Key Issues & Mandates
Secure & Reliable Energy Supplies -
Exploration and Production of Domestic Oil and Natural Gas
Just as they were fundamental to the growth and prosperity of our Nation throughout the 20th century, oil and natural gas resources can contribute enormously to our quality of life into the 21st century.
Yet the United States faces significant challenges related to oil and natural gas.
- During the last three decades, U.S. demand for oil and natural gas has outpaced domestic production. The gap between domestic consumption and production raises concerns about future energy security, since it leaves the United States vulnerable to sharp fluctuations in worldwide oil and natural gas prices and to possible supply disruptions. In addition, dependence on imports contributes to a negative trade balance.
- We also face the challenge of producing and utilizing our domestic resources as efficiently and cleanly as possible, to maintain the quality of our environment.
Advanced technologies can be instrumental in slowing the growth rate of oil and natural gas imports, and in ensuring that our Nation can produce and use oil and natural gas efficiently and reliably, in ways that serve our environmental goals. DOE is in the forefront in developing such technologies. The DOE Office of Fossil Energy, through NETL's research, development, and demonstration efforts, can enhance the role of domestic oil and natural gas in our energy portfolio for future decades.
Market and Policy Drivers
Today, oil and natural gas represent two-thirds of the energy used by American consumers. Oil is the predominant transportation fuel, accounting for 97 percent of the energy used in this sector. Natural gas uses include industrial applications, commercial and residential heating and cooling, transportation, and electric power generation. Oil and natural gas also provide feedstock materials for major U.S. manufacturing industries – including chemicals, refining, plastics, and pharmaceuticals – that employ millions.
Over the past three decades, U.S. demand for oil and natural gas has increased steadily while domestic production has declined (crude oil) or remained flat (natural gas). As a result, energy imports have increased. In 2003, net imports of crude oil and refined products accounted for 56 percent of U.S. petroleum consumption and 16 percent of natural gas consumption.15
In the future, America's dependence on oil and natural gas is projected to continue. Between 2003 and 2030, the Energy Information Agency16 projects that U.S. consumption of petroleum products will grow by 38 percent and natural gas consumption by 20 percent. The gap between domestic supply and demand will persist. In 2030, net imports of crude oil and refined products are forecast to reach 68 percent of U.S. petroleum consumption while net natural gas imports will rise to 21 percent of U.S. natural gas consumption. MORE >
NETL manages research, development, and field demonstrations of a diverse portfolio of oil and natural gas supply technologies. Efforts focus on:
- Enhancing near- and mid-term supplies by tackling the challenges of finding and producing the Nation's abundant oil and gas resources, which increasingly are found in challenging geologic and operational settings; and
- Addressing long-term supply concerns by investigating potential new resources, including methane hydrates and oil shales.
NETL also is wrapping up the development of technologies to ensure the safety and operational reliability of U.S. natural gas pipelines and storage facilities.
The Laboratory conducts onsite research related to oil and natural gas technologies in its Geological and Environmental Systems focus area. Topics of interest include resource assessments, production modeling, high temperature, high pressure drilling, and the study of unconventional resources, such as methane hydrates.
15 Energy Information Administration, Annual Energy Outlook 2005
16 Energy Information Administration, Annual Energy Outlook 2005