Burgum Says US Is Cutting Red Tape for Energy Producers

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00:00We do want to stick with energy. 28 Democratic California lawmakers writing a letter to the

00:05Trump administration condemning plans to boost oil drilling along the state's coastline.

00:10U.S. Interior Secretary Doug Burgum joins us now. Secretary Burgum, thank you so much for being with

00:16us. I want to start with just how important it is right now for the United States to increase

00:20energy supplies across the board, not just with drilling, but across the board in the face of

00:26the demand coming from AI. Well, good morning, Lisa. Yes, it's absolutely essential. And this is

00:31part of the just announced national security plan that the White House has released. That security

00:40plan mentions energy 23 times. There's an entire section about energy dominance, and folks should

00:46think about energy dominance as the ability for the U.S. to sell energy to our friends and allies so

00:51they don't have to buy it from adversaries, particularly those adversaries that are either

00:55funding terrorism or are funding, you know, wars, actively funding war machines. And so it's core

01:02to the strategy right now, but it's also, as you've talked about on the show, is about with AI, because

01:07it never before in history have we been able to convert a kilowatt of electricity into intelligence.

01:12The demand for that, regardless of stock prices or stock movements, the demand for AI, for intelligence

01:19applied to every job, every company, every industry is going to continue to increase the demand for

01:23electricity around the world. The U.S. is an energy dominant country, now the largest oil producer in

01:30the world, largest LNG exporter in the world, and growing quickly. With that strategy, it bodes well

01:36for the future of the U.S., both in terms of peace and in terms of prosperity. Secretary, I'm sure you're

01:42aware WTI is under $60 a barrel. What's the impetus for the oil and gas companies in the United States to

01:48continue drilling wells at this price level, which potentially could be a loss for them?

01:53Well, I think one thing that we know that in the Trump administration, we're cutting red tape so rapidly,

01:58we think that, you know, one of the early targets we had was cut 10 percent of the cost away from those

02:05producers just by cutting red tape. So if you think about, you know, $60 today, it might be what $67 was a year ago

02:13because of our ability to take costs out for those producers. And there's example after example,

02:21whether it's from the EPA, the Department of Energy, Department of Interior, where we've been

02:25able to help reduce costs. And of course, this industry has been better than almost any in terms

02:30of gaining, you know, productivity. The shale producers now drilling three-mile laterals instead

02:35of two-mile laterals, up to four-mile laterals in many places. Offshore, we've seen examples

02:41overseas of people driving, building 10-mile laterals when they're getting after the shale rock,

02:46all with the same small well pad on the surface. So, you know, great for land management and great

02:53for energy production. And kudos to this industry. The entire shale revolution has occurred through

02:59innovation, and that innovation is going to continue. And with AI applied to that, it's going to even get

03:04even better. So I see that the leading companies are getting their costs down, even as demand is going

03:10up. But Baker Hughes is talking about drilling rig activity has fallen 16 percent since Trump

03:15took office this year. The president loves to talk about drill, baby drill. Do you expect that to

03:20change, those numbers to change next year? Well, I think, again, I'd have to take a look at the

03:26numbers. When we talk about drilling activity, in my home state of North Dakota, we had a number of

03:32well, the well count was going down, but the miles of lateral productive rock could be going up.

03:37And so, you know, analysts have got to make sure that they're actually keeping up with how fast

03:42this industry is changing, because we've got, again, record production occurring right now,

03:48and we expect to see records through 2026. One area where you have seen price increases has been

03:53natural gas. Natural gas prices rising to the highest levels in the U.S. going back to 2022. And a real

03:59question on how much the U.S. can continue to export to places like Europe in the face of significantly

04:05higher prices here in the United States. How do you plan to sort of set policies so that the U.S.

04:10can be a big exporter to places like Europe while not allowing prices to go up so significantly in

04:16the future? Well, again, the key is its supply and its infrastructure. We have places in the U.S.

04:22right now where, again, there's not one price for gas in America, as you know. I mean, even though

04:27we've got the markets and we've got, you know, Henry Hubb, but we've got, we've got widely ranging

04:32prices. I mean, even in the difference of price in Pennsylvania versus in New England, because the

04:38lack of natural gas pipelines that have been blocked into places like New England. And when we think

04:43about, we think about markets, you're talking about A.I. and this, the capital spend going against A.I.

04:48where we're, you know, an A.I. factory where we're, where we're actually creating and

04:53manufacturing intelligence. Those, those plants are going to go to the places where states have

04:58low electricity prices and policies are setting price, not just markets. And we've got policies

05:03in blue states around our country. California, you mentioned California, 63 percent of California's

05:10oil is being imported from foreign countries because of blocking of pipelines coming into that

05:16state. They have a record number of internal combustion cars in California. They have more internal

05:22combustion cars than any other state has cars. And yet two refineries have announced that they're

05:27shutting down in California because of policies, not because of lack of demand, not because of lack

05:33of consumers. And so what's going to happen? You're going to, you're going to have oil tankers

05:39and refined products coming into San Francisco Bay and coming into Long Beach in record numbers in

05:43California because of policies. They will have higher gas prices than virtually any other state.

05:49So again, we, we, we have a, we have a strategy in America to help every state. The Trump administration

05:55wants to have low affordable energy prices for everybody, whether it's heating your home or driving

06:00your car or, or producing electricity for AI. But we're going to need the collaboration from states

06:07to make sure. And if states don't want to collaborate on that, then you're going to see this trillion

06:13dollars of AI, a historic amount of spend, all going towards states that have pro-energy policies

06:19that drive down prices. Secretary, we've seen a significant increase in energy costs, especially for

06:26individuals who live near data centers. How is the U.S. going to do both at once, both support these AI

06:32initiatives, but also make sure consumers' energy prices remain affordable? Well, if you said on the show,

06:38I mean, the prices are, are in electricity are local, not national. And, and so there are the

06:44examples that you think we're, we're, we're driving that analysis right now. And we're going to be

06:49publishing that from the White House to the National Energy Dominance Council, the Department of Energy

06:54doing great work on that. But a lot of the higher prices that you're seeing are not related to the AI

06:59data centers. A lot of the data centers are going to be off the grid behind the meter and then producing,

07:05adding more energy and then, and putting some of that energy onto the grid. So we could be actually

07:09increasing the supply in some of those areas where we've got increased pricing. It's because of the

07:15policies they pursued the last five years of having unreliable, intermittent, and highly subsidized

07:22and projects, including things like offshore wind, where people were spending $11 billion to create

07:29one gigawatt of intermittent, you know, versus spending one or $2 billion to create one gigawatt

07:35of, of a assured seven by 24 hour power. So the policy choices of the last five years driven by

07:41sometimes climate extremists were the ones that were, that were, that are driving up the prices

07:47you're seeing. I mean, electricity costs three times as much in New England as it does in North

07:52Dakota. That is not, that is not because of data centers. That's because of policies.

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