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THE ENERGY INFORMATION ADMINISTRATION’S 

ANNUAL ENERGY OUTLOOK FOR 2015 

HEARING 

BEFORE THE 

COMMITTEE ON 

ENERGY AND NATURAL RESOURCES 

UNITED STATES SENATE 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

ON 

THE ENERGY INFORMATION ADMINISTRATION’S 

ANNUAL ENERGY OUTLOOK FOR 2015 

APRIL 16, 2015 

( 

Printed for the use of the 

Committee on Energy and Natural Resources 


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COMMITTEE ON ENERGY AND NATURAL RESOURCES 

LISA MURKOWSKI, Alaska, Chairman 

JOHN BARRASSO, Wyoming 

JAMES E. RISCH, Idaho 

MIKE LEE, Utah 

JEFF FLAKE, Arizona 

STEVE DAINES, Montana 

BILL CASSIDY, Louisiana 

CORY GARDNER, Colorado 

ROB PORTMAN, Ohio 

JOHN HOEVEN, North Dakota 

LAMAR ALEXANDER, Tennessee 

SHELLEY MOORE CAPITO, West Virginia 

MARIA CANTWELL, Washington 

RON WYDEN, Oregon 

BERNARD SANDERS, Vermont 

DEBBIE STABENOW, Michigan 

AL FRANKEN, Minnesota 

JOE MANCHIN III, West Virginia 

MARTIN HEINRICH, New Mexico 

MAZIE K. HIRONO, Hawaii 

ANGUS S. KING, JR., Maine 

ELIZABETH WARREN, Massachusetts 

KAREN K. BILLUPS, Staff Director 

PATRICK J. MCCORMICK III, Chief Counsel 

TRISTAN ABBEY, Professional Staff Member 

ANGELA BECKER-DIPPMANN, Democratic Staff Director 

SAM E. FOWLER, Democratic Chief Counsel 

TARA BILLINGSLEY, Democratic Senior Professional Staff Member 


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C O N T E N T S 

OPENING STATEMENTS

Page 

Murkowski, Hon. Lisa, Chairman, and a U.S. Senator from Alaska .................. 1 

Cantwell, Hon. Maria, Ranking Member, and a U.S. Senator from Washington .................................................................................................................... 2 

WITNESSES

Sieminski, Hon. Adam, Administrator, U.S. Energy Information Administration, U.S. Department of Energy ........................................................................ 5 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Cantwell, Hon. Maria 

Opening Statement ........................................................................................... 2 

Murkowski, Hon. Lisa 

Opening Statement ........................................................................................... 1 

Sieminski, Hon. Adam 

Opening Statement ........................................................................................... 5 

Written Testimony ............................................................................................ 10 

Responses to Questions for the Record ........................................................... 57 

For the Record: 

Annual Energy Outlook 2015 by the U.S. Energy Information Administration dated April 2015 ..................................................................... 75 


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THE ENERGY INFORMATION ADMINISTRATION’S ANNUAL ENERGY OUTLOOK FOR 

2015 

THURSDAY, APRIL 16, 2015 

U.S. SENATE, 

COMMITTEE ON ENERGY AND NATURAL RESOURCES, 

Washington, DC. 

The Committee met, pursuant to notice, at 10:06 a.m. in room 

SD–366, Dirksen Senate Office Building, Hon. Lisa Murkowski, 

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. LISA MURKOWSKI, U.S. 

SENATOR FROM ALASKA 

The CHAIRMAN. I call to order the meeting of the Energy Committee. 

Good morning, everyone. I would like to welcome you, Mr. 

Sieminski, here to present on the Energy Information Administration’s (EIA) Annual Energy Outlook for 2015. 

Mr. Sieminski, you have appeared before the Committee many 

times. We appreciate your work. You have ably served as EIA’s Administrator since June of 2012, and again, we are pleased to have 

you back before the Committee today. 

The EIA, as we know, is an important agency and one that we 

take very seriously here on the Energy Committee. The volume, the 

breadth and the frequency of its many publications are very, very 

impressive. 

The publication that brings us here today is the Annual Energy 

Outlook for 2015 which was released earlier this week. It is a lovely, glossy, thick, not too thick, very readable book with good charts 

and great information as well as the Executive summary that’s in 

there—but it is chock full of good information. 

It is my understanding that this is a projective document rather 

than a predictive one. In other words, you are not telling us what 

will happen in the future. Instead you are telling us what may happen in certain reference cases under certain assumptions. 

This is a useful annual exercise. Over the past five years the 

EIA’s projections in the Annual Energy Outlook have painted a picture of a brighter American future at least in the terms of energy. 

So before we proceed to your testimony, Mr. Sieminski, I want 

to highlight two items from EIA’s Executive Summary that I found 

interesting. I think that Committee members will, perhaps, have a 

number of questions on these items. 


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First, according to EIA we could see zero net energy imports in 

2028 under the reference case or as early as the year 2019 in the 

high oil price and high oil and gas resources scenarios. I believe 

this is enormously good news for our nation. The projected zeroing 

out of our net energy imports portends a future in which the 

United States is a net energy exporter. It does not require much 

of an imagination to see how that will potentially enhance our geopolitical position around the world. 

The second point is that EIA’s report also recognizes the growth 

in crude oil and dry natural gas production vary significantly 

across regions. As a result increased investment or realignment of 

pipelines and other midstream infrastructure is necessary. 

Now as we all know this Committee is working on a bipartisan 

energy bill. We will have both infrastructure and supply titles in 

that bill, along with titles on efficiency and accountability. It is my 

hope this morning in this hearing as we look at the Annual Energy 

Outlook that we will gain some numerical grounding to that effort 

and that EIA will continue to be a resource for the Committee 

going forward. 

So, Mr. Sieminski, we look forward to your presentation on this 

annual report. Again, thank you for the good work that has led up 

to this point in time. 

With that, I will turn to Senator Cantwell as the Ranking Member and then we will turn to you, Mr. Sieminski. 

STATEMENT OF HON. MARIA CANTWELL, U.S. SENATOR FROM 

WASHINGTON 

Senator CANTWELL. Thank you, Madam Chair, and thank you for 

this annual hearing and for the update. 

Mr. Sieminski, thank you so much. It is a pleasure to be working 

with you on such an important issue. We are here today to look at 

the findings in this report. 

First, I think it is important that the U.S. is likely to become less 

reliant on imported energy but will still remain a net oil importer 

for the entire forecast period. Within the context of the debate 

about current export policy, this is a key factor that we have to 

keep in mind. 

Second, carbon pollution is still expected to increase, even while 

it remains below the 2005 levels. This highlights the fact that we 

must take steps to bend the curve even further downward, given 

the tremendous cost to our climate and what is already being imposed on businesses and communities in my state and around the 

country. 

We need to look at policies where we can be mindful that these 

analyses, as my colleague just said, are predictive about what is 

happening right now, but not 100 percent certain about what is 

going to happen in the future. Keeping that in mind we need to increase energy efficiency, make it a larger variable in the equation 

and keep carbon pollution below the 2005 levels. 

For example, carbon pollution from the residential sector is projected to decline by five percent from 2013 to 2040. These reductions come from appliance and building efficiencies, which more 

than offset the growth in the number of houses that will need to 

be heated and cooled. I know a lot of my colleagues appreciate that 


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we can do much more to drive energy efficiency solutions into the 

marketplace, and it is a policy that ultimately pays for itself. 

Another important finding in the report is that electricity prices 

are likely to increase because of fuel costs. In the reference case national electricity prices are projected to rise 18 percent between 

2013 and 2040, and these price projections are driven by coal prices 

rising by nearly 25 percent and natural gas prices rising by 88 percent. 

In contrast, the renewable generation technologies, which use 

wind and solar and fuel, are going to be comparatively less expensive, potentially seeing different technology costs dropping 10 to 20 

percent. These projections don’t even take into account the rapid 

technology changes that can further drive the cost curve down. 

So it seems like sensible policies to me that we should still do 

more to connect these technologies to the electricity grid. Along 

those lines I should note that I do have an ongoing concern that 

EIA continually underestimates the potential of renewable energy 

in the Annual Energy Outlook report, but maybe that is something 

we can work on for the future. 

In these projections renewables meet much of the growth in electricity demand. In fact, renewables are likely to become cost competitive in many regions in the coming years. According to the Department of Energy’s own 2014 Revolution Now Report, ‘‘by 2014 

roof top solar panels cost about one percent of what they did 35 

years ago and solar PV installations were about 15 times what they 

were in 2008. So between 2008 and 2014 the cost of PV model declined from $3.40/watt to $0.79/watt.’’ 

Also in the same report DOE found a similar finding for wind. 

There seems to be an internal disconnect at the Department of Energy because other offices at DOE are noting how much better 

these technologies are performing than forecasted, and yet, EIA is 

predicting the same high-cost, low-growth scenarios. 

So I cannot imagine your job, Mr. Sieminski, balancing all of 

these variables any time you have this many scenarios and trying 

to keep them all on a similar line of a level of whether it is now 

or in the future. Maybe we can talk again about how we get some 

of this in future reports. 

Another example, as of the end of 2014, the American Wind Energy Association’s market report reported that the United States 

had a wind capacity of over 65 gigawatts. Your 2013 report, just 

two years ago, projected that wind capacity wouldn’t exceed 65 

gigawatts until 2034. So in reality it happened 20 years before 

that. 

Many organizations and associations have found that EIA’s assumptions are lagging behind the real world when it comes to clean 

energy development, and these assumptions, if incorrect, drastically impact the projections of renewables and can paint a misleading picture about the power of renewables. 

So while this EIA analysis is very useful, I think we need to take 

a holistic approach about how different energy sources are faring 

against others and the policies. This analysis is just one tool that 

helps us look at market predictions. 

I am a very big supporter of EIA and actually want to enhance 

its capacity because I think in an information age energy policy is 


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so important and you can play a role on so many different avenues. 

I think it is very important we continue to strengthen your office 

and organization, and I am sure we will get a chance to talk about 

it in the Q and A. 

I would also like to commend the EIA on its announcement that 

effective in March it is now able to provide monthly data on rail 

movements of crude oil. I suspect that reaching an agreement with 

the U.S. Surface Transportation Board and Canada’s National Energy Board to get this data were not a simple task. The data shows 

that over the past five years crude-by-rail shipments have increased 17 times nationally. Let me put it in the percentage. That’s 

a 1,751 percent increase in the shipment of crude-by-rail. 

20,000,000 barrels in 2010 to 370,000,000 barrels in 2014. That is, 

to say, a big impact on us in the Pacific Northwest. The hard facts 

make it clear the responsibility lies with policy makers to consider 

the public health and safety-related impacts of this emerging trend. 

Neither the oil industry nor the rail industry should enjoy unfettered profits from the shale boom without being required to step up 

and make sure that they have the safety precautions in place for 

the kinds of rail explosions that we are seeing across America. 

So once again, Mr. Sieminski, thank you and your staff so much 

for providing this information. I want to continue to work with EIA 

to make additional progress in this area. 

One other thing I want to mention, a lingering concern about the 

data and analysis associated with another pressing topic before the 

Committee, namely the completeness of EIA’s crude oil export analysis. In February 2014, Senator Wyden, who was the Chair of this 

Committee, and I joined to ask you for a comprehensive analysis 

of the regional price and transportation impacts on any change to 

current export policies. We live in a part of the country, Washington and Oregon, that depends on Alaska crude oil, and our market has been relatively isolated from the rest of the country. 

I am sure my colleagues will remember that both Senator Wyden 

and I constantly talk about this issue. 

We have to talk about it because we have some of the highest 

gasoline prices in the nation, and we are always asking why. Let’s 

just say that now as we look at the discussion in a few weeks in 

our export hearing we want to understand more completely this 

issue. From what we have seen thus far in EIA’s piecemeal analysis on crude oil exports, there has been no analysis on what this 

policy change might mean for consumers in the Pacific Northwest, 

who pay, as I said, among the highest gas prices. We also see headlines from other organizations suggesting that crude-by-rail traffic 

could double if the export ban is lifted. We need EIA to provide 

some enlightenment and additional analysis on this. I do not think 

Senator Wyden and I are satisfied with where we are, and we want 

to see this information as soon as possible. 

Again, Madam Chair, thank you for holding this hearing. And 

again, Mr. Sieminski, we want more information. That is the bottom line, and we want to help build as robust an organization underneath you as we possibly can in an information age where this 

is such a vital, important issue to our country. Thank you. 

The CHAIRMAN. Thank you, Senator Cantwell. 


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Mr. Sieminski, again, welcome to the Committee. We look forward to your comments this morning. 

STATEMENT OF HON. ADAM SIEMINSKI, ADMINISTRATOR, U.S. 

ENERGY INFORMATION ADMINISTRATION, U.S. DEPARTMENT OF ENERGY 

Mr. SIEMINSKI. Thank you very much, Chairman Murkowski, 

Ranking Member Cantwell, Senator Manchin, Senator Gardner. 

It’s a pleasure to be here. I really appreciate the opportunity to 

talk about the Annual Energy Outlook. 

And I’d like to start off with a request. I hope it would be okay 

if I would run over by two or three minutes of the five minute allocation in trying to summarize that. 

Thank you. 

The CHAIRMAN. Absolutely. We don’t have to turn to anybody 

else on the panel—— 

[Laughter.] 

Mr. SIEMINSKI. The second thing that I would like to say is that 

when I appeared before this Committee in early 2012 during my 

confirmation hearing I mentioned a number of things that I 

thought that EIA needed to do. And one of those was to do crudeby-rail information. Another one was to have much better, more 

timely data on the production of light, tight oil in the United 

States. 

And EIA has delivered on both of those promises. And we have 

a few more things that we’re working on but in general, I think, 

that the flow of information is pretty good. 

EIA is the statistical and analytical agency within the Department of Energy. And by law, EIA’s data and analyses are independent of approval by any other Federal office. So my remarks 

today really represent EIA and not the Department of Energy or 

any other Federal agency. 

I’d like to start off with just a few comments about the short 

term energy outlook. What’s happening in the global oil markets, 

in particular. And then discuss the recently released Annual Energy Outlook in more detail. 

In the short run EIA is expecting generally rising crude oil prices 

over the next few years. But we recognize the very high uncertainty as reflected in recent transactions in the futures and options 

markets. EIA forecasts that Brent crude oil which is a global water 

borne bench-mark will average about $59 in 2015 and $75 a barrel 

in 2016. 

West Texas Intermediate or WTI crude, the land-locked U.S. 

bench-mark is expected to continue to sell at a $5 to $7 discount 

to Brent. 

Some of the key factors in the near term pricing uncertainty include the global economic outlook, what’s happening in China, especially. And geopolitical issues affecting supply in countries as diverse as Venezuela where the economic situation is really bad and 

Iran where the nuclear talks are underway and might result in a 

lifting of sanctions. And this could have big impacts on the availability of oil in the global markets. 

Total domestic crude oil production averaged about 8.7 million 

barrels a day in 2014. We think that it hit close to 9.2 million barVerDate Sep 11 2014 22:23 Jan 27, 2016 Jkt 095270 PO 00000 Frm 00009 Fmt 6633 Sfmt 6602 E:\HR\OC\A270.XXX A270

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rels a day in the last quarter of 2014, but should be relatively flat 

in 2015 then rising to 9.3 million barrels a day in 2016. EIA expects drilling activity to begin to increase in the second half of 2015 

as companies respond to somewhat higher prices and lower costs 

for leasing, drilling and completion. 

On the consumer side there’s some really good news from lower 

oil prices. This should save the average household something like 

$700 in 2015 compared to 2014. U.S. average regular gasoline 

prices at the retail level, about $2.40 or so now, are expected to remain near that level through the summer and might hit $2.75 or 

so next year. 

Natural gas storage and working inventories are in much better 

shape at the end of this winter than they were last winter. And 

EIA projects that natural gas inventories will end October 2015 

looking out towards the end of this year at nearly 3.8 trillion cubic 

feet following an injection season that’s expected to be the fourth 

highest on record. Natural gas spot prices averaged just under $4.40 a million 

BTUs in 2014. And we think that that number will be down closer 

to $3.10 a million BTU in 2015. And still under $3.50 in 2016. 

That’s pretty good news for consumers in the mid part of the 

United States that depend on natural gas for heating fuel. Primarily because lower natural gas prices relative to coal prices generators are using more natural gas than they were last year. Natural gas’ share of generation is projected to be 30.4 percent of total 

generation this year compared to 27.4 last year. The share of coal 

fueled generation is forecast to be down about three percentage 

points from about 39 to 36 percent in 2015. 

EIA expects the share of total electricity generation from renewables, all renewables, including hydropower to increase from 13 

percent in 2014 to a little over 14 percent in 2016 with wind alone 

providing more than 5.2 percent of total generation. 

I’m going to turn now to the Annual Energy Outlook which provides longer term projections focused on factors that shape U.S. energy markets through 2040 under the assumption that current 

laws and regulations remain unchanged throughout the projection 

period. Consistent with this approach neither EPA’s proposed 

Clean Power Plant rules for existing fossil fired electric generating 

units, nor the effects of possible changes in current limits on crude 

oil exports are considered. These topics will be addressed in two 

forthcoming EIA reports. 

Senator Cantwell, let me just mention very quickly that using 

the assumption that current law and regulations remains in place, 

generally tends to underplay EIA’s forecasts for renewables simply 

because of the positive impact on renewables that come from the 

tax credits and other Federal incentives. And since we allow those 

to sunset as they do in existing law, it shows lower numbers in the 

reference case. If you look at our no sunset cases, which assumes 

continuation of the tax incentives, the results are in line with the 

recent experience of short term extensions. 

The AEO reference case and the five alternative cases really do 

provide a good basis for examination and discussion of energy market trends. And they serve as a starting point for the analysis of 

potential changes in U.S. energy policies. 


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I don’t have any doubt at all that there are going to be big differences with our forecast for what 2040 looks like and what will 

really be the case in 2040. But it’s super, super helpful to have a 

reference case against which you can test changes in law and regulation and changes in the economy, changes in oil and gas and 

other prices to see what the sensitivities are. It’s really important 

we do that. 

In the reference case Brent crude oil rises steadily after 2015 in 

response to global oil demand and keeps moving. The variation 

prices that we show in the AEO is quite wide. There’s a high case 

of oil getting to $252 a barrel by 2040, a low case of $76 a barrel. 

I think of these as stress tests. It’s not that we really believe that 

oil is going to go to $250 a barrel, but we want to look at what happens in the economy if we were to have such an event take place. 

Figure two in my testimony shows net energy imports aggregated 

across all fuels. And that’s the point that we were making earlier. 

In our reference case net energy imports cross over at around 2028 

to zero net energy imports. 

Most of the heavy lifting in those numbers occurs actually in the 

period running up to 2020. So it’s possible that the U.S. could become a zero net importer of energy even sooner than the reference 

case numbers. A lot depends on geopolitical events and what happens in the markets, what happens with the economy. 

Strong growth in domestic crude oil production from tight formation leads to a decline in petroleum imports in all of the cases. In 

the reference case, the U.S. is importing about 20 percent of its 

consumption in 2015. That’s in contrast to 60 percent of demand 

for liquid fuels being met by imports back in 2005. It was only ten 

years ago. 

The possibility, that with higher oil prices or a high oil and gas 

resource case, that the U.S. would become a net exporter of total 

liquids is a real one. 

Turning to natural gas. 

Prices in the U.S. market are mainly influenced by domestic resource availability and technology. They’re also affected by world 

energy prices and natural gas demand. In the reference case, the 

Henry Hub price rises to nearly $5 a million BTU in 2020 and to 

nearly $8 a million BTU in 2040 as increased demand in domestic 

and international markets leads to the production of increasingly 

expensive resources. 

In alternative cases the Henry Hub price could be substantially 

lower, $3 a million BTU in 2020, 36 below the reference case. That 

would be if we simply find more oil and natural gas than is in our 

reference case. 

Beyond 2020 prices vary across the different cases, closer well 

spacing, greater technology than the reference case that give significantly lower numbers for gas prices and to oil prices as well 

than are in our reference case. 

Figure four in my testimony shows exports of liquefied natural 

gas in the reference case, the high oil and gas resources case, in 

the low oil price case, that natural gas trade including LNG exports depends largely on the effects of resource levels and world energy prices. In all cases, as we show in the testimony, the United 


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States transitions from being a net importer of natural gas to a net 

exporter by 2017. 

Senator Murkowski said that we would be a zero importer before 

the end of the next decade and that growth differences across regions were important. And Senator Murkowski, we do find that regional variations in domestic crude oil production and natural gas 

production could drive significant changes in flows between regions 

requiring an investment or realignment in things like pipelines and 

other midstream infrastructure. 

Some of the biggest differences in the high oil and gas resource 

case, for example, are a lot more oil in the Dakotas and Rocky 

Mountains area that requires transportation out to refineries and 

markets and a lot more production potentially of natural gas in 

places like Pennsylvania, Ohio and West Virginia that would require the movement of gas out of those regions. 

Figure six in my testimony shows manufacturing output, where 

all of the growth in natural gas goes that the United States is 

going to see, in our view, over the next 25 years or so. Both chemicals industry, the food processing industry, the refining industry 

and metal smelting, would all be beneficiaries of this growth in 

natural gas production. 

Figure seven in my testimony talks about the rise in electricity 

prices and increasing with rising fuel costs. The—one of the key 

things there is that electricity demand itself is not growing very 

much, only by about eight tenths of a percent per year. And as a 

consequence it’s very hard for new fuels, like renewables, to penetrate the electric markets. Although renewables are growing quite 

substantially in EIA’s forecast, it’s still very hard for renewables to 

compete against some of the established, coal, nuclear and natural 

gas base load plants. 

Rising costs for electric power generation, transmission distribution coupled with relatively slow growth of electricity demand lead 

to an 18 percent increase in average retail prices in the reference 

case over the period. And we see that in virtually all of our cases. 

I’m going to conclude on just a couple of comments concerning 

growth in wind and solar generation. 

By the end of the forecast period even with the existing law and 

regulation constraint that we have in the Annual Energy Outlook, 

wind power generation exceeds power from traditional hydropower 

by the end of the forecast period. And across all of the cases wind 

and solar generation meet a significant portion of the projected 

growth in total electricity load. So to the extent that electricity demand would rise faster there could even be more room for things 

like renewables generation. We’ll just have to see how that works 

out. 

A final comment on carbon dioxide emissions. 

CO2 emissions are very sensitive to the influence of future economic growth assumptions and energy price trends. They vary 

across all of our cases. In the reference case, however, carbon dioxide emissions remain below 5.5 billion metric tons, well below the 

peak of six billion metric tons that was reached back in 2005, 6 and 

7. And they shift away from more carbon intensive fuels, especially 

for electric power does help to stabilize those numbers. 


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The last comment I would make and I appreciate the extra time 

very much, Senator, is that this is a shorter edition of the Annual 

Energy Outlook. It was completed under a new two year cycle. 

The reason I bring this up is that is that by doing a somewhat 

shorter version every two years it enables us to use those resources, people, time and money, on doing an international energy 

outlook in the international energy outlook is increasingly important in trying to understand what’s happening in the United 

States. Most of the energy growth globally is going to be occurring 

outside of the developed economies and it’s critical that EIA do 

more work in the international area. And we’re finding ways within 

our existing budget to do that. 

I’d like to thank you very, very much for the opportunity to be 

here this morning. And I look forward to your questions. 

Thank you. 

[The prepared statement of Mr. Sieminski follows:] 


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The CHAIRMAN. Thank you, Mr. Sieminski. I appreciate not only 

your recap here this morning, but again, the very serious and substantive work that EIA does. 

I want to remind members we do, apparently, have a vote at 

11:00. I am assuming it is just one vote, so we will move through 

our questions. We will keep going through that vote in case you 

have not had an opportunity to ask your question by the time the 

vote is called. 

You started off your comments this morning by referencing the 

short term energy outlook and some of the information contained 

in that. There is a lot of focus here in the Senate on the situation 

with Iran and the negotiations that have been taking place, so I 

want to start my questions on the topic of the Iran situation. 

In the short term report it is noted that Iran holds about 

30,000,000 barrels of crude in storage and that they can ramp up 

in production by some 700,000 barrels a day by the end of 2016 in 

the event that sanctions are lifted. Obviously there is a great deal 

of discussion about when any sanctions might be lifted but one 

thing that we do know is that we understand that sanctions have 

cost Iran some $40 billion in oil revenues just last year alone. 

A couple quick questions for you this morning, Mr. Sieminski. 

If an agreement is reached that does lift those sanctions on 

Iran’s exports would you expect that most of these new barrels to 

be exported would be to global markets? 

Mr. SIEMINSKI. Thank you for the reminder. 

Iran has, we believe, about 30,000,000 barrels of oil in storage. 

The removal of sanctions and how the sanctions are removed and 

whether it happens slowly over time or immediately is still undecided, as far as we can tell in the negotiations, would make a big 

difference. 

Iran’s production of crude oil, very recently, is around 2.8 million 

barrels a day, a couple million barrels a day of that is being used 

internally. So their exports are fairly low now. They will go up if 

the sanctions are removed. 

How rapidly the oil in storage goes into the markets will depend 

a lot on how the markets behave themselves. 

If they were to try to put all 30,000,000 barrels a day on the 

market very quickly it could lower the price and they would get 

lower revenue than they would expect. 

If you assumed that they might try to move that over, let’s say, 

a 100 day period the impact would be .3 million barrels a day. 

We believe that Iran, over time, could increase its current production and exports by about .7 million barrels a day. So the total 

amount would be about a million barrels a day of production coming on to the market. It’s really hard to see right now, Senator, 

how that could be absorbed without causing either other production 

to go down or the price to go down. 

The CHAIRMAN. The direction of my question is if we are assuming that if sanctions are lifted and there is that opportunity for export, not just internally within the country but opportunity for export, that there will be additional revenue that is generated to Iran 

that they would otherwise not have had. Then our situation here 

in the United States is American companies are subjected to an export ban here. So you have got an incongruence going on here 


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where we will have Iran able to make money off selling oil to our 

friends, our allies and using that new revenue for whatever purposes, perhaps nefarious purposes. We do not know. 

At the same time, if we were to go to this snap back that everyone keeps talking about or re-impose sanctions, it would be helpful 

here in this country if we were willing to lead from the front on 

this and lift our own outdated restrictions on exports, helping other 

countries. This is more of a political statement than the analysis 

that you have given us. 

I think it is important for us to recognize that if these sanctions 

are lifted and we, in fact, keep our own domestic sanctions in place, 

if you will, our ability to export a product that, again, could help 

our friends and allies and help our own country. It effectively ends 

up being a liability for us. 

Mr. SIEMINSKI. I did bring with me a list of the studies that 

we’ve completed on the topic of crude oil exports in response to the 

letter that I received from you and Senator Cantwell. And one of 

those does deal with the issue of how gasoline prices are set in the 

U.S. markets. They generally tend to be tied to the global oil price 

rather than the West Texas Intermediate bench mark. 

What that does suggest is that if more crude oil enters the global 

markets whether it’s from U.S. exports or from Iran or from production anywhere, it would tend to lower the global oil price which 

would tend to lower gasoline prices in the U.S. So one of reports 

does suggest that allowing more exports of crude oil would either 

be neutral or lower the gasoline price. 

There were a few studies that suggested that it could cause gasoline prices to go up. That seems to be a pretty low probability in 

our view. 

The CHAIRMAN. We appreciate the work that you did on that report. Again, I thought that the overall conclusion there to be drawn 

that we would see an ultimate lowering in price, not only worldwide but here in this country, was very beneficial for the discussion 

and the debate going forward. 

Senator Cantwell. 

Senator CANTWELL. Thank you, Madam Chair. 

Again, let me just reiterate how important I think good information is. 

Mr. SIEMINSKI. Thank you. 

Senator CANTWELL. Good information is, I think, like science. 

Usually like science you can get people to agree on that because it 

is basic information, so I hope we can do more. 

I did want to make a point about what you just said about the 

renewables and the tax credit. It is almost like we have a perverse 

relationship, because we have permanency in the oil and gas tax 

credits and so they receive better treatment in the report. The renewables don’t have as much predictability and certainty so they 

don’t receive as good of treatment in the report. And then conversely the people look at the report and then make assumptions 

about policy. So it is really a perverse incentive that is demonstrated, because they do not have the same permanency and 

treatment. 

I personally believe that you incent things that are nascent early 

technologies, and once things are well established that is when you 


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stop the incentives. But we can continue that debate in the future. 

I want to ask you a couple questions. 

One. What do you think the increase in the Dakotas and Rocky 

Mountain region in crude oil production could mean for those 

crude-by-rail numbers compared to the historic pattern that we’ve 

already been seeing? Are we going to see an even greater increase 

in crude-by-rail if the Rocky Mountain production increases? 

Secondly, when can Senator Wyden and I likely see our regional 

data on energy price impacts of lifting the crude export ban? 

Third, can you talk about why coal is going to become more expensive even under current law? 

Oviously the biggest, if we move more quickly than your forecast 

shows on electricity with no-cost fuels like the renewables, could 

consumers see even lower overall electricity costs? 

Mr. SIEMINSKI. Senator Cantwell, on a number of these things it 

would probably help if I try to give you the best view that I have 

now and get back to you for the record. 

Senator CANTWELL. Yes. 

Mr. SIEMINSKI. With some more detailed numbers. 

Senator CANTWELL. I appreciate that. 

[The information referred to follows:] 

The Annual Energy Outlook 2015 Reference case projects an increase in crude oil 

production from the Dakotas/Rocky Mountains region; with growth from 1.7 million 

barrels per day (b/d) in 2014 to 2.5 million b/d in 2020 and 2.6 million b/d from 2021 

through 2025, followed by a slow decline. Much of the increase is projected to come 

from the Bakken/Three Forks play in North Dakota and Montana, which increases 

from 1.1 million b/d in 2014 to 1.7 million b/d from 2020 through 2025 before slowly 

declining. If resources and/or oil prices are higher than assumed in the Reference 

case, projected production would be higher and production growth would persist for 

a longer period. Lower resources or prices would lower the projected production trajectory. 

The Dakotas and Rockies production region includes parts of Petroleum Administration for Defense District (PADD) 2 (Dakotas and Midwest) and PADD 4 (Rockies). 

EIA’s crude-by-rail (CBR) data, which are developed at the PADD level, show that 

rail shipments do not have a 1:1 to field production in those regions. Analysis CBR 

data from July 2012 through December 2014 indicates that the rate of growth of 

PADD 2 and PADD 4 field production far exceeds any increase in crude-by-rail 

movements from those regions to PADD 5 (West Coast). Future increases in rail 

shipments to West Coast refineries will depend on the economic viability of crudeby-rail versus imported crude oil, the type of crude oil refineries are able to process, 

and the regulatory outcomes for new or existing crude-by-rail facilities. 

EIA will be releasing a report on transportation fuels in Petroleum Administration for Defense Districts 5 in July. The study covers the market with a detailed 

analysis of infrastructure from refineries to retail facilities. 

In our October, 2014 report titled ‘‘What Drives U.S. Gasoline Prices’’, EIA concluded that gasoline prices throughout the United States are more related to 

changes in international crude prices than to changes in domestic crude prices. To 

the extent that changes to current crude export policies would increase global crude 

supplies, we would expect international crude prices to directionally decline, thereby 

lowering gasoline prices. On a regional basis, however, many other factors can influence gasoline prices, potentially negating any effect from enhanced crude exports. 

The effect of a relaxation of current restrictions on crude exports on the actual 

level of such exports would depend to a significant extent on the level of U.S. crude 

oil production. Projected production is sensitive to both resource and technology assumptions and oil prices. In production scenarios where domestic production increases by enough to result in more crude oil exports than would occur under existing crude export policies, the most likely export pathway for crude from the Dakotas/Rockies region would be for increased pipeline capacity to move crude to the 

Gulf Coast, where it could be most easily exported. 

Mr. SIEMINSKI. But let me try to go through that. 


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Thinking about production in the Bakken area and that’s where 

most of the growth is occurring in the Rockies, some in the 

Niobrara which is also an oil area in Colorado in that part of the 

country. About a million barrels a day is coming out of the Bakken 

now. The upper end of the estimates that I’ve seen for the next few 

years are in the neighborhood of a million and a half, possibly as 

high as two million barrels a day. 

So it’s potentially possible that another half a million barrels a 

day, let’s say, could be on the rails or in pipeline systems coming 

out of that region over the next few years. 

Senator CANTWELL. I would just say no one is proposing these 

East/West pipelines. So while I appreciate where this debate has 

been about the Keystone pipeline, the issue is that we’re talking 

about the demand. Our refineries are telling us it would have minuscule impact on the amount of crude that would move from the 

central part to the West Coast. So no one is proposing that pipeline. 

Mr. SIEMINSKI. Right. In the crude-by-rail data that we have put 

out, most of the oil from that region is actually, the greatest portion of it, is moving toward the East Coast, some towards the Gulf 

Coast and a smaller amount towards the West Coast. How that 

would change over time would depend on a lot of things. 

You also asked about regional price variations. I think that’s 

something that probably I could come back to the record for you. 

Mr. SIEMINSKI. There are—— 

Senator CANTWELL. When do—— 

Mr. SIEMINSKI. Regional variations in gasoline prices. They tend 

to be high on the West Coast and East Coast and lower in the Gulf 

Coast. A lot of that has to do with state and local rules on taxation 

and fuel, quality rules. And location of refineries makes a big difference and that sort of thing too. 

On your question of why electricity prices go up. 

There are going to be with relatively low growth, but the need 

for replacing existing plants as retirements occur for improvements 

in transmission and distribution. There’s just not as much—there 

aren’t as many people to spread the cost over, so the cost gets 

spread over roughly the same number of people and it causes rates 

to rise. 

We also have increasing natural gas, oil over time and coal prices 

over time as well, kind of in line with inflation. So an 18 percent 

increase in electricity prices over a 25-year period is significant but 

it’s, you know, less than one percent a year. 

Senator CANTWELL. Could you get this information for Senator 

Wyden and me by the end of this year? 

Mr. SIEMINSKI. I’m sure we could get something to you. 

Senator CANTWELL. Okay. I have a feeling the export debate is 

going to continue, and I think every member of this Committee is 

going to be interested in what that would look like and the impact 

on U.S. pricing. So it won’t be just Senator Wyden and me, but we 

certainly appreciate that commitment. Thank you. 

Mr. SIEMINSKI. Thank you. 

The CHAIRMAN. Senator Gardner. 

Senator GARDNER. Thank you, Madam Chair, and I appreciate 

Mr. Sieminski for being here this morning. 


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A couple questions to follow up on what the Chairwoman had 

asked about the Iran sanctions. You say you don’t have an idea on 

what impact it would have on price because you don’t quite know 

how much would be released daily, monthly, what would be released and put on the market by Iran. Is that correct? 

Mr. SIEMINSKI. We actually did say in the short term energy outlook that depending on the timing and how much could actually be 

moved into the markets that there could be as much as a $5 to $15 

per barrel impact lower on oil prices from Iranian crude reentering 

the market. 

And the basis of that, Senator, is just sort of looking at what 

happens when you add a million barrels a day, let’s say, to the 

global oil markets, what kind of effect does that have, you know, 

relative to supply and demand balances. And typically we come up 

with numbers that for a million barrels a day would be something 

like $10 a barrel. 

Senator GARDNER. Do you know what production impact that 

would have? Did you make a production impact projection on the 

U.S. then? 

Mr. SIEMINSKI. We did not, but it would certainly be the case 

that lower oil prices would lead to, in the short run, lower production. 

We have actually seen and EIA has published this in something 

we call the Drilling Productivity Report that three of the four big 

shale areas. So the four big areas are Eagle Ford and Permian 

Basin in Texas, the Niobrara, kind of in the midcontinent and the 

Bakken in North Dakota and Montana. Three of those areas, so the 

only area that’s still, where oil production is still rising, is the Permian and those other three areas we believe oil production has flattened off. 

And I would believe, Senator, that that’s a reaction to the difference between $100 oil that we had, you know, a year ago and 

$60 oil that we had this year. 

Senator GARDNER. Would it be possible to get a projected economic impact of Iranian oil exports as it relates to a decline in U.S. 

production? 

Mr. SIEMINSKI. We could try to do some back of the envelope calculations for you. 

Senator GARDNER. That would be great to see. 

[The information referred to follows:] 

The economic impacts of increasing Iranian exports will depend on whether and 

how much oil prices and production in other countries, including the United States, 

change in response. Generally, all things equal, when oil prices decline, the U.S. 

economy should benefit as the U.S. continues to be a net oil importer, with oil consuming activities making up a larger share of the overall economy than oil production activities. Certain regions in the U.S. where oil production is concentrated may 

experience reduced growth, especially if that region specializes in energy production 

and does not have a varied industrial base. Other factors will impact economic 

growth more than oil prices, such as what happens to exchange rates or whether 

consumers will spend or save the additional savings coming from lower energy 

prices. Many macroeconomic models estimate increases in U.S. GDP of between 0.1 

and 0.5 percent for every 10% reduction in the oil price if exchange rates do not 

change. A strengthening exchange rate could affect the competitiveness of U.S. exports. 

Senator GARDNER. Just a question as we talk about crude oil exports, as we talk about LNG exports. You and I have talked about 


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this before. We would not be in a position to even have a conversation on exportation of LNG if it weren’t for hydraulic fracturing. Is 

that correct? 

Mr. SIEMINSKI. Well, we could be talking about LNG, Senator, 

but we’d be talking about LNG imports instead of exports. 

Senator GARDNER. And it’s the hydraulic fracturing, the capabilities, that have allowed us to enter into the export conversation on 

LNG. 

Mr. SIEMINSKI. That’s correct. 

Senator GARDNER. Thank you, and we count rig counts. We have 

seen rigs being laid down in Colorado across the United States, but 

recent news reports have shown that we are actually increasing 

production in Colorado with several of our wind energy manufacturing centers. Wind turbine production is up. 

Do we have a way of counting production at facilities like that 

in Colorado? I mean, we count rigs. Do we count turbines being 

produced in this country? 

Mr. SIEMINSKI. I don’t think that EIA actually has that on the 

state-by-state numbers for production of things like wind turbines, 

but we are looking at generation electricity on a state regional 

basis. 

Senator GARDNER. Right. 

Mr. SIEMINSKI. And in fact, one of the things that we’ll be doing 

before the year is out here is reporting generation of electricity on 

an hourly basis. As far as I can tell when we begin this, this will 

be the first time that any statistical agency has collected data on 

anything on an hourly basis. So we’ll be showing electricity generation hourly. 

Senator GARDNER. Very good. In the Energy Outlook it talks 

about the capital costs of renewable technology decreasing over 

time resulting in more competition accounting for about 18 percent 

of total electricity generation in 2040. Do you believe at this point 

that we are accelerating renewable energy and efficiency technology into the grid at the scale we need to meet that energy production by 2040? 

Mr. SIEMINSKI. I think on that I’d like to come back to you for 

the record so that we could get our electricity people to have a look 

at it. 

These things get really complicated. I was thinking even about 

your earlier question about GDP with lower oil prices, you know, 

what effect does that have on the economy. And it actually, in the 

very near term, the lower oil prices tend to boost economic growth 

because there are more consumers of oil than there are of producers. 

So in the United States we would expect GDP to go up a little 

bit, but it would obviously vary across states and states that are 

more dependent on production would tend to suffer. 

And in trying to answer your question, I think I would, I’d like 

to be able to dig more into the numbers. 

Senator GARDNER. Absolutely. Absolutely. 

Mr. SIEMINSKI. And make sure we get the right numbers. 

[The information referred to follows:] 

In EIA’s Annual Energy Outlook 2015, electricity demand grows slowly, less than 

1 percent per year between now and 2040. The slowing growth in demand for elecVerDate Sep 11 2014 22:23 Jan 27, 2016 Jkt 095270 PO 00000 Frm 00036 Fmt 6633 Sfmt 6621 E:\HR\OC\A270.XXX A270

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tricity is in part due to improvement in energy efficiency in buildings and industry. 

During this period, renewable generated electricity grows by 2 percent and natural 

gas-fired generation grows by 1.3 percent. The projections include electric generating technologies that are commercially available or reasonably expected to be so 

over the time frame of EIA’ s projections. EIA believes that the capacity expansion 

for renewable electricity generation resources and energy efficiency improvements 

projected in the AEO 2015 Reference case are achievable under current laws and 

policies. 

Senator GARDNER. Thank you, Madam Chair. 

Thank you. 

The CHAIRMAN. Senator Franken. 

Senator FRANKEN. I do have some questions I want to ask but 

can I give Senator Manchin my spot, then go next? Am I allowed 

to do that? 

The CHAIRMAN. No. 

Senator FRANKEN. I’m not? 

The CHAIRMAN. You asked? 

Senator FRANKEN. I asked and I’m not? 

The CHAIRMAN. Well, we typically go back and forth from side to 

side. 

Senator FRANKEN. No, no, no, no, no. I would not go next. I know 

that would be Senator Barrasso, but could I be next in order on 

this side? That is what I meant. I know the back and forth thing. 

I yield to my good friend from the great State of West Virginia. 

Senator MANCHIN. Thank you to my friend who has allowed me 

to have this opportunity real quick before we go to vote. 

Mr. Sieminski, thank you so much for being here, and I appreciate it. We have had a chance to speak before, and sir, you know 

I have a real problem with what is going on. The demonizing of 

coal, it seems by a whole group of people who do not seem to understand the life that we all have is because of the domestic energy 

that we have right here in this country. We have developed to be 

one of the greatest industrial mites and built the middle class off 

of coal. 

Now, with that being said, if there is another source of energy 

that will replace that we, in West Virginia, are fine. The bottom 

line is that we produce a lot of gas and a lot of coal and we do wind 

and we are trying to do everything. The thing that I am concerned 

about is no one has raised the alarm as far as the reliability of the 

system that we have right now and how we are dependent on that 

reliability, and that is basically base load fuels. And base load fuel 

is something that 24/7 will run. 

It will produce whatever you want. You want to keep your refrigerator cool. You want your house cool. You want your factory to be 

working to where you have a job. You want all this to happen, but 

you have to have something that produces that energy and it has 

to be 24/7. 

The only two base loads you have right now are coal and nuclear. 

Gas, I think, will become a base load fuel. It is not integrated 

enough yet because of the supply chain, correct? With the pipelines 

and things that we are—— 

Mr. SIEMINSKI. Well there certainly are places now where natural gas—— 

Senator MANCHIN. Has become—— 

Mr. SIEMINSKI. Is being used as base load. 


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Senator MANCHIN. Right. 

Mr. SIEMINSKI. In our forecast we see more of that going out into 

the future, but you’re absolutely right. 

Senator MANCHIN. Let me just ask this question. 

Mr. SIEMINSKI. I mean coal is more than a third, almost, right 

now, close to 40 percent of electricity. 

Senator MANCHIN. And it anticipates being that until 2040. If 

there is a difference, if there is another fuel on the horizon, fine. 

But why in the world are we beating it to death and making it so 

impossible to produce the energy the country needs? The only thing 

I would ask you is this, sir. The aging of traditional electric base 

loads, the aging of these plants of coal and nuclear since they have 

been demonized and beaten the living crap out of. The age of them 

by 2040 will be the unit age of 60 years old. Those plants cannot 

expect to give the energy this country needs past 2040 at the reliability factor we have now. 

What do we do? I have read your report. We have gone through 

your report. If we do not do any upgrading to the plants that are 

producing the energy right now, what do we do in 2041? Do you 

expect they will all be replaced in one year or do we just fall on 

our face as far as reliability? That is what scares me, and no one 

has raised that alarm. 

Mr. SIEMINSKI. We have coal, nuclear and natural gas still accounting for a huge amount of our—— 

Senator MANCHIN. 75 percent. 

Mr. SIEMINSKI. Yeah, exactly. 

Senator MANCHIN. Yeah. 

Mr. SIEMINSKI. And renewables do grow very rapidly, but they’re, 

you know, a little below 20 percent. 

Senator MANCHIN. Right. They’re never going to carry the load, 

and we know that. 

Mr. SIEMINSKI. Or the generation mix. 

Senator MANCHIN. Right. 

Mr. SIEMINSKI. Right. 

Senator MANCHIN. I am just saying though you have particularly 

for 250 gigawatts of coal units remaining in 2040 with an average 

unit age of 65 years the expectation of operating of 75 percent of 

capacity. Your report says—— 

Mr. SIEMINSKI. Well, we don’t have everything retiring in 2041. 

Senator MANCHIN. Could you conduct? 

Mr. SIEMINSKI. It would happen over time. We could show you. 

I’d be happy to provide for the record, Senator, how we see the retirement schedule. In our reference case, there are coal retirements, there are also nuclear retirements, and even some of the 

older natural gas plants retire. They do get replaced by better technology. 

[The information referred to follows:] 

The AEO2015 only extends to 2040, so projections for the post-2040 period, including coal plant retirements, are not available. Although EIA does not project beyond 

2040, some inferences can be made about retirements in the early years after 2040 

given our understanding of retirement decisions. 

Coal plants do not retire upon reaching a certain age. Instead, a decision is made 

on the economics of the continued operation of the plant. In its modeling, EIA assumes $7 per kW annualized capital charge is incurred for coal plants that operate 

beyond 30 years of age. These added age-related costs account for major repairs or 


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retrofits, decreases in plant performance, and/or increases in maintenance costs to 

mitigate the effects of aging. In our projections, coal plants are assumed to retire 

if the expected revenues from operating the plant are lower than the annual goingforward costs (including age-related costs, fuel, O&M costs and annual capital additions) and if the overall cost of producing electricity is lower by building and operating new replacement capacity. 

In addition, the majority of the retirements that occur in the AEO2015 occur early 

in the projection period, and two major factors contribute to these retirements—low 

gas prices and the implementation of the Mercury Air Toxics Standards (MATS). Of 

the 40 gigawatts of projected coal plant retirements, 78% retire by 2016, the year 

that EIA models MATS implementation. The last projected coal retirement takes 

place in 2025, well ahead of the last AEO projection year of 2040. 

Both market and policy factors do affect projected retirements of coal-fired plants. 

For example projected coal-pant retirements are higher in EIA’ s High Oil and Gas 

Resource case, which assumes more resources and better technology that results in 

significantly lower projections of natural gas prices than the Reference case, which 

increasing the incentive to increase gas generation and reduce coal generation. Policy also matters, as exemplified in EIA’s recent analysis of the Environmental Protection Agency’s proposed clean Power Plan rule; compliance with that rule, as modeled in EIA’s analysis, caused projected coal-fired generation to decrease substantially and coal plant retirements to increase substantially. 

Presuming current laws and regulations, rising gas prices, and rising electricity 

demand while continuing to include age-related costs, and no other explicit technical 

limitations on expected plant life, a sudden onset of coal plant retirements in the 

early 2040s would seem unlikely. Because of the inherent uncertainty in aging related costs, EIA periodically reviews its methodology and gathers industry expertise 

and advice on the subject of aging. EIA held a workshop on the subject following 

its 2015 Energy Conference. 

Senator MANCHIN. Here is the other thing. To properly reflect 

the energy security benefits of combined CTL, basically with EOR, 

enhanced oil recovery, it seems to me it would make good strategic 

sense for us as a country to where we have these oil productions 

now. If you go to coal to liquids and use the EOR so we have no 

emissions. It is going down to produce more oil that gives us the 

reliability. 

We do not see anybody planning out for this. Everybody thinks 

in this perfect world that we’re going to be able to extract out of 

the air or the water, the energy that we need. I hope that day 

would come, but I like to prepare in case it doesn’t come and the 

demands we have we are able to meet. That is all I am trying to 

find is the balance, sir. You all have been pretty balanced and realistic. What do you recommend and how should we proceed from 

here? 

Mr. SIEMINSKI. Well, as I said at the beginning of my remarks, 

we try to stay out of the business of making recommendations. We 

leave that to the policy makers. 

Senator MANCHIN. But has anybody questioned in your—— 

Mr. SIEMINSKI. I’d be happy to pass your concerns along to the 

Office of Fossil Energy at DOE and they could probably help answer. 

Senator MANCHIN. But you have heard us all. We all trust, and 

basically we know, that you have people who are doing pretty accurate forecasts. 

Mr. SIEMINSKI. Right. Right. 

Senator MANCHIN. These forecasts have not been that far off in 

the past, yet no one seems to be heeding your forecast warnings of 

what we are going to be facing as a country. That is what scares 

me. I do not know how to get that to a level. It is just like you are 


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saying, well, you come from West Virginia. We expect you to rattle 

the cages. 

If someone told us in West Virginia you could have commercial 

hydrogen by 2040. 

Mr. SIEMINSKI. Right. 

Senator MANCHIN. And you do not need any fossil whatsoever. 

We will find a way to make it, trust me. We always have in West 

Virginia. 

But you are going to be needing the products that we produce. 

We want to make sure that we are able to do the job you need for 

our country, and we need somebody to help rattle the cages with 

us. 

Mr. SIEMINSKI. Well, we do try to provide the information, and 

we try to let the policy makers come up with the solutions. [Laughter.] 

Senator MANCHIN. What you are saying is I need more help, 

right? [Laughter.] 

Mr. SIEMINSKI. Well, we’ll do as much as we can with—— 

Senator MANCHIN. Your job and you are doing a good job and I 

appreciate it, sir. 

Senator FRANKEN. Madam Chair, may I say I regret allowing the 

Senator from West Virginia go before me? [Laughter.] 

The CHAIRMAN. You cannot pull back that, Senator Franken. 

Senator Manchin, the monkey is still on our back here to make 

sure that we do this. 

Let’s go to Senator Daines since Senator Barrasso has stepped 

out, and then we will turn to Senator Franken. 

Senator DAINES. Thank you, and Senator Manchin, I am grateful 

for you, just so you know—you betcha. 

Mr. Sieminski, your assessment talks about strong growth in domestic crude oil production from the tight formations. I assume 

that includes the Bakken formation in Montana as well as North 

Dakota? 

Mr. SIEMINSKI. Yes, Senator, yes. 

Senator DAINES. As you know when you cross the state line going 

west from North Dakota into Montana we have a lot more federal 

land in Montana than our neighbors in North Dakota. How much 

of the projected growth in production do you believe will come from 

Federal lands versus state or private lands? 

Mr. SIEMINSKI. I’d be happy to try to supply some of that for the 

record for you. We do a report. We published one that shows the 

location of oil production by private, Federal and American Indian 

lands. The bulk of the resources and we have overlaid the shale basins that we know of with a map of who the landowners are, tends 

to show that the bulk of the shale resources are on private lands. 

That is obviously going to vary from state to state, and perhaps we 

could get you some information on that. 

Senator DAINES. You would not want to venture a prediction on 

that at all or just wait to get the information from you? 

Mr. SIEMINSKI. I would rather have the numbers. 

Senator DAINES. Yeah. 

Mr. SIEMINSKI. Than to make a guess. 

Senator DAINES. I think—— 


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Mr. SIEMINSKI. I do know that the production on private land is 

way above the level of production on Federal land. 

Senator DAINES. I think over the last six years or so the production on private and state land is up around 50 or 60 percent. I 

think we are actually down single digits on Federal lands over the 

last six years, but I would be interested to get your—— 

Mr. SIEMINSKI. Yeah. 

Senator DAINES. Go forward. 

Mr. SIEMINSKI. And we will provide you with those numbers, 

Senator. 

[The information referred to follows:] 

Roughly 35% of the nearly 2.0 million barrel per day projected growth in domestic 

crude oil production between 2014 and 2020 is estimated to come from federal lands, 

defined to include both onshore and offshore areas. The federal Gulf of Mexico accounts for 95% of the growth in production from federal lands during this period, 

as new deep water projects start up. 

Historical oil production information is available from the ETA study ‘‘Sales of 

Fossil Fuels Produced from Federal and Indian Lands, FY 2003 through FY 2013’’ 

at http://www.eia.gov/analysis/requests/federallands/pdf/table7.pdf. 

Senator DAINES. Another question. Was the Department of Interior’s recently announced rule on hydraulic fracturing for Federal 

lands factored into your projected growth numbers? 

Mr. SIEMINSKI. Not specifically. There are different views about 

what that possible impact would be. The industry itself is moving 

towards greener completions across the board. So on both private 

and Federal lands it does tend to lift costs a little bit, but there 

are offsetting factors too. 

It’s one of the issues and greenhouse gas emissions. Perhaps we 

could come back to you on that with more information too. 

[The information referred to follows:] 

The BLM hydraulic fracturing rule was released in March 2015, after the Annual 

Energy Outlook 2015 analysis was completed. The rule is not expected to have a 

major impact on drilling because (1) the rule only applies to drilling on federal and 

American Indian lands and tight/shale formations that are primarily situated on 

nonfederal lands; (2) many provisions in the rule are similar to or based on current 

practices and State requirements; and (3) BLM estimates the incremental cost will 

be less than 0.25% of the cost to drill the wells (e.g. less than $12,500 on a $5 million well). 

Senator DAINES. Yes, we were disappointed in Montana. We have 

very robust and rigorous regulations. 

Mr. SIEMINSKI. Right. 

Senator DAINES. Because we have got to live near where the activity is occurring. We want to make sure we protect our environment and just do while this additional layer of regulations. We did 

not see that as helpful, certainly in Montana, when we think we 

have got that well regulated ourselves. Your assessment talks 

about an 18 percent increase in the average retail price of electricity over the projection period. What were the factors contributing to the projected increase in electricity rates in your assessment? 

Mr. SIEMINSKI. Senator, let me just take a quick look at what 

some of those numbers were. 

Senator DAINES. As you are looking that is important, certainly, 

for many, many states and for all of us. I think we are about 40 

percent of things like—— 

Mr. SIEMINSKI. Right. 


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So what we said was—— 

Senator DAINES. Coal. 

Mr. SIEMINSKI. You have rising costs for electric power generation, transmission and distribution coupled with the slow growth of 

electricity demand or what add up into that 18 percent number. 

So within the generation area some of that is going to be fuel increases and some of that will be the capital costs of expansion. 

Senator DAINES. I do not think your assessments, though, take 

into account the EPA’s clean power plan. 

Mr. SIEMINSKI. That’s correct. 

Senator DAINES. I can tell you Montanans are very concerned 

given that 51 percent of our electricity comes from coal that this 

plan would further increase electricity rates for Montanans, for 

Montana families, while also damaging our state’s ability and our 

tribe’s ability to produce coal. 

I did a field hearing on the Crow Reservation last week. Their 

unemployment rate is 47 percent today. If they lost those coal jobs 

it raises to over 80 percent unemployment rate. Certainly it is a 

concern back home. It is killing jobs, affecting our tax revenues 

which fund our schools, our teachers, our infrastructure and supporting overall essential services. 

Given these factors to electricity rates I remain highly concerned 

about the EPA’s proposed actions which would severely impact 

Montana’s coal sector. We have the most recoverable coal deposits 

in the United States. 

I am out of time, thank you. 

Mr. SIEMINSKI. Thank you, Senator. 

The CHAIRMAN. Thank you, Senator Daines. 

Senator Franken. 

Senator FRANKEN. Thank you. 

I am actually concerned also about climate change, so that is 

why I regretted yielding to the Senator from West Virginia. 

[Laughter.] 

And coal and we had all this coal talk. Okay. [Laughter.] 

You state very clearly in your report that energy market projections are subject to a lot of uncertainty, and one reason for this uncertainty is that you cannot predict technological breakthroughs, 

for example. No one could have predicted the magnitude of the 

shale revolution when hydro fracking was in its infancy. Now because of decades of major Federal investments, the commercialization of this technology has made the United States an energy super 

power. Similarly advanced energy storage will be a game changer 

for the utilities industry. It will allow us to incorporate more renewables so we can utilize wind and solar power when needed, if 

you can store wind that blows at night then that is the game 

changer. 

So instead of very modest growth in renewables which you 

project in this report, advanced energy storage could allow renewables to play a much more prominent role in our electricity generation mix. 

Can you talk about the next big breakthrough in grid scale storage and how it would impact the amount of electricity that would 

be generated from renewable sources? 


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Mr. SIEMINSKI. I’m sure we could supply you with some data for 

the record. 

[The information referred to follows:] 

Availability of grid-scale electricity storage could impact the amount of renewable 

resources that could be accommodated on the grid. Wind and solar resources 

produce variable, intermittent generation that may or may not match patterns of 

local or regional electricity demand on a daily or seasonal basis. Incorporating electricity storage with renewable generation could enable better operator control of 

these resources by storing excess generation and redeploying it during peak-demand 

periods. While the presence of energy storage may help the grid accommodate higher levels of wind or solar generation, EIA does not believe that renewable generation 

levels projected in the AEO2015 or its side cases would require the addition of storage to be realized. 

Currently EIA collects data from a number of utility-scale storage facilities located 

within the U.S. These technologies include pumped-hydroelectric generation, compressed air energy storage, flywheel, and a variety of battery technologies. EIA does 

not specifically model new storage technologies in the Annual Energy Outlook and 

does not predict which technology might be the next breakthrough technology. 

Mr. SIEMINSKI. In general, battery technology simply makes 

things like wind which tends to be stronger at night and solar 

which, obviously, is during the daytime, usable across the 24 hours 

of demand. 

There are some interesting things. Just recently I’ve been reading about aluminum as a battery material rather than lithium. It’s 

cheaper. It would have more cycles associated with recharging. It 

could be a huge development. 

That kind of thing doesn’t really have—doesn’t work its way, as 

you said, Senator, into EIA’s forecast because—— 

Senator FRANKEN. Sure. 

Mr. SIEMINSKI. We’re not. We try to forecast the future, but we 

don’t have our own crystal ball in that sense. 

We do have workshops at EIA and conferences all the time and 

one of those conferences coming up is actually going to deal with 

questions like yours. I’d be happy to make sure that your staff is 

invited to that. We’d be delighted to have you come, if you’d like 

to. 

Senator FRANKEN. When is it? 

Mr. SIEMINSKI. Um. 

Senator FRANKEN. Well, you can get that information to us. 

Mr. SIEMINSKI. Yeah, well—— 

Senator FRANKEN. I would love to—— 

Mr. SIEMINSKI. Love to do that. 

I think it is important. I mean we have looked from time to time 

at the technology, even on the generation side. I think we are doing 

pretty well with our wind numbers. 

A lot of the issues associated with whether or not we’re capturing, the number is properly, along the lines of Senator 

Cantwell’s questions, are in the solar area where the costs have 

been coming down. The technology is improving. And whether 

we’re fully capturing that or not, you know, I grant you, it’s an 

open question. 

Senator FRANKEN. Okay. I want to turn to LNG exports. The different scenarios considered in the Annual Energy Outlook highlight 

the risk that large volumes of LNG exports can drive up domestic 

natural gas prices. For example, in one of the scenarios where LNG 

exports exceed eight trillion cubic feet per year you project a 35 


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percent increase in domestic natural gas prices. The EIA found 

similar price increases in its previous studies which looked specifically at how increased levels of LNG exports would impact American consumers and industries. 

That is very serious to a state like Minnesota which produces no 

natural gas, but uses a lot of electricity for its manufacturing and 

uses a lot of, also, natural gas in its manufacturing. 

What impact would these kind of price increases have on the 

manufacturing sector, particularly for natural gas intensive industries such as the paper pulp and primary metal manufacturing sectors? 

Mr. SIEMINSKI. The EIA actually did a report at the request of 

the Office of Fossil Energy at the Department of Energy on the impact of increased LNG exports to the U.S. energy markets. First we 

were asked to look at possible export rates as high as 20 billion 

cubic feet a day. 

Across all of the cases in the current Annual Energy Outlook the 

highest we get is 13 or 14 billion cubic feet a day. I would kind of 

look at that 20 billion cubic feet a day request as a stress test, sort 

of like, what happens if oil goes to $250. We don’t really expect it 

to. What if LNG exports were to go 20 billion cubic feet a day? 

What would it do? 

Across all of those estimates we had end use consumer bills in 

residential, commercial and industrial sector going up anywhere 

between one to eight percent. I would think that in thinking about 

this it probably would be towards the lower end. We do find that 

prices would go up. 

A couple of other things, Senator, that I think actually would be 

important. 

One is that we, although natural gas prices would go up and it 

could have a differential impact as you said between those states 

that are producing gas and those that are doing more consumption. 

But a state like Minnesota actually has a fairly decent industrial 

base in things like heavy construction and services that would be 

useful in the producing industry. So there would be opportunities 

for the State of Minnesota to sell to those people who are making 

more money. 

One of the other things that I think would be important is that 

if we are right about how gasoline prices are set in the U.S. markets. That is based on the global oil price. Putting more U.S. natural gas into the global markets would probably tend to lower the 

prices for all fuels, including oil, which would then be reflected in 

lower gasoline prices in the U.S. and Minnesota, obviously, is a 

consumer of gasoline as are all the other states. 

So there are offsets, and I think some of the times I know about 

the EIA models. Look, we try really hard to get it right, but we 

can’t possibly get a lot of these secondary and complicated effects 

in there. And some of them that would go the other way and would 

actually help, I think, rather that hurt a state like Minnesota. 

Senator FRANKEN. Alright. Well, thank you for your answer. 

We are way over my time, but I want to continue this conversation. 

Mr. SIEMINSKI. Thank you, sir. 

Senator FRANKEN. Thank you, Madam Chair. 


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Mr. SIEMINSKI. It’s very serious because—— 

Senator FRANKEN. It is. 

Mr. SIEMINSKI. And it should be addressed. We’re trying the best 

we can. 

Senator FRANKEN. Thank you. 

Mr. SIEMINSKI. Thank you. 

The CHAIRMAN. Well, it is serious. It will be continued in this 

Committee and in others because as we look at those policies that 

may, in fact, inadvertedly be keeping our prices higher than we 

might like. We need to look to how we might refresh those policies. 

Senator Barrasso. 

Senator BARRASSO. Thank you very much, Madam Chairman. 

I want to continue on this line of questioning because in February of this year President Obama’s Council on Economic Advisors 

issued its report. It said, ‘‘An increase in U.S. exports of natural 

gas would have a number of mostly beneficial effects on natural 

gas producers, unemployment, on U.S. geopolitical security and the 

environment.’’ 

The President’s advisors explain that natural gas exports of six 

billion cubic feet per day could support as many as 65,000 jobs. 

They go on to say that expanded natural gas exports will create 

new jobs in a range of sectors including natural gas extraction, infrastructure investment and transportation. So the President’s economic advisors also go on to say that the natural gas exports for 

the United States would have, ‘‘a positive geopolitical impact.’’ 

Specifically they explain that U.S. natural gas supply builds liquidity in the global gas market, reduces European dependence on 

the current primary suppliers of Russia and Iran. So I am encouraged that your agency, the EIA, predicts that the U.S. will be a net 

exporter of natural gas by 2017. Would you expand on additional 

benefits that you see the natural gas exports bring to the United 

States, if you see additional ones? 

Mr. SIEMINSKI. Senator, I think it’s actually hard to expand on 

the list that you just went through. I didn’t hear anything in there 

that I would disagree with. 

One of the things, if Senator Franken were here, the NERA 

study did find that there might be some impacts on wages from 

higher natural gas prices. And from what I can tell in the models, 

many of the models don’t deal very well with questions like that. 

And the effects seem to be pretty small so that I think that the 

overall direction that virtually everybody who has looked at this 

comes to is that trade, generally speaking, has positive benefits 

across the economy. And LNG trade is no different. 

Senator BARRASSO. Great. I also wanted to follow up on Senator 

Gardner’s questions about Iran. Last month the Wall Street Journal ran a front page article that I have here. ‘‘Iran Nuclear Deal 

Portends Rush of Oil, New Price Drop.’’ 

The article explains that independent observers believe that lifting sanctions on Iran could result in boosting Iran’s exports by 

800,000 barrels per day within the year. Meanwhile the Wall 

Street Journal yesterday, that was a month ago, ran a story yesterday, and this is on page B1. ‘‘Oil industry layoffs hit a 100,000 and 

counting in the United States.’’ 


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Would you discuss the impact that lifting sanctions on Iran 

would have on American workers in the oil and gas industry? 

Mr. SIEMINSKI. We, EIA, actually published in our short term energy outlook our assessment. And we talked a little bit about that 

earlier. But refreshing, there’s 30 million barrels of oil that Iran 

has in storage that could come out at any time. And how quickly 

that comes out is hard to decipher. 

We believe that the Wall Street Journal article that you mentioned said 800,000 barrels a day of growth in production. We think 

the number is 600,000 to 700,000 barrels a day, could be 800,000 

barrels a day, let’s say, by the end of 2016. 

Senator BARRASSO. Yes, the Economist this past week said 

800,000. 

Mr. SIEMINSKI. Right. 

Senator BARRASSO. Well, but roughly, yes. 

Mr. SIEMINSKI. So, again, our roughest estimate is that this could 

lower the price. If everything else held constant, that much more 

oil on the market would lower the price anywhere between $5 to 

$15 a barrel. That lower price implies lower drilling activity which 

would then influence the numbers that you were citing. 

How quickly all that comes to pass? Whether something else 

might happen in the global markets? 

Just as an example, Senator, we are seeing a little bit of a lift 

in demand over the past few months. EIA has increased its estimate of gasoline demand on the back of better income and lower 

gasoline prices, along with interestingly, employment, that as the 

employment numbers have recovered we’re beginning to see people 

drive more which leads to gasoline. And trying to get all those 

numbers to balance is tricky. 

Senator BARRASSO. I had a final question on the predictions that 

EIA makes on the average retail price of electricity. It predicted it 

will increase as much as, I think, 28 percent by the year 2040. 

Mr. SIEMINSKI. Right. 

Senator BARRASSO. It explains that its predictions now do not 

take into account the EPA’s forthcoming Greenhouse Gas Regulations for the existing power plants. In other words any increases 

in electricity prices resulting from these greenhouse gas rules will 

be in addition to the increases that you currently predict, the 28 

percent. 

So I understand that EIA plans to issue a separate report on the 

impact of the EPA’s greenhouse gas rule. Can you tell me when 

you expect to see that report? 

Mr. SIEMINSKI. Yes, Senator. 

I think the reference case number was 18 percent out to 2040 for 

retail electricity prices. A lot of that coming from higher generation 

costs because of fuel and largely because of our assumptions of rising natural gas prices. 

Specifically to your question of will we look at the Clean Power 

Plan impact? Yes, we will, and I hope to have that report out in 

May. 

Senator BARRASSO. Because I know that in the past EIA has 

sometimes underestimated electricity prices in the reports. I am 

just curious if any specific steps are being taken now to ensure that 


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there isn’t an underestimation of the impact of the EPA’s rules on 

retail electricity rates. 

Mr. SIEMINSKI. Well, we’re looking very closely at that, and I 

would be happy to come up and discuss it with you when we have 

the report. 

Senator BARRASSO. Thanks, I appreciate it. 

Mr. SIEMINSKI. Thank you, Senator. 

Senator BARRASSO. Thank you, Madam Chairman. 

The CHAIRMAN. Thank you, Senator Barrasso. 

Senator Hirono. 

Senator HIRONO. Thank you, Madam Chair. 

Aloha, Mr. Sieminski. In 2008 Hawaii set a 40 percent renewable 

energy goal and a 30 percent increase in energy efficiency both by 

2030, and this is the most ambitious goal in the country. Why? Because Hawaii residents were paying, still do, pay the highest electricity rates in the country. We needed to get away from our over 

reliance on imported oil for 90 percent of our energy, so Hawaii 

now produces 18 percent of its electricity from renewable sources 

and achieved a 16 percent improvement in energy efficiency. 

I see that EIA projects that nationwide the U.S. will only achieve 

18 percent renewable energy by 2040 if we continue our current 

policies. Do you agree that the U.S. could develop much greater use 

of renewable energy if we establish national standards for renewable energy and energy efficiency like Hawaii has done? Because 

when we set these national standards it does spur the private sector to engage in research and development into alternatives in renewables, we think. Do you agree with that? And if we did that, 

couldn’t we achieve renewable goals greater than what you are projecting by 2040? 

Mr. SIEMINSKI. Senator, my opinion on whether we should do 

that or not is—I like to think of myself as one policy remark away 

from returning to the private sector. [Laughter.] 

Senator HIRONO. Oh, take a chance. [Laughter.] 

Mr. SIEMINSKI. On the issue, you know, if we had state renewable standards. In fact, state renewable standards and the Federal 

tax credits are a very important part of what’s driving renewables 

in our models, the technology and the role that cost reductions 

driven by technology would also be very important. Yes, it’s certainly possible that the numbers that we’re showing could be higher, and they definitely are, even under our no sunset case. 

John Conti and Paul Holtberg, who are here with me today, they 

are the ones generating a lot of this material. I could ask them, you 

know, have we in the past done a high technology case to look at 

things like this? I think we have and we’ll be doing more of that 

in next year’s Annual Energy Outlook. We’ll have a broader set of 

cases. And so perhaps next year I could come back and report on 

those outcomes. 

Senator HIRONO. Yes, I think there definitely is a connection between setting certain standards and the spurring of developments 

that would help us meet those standards. 

In looking at your figure eight, you show the growth of wind and 

solar. So that makes energy storage, I would say, a priority for us. 

According to a recent analysis by the Rocky Mountain Institute, a 

system of solar panels and battery storage that is connected to the 


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electric grid would be the most affordable option for places like 

Honolulu, Hawaii in 2016 and many other states in the next decade. 

A March 2014 analyst at Morgan Stanley concluded prices for energy storage could drop by more than half in the near future, and 

they expect batteries, including them, to be cost competitive with 

the grid in many states and think investors generally do not appreciate the potential size of the market, meaning the storage market. 

Does EIA acknowledge or appreciate the potential size of the battery storage market? And has the EIA include a recent assessments of storage costs in its projections of renewable energy deployment in the Annual Energy Outlook? 

Mr. SIEMINSKI. Our electricity group does look at things like 

that, very carefully, and cost is still an issue. I do understand the 

position that states like Hawaii and some of our territories, Puerto 

Rico and the U.S. Virgin Islands are largely dependent on oil for 

generation of electricity, and it does put them in a very tough position. 

I guess the good news, Senator, is that oil prices are half the cost 

of this year of where they were last year which should make electricity lower in Hawaii. And it would be interesting to see those 

numbers as they come out. Can we move to these other fuels? 

One of the things you didn’t mention that I know is being looked 

at by people in Hawaii is whether or not liquefied natural gas. 

Senator HIRONO. Yes. 

Mr. SIEMINSKI. Possibly coming from Alaska could help to generate power in Hawaii at prices competitive with some of the other 

fuels and lower than what you’re currently paying. 

Senator HIRONO. Madam Chair, if you don’t mind? 

Clearly when we rely on oil then we do have climate change 

issues. So states like Hawaii will make a commitment to get away 

from oil reliance and into the renewables and alternatives. I would 

say that the developments R and D are making on storage are a 

really important part of our energy future. 

Thank you, Madam Chair. 

Mr. SIEMINSKI. I absolutely agree with you, Senator, and we 

could look at a range of how electricity prices could change or how 

renewables could move into the mainstream faster with improvements and things like battery technology and some of the transmission. And as I said, I think in the next year’s Annual Energy 

Outlook we’ll have more of that. Thank you. 

The CHAIRMAN. Senator King. 

I also want to acknowledge that, in reference to your comment, 

Mr. Sieminski, we would love to be supplying our friends to the 

South in Hawaii with some of our natural gas. [Laughter.] 

The CHAIRMAN. We have got to get there first. 

Senator King. 

Senator KING. Thank you, Madam Chair. 

First, I want to thank you for the work that you do. I consult the 

data from your agency probably two or three times a week and now 

that I am on this Committee it will probably be even more frequent. 

Mr. SIEMINSKI. Thank you, Senator. 


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Senator KING. This is 50 shades of grey for a data geek. [Laughter.] 

I just really appreciate the work you do, and I also appreciate 

your resistance to being dragged into the policy discussions because 

the data is so important. 

In my experience having good data is what drives good policy, 

and if people can share an understanding of the data they can generally get to the policy conclusions without that much difficulty. 

This has been a fascinating hearing because of the regional differences. I would ask Senator Barrasso to come to Maine and tell 

the people of Maine the virtues of higher oil prices. How $1.00 diminution in gasoline and heating oil prices is $1 million into the 

pockets of the people of Maine. I just did the calculation, and that comes to $770 for every man, 

woman and child in the state. 

Mr. SIEMINSKI. Right. 

Senator KING. So lower oil prices. I noticed he used the phrases 

would cost jobs in the oil and gas industry, but the larger question, 

of course, is what would be the benefit to the economy at large? 

We are seeing a rejuvenation of manufacturing in this country, 

for example, because of the low prices of energy which is a competitive advantage we now have with other parts of the world, particularly in natural gas. So a fascinating discussion all about your 

point of view, I think. 

The other piece, of course, was the Senator from Montana talking 

about electricity prices and coal. New England prices are about 35 

percent above places that are dependent on coal. The problem is we 

do not get the cheap power, but we do get the pollution. 

We did a study some years ago in Maine that if we shut down 

every factory in Maine, took every car off the road, we would still 

have ozone violations along our coast because of pollution being 

transported by the westerly winds, so it is a very interesting regional discussion here. 

I just have a quick couple of questions. I apologize for the speech. 

In a nutshell, what will the effect of opening up oil exports be 

on domestic oil prices? My assumption is it will not be much because we have got a worldwide oil price anyway. But is that what 

your data shows? 

Mr. SIEMINSKI. Yes, sir. At least looking at history what our 

study showed was that because gasoline prices in the U.S., heating 

oil prices as well, tend to be tied to the global markets. And the 

reason for that is we’re both big exporters and importers of oil 

products like gasoline, diesel fuel, jet fuel and so on. The net effect 

that we saw was a slight decrease in the price of petroleum products if the U.S. were to export crude oil. 

Senator KING. And that would include decrease of those products 

in the U.S.? 

Mr. SIEMINSKI. In the U.S. 

Senator KING. Okay. By the way, on the question of Iran that 

30,000,000 barrels that is stored in the ships, they think. 

Mr. SIEMINSKI. Yes, sir. 

Senator KING. What is the daily worldwide consumption of oil? 

Mr. SIEMINSKI. Worldwide consumption is about 92,000,000– 

93,000,000 barrels a day. 


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Senator KING. So we are talking about an eight hour supply on 

ships. 

Mr. SIEMINSKI. Worldwide. 

Senator KING. I just think we need to put that in perspective. 

Mr. SIEMINSKI. What you wouldn’t want is to see it all come in 

at the same time. 

Senator KING. Clearly, I understand that, but it is not like it is 

a month’s supply. It is a third of a day’s supply. 

Mr. SIEMINSKI. Correct, and Iran would have its own financial incentives to try to minimize the impact on the global market. 

Senator KING. When you did your estimates about the penetration of renewables, did you make any assumptions about technology advancements in storage or energy storage capacity because 

as you’ve testified that would make a big difference in the ability 

to integrate wind and solar into the grid, for example. 

Mr. SIEMINSKI. We do make assumptions about improvements in 

technology across all of the fuels, and I think where the arguments 

come, Senator, is on the pace of those changes in technology. 

Senator KING. And the only thing we can say for sure about any 

of our predictions is that they will be wrong. [Laughter.] 

Mr. SIEMINSKI. I know that we’re going to be wrong. I’d like to 

not be wrong right away. [Laughter.] 

Senator KING. I would subscribe to that as well. I would like to 

be proven wrong long after I am gone. [Laughter.] 

But how about any assumptions about CO2 sequestration in your 

calculations because that could make a huge—Senator Manchin is 

right. We have a huge coal asset. If we could figure out how to deal 

with the CO2, that would be that would be a plus for everybody. 

Mr. SIEMINSKI. There actually is one of the things—and Senator 

Manchin didn’t mention it directly, but he alluded to the Kemper 

Facility that’s being built by, I think, the Southern Company that 

will take coal and turn it into natural gas and hydrogen, capture 

a good portion, I think more than half of the carbon dioxide. And 

move that by pipeline to an old oil field that would benefit from 

having CO2 injection to help increase the oil production. What we 

found. I mean, this is a very early stages, really nobody has tried 

to do this at this scale before, is that it’s been costly. I think that 

if we’re going to do this economically at scale where you have more 

of these, we’re going to have to find ways to improve the cost of 

doing it. 

Senator KING. One of the realities here is that none of us can 

really predict where the technology will go. Hydro fracking, I think 

Senator Franken mentioned, was developed under Federal research 

and development support. Nobody predicted that even eight or nine 

years ago in terms of the impact that it was going to have, and 

there may be some kid somewhere who is figuring out how to sequester coal CO2. And it is going to change the whole world. 

Mr. SIEMINSKI. It would really help actually. And finding ways 

to do that, the Department of Energy, other part, obviously not 

EIA, but there are parts of the Department of Energy, Fossil Energy and the labs who are working very hard on trying to find 

ways to make that happen. 

Senator KING. I am over time. Thank you very much. I look forward to continuing the discussion. 


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I think another issue is distributed energy. Distributive solar on 

the roof is going to have broad effects, but I will leave that for another time. 

Mr. SIEMINSKI. Senator, with your permission, 30 seconds on 

that. We’re really interested in that issue at EIA. It’s very hard for 

us, actually to do because it’s behind the meter. It’s hard for us to 

do that. We tried it on an annual basis. 

We have looked at rooftop solar and its impact, residential and 

commercial. It’s easier to get the commercial numbers than residential. 

We are looking for ways now, and I think we’ll be successful at 

this. This year I think we’re going to start to find ways to make 

estimates on a monthly basis of what the impact is of rooftop solar 

on the electricity generation markets, and it’s one of those other 

areas that we’ve been trying to emphasize as an important part of 

the ongoing effort at EIA to stay up with current technology. 

Senator KING. It could very shortly turn into a true disruptive 

technology. 

Mr. SIEMINSKI. It could very well do that. I mean we do know 

that the combination of tax incentives and the environmental positive nature that many people who were installing it want to see is 

pushing this, so the growth in that area—— 

Senator KING. It could dramatically lower costs—— 

Mr. SIEMINSKI. Right. Correct. 

Senator KING. Thank you. Thank you, Madam Chair. 

Mr. SIEMINSKI. Thank you, Senator. 

The CHAIRMAN. Thank you, Senator King. 

Senator Hoeven. 

Senator HOEVEN. Thank you, Madam Chairman. Thanks for 

holding this hearing today. Mr. Sieminski, thanks for being here. 

Mr. SIEMINSKI. Thank you, Senator. 

Senator HOEVEN. And for your very, very important work. I 

would mention, pursuant to one of the last questions brought up 

by the good Senator from Maine, in North Dakota the Dakota Gasification Company takes lignite coal and converts it to synthetic 

natural gas. That natural gas is put in the pipeline and sent off 

to a number of different states for use. 

We also capture the CO2, condense it, cool it, condense it, put it 

in a pipeline and ship it to what is called the Weyburn oil fields 

which are actually in Canada just over the border from North Dakota. That CO2 is put down a hole or sequestered and used for tertiary oil recovery in the Weyburn oil fields. 

So we are doing just exactly what you described, producing natural gas from coal, capturing the CO2 and sequestering it and producing more oil and gas in the process. 

I think, Mr. Sieminski, your point is exactly right. The problem, 

the reason we are not doing more and more and more of it is we 

have got to make it economically viable, and that means we both 

have to reduce the cost of carbon capture and there has to be 

enough benefit in the molle patch to use CO2 for tertiary recovery 

rather than water floods or something along those lines. 

Mr. SIEMINSKI. That’s correct. 

Senator HOEVEN. My question to you is right now today the 

world price for oil as posted for Brent crude is $63 a barrel. The 


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domestic price for oil is West Texas Intermediate crude. That’s $55 

a barrel. That means our producers get $8 less per barrel of oil 

than foreign producers. 

So here we are locked in a battle to determine who is going to 

supply energy in the future, who is going to produce energy in the 

future, and our producers are at an $8 disadvantage against producers in places like the Middle East and Russia and Venezuela. 

At the same time our consumers do not benefit because gasoline 

is benchmarked off world crude which is the higher price at Brent, 

so we lose both on the production end which hurts our ability to 

produce more energy, be more energy secure here at home. It also 

hurts our consumers at the pump, so we need to lift the export ban 

on oil. Everybody wins in that equation all the way from the producer to the consumer at the pump. 

How can you help get that information out so that when we go 

to the Senate Floor we can get more than 60 votes and pass that 

legislation? 

Mr. SIEMINSKI. Well, Senator Hoeven, we appreciate the support 

that you’ve shown us over the years in terms of our budget. Our 

budget enables us to do that, and I know that you’re there. 

You know, on this difference, it actually goes back to something 

that Senator Murkowski mentioned at the very beginning of the 

hearing that measurement of the WTI price is in the midcontinent 

at Cushing, Oklahoma. And as long as you can’t consume as much 

of oil in that midcontinent area as you’re producing, prices are 

going to be depressed. And you know very well, Senator, that prices 

can often even be lower in North Dakota because you’re even further away from the refineries that will consume the oil. 

I think that the infrastructure issues are critically important as 

we build out. 

Senator HOEVEN. I am glad you brought that up. Thank you. 

[Laughter.] 

Mr. SIEMINSKI. As we build out the infrastructure some of that 

differential could disappear and our producers would be getting 

closer to world prices. 

Senator, you also missed an interesting dialogue between Senator Murkowski and the Senator from Hawaii. Hawaii is paying 

very, very high prices for electricity. And you know, that might be 

helped if you could get LNG from Alaska down to Hawaii, for example. 

I remember last time I was up here Senator Baldwin was saying 

that the paper industry in Wisconsin was really getting hammered 

by high energy prices, and they don’t use a lot. They could use 

more natural gas there, and I remember you saying that you’d love 

to sell some of that gas that’s not being used and get that down 

to Wisconsin. 

Those are the kinds of infrastructure issues that need to be addressed so that we can get the energy from where it’s being produced to where consumers need it. 

Senator HOEVEN. So infrastructure is vital. But also in your expert opinion the ability to export LNG, liquefied natural gas, and 

the ability to export oil will benefit our consumers because we will 

produce more here at home. The price at the pump is benchmarked 


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off the world price. More supply pushes prices down so the consumer benefits. Is that correct? 

Mr. SIEMINSKI. I’d say that in general, trade generally tends to 

boost GDP and GDP is obviously, ultimately, helping everybody. I 

think there are some very serious regional issues that—— 

Senator HOEVEN. But apart from the regional issues, overall you 

are always going to have imbalances, particularly when we can’t 

when we are blocked from building vital infrastructure. To build an 

energy plant for the country we need the right mix of pipelines, rail 

and road. We need the energy infrastructure. We need transmission lines. 

You cited some great examples, but producing more energy at 

home, more supply here at home, helps our consumer, correct? At 

the same time that prices are priced off a global market. 

Mr. SIEMINSKI. That is correct. 

Senator HOEVEN. And we are competing in a global market. 

Mr. SIEMINSKI. I agree with that. Yes, sir. 

Senator HOEVEN. Yes, sir. 

My second question is the imbalance of light and heavy. What 

can we do to help our refiners modify their refineries so that we 

can process more of the light, sweet crude we produce which would 

help us, of course, with energy production here at home, energy security and again, benefit the consumer? What kinds of things can 

we do to help our refiners address this imbalance of light and 

heavy crude? 

Mr. SIEMINSKI. The—— 

Senator HOEVEN. In terms of refining capacity? 

Mr. SIEMINSKI. Yeah, you know, I’m not—beyond the issues that 

have been talked about in terms of what happens if you allow exports or don’t allow exports EIA has been looking at this from a 

couple of different angles. 

In April, we published earlier in this month, we published a 

paper on the options for petroleum refineries to run more light, 

sweet crude oil. So it was, kind of, along the lines of what they 

could do. You know, what are the things they can do in a refinery 

to run more light, sweet crude oil? 

In another month and maybe by the end of this month we will 

have a report out that looks at the question of well what would 

they do given the existing set of costs and so on. And it will try 

to look at the question of what refiners would actually do in response to the current production of light, sweet crude oil and the 

refining kit that’s available to run it. 

The final report that we’ll have out, I hope in June, will look at 

the costs, the impacts on production and the impacts on trade from 

either having the crude oil export ban, you know, or rules continue 

as is or changing those to make it more open. 

Senator HOEVEN. So you said your next study will actually focus 

on some of the things refineries can do to address—— 

Mr. SIEMINSKI. We will do that. Yes, sir. 

Senator HOEVEN. This imbalance between light and heavy and 

process—— 

Mr. SIEMINSKI. Right. We’ll have that out relatively soon. 


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Senator HOEVEN. Madam Chair, I do have one more question. I 

am certainly willing to wait, but I would like to ask one more question. 

The CHAIRMAN. We are going to do one more quick round, if you 

do not mind waiting. 

Senator HOEVEN. Thank you. 

The CHAIRMAN. Okay. 

Mr. Sieminski, thank you for, kind of, the continual plug here for 

Alaska to move its LNG. We believe, of course, that we have considerable opportunity, not only for our state, for Hawaii, but what 

it represents beyond that. Know that we are working it, but the 

need is clearly there. 

We are talking about the infrastructure and the alignment that 

is going to be needed going forward. I appreciate some of the specifics you’ve outlined here just with Senator Hoeven, but as you 

know within the State of Alaska we have an extraordinary piece 

of energy infrastructure, the TransAlaska pipeline. 

Right now we are moving about 500,000 barrels a day, but your 

forecast projects 420,000 barrels a day by 2020, 320,000 barrels per 

day in 2025 and then just 180,000 barrels a day when we hit 2035. 

This is a terrifying prospect for us right now because the concern 

is that there gets to a point where that throughput is so low it 

brings into question the ability of that pipeline to function as safely 

as we need it to be. 

If it cannot function safely then we stop moving the oil through 

the line, and when you stop moving the oil through the line the law 

requires that we decommission that incredible energy infrastructure. For those who wonder how long it might take to permit a new 

TransAlaska pipeline, I do not even want to speculate about where 

that might take us. 

So when we are talking about infrastructure and the need to realign, I think we also need to recognize that we have very good infrastructure that effectively needs to be filled up in Alaska’s case. 

The question to you this morning is in your reference case I am 

assuming you have factored in a steady state in Federal policy. 

Mr. SIEMINSKI. Right. 

The CHAIRMAN. Some of what we are dealing with in Alaska, of 

course, is being able to access other areas, other Federal areas so 

we can fill up that pipeline whether it may be the ANWR area, our 

offshore prospects or being able to tap into some resources within 

the National Petroleum Reserve. How does the issue of access factor into your projections? 

Mr. SIEMINSKI. Well we do follow existing law and regulation, 

and unless there are changes to the ability to lease in the Arctic 

refuge, for example, or we see other things like a lowering in the 

cost of doing shale oil developments. There are shale oils on the 

North Slope of Alaska that right now it seems in our models uneconomic to do that. 

At $100 it was getting closer at $60 or $75, maybe not as much, 

but those sorts of things would enter into those calculations. 

Senator, we did do a study specifically of the Alaska oil pipeline 

in, I think it was the 2013 Annual Energy Outlook, where we highlighted the fact that there could be a step change down at some 

point as production flow through the TransAlaska pipeline gets 


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down to about 300,000 barrels a day. The mechanical ability of the 

pumps to work at that level of throughput comes into question, and 

it’s very possible that it would have to drop. 

It was one of the things that we thought should be looked at because a change of 300,000 to 500,000 barrels a day in the global 

oil markets is enough to make a difference, and it was something 

that we wanted to look at. 

I understand your concern. It’s policy issues. That’s another one 

of those policy issues that EIA generally tries to provide the facts 

so the people can understand what’s happening but not a recommendation to—— 

The CHAIRMAN. That is greatly appreciated, but I think it is important for people to not assume this is just going to be continuing 

with a flow from the north if we cannot have access to these resources, those reserves. 

Mr. SIEMINSKI. Right. 

The CHAIRMAN. That are, in fact, in place up there. 

Can I just ask one quick question about, again, Alaska LNG and 

the fact that the reference case does include a completion of the 

Alaska LNG project? Which, of course, I fully support and Alaskans 

fully support. But in terms of the economics that derive from that 

project coming out of Alaska, can you speak briefly to that? 

Mr. SIEMINSKI. Sure. We have LNG from Alaska coming in 

around the year 2025. It seems like a long way away, but 10 years 

is not a lot when you are developing a project the size and scope 

associated with that. 

It is dependent on our reference case forecast for oil hitting $75 

a barrel next year and then moving up over time. Higher oil prices 

make LNG more attractive in overseas markets where fuels tend 

to get priced against each other where there’s oil linked contracts 

for gas. So the higher oil prices would help that. 

Two other cases that we ran, Senator, we don’t have Alaska LNG 

coming in. 

One of those is the low oil prices case. As I said low oil, low global oil, prices just make it harder for the economics to work for Alaska LNG. 

And the other one, interestingly, is high oil and gas resource 

case. If there are more oil and gas resources let’s say in the lower 

48 states relative to Alaska then Alaska’s standing in the queue of 

projects that would get done on an economic basis might slip down. 

So there’s a lot of moving parts. 

The reference case though does have LNG from Alaska coming 

in. And it would, I think, most of it would probably go to Asia. But 

I think some of that actually might end up in Hawaii as well. 

The CHAIRMAN. As I have told Senator Hirono, Hawaii is on the 

way to Asia. [Laughter.] 

So we can make that work. Thank you for that. 

Senator Cantwell. 

Senator CANTWELL. Just to clarify on that point. So Alaska being 

able to export LNG and possibly being successful on a pipeline 

would not have an impact on the U.S. market? 

Mr. SIEMINSKI. It would have a minimal impact mainly because 

it’s separated from the lower 48 state markets. 


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So it would have more of an impact on the global markets. I 

mean, you know, again, to the extent that you get more fuel whether it’s oil or gas or renewables into the markets you’re going to 

tend to lower prices. Certainly that would be the case for oil and 

gas. And the net effect of that would be to bring fuel costs down 

for everybody. 

Senator CANTWELL. Can I talk for—— 

Mr. SIEMINSKI. And Senator Cantwell, if I, just a second. 

We are working really hard on a study of gasoline on the West 

Coast markets. And we hope to have that out fairly shortly. And 

I think that’s something that you’d be very interested in. 

Senator CANTWELL. Good because I gave you up to the end of 

this year. Now that it is going to be very shortly, I love that answer. So, thank you. 

Mr. SIEMINSKI. Right. 

Senator CANTWELL. I liked this part of your report on page four 

about liquid fuel consumption falling, and I am sure that is directly 

related to transportation fuel. 

Mr. SIEMINSKI. That’s correct. 

Senator CANTWELL. Do you see that trend continuing? 

Mr. SIEMINSKI. In the reference case total liquid fuels consumption comes down a little bit over the forecast period. It’s very different between the different fuels of gasoline comes down pretty 

sharply. Diesel fuel and jet fuel actually go up a little bit. The reason jet fuel goes up is there’s just more people flying. 

Senator CANTWELL. Yes. 

Mr. SIEMINSKI. And diesel fuel—— 

Senator CANTWELL. Which is why—— 

Mr. SIEMINSKI. Diesel fuel goes up because, with population and 

economic growth, there is more trucking occurring and train transportation as well. And both trucks and trains use diesel fuel. 

Senator CANTWELL. Well, we are definitely working on those on 

the R and D side. [Laughter.] 

Both on jet fuel and on other biofuels, so that is why it is so important. But—— 

Mr. SIEMINSKI. Biofuels are in that forecast too in a portion of 

the diesel fuel category there’s bio diesel. 

Senator CANTWELL. I am sure tax credits, but I am sure the tax 

credits are not. So then their predictions are not as robust. Okay, 

we will not go there. 

Mr. SIEMINSKI. We would love to get help from the Senate and 

House of the United States on clarity on the path forward for those 

tax credits. It would help in our analysis a lot, but I’m not counting 

on it. 

Senator CANTWELL. One of my top priorities for energy is to get 

that predictability. We are going to continue to see a savings at 

least within transportation fuel. We are going to continue to see 

that consumption savings. 

Mr. SIEMINSKI. Right. 

And it’s an important part of our forecast for the question of net 

oil imports and the benefits to the economy as we produce more of 

the fuels that we’re consuming. The flatness in the overall liquids 

fuels and the drop in gasoline consumption that’s being encouraged 

by fuel efficiency standards and changes to other fuels in the transVerDate Sep 11 2014 22:23 Jan 27, 2016 Jkt 095270 PO 00000 Frm 00056 Fmt 6633 Sfmt 6602 E:\HR\OC\A270.XXX A270

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portation sector helps to keep that oil import number down at that 

15 percent level that we have in the reference case. And that’s a 

huge improvement over what the U.S. situation was just ten years 

ago. 

Senator CANTWELL. Yes, I agree. You had some interesting projections on hydro. So what are some of the factors that are driving 

those projections? It sounds to me like there are efficiencies being 

implemented, new turbo—— 

Mr. SIEMINSKI. One of the charts in the Annual Energy Outlook 

basically shows all renewables. And EIA includes hydro as one of 

the renewables. We, right now, hydropower is just about equal to 

all of the other renewables combined. 

But we think hydropower over the 25 year forecast is going to 

be relatively flat. The reasons behind that is there just aren’t that 

many more places where you’re going to put big dams in the 

United States. So with hydropower relatively flat and increases 

coming in in other renewables like solar and especially wind—we 

have a lot of growth in wind that by the end of our forecast period 

wind generation, actually exceeds hydro generation for the first 

time ever in the United States. 

And it could then happen sooner. Yes, it could, you know, if we 

ran that in the no sunset case we would have more growth than 

wind and solar than are shown in our current charts. 

Senator CANTWELL. Thank you for bringing that point up about 

wind. I was definitely going to go there, so thank you for explaining 

that. 

On hydro, I just want to emphasize how much new technology 

is helping us drive efficiencies there. 

Mr. SIEMINSKI. Right, to the extent that better generators can 

convert the energy that’s in the water into something that’s deliverable across the lines. It would be a real benefit out in the Northwest. Also the transmission, I mean, we’re making progress in the 

efficiency associated with the transmission grids and the more of 

that electricity that you can get to the end user the better off everybody is. And so there is progress being made in that area. 

Senator CANTWELL. We definitely want a dialogue with you 

about how you would start to model some of that information. 

Again, you are modeling what is in place, right, not what is not in 

place? 

Mr. SIEMINSKI: Right. 

Senator CANTWELL. We are seeing huge efficiencies from smart 

grid technologies, and they are just basic things in the various sectors, everything from synchophasors to other things, resulting in 

huge savings. So I think your report is actually showing the end 

result in some of that data already, and that is why we want to 

keep emphasizing how important efficiency is. So thank you. 

Thank you, Madam Chair. 

The CHAIRMAN. Senator Hoeven. 

Senator HOEVEN. Thanks, Madam Chair. 

I just had the one question that I wanted to follow up with you 

on. 

I know you have addressed it to some extent but let’s talk for a 

minute about the impact on Iran’s economy that would result from 

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pects in terms of the oil that is currently being stored, but the fact 

is our sanctions have reduced Iran’s ability to sell oil from 2.5 million barrels a day in 2011 down to 1.1 million barrels a day in 

2013. Very, very significant for an economy that is pretty much entirely dependent on petro sales. 

Would you please talk about both the immediate term and the 

longer term impact on Iran’s economy that lifting of the sanctions 

would have. 

Mr. SIEMINSKI. I think in very rough numbers, Senator, that you 

could think about another million barrels a day of oil could be out 

on the global markets from Iran at $60 to $75 a barrel. 

Senator HOEVEN. Again at a higher price than our domestic producers get by $8 a barrel. Correct? 63 Brent versus 55—— 

Mr. SIEMINSKI. I think we’d want to look at that to try and see 

whether or not the quality of the oil that Iran is selling is, what 

the differentials would be there. But in rough terms if you just said 

$60 at a million barrels a day it’s $60 million a day of additional 

revenue that Iran would be receiving. 

Senator HOEVEN. Thank you. 

Mr. SIEMINSKI. About $25 billion a year. I wish I had a million 

barrels a day of production. 

Senator HOEVEN. So you would say it is a huge impact to their 

economy? 

Mr. SIEMINSKI. Oh yeah, it would be very big. 

Senator HOEVEN. Thank you, I appreciate it. 

Thank you, Madam Chairman. 

The CHAIRMAN. Senator Hoeven, I appreciate you drilling down 

on that. There have been several questions about the impact of removing these sanctions on Iran and just the value to Iran and how 

it effectively puts us at a disadvantage then when we are not able 

to export our oil into that global market. 

I think it does just push the discussion on what we do here in 

this country to relook, critically relook, at these export policies that 

are inhibiting not only our job growth, our economic opportunity, 

but really our ability to utilize a resource, a strategic resource, for 

the benefit of the geopolitics surrounding, not only oil, but other resources as well and how the United States can play as an international leader with, effectively, this oil diplomacy, if you will. 

What we are seeing right now playing out in real time should be 

a reminder to us that we have in place policies that were put in 

place many decades ago for reasons that are no longer necessarily 

applicable. I think that is our role and our job here as a Committee 

to look at these policies and see if it is time that we address and 

change them. I believe it is time, and I think you would agree as 

well. 

Senator HOEVEN. Madam Chairman, if I may, I want to again 

thank you for holding this hearing. I think it is so important because it not only demonstrates the economic benefit and impact of 

the right policies here at home, but also the geopolitical influence 

we can have on a global basis with the right approach both in 

terms of what we do with our energy policy and in terms of what 

we do with our international approach to energy as part of diplomacy. I think you have done an excellent job with the Administrator highlighting that here today. 


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It is so important on all these fronts, not just on the economic 

front here at home, but the impact we can have in terms of foreign 

relations and diplomacy above and beyond military strength. We 

can have a real impact here, and I think the Administrator highlighted this when he talked about a million barrels a day and what 

that does for Iran’s economy if these sanctions are lifted. 

We have to understand how powerful that sanction is and certainly make sure that when we are dealing with something like a 

nuclear Iran that we understand the leverage we have with these 

sanctions. So I thank you, again, for holding this hearing today, 

Madam Chairman. 

The CHAIRMAN. I think we also need to appreciate that these 

sanctions that have been in place, that have brought Iran to the 

table with these negotiations, these sanctions could not have been 

near as effective if we did not have our own resources to rely on. 

The figures that you gave us, Mr. Sieminski, were back in 2005 

when we were importing 60 percent of our oil. Today, it is 15 percent. That is incredible. It is absolutely incredible how quickly we 

have moved that dial. 

When we were more than 50 percent dependent on a resource 

coming from others, including others who do not like us, there is 

a vulnerability. When we can move to the place where we are today 

where we are not only in a position to influence and lead but to 

ultimately get to that point where we are a net exporter, this is a 

dramatic change, a dramatic shift, and I think only for the betterment of our country. 

So this is all good information today. I know you have, again, 

couched all of this in terms of these are reference cases. We are not 

always right, but you hope to be proven not wrong today. I appreciate that. [Laughter.] 

The CHAIRMAN. We recognize, again, that this is projective. You 

are projecting out. It is not predictive. We put it in those terms, 

but I think the good work that EIA does not only with your Annual 

Outlook, but truly on a day-to-day is greatly appreciated. We thank 

you and your work and that of your great staff that stand behind 

you. 

Know that we will use this as a resource going forward. I understand you will be traveling to the State of Alaska, so you will have 

an opportunity to become even more informed with the—— 

Mr. SIEMINSKI. Senator, before you hit the gavel, just 30 seconds. 

The CHAIRMAN. Please. 

Mr. SIEMINSKI. The impact of U.S. production goes beyond just 

the Iranian sanctions issue. Back in 2012 and ’13 there were some 

really serious interruptions in oil production in countries like 

Libya. 

The CHAIRMAN. Libya. 

Mr. SIEMINSKI. Sudan, Yemen, Syria and others. They add up to 

a huge amount of oil, over 2,000,000 barrels a day, at one point approaching something like 3,000,000 barrels a day. And had it not 

been for the growth in shale production in the U.S. and production 

in a few other countries, including Canada, the price of oil would 

have been a lot higher. 

Obviously that would have been a benefit to producers but the 

overall impact to the economy could have been pretty devastating. 


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And I think that the growth in production in the U.S. played a very 

important role in stabilizing that global oil markets. 

The CHAIRMAN. That is an important factor to keep in mind. Because when we do not see the disaster that could have come, it is 

like, well, nothing really bad happened. The fact of the matter is 

nothing really bad happened because we had built a cushion, a 

cushion that we did not have before. It becomes more difficult for 

people to appreciate exactly how significant that was, that we were 

able to weather those pretty considerable disruptions. 

Mr. SIEMINSKI. Right. 

The CHAIRMAN. Because of what we were producing here in this 

country at an unprecedented rate, again, going from 60 percent reliant on imports to the level that we are at today. 

So we thank our friends from North Dakota. It really bothers us 

that North Dakota has pushed Alaska out of its leadership position 

there, but we are just glad somebody is doing it. 

Senator HOEVEN. If I may, Madam Chairman? You made such a 

great point today. You talked about the Alaskan pipeline and how 

it is in jeopardy if we do not have the right policies. 

The CHAIRMAN. Yes. 

Senator HOEVEN. So that we can continue to produce domestic 

energy rather than rely on energy from the Middle East. You have 

highlighted that so well here today with the Administrator. I hope 

people are really paying attention, not just what it means to us 

here at home and our economy, but to our security in the world. 

The CHAIRMAN. Yes. 

Senator HOEVEN. I think this hearing has really brought that out 

very dramatically. So, thank you. 

The CHAIRMAN. I wish all 100 of us were here instead of just the 

two of us concluding it. [Laughter.] 

But we will make sure that that word gets out. 

Again, Mr. Sieminski, thank you so very much. 

Mr. SIEMINSKI. Senator, thank you very much. Senator Hoeven. 

The CHAIRMAN. We stand adjourned. 

[Whereupon, at 12:10 p.m. the hearing was adjourned.] 


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asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 146 here 95270A.034
74 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 147 here 95270A.035
75 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 148 here 95270A.036
76 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 149 here 95270A.037
77 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 150 here 95270A.038
78 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 151 here 95270A.039
79 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 152 here 95270A.040
80 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 153 here 95270A.041
81 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 154 here 95270A.042
82 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 155 here 95270A.043
83 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 156 here 95270A.044
84 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 157 here 95270A.045
85 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 158 here 95270A.046
86 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 159 here 95270A.047
87 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 160 here 95270A.048
88 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 161 here 95270A.049
89 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 162 here 95270A.050
90 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 163 here 95270A.051
91 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 164 here 95270A.052
92 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 165 here 95270A.053
93 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 166 here 95270A.054
94 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 167 here 95270A.055
95 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 168 here 95270A.056
96 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 169 here 95270A.057
97 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 170 here 95270A.058
98 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 171 here 95270A.059
99 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 172 here 95270A.060
100 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 173 here 95270A.061
101 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 174 here 95270A.062
102 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 175 here 95270A.063
103 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 176 here 95270A.064
104 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 177 here 95270A.065
105 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 178 here 95270A.066
106 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 179 here 95270A.067
107 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 180 here 95270A.068
108 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 181 here 95270A.069
109 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 182 here 95270A.070
110 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 183 here 95270A.071
111 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 184 here 95270A.072
112 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 185 here 95270A.073
113 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 186 here 95270A.074
114 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 187 here 95270A.075
115 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 188 here 95270A.076
116 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 189 here 95270A.077
117 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 190 here 95270A.078
118 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 191 here 95270A.079
119 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 192 here 95270A.080
120 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 193 here 95270A.081
121 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 194 here 95270A.082
122 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 195 here 95270A.083
123 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 196 here 95270A.084
124 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 197 here 95270A.085
125 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 198 here 95270A.086
126 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 199 here 95270A.087
127 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 200 here 95270A.088
128 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 201 here 95270A.089
129 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 202 here 95270A.090
130 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 203 here 95270A.091
131 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 204 here 95270A.092
132 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 205 here 95270A.093
133 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 206 here 95270A.094
134 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 207 here 95270A.095
135 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 208 here 95270A.096
136 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 209 here 95270A.097
137 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 210 here 95270A.098
138 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 211 here 95270A.099
139 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 212 here 95270A.100
140 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 213 here 95270A.101
141 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 214 here 95270A.102
142 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 215 here 95270A.103
143 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 216 here 95270A.104
144 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 217 here 95270A.105
145 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 218 here 95270A.106
146 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 219 here 95270A.107
147 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 220 here 95270A.108
148 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 221 here 95270A.109
149 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 222 here 95270A.110
150 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 223 here 95270A.111
151 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 224 here 95270A.112
152 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 225 here 95270A.113
153 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 226 here 95270A.114
154 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 227 here 95270A.115
155 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 228 here 95270A.116
156 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 229 here 95270A.117
157 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 230 here 95270A.118
158 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 231 here 95270A.119
159 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 232 here 95270A.120
160 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 233 here 95270A.121
161 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 234 here 95270A.122
162 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 235 here 95270A.123
163 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 236 here 95270A.124
164 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 237 here 95270A.125
165 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 238 here 95270A.126
166 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 239 here 95270A.127
167 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 240 here 95270A.128
168 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 241 here 95270A.129
169 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 242 here 95270A.130
170 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 243 here 95270A.131
171 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 244 here 95270A.132
172 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 245 here 95270A.133
173 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 246 here 95270A.134
174 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 247 here 95270A.135
175 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 248 here 95270A.136
176 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 249 here 95270A.137
177 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 250 here 95270A.138
178 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 251 here 95270A.139
179 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 252 here 95270A.140
180 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 253 here 95270A.141
181 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 254 here 95270A.142
182 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 255 here 95270A.143
183 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 256 here 95270A.144
184 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 257 here 95270A.145
185 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 258 here 95270A.146
186 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 259 here 95270A.147
187 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 260 here 95270A.148
188 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 261 here 95270A.149
189 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 262 here 95270A.150
190 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 263 here 95270A.151
191 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 264 here 95270A.152
192 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 265 here 95270A.153
193 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 266 here 95270A.154
194 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 267 here 95270A.155
195 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 268 here 95270A.156
196 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 269 here 95270A.157
197 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 270 here 95270A.158
198 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 271 here 95270A.159
199 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 272 here 95270A.160
200 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 273 here 95270A.161
201 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 274 here 95270A.162
202 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 275 here 95270A.163
203 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 276 here 95270A.164
204 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 277 here 95270A.165
205 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 278 here 95270A.166
206 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 279 here 95270A.167
207 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 280 here 95270A.168
208 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 281 here 95270A.169
209 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 282 here 95270A.170
210 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 283 here 95270A.171
211 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 284 here 95270A.172
212 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 285 here 95270A.173
213 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 286 here 95270A.174
214 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 287 here 95270A.175
215 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 288 here 95270A.176
216 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 289 here 95270A.177
217 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 290 here 95270A.178
218 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 291 here 95270A.179
219 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 292 here 95270A.180
220 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 293 here 95270A.181
221 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 294 here 95270A.182
222 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 295 here 95270A.183
223 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 296 here 95270A.184
224 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 297 here 95270A.185
225 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 298 here 95270A.186
226 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 299 here 95270A.187
227 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 300 here 95270A.188
228 


asabaliauskas on DSK5VPTVN1PROD with HEARINGInsert offset folio 301 here 95270A.189