Perry pressing North American energy strategy

Fuel Fix:
Energy Secretary Rick Perry is bullish the United States can come to a deal on a "new North American energy strategy, " saying he discussed the prospect during his visit with officials in Mexico City last week.

At the core of the discussions is working together on increasing the United States, Canada and Mexico's energy production and exports, while working together on improving security on the countries' power grids, pipelines and "energy systems" at-large.

Pointing at the announcement last week of a historic billion-barrel crude discovery off the Mexican coast, Perry said, "Mexico is going to be a massive influence in the energy markets going forward."

"I'm excited they're our partner, and we look forward for many decades of economic prosperity for this region."

The prospect of turning North America into an energy powerhouse to rival the Middle East has been discussed wishfully by U.S. politicians for years. Since the advent of the shale boom, the United States has emerged as the world's largest oil producer. Canada is the world's fourth largest oil producer, and Mexico, which has undertaken historic reforms to its energy sector under President Enrique Pena Nieto, is eleventh, according to the U.S. Energy Information Administration.

Now with the Trump administration preparing to renegotiate the North American Free Trade Agreement, some in the energy sector believe it could lead to improvements in how the three countries move energy resources between themselves and to the rest of the world.

"The U.S. is now the largest producer of oil and natural gas in the world, and this coupled with enhanced energy integration with Canada and Mexico will increase long-term U.S. energy and national security," Jack Gerard, president of American Petroleum Institute said.

The North American strategy is part of a larger vision within the Trump administration of expanding U.S. energy production while increasing exports abroad.

During a press conference in Washington Tuesday morning with Fatih Birol, director of the International Energy Agency, the former Texas governor discussed the administration's hopes to grow the U.S. LNG industry and develop clean coal technology that can then be sold abroad.
There also needs to be a greater focus on refining capacity if the US is to become energy independent.  While I approve of the export strategy, there are still too few refineries in the US that can use the light crude being produced from the shale wells.   That is the main reason the US is still importing heavy crude from OPEC countries.

If the Energy Department is putting together a new strategy it should include encouraging a change in refineries that allows them to use the abundant sale oil being produced.  That would also help firm up prices for domestic production and encourage more drilling.


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