know, kind of what did his core believe? Those are the two. Other things have evolved, other things have changed. But he's
45:15 been talking about tariffs and immigration since the '80s So it's something that's at his core, and I agree completely with Ann, this is something as an industry we're going to have to deal with the
45:28 whole time that the
45:30 administration operates. So Chuck, I want to go over to you. You know markets so well. You know world markets. What are your thoughts on, not even necessarily the tariffs, but the impact on
45:39 what's going to happen in the industry? Well, and I don't want to be the Trump spokesman here, but to his credit, he's been anti-war since the '80s, too He was anti the first Gulf War, and so he
45:53 has been consistent on that.
45:57 I think the way to think about these tariffs and by the way I totally knew we were going to win the tariff war with Canada they were going to back down did you know that 87 and a half percent of the
46:09 toilet paper that Canada uses is imported from the United States there was no way we were going to lose that but
46:19 I I think the way we're going to have to think about tariffs over the next four years is you know the little kid that just sits there and swings and fights and you put your hand on their head to hold
46:31 them away and you just let them do that I think that's what's going to go on for four years but I do think after we lived through a pandemic where we couldn't get toilet paper and all our trip supply
46:46 lines were disruptive we do need to rethink some level of protection is them in America the absolute free trade we've had and exporting all our Capacity to China was bad so it's going to be crazy.
47:01 It's going to be madness watching Trump do this But I do think there's a little bit of method behind it And if I were a CEO of any sort of company whether it's a supplier a manufacturer, etc I would
47:14 be thinking of how do I do business in the United States?
47:20 Kathleen any thoughts don't want to touch it.
47:24 I Don't have anything to add after the toilet paper example
47:30 Well, I'm looking at my watch we have about five minutes left and one other issue that I want to talk about that was referenced briefly is The amount of energy used data centers. It's again in
47:42 Washington everybody's talking about it right now
47:46 Kathleen I will throw it to you first thoughts on how American oil and gas producers engage on the issue and And have a discussion about the needs for energy, not only our product, but how they
47:57 address this because it's being talked about all the time.
48:01 It's a great issue to talk positively about our industry and natural gas and how we provide base load electricity in contrast to intermittent renewables. It's a great opportunity to talk about how
48:17 the grid is becoming more unreliable and that if there is an energy emergency as President Trump has declared then it is when it comes to that infrastructure, transmission lines, grid stability and
48:34 pipelines, that's where the energy emergency is not obviously with oil and natural gas production. So I do think it's an opportunity for us to talk about natural gas, all the greenhouse gas
48:47 emissions that we have reduced more than wind and solar combined. Every year the energy information administration puts out a little chart. And it shows that we have reduced more greenhouse gas
48:59 emissions than wind and solar combined. It's always around 60 due to natural gas, electricity generation, and about 40 from wind and solar and other non-carbon electricity. That doesn't include
49:14 nuclear, but new capacity. So we have a really good story to tell. We have a solution to the AI issue. We have a great political environment where we've got the secretary of the energy. We've got
49:28 the interior secretary who are going gangbusters for energy. We've got the electorate who cares about it. We've got a lot of things aligning to make this a very exciting time to be in the oil and
49:40 natural gas industry and to provide a solution that is realistic. So those are kind of my thoughts on the issue of AI and data centers. And I think we should really make sure we take advantage of
49:53 this political environment, this.
49:56 interest in the public because that doesn't happen all the time and we should really if we don't start to take advantage of the situation and really move policy and make positive changes for long-term
50:11 stability then we're and you and I are not doing our jobs and Dan we're not doing our jobs correctly. Anybody else have any thoughts on it?
50:21 I'd be curious to hear I completely agree with everything Kathleen said I'd be interested to hear Chuck's perspective as well I will say this is something that you
50:28 know my board is talking more and more about as well and you know as upstream producers it's not always like top-of-mind but the fact is that natural gas is an essential part of a reliable electrical
50:48 grid and this the demand for this energy is is here you we are just starting to see it. And most of the sources that have been added to the grid have been from intermittent sources, and we need more
51:04 natural gas. And there's a lot of different policies that we need in order to enable that, from, you know, certainly on the production side, but on the midstream side to transport that energy to
51:16 where it needed, to where it's needed on the generation side to build more gas-buelled plants. And this is something that is incredibly urgent And what I think is really interesting is that you hear
51:27 it in Washington in almost every room you go in. It came up in every one of the hearings that we watched for Zeldin Wright and Bergum on both sides of the aisle. You hear it from the tech community.
51:39 Every room you go in, they're talking about AI in power demand. And natural gas is a really important part of that conversation, and we need to make sure that it remains sort of the central part
51:52 No, let's just ask this question real quick. Raise your hand if you have natural gas.
51:59 Now, raise your hand if you've sat down with Microsoft, Google, Amazon, and talked about how to supply their electricity. Nobody. I mean, come on guys. You're not selling natural gas anymore.
52:15 You are selling electrons because at the end of the day, all of this AI demand is gonna be built off grid 'cause you're gonna supply these big data centers. And if you don't go out to Silicon Valley
52:29 and tell these people that we have this great story that these two have told you about and that we can power, we can provide power cheaply for 'em, guess what? They're gonna go choose nukes. They
52:41 really are and it's not because nukes are a better solution, it's 'cause they don't know. Literally, I'm sitting here in the energy capital of the world, and no one in here has gone and talked to
52:52 Amazon and Google, all these people that are going to build the data centers. So come on, guys, we got to do it. We all know how to generate power. Go find some old cow pine IPP guys from back
53:05 in the day, and you can make this happen. I'll get off my soapbox. Well, I want to thank everybody. We want to stay on time here. It's a really good panel in there We could talk for another
53:15 couple hours on a variety of issues, but I want to thank everybody for joining us today, and I'll turn it over to Julie.