9/11 had major impact on energy industry — in Wyoming and elsewhere | Energy Journal

An above-ground network of power lines keeps the lights on, the A/C running and the Wi-Fi connected. An underground network of pipelines fuels stoves and furnaces and allows gasoline to flow freely from the pumps. In Wyoming, energy is plentiful — and predictable. Most people don’t really have to think about it.

Twenty years ago, after the events of Sept. 11, 2001, shattered Americans’ sense of safety, that stable energy supply didn’t feel like such a given. Suddenly, it seemed more like a vulnerability.

“Whether you’re talking oil and gas or electricity, think of all the things that you can’t do, that you’re used to doing every day, without your electricity,” said Lynn Budd, director of the Wyoming Office of Homeland Security.

In the months after 9/11, the immediate worry was about physical attacks. Energy infrastructure is visible. It’s distributed virtually everywhere. And transmission, including pipelines and power lines, is often concentrated in narrow passages to simplify complex permitting processes.

“We didn’t know if even our dams were safe,” said Steve Degenfelder, land manager for Kirkwood Oil and Gas. “If we’re going to be subject to terrorism, putting all of our pipelines in one corridor, does that put all of our eggs in one basket?”

Those perceived physical threats to infrastructure never materialized. But the collective sense of uncertainty gave rise to a national campaign for energy independence that shaped the modern energy market — and the distinct energy security landscape of today.

In the years following 9/11, President George W. Bush embarked on an effort to retake control of the domestic energy market. The country already had a stable coal supply: In 2001, it imported less than 2% of the total coal consumed nationwide, and exported twice that much. Bush was more concerned about oil.

The Energy Independence and Security Act of 2007, which formalized Bush’s efforts to limit U.S. reliance on oil imports, marked a reversal from earlier presidents’ efforts to drive down prices by expanding international oil production.

“Energy is a weapon,” said Mark Doelger, president of B & H Geologists. “It’s an economic weapon.”

After 9/11, the U.S. was no longer comfortable giving its political adversaries that kind of leverage. But it didn’t have the tools to repudiate all foreign oil right away. In 2001, the country was the world’s second-largest petroleum producer, after only Saudi Arabia. It fell to third, behind Russia, in 2004.

Domestic oil production climbed steadily under President Barack Obama, despite the implementation of drilling policies more restrictive than his predecessor’s. In the years since, Obama has claimed credit for the industry’s growth.

It was hydraulic fracturing, however, that by 2014 drove the U.S. to its current spot atop the oil production rankings.

“It really is more the economic conditions of energy production than anything,” said Shannon Anderson, staff attorney for the Powder River Basin Resource Council. “That’s the reason we created greater domestic energy security with oil and gas. It was the technology and the economics.”

In 2019, the U.S. was still a net petroleum importer, producing 19.27 million barrels per day and consuming 20.54 million, according to the Energy Information Administration. It exported 8.47 million barrels per day. Most of the 9.14 million barrels per day sourced internationally came from Canada and the OPEC countries, including Saudi Arabia.

Amid the pandemic-driven demand crash in 2020, the U.S. became a net petroleum exporter for the first time since the mid-20th century. It imported 7.86 million barrels per day and exported 8.51 million, and consumed an average of 18.19 million barrels per day.

The fracking boom transformed the domestic natural gas market, too. After 2005, production soared. U.S. imports of natural gas began declining in 2007, and the country has remained a net exporter since 2016. In 2020, it produced 33.43 trillion cubic feet of natural gas — close to 3 trillion cubic feet more than it consumed.

“Energy independence, particularly in oil and natural gas, has really come a long way,” Doelger said. “Great strides have been made in those areas.”

Two decades after 9/11, despite the shifting regulations imposed by Bush, Obama, Trump and Biden, the U.S. has regained considerable control over its oil and gas markets. But fossil fuels are no longer the only major players in the energy sector.

Technological advancements and growing demand for low-carbon energy are driving a rapid transformation of the national energy landscape. Renewables, battery storage and nuclear power are displacing coal, oil and natural gas. But the generation sources needed to mitigate the climate crisis also come with new challenges.

“We all know where we are today with energy security,” Doelger said. “Clearly, it’s compromised, because of our reliance on unstable countries — countries that don’t have our best interests at heart.”

The U.S. depends on China and Russia to supply the uranium used in its nuclear reactors, which provide 20% of the country’s total electricity, as well as the rare earth elements needed to manufacture wind turbines, solar panels and commercial batteries.

Though there are some deposits of uranium and rare earths in the U.S., both resources can be imported relatively cheaply and remain prohibitively expensive to mine and process domestically.

U.S. uranium production, which peaked in 1980, has all but ceased, and its nuclear enrichment capacity — a necessary part of the refining process — is all but nonexistent. Even uranium mined within the country must be enriched outside its borders.

“We have the uranium resource,” Doelger said. “We have the rare earth resource. What we’re lacking, I think, to a degree, is the public acceptance and the political will to develop our domestic resources.”

To some extent, the factors hampering nuclear development are the reverse of the circumstances now extinguishing coal. There’s a market for nuclear, but the country’s uranium is inaccessible; coal is abundant, but demand is waning.

The disappearing market for coal poses a unique threat to U.S. energy security, said Jason Begger, executive director of the Wyoming Integrated Test Center, a carbon capture research facility. As climate-fueled hurricanes, wildfires, heat waves and ice…