Early Trump energy actions to include emergency declaration, Alaska focus

Incoming White House officials early Jan. 20 laid out plans for President-elect Donald Trump to sign a slew of executive orders once sworn in, with a focus on unleashing affordable, reliable energy to both lower energy and fuel costs at home and aid foreign policy.

The incoming officials promised to follow through on Trump's campaign pledge to "drill, baby, drill" and boost domestic energy production by opening more federal lands and waters to leasing and oil and gas development, including in Alaska, where the outgoing administration of President Joe Biden focused many of its climate-oriented regulatory efforts.

A national emergency declaration on energy is also in the offing as well as plans to end what conservatives derided as an electric vehicle mandate, although the incoming White House officials offered little detail.

The emergency declaration "will unlock a variety of different authorities that will enable our nation to quickly build again," an incoming official added.

The rationale for this national energy emergency is that certain high costs of energy are unnecessary, the official said. "They are caused by policy," he added, while also noting that the AI race with China will also make it crucial to generate the electricity to stay at the forefront of global technology.

As expected, the incoming orders will also target Biden administration regulations the incoming team called a "burdensome" impediment to job creation and resource production.

It remains to be seen what obstacles the executive actions will face, both in terms of market impediments to increased production and legal hurdles if regular procedures for rulemaking are leapfrogged.

Unleashing Alaska

A unique executive order will focus solely on developing Alaska's natural resources.

"Alaska has such an incredible abundance of natural resources, but under the previous administration, both the Department of Interior and [US Department of Agriculture] have limited Alaska's production and its ability to produce wealth for American citizens," the incoming official said, making note of the oil, gas, timber, critical minerals and seafood resources in the area.

In August 2024, the Biden administration banned drilling on 28 million acres of Alaskan federal land, declaring unlawful an order from the first Trump administration that sought to open those areas for oil, gas and mineral extraction. That order followed an April move to close development in over half of the 23-million-acre National Petroleum Reserve-Alaska, the largest federally managed tract of land in the US, which is estimated to hold 895 million barrels of oil, per a 2010 US Geological Survey.

The official cited Alaska's geostrategic location, which includes its positioning for LNG exports.

Biden's moves have drawn legal challenges and Republican criticism, the latest coming after a congressionally mandated lease sale on the Coastal Plain of the Arctic National Wildlife Refuge drew no bids.

"If we get the right policies in place, I think you'll see the Trump administration pushing more projects to get more leasing and generate more royalties," Bruce Westerman, Republican-Arkansas and chair of the House Committee on Natural Resources, said at an American Petroleum Institute event Jan. 14.

The location of the lease sales would be critical, he suggested. Critics accused the Interior of offering unattractive parcels during the Biden administration.

In January, the Biden administration also permanently banned offshore oil and gas development from 625 million acres of US waters, including portions of Alaska's North Bering Sea.

On the natural gas side, the long-stalled Alaska LNG project and pipeline would link Alaska North Slope supplies through a roughly 806-mile pipeline to an LNG export terminal in Nikiski on the Kenai Peninsula in southern Alaska. If constructed, the 20 million mt/year LNG export terminal would provide a shorter shipping route to key demand centers in Asia compared with rival export projects on the US Gulf of Mexico.

During the Biden administration, the US Fish and Wildlife Service and US National Marine Fisheries Service said they planned to complete new biological evaluations for the export project by the end of 2025, amid renewed litigation mounted by environmental groups.

Focus on 'consumer choice'

Officials also pledged to repeal Biden's regulations to tighten vehicle fuel economy standards and boost the uptake of EVs.

Three recent rules finalized in the spring of 2024 to reduce carbon emissions from vehicles are on the table: the US Environmental Protection Agency's greenhouse gas standards for light- and medium-duty vehicle model years 2027-2032 and later; the agency's emission standards for heavy-duty vehicle model years 2027-2032 and later; and the US Department of Transportation's corporate average fuel economy (CAFE) standards for model years 2027-2032 that also included new standards for heavy-duty pickup trucks and vans for model years 2030-2035 and later.

All three rules faced legal challenges and are pending in the DC Circuit Court of Appeals. The Trump administration's industry allies were expected to withdraw those lawsuits to set the deregulation in motion. But undoing such regulations could take a year or longer since a repeal must go through a legally required process that includes public comment periods and other input. It is unclear how the details of the executive orders will affect this process.

While putting an end to EV mandates and a greater focus on fossil fuels over renewables, the Trump White House does not intend to shy away from critical minerals, saying they would play a key role throughout the executive orders.

An official said critical minerals were crucial to the country's national security and formed the "building blocks of so much of our technology."

Trump has been critical of the country's supply chains being dependent on China and backed domestic mining and critical minerals activity.

Trade measures

Trump has threatened to impose 25% tariffs on goods from Mexico and Canada, both of which regularly export crude and other energy commodities to the US -- but according to a Wall Street Journal story that cited a presidential memo, Trump will not impose tariffs on any countries when he is inaugurated Jan. 20. Instead, Trump will call for "federal agencies to investigate and remedy persistent trade deficits and address unfair trade and currency policies by other nations," the story said.

Specifically, Trump has vowed to impose a 25% tariff on products imported from Canada and Mexico to apply pressure on the countries to enact policies tied to illegal drugs and immigration. But Canadian officials have warned that tariffs could hurt the ability of the US to ramp up energy production since Canada supplies about 4 million b/d of crude to the US, and US firms have invested heavily in refineries to process Canadian heavy crude.

Crude futures slipped early Jan. 20 on news that tariffs would not be imposed on trading partners right away. At 1502 GMT, NYMEX front-month crude was trading $1.17 lower at $76.71/b, while ICE front-month Brent was down $1.08 at $79.71/b.

As part of the executive orders, Trump is expected to lift the Biden administration pause on key new LNG export authorizations to non-free trade agreement nations.

Analysts with S&P Global Commodity Insights anticipated that the Department of Energy would move quickly on applications that relate to projects with 54 million mt/year of aggregate capacity. New approvals, which could occur weeks or months after Trump formally takes office, "may reinvigorate contracting momentum for US-sourced LNG and bring forward some final investment decisions," Laurent Ruseckas, Commodity Insights executive director for global gas, and Anusha De Silva, Commodity Insights director for North American LNG, said in a recent note to clients.