In Houston, a significant message was sent out to the oil, gas, and mining sectors: the current administration is dedicated to clearing the path for expanded drilling on federal lands and waters. Leaders of President Donald Trump’s energy agenda made it known that the industry has a strong ally in Washington.
Interior Secretary Doug Burgum addressed executives at the world’s premier energy conference, making it clear that the administration doesn’t see climate change as an immediate threat. Energy Secretary Chris Wright echoed this sentiment, suggesting that the rise in global temperatures is merely a consequence of utilizing national resources to drive economic progress and national security.
Tasked with empowering energy production, Burgum heads the National Energy Dominance Council, and Wright is his deputy. During remarks at CERAWeek hosted by S&P Global, Burgum praised the oil and gas industry. “I want to share two words you probably haven’t heard much from a federal official these past four years: thank you,” remarked Burgum, highlighting his background as a former North Dakota governor, a state pumping out 1.2 million barrels of oil daily.
Leveraging his experience as a software executive, Burgum described how he envisions the role of the Interior Department. He emphasized that businesses working on federal lands are “customers” supporting the nation’s financial health. “If someone was fueling my revenue, they weren’t the enemy; they were the customer,” Burgum asserted, noting the administration’s fondness for those looking to harvest resources like timber, minerals, and oil on federal grounds.
The royalties from these federal land agreements are perceived by Burgum as a method to help reduce national debt and balance the U.S. budget. “You’re the customer,” he reiterated to the sector executives.
Burgum highlighted the untapped value of the nation’s natural resources, stating it far exceeds the $36 trillion national debt. He argued that if financial markets truly recognized this, long-term interest rates might drop. “Interest rates are one of the largest expenses for us as a country,” he explained. “We need to unlock America’s balance sheet, and President Trump is assisting us in doing just that.”
Criticizing Biden’s emphasis on climate change, Burgum classified it as more ideological than practical, prioritizing threats like Iran’s nuclear ambitions and China’s advancements in artificial intelligence. Wright criticized Biden’s approach to emissions as narrow-minded and harmful to consumers.
Both Burgum and Wright downplayed the movement towards renewable energy, claiming wind and solar aren’t capable of fulfilling the expected energy demands in the face of technological and industrial growth. “Physically, there’s no way for wind, solar, and batteries to substitute for natural gas — let alone oil or coal,” Wright noted, drawing from his experience as the former CEO of Liberty Energy and board member at nuclear venture Oklo.
Oil industry leaders reciprocated the warm reception from the Trump administration. ConocoPhillips CEO Ryan Lance expressed appreciation, describing Wright and Burgum as the most knowledgeable energy team in decades. TotalEnergies’ CEO Patrick Pouyanné and Chevron’s CEO Mike Wirth shared similar sentiments, indicating a return to practical discussions around energy.
The discussion amongst executives turned to the Gulf of Mexico, dubbed the Gulf of America after a renaming by Trump. This followed his reversal of Biden’s ban on offshore drilling in extensive U.S. coastal waters.
Amidst this backdrop, BP’s CEO Murray Auchincloss humorously corrected himself while discussing AI advancements, adapting the new terminology for the Gulf region. Despite Trump’s pressure to “drill, baby, drill,” industry realities are setting in. Chevron and Conoco leaders suggested a production plateau is likely while emphasizing the importance of generating more free cash flow instead of raw growth.
Looking ahead, Lance predicted a production slowdown after reaching new heights under Biden. Pouyanné suggested that revisiting exploration efforts in the Gulf of America might be timely, especially since the area is opening up again after setbacks from the Deepwater Horizon disaster.
An upcoming meeting between U.S. oil producers and the president is expected next week, as confirmed by the American Petroleum Institute.
