Washington — Following Donald Trump's victory in Tuesday's presidential race, Congressman Kevin Cramer, a North Dakota Republican and a top Trump energy advisor, spoke with S&P Global Platts about what impact the election will have on US oil producers, energy markets and stalled pipeline projects.
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Cramer has called for a federal government probe of potential oil price manipulation by OPEC and said that he plans to re-introduce a bill in the next Congress to mandate that investigation.
Here's a partial transcript from the interview which took place late Wednesday:
Q: What impact do you think the Trump victory will have on US oil and gas producers?
A: Well, there's tremendous renewed optimism, I can tell you that. The commitment to rolling back regulations and returning more oversight back to states, things like the fracking rule, methane emissions rules, for example. There's just a renewed optimism that [US producers] are going to be unshackled from over-regulation. It doesn't do much for the price [of oil] but it does reduce the cost of doing business.
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Q: What does the Trump White House plan to do about OPEC?
A: That fits right in with [Trump's] 'America first' energy policy and he has spoken a little bit of the concept of making sure that we're less dependent... on OPEC for oil. He likes to use the word independent, I tend to use the term security. I would expect a little more proactive engagement from the White House and the new administration.
Q: What do you mean by that? Would Trump try to put import restrictions in place?
A: I don't want to say no because I don't know and he's talked about tariffs on manufactured products so I suppose it's possible. That's not something I would advise. I'm more interested in a close observation and oversight of potential unfair trading practices by OPEC and whatnot so that we can attempt to avoid doing anything proactive on our side.
Q: Now that US oil is so entrenched in the global market how much could the White House do, though?
A: What they could do is, they could unleash some of the production potential of our federal resources on our federal lands and, obviously, offshore and [Trump's] talked pretty openly about that. Now, that still means that the producers themselves that have to have markets to sell to, it would just open up more opportunities for them to choose the best play. I think that's all good because it just gives more options on the supply side. It is somewhat limited about what [Trump] could do about price, but making more of it available and reducing the cost of getting it by rolling back some regulations could go a long ways to more production.
Q: How much of Obama's efforts to combat climate change will Trump try to weaken or eliminate?
A: I think he'll be able to do a lot, hopefully, and return that kind of oversight to states where it belongs. Some of that he can do, maybe, by simply eliminating certain rules or regulations or taking them back from the courts where they're in limbo.
Q: You've said that you don't even know if Trump is aware of the controversy surrounding the Dakota Access Pipeline. Is Trump aware of it now?
A: He may be, I know it's got a lot more publicity... but I still don't know for sure if he's been talked to about it. I certainly haven't spoken to him about it because so much of the focus the past couple weeks has been on, obviously, these battleground states. I'm of the opinion that this thing's going to be permitted, finished off. I don't mean the pipeline completely built, but I believe that the permit that was issued and rescinded at the Missouri River will be reissued and I think the easement to work there will be as well and I think that's going to all happen under Barack Obama. And I don't have any special insights into that other than just looking at the law and looking at the objections and realizing there's just no legal reason for the court to withhold this any longer or at least much longer. The president said that the [Army Corps of Engineers] is looking at potentially rerouting it, but the Corps doesn't have any authority to reroute a pipeline. They don't do routing for pipelines, they do permits. And they've done 230 permits on this pipeline and it'd be pretty difficult to reroute a pipeline they've already permitted all over the country. I just think that's an issue that's going to resolve itself before Donald Trump becomes president. And if it doesn't he'll become very aware of it.
Q: And you think Trump will approve it?
A: I do and, again, I haven't talked to him about it, but he's been so clear about his commitment to transportation infrastructure and to energy infrastructure development... not just to move product, which is the fundamental purpose, but to getting America back to work. I just don't see him letting the federal government continue to slow walk something that should have been done a long time ago.
Q: What about Keystone XL?
A: That ball is going to be in the hands of TransCanada obviously. He's been very clear that he'd like it to be reapplied for and he'll issue the permit. As long as it's the same route and corridor and whatnot... there's no real reason not to do it. I expect that will be done very, very quickly.
Q: Do you see other energy legislation now moving through this Republican Congress now that we have a Republican president?
A: I think there will be a real collaborative effort with the White House to determine what requires legislation and what can be done with better administrative policy. How do we legally deal with, for example, the Waters of the US or the Clean Power Plan, given where they are in the legal process? Not to mention the [Paris climate change agreement]. There are a lot of these kinds of things that may not require a lot of legislation. Whatever the outcome of that process of reviewing all the regulations which Mr. Trump has been very clear about and doing what can be done with executive orders and doing what needs to be done with promulgation of rules and legislation and whatnot. Then we need to take a good, hard look at the big laws, like Clean Water Act, like Clean Air Act and then say what was Congress' intent? What is the appropriate modern application of those bills? What kind of proscriptive things should be added so that we don't run into this kind of confusion... like what exactly is the definition of the waters of the US or what exactly is the definition of a pollutant and what do we intend and not intend? Some of those kinds of things require a real good, detailed look at the broad authorizations in those kinds of bills. I see that as very important for Congress to be doing.
Q: What will his administration look like? Who will make up his cabinet?
A: I don't know any specific people, but Mr. Trump's been very clear that he likes very successful business people serving in high positions with close access to him and I think that would certainly apply to places like [the Department of] Interior and [Department of Energy]. He obviously is going to have a good policy team around all that and I would hope people with technical experience as well. So, I think he's been pretty clear he's looking to the business community to help him shape a government that runs a little bit more like a business and understands the ramifications and the consequences of regulation on business. I think it's a noble goal.
--Brian Scheid, email@example.com
--Edited by Alisdair Bowles, firstname.lastname@example.org