administration's clean power plan and with paris happening a month ago, carbon pricing more broadly? how ready are u.s. energy companies for those two regulations? >> all of our companies -- some are across the continuum. some have supported a trade approach. some have supported a carbon tax. there's a variety of different position amongst our member companies. the things we have focused on primarily is the science and the data. why? because we think that is the story that's not being told today. the relate is that the u.s. is the leader. the president should have gone to paris and said i have a case study in the united states. we're able to grow our economy, put people to work, at the same time our carbon emissions are at a 20-year low. we think that story should be told because we think it will help reorient other thinkers about the solutions of our time which is climate. we believe we now have a case study. we actually have data that shows how you continue to support a growing economy at the same time the climate issue. we should think about how we can use it in other venues around the world. and that's why the production right here at home is so important to us, creating great jobs in pennsylvania, colorado, oklahoma, texas, ohio. at the same time we're dealing with the environmental challenges. >> jack, i'm jim at the voice of america. >> yeah, jim. >> low oil prices meaning lower investment in the energy industry. eventually that's going to mean lower production. how long do you think it will take before we see reduced production because of reduced investment? >> you can see today some of the production, of course, being curtailed. these are long lead time opportunities when you drill a well, when you eventually bring that well into production. but as you see today, our production is off slightly here in the united states. but again the market will drive that. all we're asking for is opportunity. give us a chance to compete with everybody else around the world and the key beneficiary is the consumer. why? because the lowest class oil will find itself into the marketplace. it will be refined for less and it will be brought to the american consumers' doorstep for less. that's why i think american infrastructure is so important. if you look at those who live in new england today, you're paying 69% more than the national average. why is that? merely because we can't get that clean burning natural gas to you. if we could build pipelines and infrastructure, then we're allowed to compete and you'll see a huge benefit not only in the clean burning fuel being put into those regions, particularly in new england, but lower cost to the consumer. so there are a lot of benefits here. we just don't think those who take the simplistic approach of forgetting fossil fuels -- you can't forget about fossil fuels. they're the foundation of our economy for many years to come. let's be smart, thoughtful. let's look at the data and the science surrounding them. >> two quick questions, the first one on climate change and in general what do you see as the biggest climate-change related issues affecting your member companies or your group from an advocacy standpoint in 2016? the second question is a quick question on the rfs. what do you see the prospects for pushing back for repeal or significant modification of that in an election year? thank you. >> doug, i think on the climate question the untold story, as we talked about earlier, is the u.s. model. i think there needs to be more conversation about what is working globally, where the united states is the leader. we don't need to apologize for where we are. we need to lead the world and show them how we got here and what we can do in the future as we deal with this serious challenge called climate. so i think that's the first issue that we ought to focus on in the climate discussions. let's put all the science and all the data on the table. let's not drive the conversation based on pure ideology or a particularly dogma. let's focus on the science and on the data. we couldn't agree more. there are some who want to ignore the reality of the u.s. model. there are some who choose to deny the reality of the u.s. success in growing our economy, producing more energy at the same time bringing down carbon emissions. there's a lesson there for us to learn, and our hope is more will talk about this, more will learn from it, and we'll figure out collectively not only the united states, but globally how to address the issue. once we see the new congress assembled, we see who's in the white house, i think at that point we better be able to judge the likelihood of change. i will say i believe there's a clear majority in both the house and senate today to make significant changes to the rfs. i think process has been the thing that's protected that old relic in the past, and i think we just need to mount an effort to educate the american consumer and call on congress to fix a problem that's not helping american consumers. >> let's turn to the phones. we have a question. >> caller: good afternoon. i'm from the financial times. >> yes. >> caller: i want to get back to the subject of the clean power plan. you're strongly critical of it, but not recognizing the significance and the valuable role that natural gas can play in reducing emissions. just wondering what sort of policy conclusion you draw from that. does that mean you think the clean power plan should be scrapped, or is it possible there could be some reform or amendment to it or some sort of similar plan put in place but still has that same objective of driving down emissions, but does so by making more use of natural gas? >> i think, ed, where we are today i would hope there would be more consideration where we don't pick winners and losers, but we allow all energy sources to compete in a true all of the above energy strategy. the president has oftened commented doct eed or used to c that he's for an all of the above energy strategy. but the fuels that cost a lot we should tip the scale or put the finger on the scale and be half of one form or the other because it happens to be our favorite fuel. to allow consumers to benefit should allow natural gas to compete on a level playing field with all other forms of energy. that's really all we're saying, ed, in our conversation. let's look at the facts. let's look at the reality. i remember not too many years ago where natural gas was selling for $13 or $14. that's a very different world than it is today. it's changed today because of our modern techniques and technologies. we've been able to produce vast amounts of it, so now it is competitive to come into the marketplace. we shouldn't put the finger on the scales for any particular fuels. just let them all compete. let's allow those fuels that will reduce carbon emissions to compete in the marketplace. >> hi, chris. you devoted a lot of your talk today to talking about the success of what you call the u.s. model. i wonder if this is a conception part that the obama administration has been relat e relatively accommodating to you guys and you would like the next administration to sort of extend that. >> say that again, chris. the administration has been accommodating to us? >> relatively accommodating. >> can i take issue with your premise? as an industry that has over 100 pending regulations, i wouldn't think it is accommodating. i think what the reality is is that they're looking at what it takes to fuel an economy like ours. if you remember on crude oil exports the administration spokesperson was commenting they didn't think it was the time to do it. we probably have some difference of opinions on how you should approach the regulatory regime. we look at methane. methane emissions are down in the united states, yet they're pursuining a methane regime in e united states. so i don't know if that's accommodating or helpful or whatever the word you used is as much as i believe we need to look at it on the basis of the science and the data. and the reality is that we're now a major producer of natural gas. it's cleaner burning, reduces carbon emissions, and i think that needs to be given due attention and i don't think it is in the current administration. >> i'm jim. you alluded to it in your speech, but given the administration's climate perspective, how concerned are you that the interior might start pulling back on oil and gas leasing as driven by the environmental movement? >> i think it's fair to say we're always concerned about where the regulatory approach will go. we think it's unfortunate there's some who have taken in our view an irresponsible approach saying we ought to keep it all in if the ground when the administration's data shows 80% of our energy will still be oil and gas. they're not driven by science and data. those individuals deny the u.s. model that shows you can create jobs, you can produce energy, and you can also reduce carbon emissions. so we're always concerned about where the administration will go. we try to work with them every place we can. we've had some successes in working through some of these issues. we hope this last year if we can get the focus on what really benefits our society with job creation and environmental production, that we can find some common grounds to work on, but there's a lot of pending regulations out there that we can are unnecessary that we wish that wouldn't be pursuing so aggressive aggressively. >> hi, jack. good afternoon. amy with the wall street journal. i wanted to go back to carbon policy for a moment. you said a couple of minutes ago your members have various different positions on this issue. so i want to know what api's official position is on a carbon tax or some sort of price on carbon. i know you have a strong position on the rfs. you have a strong position on oil exports. as an official position, do you not have a position given the various positions of your member companies, or do you have one? >> we have a position. it's posted on our website. if anybody goes back, i think you'll see there a description -- we believe it is a serious concern, a challenge that needs to be dealt with, so we focus our time and attention on solutions. we ought to have a lot more conversation about what natural gas has done as a solution. there are those that want to get into this conversation. well, are you for or against this or that or do you deny this or that? let's look at the data. the u.s. leads the world in carbon reductions. why is that? it didn't happen because of government mandate. it happened because of free market principles where a cleaner burning fuel was brought to the market. it's now become cost competitive. what's it doing? it's further improving our environment. so we believe as scientists and engineers that what you do. you go back to the case study and look at the model and say what is the solution. that's why we take issue with some of solutions being proposed around the world. it's not an ideology. it's not based on theoretical foundations. we've demonstrated that right here at home. we believe that's what's missing in the conversations. we can all agree climate is a challenge. if it needs to be addressed, the real discussion needs to be focused on solutions. ours is better for consumers. it's better for environment and longer term it doesn't unintentionally displace economic activity and hurt consumers in the process. we believe ours is a winning solution and that's why we want to be pushing it. >> let's go back to the phones. i've got a number of callers. >> your next question is from amy donohue. >> caller: thank you for taking my phone call. in your report you outlined the disparities related to oil and gas production when there is federal land ownership. you specifically note the huge difference between the utah experience and the pennsylvania experience. can you elaborate on that and is there something else going on here besides federal land ownership? the numbers are quite amazing. >> thanks for the question, amy. the numbers are quite amazing. i would encourage you all to take a look at our report and some of the data because there is a dramatic difference between federal ownership and state ownership. that's one of the reasons this year in our report we focus on the role of the states. if you look in the state of pennsylvania, for example, in the past the governor has been very supportive of the development of the natural gas up there. you look in the state of ohio today where there's lots of conversation about ohio becoming a significant oil producer, driven primarily by innovation in technologies. you look at the state of utah where you have a lot of federal lands and you can see a stark contrast between what's going on on the federal land which is controlled by the federal government versus what governors are allowing to happen on the state land. that's the point we raise. this is driven by ideology, not by geology. the oil and gas reserves don't go to that line of state and federal land and stop. they typically cover both basins, but there's a reason the dollars aren't being invested to drill on the federal land. that's because that's great uncertainty. costs are much higher associated with it. so you see the capital investment dollars just like any other industry. it's going to go where it can get its best return for as little investment. that's why as i mentioned earlier in my comments if you look at crude oil production in the united states, it's flat at best. natural gas production, the cleaner burning fuel that's reducing carbon emissions, is actually down on federal lands 35%. you get off the federal land, the state land, which adjoins the federal land, and the production is up 80% for crude oil, 40% for natural gas, i believe. again, it's a function of policy and ideology and not science and energy. we think it should be focused on geology. we strongly encourage the states and the feds to work together on these matters. that's why the report points that out because it does make a long-term difference in the united states' ability to produce energy. >> jeremy. the house just passed an energy package last month and a senator is pushing to get her energy package to the floor sometime soon. with tho would those bill packages be enough to address concerns and do you have any other thoughts on that pending legislation? >> there's always a good start in some of those. each of the packages are a little different in the house and senate. we think there needs to be a lot more focus on the infrastructure issues, things such as permitting timelines. is it enough? we think now is the time to go back and revisit that and look at it a little bit more specifically particularly in light of lifting the crude oil export ban. we think you always have to reassess where the infrastructure opportunities are in the united states not only for the domestic market, but now the global market. we'll be working with both the house and senate. there's a lot of provisions in it. we're generally supportive of energy policy that, again, expands opportunity, gives us a chance to compete in the global marketplace. >> i'm jeff from energy outlook blog. looking ahead, could you talk about what the oil and gas industry could look like coming out of the current price cycle? when investment starts to ramp up again, do you think we're going to see an even bigger shift towards shale, including potentially finally the takeoff of global shale development? >> i think that's difficult to predict obviously. as we look down the road the next year or two, i think the fundamentals going back to the marketplace factors of supply and demand are the fundamentals that will continue to drive that. and that's why i keep emphasizing we're not looking for government intervention. we're not looking for government handout. we're looking for opportunity. treat us equitably. let us compete globally and the market and capital investment dollars will find a way. our basins are rich, but at the same time we have the certainty of the rule of law, the court system. there's lots of factors that go into where you invest these dollars. the united states can get more than its fair share if the policies are right. when you look at keystone pipeline that were driven not by environmental considerations, that has a chilling effect on where those cladollars go. we need certainty. we need predictability. eventually, the market will sort that out. i don't think anyone would have predicted oil is where it is today two years ago, yet the market drove it there. now we just want a chance to compete in that market. >> a couple of questions over here. >> hi. thanks for doing this again. >> you bet. >> i want to know what changes to the u.s. regulatory scheme does api want to see advocated in this upcoming election cycle? >> well, we think there ought to be a serious look at the impact, particularly the cost implications and the chilling effect on investment that regulatory activities have. if you look today, for example, as we have always argued, the states of historically regulated things like hydraulic fracturing. for whatever reason, the federal government decided it had to lay another layer on top of the states. what happened? a federal judge in wyoming has now determined he's not sure the federal government has the authority to do that. you can imagine the chilling effect that has on an industry that's not sure who the regulatory body is or what impact it will have. so we would suggest that all regulations should be scrutinized on the basis of what is the cost-benefit ratio, does it provide value. you look at the methane emissions issue. the industry has led in methane emissions reductions. we are down in real terms. methane emission reductions associated with natural gas, hydraulic fractured wells, are down 83%. and yet the administration chose to go ahead and regulate it yet again. i don't know if they're trying to catch up with our success through innovation and technology or what it is, but it's unnecessary. if we're already going on a down cycle, if we're already moving those down, therefore reducing the carbon impacts, why do we have the need to go out and regulate it even more than it already is? last year was a record in the numbers of pages in the federal register by new regulations. we have close to 100 pending regulations, new regulations. that covers our upstream, our downstream activities. we would encourage the administration to look closely at what you're doing, why you're doing it, and is there a better way to accomplish the stated objective which makes us less competitive and discourages those capital dollars to come home to the u.s. >> i want to ask you about the epa's draft assessment on hydraul hydraulic fracturing and drinking water. many of the peer-reviewed scientists have raised several questions about the top line finding that there have been no widespread systemic impact on drinking water. first, do you think the science has settled on drinking water well integrity? do you think this study now seven months out, this draft, has sent scientific regulatory signal? >> i think what it does -- i'm glad you raised that. that's the perfect example of where the science was concluded and the epa came out with the report that said there was no systemic impact. the epa worked the state. they've gone back and looked at all those wells, which drove some of this discussion and now the state has concluded there's no connection between hydraulic fracturing and the potential contaminants in the energy out there. so now we've got two comprehensive studies done by government regulators that there is a handful of people that are not happy with the outcome. right? they continue to drive their agenda based on the ideology, not based on the science. the science has shown, as epa concluded a year or so ago after five or six years of study, that there is no systemic widespread impact due to hydraulic fracturing. the science should be settled on that, but there's some that are not content to have the science settled on it because they have their agendas. i think that's very unfortunate because if you have government regulatory bodies that are subject to scientific conclusions being amended because you have a few vaactivis that are trying to get that changed, it drives the whole process into question and i hope they don't go there. >> a couple more questions on the phones. >> your next question is from david. >> caller: thanks for taking the call. you mentioned the discourse in the election year revolving around energy. do you expect to see the energy issue become more of an issue in the debates in the presidential debates and congressional races? all with the vote for energy program, do you expect to do any expansion of that during the election year? >> good question. i do believe the energy debate is going to be part of this election. the reason i say that is for a couple reasons. number one, with the significant changes we've seen in the energy equation in the united states, it has very significant impacts on job creation, consumer cost. consumers, voters, are aware of this now. that's a key part of this that will be part of this national debate. the other part of it is you see some very different views as to how to handle the energy equation. clean power plan being one of them. as i understand it, the majority of states have sued to overturn the clean power plan. that is significant. there will be discussions about those very issues in all jurisdictions around the country. the fundamentals around oil exports, the fundamentals around lng exports, about producing natural gas and oil. ours is not driven by a political philosophy or individual candidates or political parties. ours is driven by fundamental literac literacy. let voters make up their own mind, but to talk about the important role that energy plays throughout our domestic economy. as i mentioned earlier, if you look at the gdp associated with oil and gas in the united states. it's the equivalent of the mexican economy. that's significant. we shouldn't overlook that. it's close to 10% of all that we do in the united states. that should be part of the public discourse. it should be part of this national debate as we go through this election cycle. >> cat with tax notes. >> yes. >> thank you for having me. i know api is focused on the science and data, but you also talked about a pro-growth agenda. i'm curious what energy tax policies do you think would gain traction in congress, especially with the new leadership of house ways and means committee kevin brady chair from texas and the new speaker paul ryan. >> there's been a lot of conversation about the need for tax reform. i think that's a heavy lift to get that done in 2016 because of the election cycle, but i do believe there will be those that continue to talk about the tax reform approach. our view from a tax standpoint is we want to be treated equitably with everybody else. don't discriminate against individual industries. treat us like you do everybody else in the tax equation. by doing that, we do believe we can compete on a global scale. the oil and gas industry are some of the highest effective rate taxpayers in the united states. we contribute millions of dollars a day. i'll have to go back and check the number. it used to be about 70 million a day. i better go back and check that with my sources here, so don't quote me on that, but we contributed about $70 million a day to the treasury. they generate taxes, local, state, federal level taxes, so we're anxious to be part of the debate. i don't expect that's going to get done in 2016. >> one last question. >> hi. i'm are reuters. >> yes. >> how concerned is api with current and potentially future investigations by the new york attorney general's office and other potentially other attorneys general into the climate change disclosures of some of your member companies? is this something that you're concerned about for 2016? >> well, those are all handled by the individual companies, so i wouldn't really comment on that. again, i'm not sure exactly what they're doing or some of those looks. again, i would encourage folks to look at the data, to look at the science. if you have a political dispute over something, it should be a political dispute. there would be those that would like to change that conversation. the reality is today our companies are lead investors in producing low carbon, zero carbon emitting technologies. go back 2000. go back 15 years ago. we have invested $90 billion to find the solution to the challenge. at the same time the government has invested $110 billion. so we really take second seat to no one in looking for solutions to these challenges. that's why i emphasize so much the role of natural gas in dealing with the carbon challenge. we have a case study now. you can produce energy. you can create good paying jobs. and you can protect the environment at the same time. we believe that should be part of the discussion. move away from ideology. move away from a pure political discourse. let's look at the science and let's look at the data. we think that's the way all investigations should be undertaken. thank you very much. i appreciate you taking the time today. sorry i'm hoarse. hopefully next time i won't feel this way. thank you. good afternoon, all, again. i hope everybody enjoyed your lunch. again, welcome to the 2016 state of american energy presentation. as we all know, energy is fundamental to our society's standard of living, to a healthy economy, and its a critical part of our national security. as this new year begins and clearly the presidential elections and campaign are in full swing, this year's state of american energy report, which is on the table in front of you at your seats, focuses on the critical energy policy choices ahead. the presentation today will focus on the importance of getting it right when it comes to our energy future and the policies that will drive that. it's our hope that this information in the presentation today will help drive a thoughtful discussion about policy both now and into the future for the campaigns ahead. let me remind you one last time you all have the question cards. if you have any questions related to jack's presentation. with that, let me introduce jack gerard, api's president and ceo. [ applause ] >> good afternoon, ladies and gentlemen. happy new year to each of you. as you can tell my voice is little scratchy today, so i hope we get through this well. i think a number of you know i have a number of children, 8. t heaven knows what they brought home, but i have it. i would like to blame my 10 year olds on what's going to happen today for better or worse. as lewis mentioned, it's a time of year for us all to come together to talk about the role of energy and from our vantage point specifically oil and natural gas. with a room full of vips, i don't want to take time to introduce all of you, knowing that in washington everybody is a vip. but here i do have two head tables of our partners that i would like to make mention of. i'd ask you to stand very quickly and acknowledge the crowd. first is tom gibson who is the president and ceo of the american iron and steel institute. next to tom -- hold your applause. next to tom is james bowen the president of bricklayers and allied craftsman. next to james is shawn mcgarvey. next to shawn is one of our important members, alan armstrong, who is the present ceo of williams companies. next to alan is our good friend dod harris, the director of the department of energy. our good friend and admiral, don lauren, our strategic adviser for veterans for energy. peter is the present ceo of the american road and transportation association and is thrilled that he got a highway bill done. is that right, peter? next to peter is our long standing partner paula jackson. then our friend barry russell who heads iplaa. let's give them a round of applause. [ applause ] >> floyd is the president and ceo of the pacific asian institute for congressional studies. next to him is gwen. next to gwen is karen, the president and ceo of the small business council. then we have rob underwood, the president of the petroleum marketers association. then tom karen, the ceo of the american wind energy association. tom asked what i was going to talk about today and i said i was going to take on the wind energy association, so he is listening very intently, as you can tell. next to tom is don santa, who is the present ceo of the national gas association. next to eric is andy black, the president and ceo of the association of oil pipelines. thank you all. let's give them a round of applause. [ applause ] >> before i turn to my prepared remarks, i'd also like to acknowledge a couple dozen veterans that we have in our room today. those that lead our efforts of what we call vets for energy group. i'd like them all to stand. i think they're all over in this area. would you please stand for us? we greatly appreciate -- [ applause ] >> all you have to do is read the newspaper headlines today and see what's going on around the world. it's a very sobering thought, particularly as we give thanks to these veterans and others. what they have been doing is working hard on the issues of national security associated with energy security. we want to give a special shout-out to you for your service and the other vets that happen to be in the room with us today. at your seat, you have a copy of this year's report, which captures america's current energy reality and potential through the lens of seven u.s. regions -- the east, southeast, gulf coast, mountain, west, and central. this year the report emphasizes the national scope of the oil and natural gas industry and identifies the common challenges which we face. and the important leadership role played by the states in the transition of our nation away from the decades of energy scarcity and uncertainty towards an era of energy abundance and security. the report is a snapshot of energy policy as it is today and as it could and should be in the future. in broad terms the state of american energy is strong, even during this time of what we call realignment. the united states is more energy self-sufficient and has transitioned from an era of scarcity and dependence into a global energy leader. today the global energy world is realigning with the united states poised to remain a dominant global player, something that was unforeseen just a decade ago. the energy policy decisions we make today will determine whether this nation remains a positive stabilizing force in the world's energy market and whether consumers can continue to count on reliable, affordable, and abundant domestically produced energy for years to come. domestically, the energy renaissance, which has created an unprecedented surplus of energy, has significantly lowered energy costs for american consumers and delivered a sizable lift to our u.s. economy. for example, the energy information administration estimates that the american consumers have now saved on average $700 in 2015 on transportation fuel costs alone. as a result of this abundant energy. the average u.s. income was $1200 higher in 2012 given lower home energy costs brought about by unconventional development. the figure could reach as much as $3500 a year per family by 2025. even during this period of realignment, the oil and gas industry remains an important source of well-paying jobs for millions of americans. america's oil and natural gas industry supports approximately 1.2 trillion in u.s. gross domestic product. that's the equivalent of the size of the mexican economy, according to the world bank. fortunately, we know how to bring about america's brighter energy future, which means lower costs for american consumers, a cleaner environment, and american energy leadership because that is today's reality here in the united states. we call it the u.s. model. simultaneously the united states is leading the world in energy production. we have one of the strongest western economies, and we are leading the world in reducing greenhouse gas emissions. a trifecta of success unmatched by any other nation in the world. our nation's success is a global energy product and carbon reduction leader is rooted in the united states federal system which allows the states to be an active actor when it comes to how its energy resources are developed. our system of government working in combination with our long tradition of entrepreneurship and distinctive innovative spirit has led to world-leading reductions in carbon emissions now at near 20-year lows. as the state of american energy report details, the states demonstrate time and again that the best way forward on energy policy is not through legislative mandate, overreaching regulatory oversight, or executive decree, but by using facts and what we call the u.s. model, including what's worked and what's best for our energy future. the economy, the consumers, and the environment as our guiding principles. the states demonstrate our bipartisan compromise can lead to significant increases in energy production and environmental protection. nationally according to the latest epa data, in 2013 greenhouse gas emissions were 9% below 2005 levels, even as our population, energy use, and gross domestic product have increased. proof that the u.s. model is the most effective way to better protect the environment while growing the economy and increasing our energy production. our nation's emissions are lower as a result of greater use of cleaner burning natural gas. the oil and natural gas industry itself reduced its own greenhouse gas emissions by the equivalent of 55.5 million metric tons of co2 in 2015 while dramatically increasing our production right here at home. we in the industry have invested $90 billion in zero and low carbon emitting technologies from 2000 to 2014. almost as much as the entire federal government's investment of $110 billion. we also know what the difference between pro-energy development and anti-energy development will mean to our nation's economy, businesses, families, consumers, and for our environment. last year a study by wood-mckenzie found with the right energy policies america's oil and natural gas industry could support as

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