Expanding Domestic Oil and Natural Gas Production

Domestic U.S. oil production peaked in 1970 and has declined steadily since. Currently, the U.S. is able to meet one-third of its petroleum demand with domestic resources, and imports the remaining two-thirds. Domestic crude oil reserves are estimated at around 22 billion barrels, mostly found in Texas, the Gulf of Mexico, Alaska, and California. For comparison, global reserves are estimated at 1.1 to 1.3 trillion barrels.

U.S. natural gas production is also near its peak, but domestic production continues to meet over 80 percent of demand. The remaining imports come by pipeline from Canada and Mexico, and as liquefied natural gas at 4 major import terminals. While global natural gas reserves are thought to be over 170 trillion cubic meters (TCM), domestic reserves amount to only 5.6 TCM.

Both oil and natural gas contribute to climate change by forming carbon dioxide during combustion. Natural gas emits only about half, and oil about two-thirds, the carbon dioxide per unit of energy as coal. The greenhouse gas profiles of imported oil and gas resources compared to their domestic counterparts are roughly similar. In some cases, imports may result in slightly higher emissions since they are often transported a greater distance. In other cases, however, carbon-intensive infrastructure may be needed to deliver domestic oil and gas to U.S. markets. Oil from the Trans-Alaska pipeline, for example, almost certainly has higher lifecycle greenhouse gas emissions than oil from Canada or even Nigeria.

Other environmental concerns related to oil and natural gas production and transport include: spills, leaks, explosions, and damage to natural habitats. While improved exploration and drilling practices have dramatically reduced local environmental impacts, oil and gas production in pristine areas remains an invasive activity. Refineries that convert crude oil into valuable petroleum products have more concentrated environmental and safety impacts.

Exploiting domestic sources of oil and natural gas helps reduce the amount of oil that the U.S. must import. However, the amount of domestically available oil is limited and the public often opposes drilling in sensitive areas. Furthermore, domestic oil and gas is usually more expensive than imports. When oil and natural gas prices are high, pressure increases to open exploration and drilling in lands previously considered off-limits, such as the Arctic National Wildlife Refuge and many offshore areas. For example, offshore drilling along in the eastern Gulf of Mexico and along the east and west coasts has been prohibited since 1980. Late in 2006, however, Congress voted to open 8.3 million acres to drilling in the Gulf of Mexico that had been previously protected under the ban.