Republicans, Conservative Think Tanks Use Flawed Data To Draw Flawed Conclusions About American Oil Production

EIA Data Vastly Underrepresents How Much Oil and Gas Produced on Federal Lands

Washington (January 26, 2012) – In this week’s State of the Union address, President Obama highlighted that American oil production is at an eight year high and is projected the grow another 22 percent this decade. But data presented by the Energy Information Agency (EIA) has led others to incorrectly claim otherwise. House Republicans and conservative think tanks such as the Heritage Foundation and the Institute for Energy Research are using flawed data from the EIA that significantly underrepresents oil and gas production on federal lands to attack the President’s energy policies and incorrectly inform policymakers. Similar erroneous assertions that appear to be based on EIA’s flawed data also appeared this week in mainstream media stories.
In its 2010 Annual Energy Review, the EIA is presenting incomplete data that appears only to be counting oil and natural gas produced from federal lands for which royalties were paid to the federal government. But, as the result of an oil company challenge to a 1995 law, oil companies are able to produce oil and gas from federal lands offshore without paying any royalties to the American people. In actuality, there were more than 700 million barrels of oil produced on federal lands in FY2010, an amount that is 80% higher than the 384 million that EIA currently presents in its materials.
Not counting oil and gas production that is free from any royalty payments to the American people in the official domestic production statistics is like not counting the free throw when you score a basketball game. It doesn’t make any sense and only confuses people,” said Rep. Markey, top Democrat on the Natural Resources Committee. “As an informing agency, EIA has the responsibility to ensure the data they present is clear and correct, and I urge those using this flawed data to stop, inform themselves of the reality of the significant increases of oil and gas production on public lands, and stop their opposition to fixing this royalty-free drilling loophole.”
A copy of the letter to the Energy Information Agency can be found HERE.
Earlier this week, the Institute for Energy Research posted an entry on their website that stated “production on federal lands is decreasing significantly…oil and natural gas production on federal lands has fallen by over 40 percent since 2000”. The Heritage Foundation, meeting this week in Pennsylvania for their annual retreat, used their blog to erroneously state, “Oil and natural gas production on federal lands is down by more than 40 percent compared to 10 years ago” based on the incomplete EIA data. The Natural Resources Committee Majority staff also echoed the erroneous information with an alert yesterday.
It is particularly dismaying that some who have been in opposition to fixing the royalty-free drilling loophole are now trumpeting misleading data that omits royalty-free production as a way of attacking the Obama administration’s energy policies,” writes Rep. Markey in the letter to the EIA. “I will continue to push to rectify the royalty-free drilling rip-off of American taxpayers by oil companies, but oil and natural gas is still being produced on federal lands even if oil companies are not paying royalties on it.”
Last year, Rep. Markey offered an amendment to a Republican drilling bill (H.R. 1231) that sought to recover funds from faulty drilling leases in the Gulf of Mexico that allow oil companies to drill without paying any royalties.  The amendment was defeated 189-238, with 223 Republicans voting against it.
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