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Texas energy alliance breaks with Trump, backs NAFTA

The Texas Alliance of Energy Producers has come out in support of maintaining the North American Free Trade Agreement, saying withdrawing from NAFTA would have a powerful negative effect on the state's oil and gas industry.

The alliance's stance highlights a rare disagreement with President Donald Trump, who has repeatedly threatened to pull out of the agreement if talks with Mexico and Canada on updating the pact are unsuccessful.

"NAFTA is important to Texas, and if renegotiated, its impact on our markets for oil and gas needs to remain positive and profitable," alliance Chairman Bob Osbourne said. The alliance said that any renegotiation of NAFTA must keep low to no tariffs on energy trade and be enacted with no sunset provision. If an agreement cannot be reached, the group said, then the existing agreement should remain in place.

The Texas Alliance of Energy Producers welcomed Trump's election in 2016, highlighting comments the president had made about overhauling regulations governing the energy sector.

Statistics cited by alliance economist Karr Ingham show why the industry group supports NAFTA's continuation. Ingham said natural gas exports to Mexico have increased 445% since 2010, including an estimated 30% in 2017. Exports of crude oil to Mexico have surged by 320% since 2010, and shipments to Mexico and Canada account for nearly half of the state's exports.

"The North American Free Trade Agreement is an energy economics success story by virtually every measure," Ingham said in a statement. "It has contributed to growth and jobs in the Texas and U.S. oil and gas industry, it is providing new markets for domestic energy production, and is lowering the costs to consumers in all three countries. Taken as a whole, North America is on the verge of achieving energy self-sufficiency — a longstanding goal that has enjoyed significant advancement under NAFTA."

As of Jan. 29, the U.S., Canada and Mexico said they made progress during their recent sixth round of trade talks, and the nations pledged at that point to extend the negotiations aimed at reworking NAFTA.