While the presidential election between Democrat Hillary Clinton and Repub­lican Donald Trump at times seemed like a muckfest without a desirable choice, the difference between the two regarding oil and gas industry interests was clear. Clinton promised to continue the anti-hydrocar­bon policies of the Obama administration, and Trump campaigned on an “America First” energy plan to remove unwarranted government road blocks to development. Against perceived odds, Trump won, and by publica­tion date is now president, to the relief of the industry that was braced for four more years of political battle.

So what might the oil and gas industry expect from President Trump? During his campaign he vowed to “unleash an energy revolution that will bring vast new wealth to our country.” This includes reducing and eliminating all barriers to responsible energy production, “scrapping” unnecessary regula­tions, opening onshore and offshore leasing on federal lands, permitting the Keystone Pipeline and other energy infrastructure, pulling out of the Paris Climate Agreement and rescinding the Climate Action Plan put in motion by President Obama.

Since the election, Trump has nominated several unconventional but pro-industry candidates for key appointments: Oklahoma attorney general Scott Pruitt for the Envi­ronment Protection Agency; Montana congressman Ryan Zinke to lead the Depart­ment of the Interior; former Texas governor Rick Perry for the Department of Energy; and former ExxonMobil Corp. CEO Rex Tillerson to head the State Department.

For further insight into President Trump’s influence on the industry, Oil and Gas Inves­tor tapped Barry Russell, president and CEO of the Independent Petroleum Association of America (IPAA) for his perspective. IPAA is the leading advocate for America’s inde­pendent producers in Washington, D.C., and Russell first joined the asso­ciation in the early 1980s. During the presidential transition, IPAA worked with Trump’s transition teams at each of the key agencies. Here, interviewed ahead of the inauguration, Russell shares his insight into what to expect in the coming months and years.

IPAA president and CEO Barry Russell anticipates a return to normalcy for the oil and gas industry under a Trump administration.

Investor What does a Trump presidency mean for the oil and gas industry?

Russell It’s a historic rebal­ancing between the best way to protect the environment and maximizing energy production, or at least treating our energy as an asset, which I don’t think the previous administration has done. The primary focus of the Obama administration has been about overregulation.

Over the past few years, the Obama administration has taken regulations that historically have been implemented at the state level and moved them to the federal level, making them much more expansive. It hasn’t really protected the environment, but has caused extra costs to be incurred and has forced producers to be involved in needless permitting delays and litigation.

One of the major things that will take place now is to reverse the federalization of regula­tions traditionally handled at the state level. Many of these regulatory efforts can go back to the state level where they have been for years. We support that.

Investor During the campaign Trump claimed Hillary Clinton would have “waged a war” against the fossil fuel industry. Has the indus­try dodged a bullet with the election of Trump?

Russell Yes. Both of them focused more on the coal side of the energy industry during the campaign, but it was clear Hillary Clinton was going to continue with the approach of the Obama administration. To give a sense, I’ve been at IPAA for decades, and we’ve had maybe one or two major regulatory efforts that have been pushed through in each admin­istration. Over the past two years, we’ve had something like 20 major regulatory proposals or federal expansions under the Obama administration. We’re hoping now these federal expansions can be paused, revised or moved back to the states.

Investor Going forward, what issues will IPAA look to address as high priorities under the new administration?

Russell There are a couple. Over the past five years, the EPA has looked at how hydraulic fracturing is regulated. They’ve done exten­sive analysis and study and have come to the conclusion that states regulate hydraulic fracturing in a safe and effective way.

But in the meantime, the Department of the Interior has gone forward with hydrau­lic fracturing regulations on federal lands that involve well construction, more citizen participation and information disclosure issues. It creates a patchwork of uncertainty for producers because they must meet state requirements in the same areas. IPAA led the fight to sue the Interior Department on that issue. It’s been a three-and-a-half year fight. It’s an issue that we’re going to look at now with a different perspective with the new administration.

Investor How should the oil and gas indus­try view climate change and the regulation related to it?

Russell Serious issues surround global climate change policy. An improper or hasty resolution of this debate could have extreme implications for America’s oil and natural gas producers and consumers. First, a strong economy hinges on energy. The reality that this link exists must be reflected in any policy actions.

Second, global action must be taken. The United States’ economy and its work­force should not be expected to absorb the economic consequences of emissions regula­tions merely to see other countries benefit at America’s expense.

Third, clean-burning natural gas is a linch­pin to any climate strategy. Emerging shale gas plays throughout the nation can produce natural gas to meet American needs for 100 years.

These newly defined resources will allow the U.S. to develop climate approaches that can rely on clean, abundant and affordable Amer­ican natural gas. Natural gas can be the fuel of choice for new electricity generation. Not everyone recognizes that the strides the United States has made in reducing carbon emissions over the last five years is due to the increased use of clean-burning natural gas. While natural gas production has recently risen to its highest levels, carbon emissions have dramatically dropped to historic 20-year lows.

We’re hopeful that the new adminis­tration is going to take a fresh look at addressing climate change and offer smart, forward-thinking solutions that protect our environment and ensure American consumers continue to benefit from affordable and reli­able domestic energy.

Investor Trump said during the campaign that he would remove unnecessary regulation on the industry. What might this look like in actuality?

Russell In addition to hydraulic fracturing, another major area is the Endangered Species Act. In the last eight years, the government has greatly expanded the number of potential species to protect, and therefore, the process of protecting habitat and the procedures to mitigate that damage. I think that will be looked at again to see if there are better ways to accomplish that goal.

Another area we’re looking at is taxes. This is something the Trump administration is talking about fairly soon out of the gate. For eight years, President Obama proposed to Congress that all of our tax provisions be eliminated. We’ve fought that and won for the last eight years, but now Congress is talking about revising the tax code and moving to a simpler tax structure. As they do that, we want to make sure the provisions that encourage oil and gas production are maintained; that they don’t throw those out because they’re lowering the rate.

Investor Of Trump’s nominations so far, who do you see as the most influential for the oil and gas industry?

Russell The EPA and Interior Department are the two critical agencies that involve oil and gas production. That’s Mr. Pruitt and Mr. Zinke. We’ve worked with both of them, and we think they have the right perspective on the rebalancing that I’m talking about. We support both of them, and we think having them at the helm of these agencies is going to be very positive for the industry.

Investor Do you expect the interpretation of environment law to change at EPA under Pruitt?

Russell I do in the sense that the Obama administration has moved away from the traditional environmental law structure. What I expect Mr. Pruitt to do is look back at the last eight years of regulations and see whether or not federal action is truly needed. I think the new administration is going to make an effort to protect the environment in a more efficient, common-sense way.

Investor Environmentalists have used the Endangered Species Act as a weapon against the oil and gas industry. Do you think the Interior Department will be less aggressive in using that to block development?

Russell Over the last eight years, the Obama administration has looked at taking action on protecting over 1,000 species. You can imagine how hard it is for a business to operate in a bunch of different states with different species that have different protection requirements. And it’s not clear that the expenses these busi­nesses incur will make any difference at all to the conservation of that species. This is one of the benefits of a new administration—they will bring a fresh look and a new way of thinking to these processes.

Investor How aggressive should the industry be in opening federal lands to development?

Russell We think access to our abundant natural resources is something that is critical. We think energy is important for economic development. It’s the driver, not only in the United States, but all over the world.

Investor Obama tried to block licensing in restricted waters on his way out via an obscure 1953 law. Has he succeeded in blocking licensing permanently in the Arctic and Atlantic?

Russell We’re hoping that can be reversed. Clearly, he was trying to unilaterally regulate all these things at the last minute. That’s exactly the kind of thing the new adminis­tration said it would look at, and I think this needs reversing. Once you take areas for development off the table, it’s a lot harder to make them available down the road when they may be in critical need.

Investor Do you think Trump will look to open all federal waters to oil and gas devel­opment, and is that a good thing?

Russell I think President Trump will take a step back, look at the overall picture and restore an appropriate balance between the Congressionally mandated multiple use concept of our federal resources. He’s going to balance conservation and recreational needs with our energy needs to best utilize these federal resources.

Investor What implications might Rex Tillerson have for the industry as Secretary of State?

Russell We think Rex is a fantastic pick. This new pattern that we’re seeing from Mr. Trump of picking people that are outstand­ing leaders in different areas is a refreshing change. More than anybody else, looking at the geopolitical implications of our energy and energy around the world, that is certainly his strong point. The United States has foreign allies in some cases that need energy, and we have the capacity and ability to supply them, and that is very important.

We’ve seen before how Russia deals with countries on their border; when things don’t go the way they want, they just cut off all the natural gas to places like Ukraine. The United States should use its abundant oil and natural gas resources in support of its security interests around the world—partic­ularly to counter the influence of Russia and Iran. So we have a significant opportunity on the world stage to use energy in a way that advantages the United States.

Investor How might international policies affect domestic producers, if at all?

Russell That’s where the structure of the industry changed this last year because, finally, we got the ban on crude oil exports lifted. So for a long time there was not much you could do on the crude oil side. Now you can. The part that affects producers is the increase in LNG and crude oil exports around the world. You’ve seen that ramp up in the last six months and we expect it to continue.

Investor What is the significance of Trump’s promise to greenlight LNG permitting?

Russell It signals a better balance between environmental concerns and energy produc­tion. I don’t think President Trump is saying he will greenlight everything willy-nilly. Instead, I think there will be an appropriate evaluation on the facts. If something makes sense, whether an LNG plant or a pipeline or any of the other actions that are extremely important for our infrastructure, then he’s going to make sure there is not a lot of federal red tape or decisions that are made for political reasons.

Investor Jordan Cove LNG, like the Keystone Pipeline, has been shut down time and again. Do you expect those or other projects to go through once the new adminis­tration takes over?

Russell It would be hard for me to specu­late, but for Keystone, there were several studies that showed no impact on the envi­ronment and that it was important for our own energy infrastructure. Yet, for political reasons, it was given the thumbs down. I’m hopeful those kinds of decisions will be reversed, or at least the new administration will take a second look at them. The point is President Trump is setting up a framework where there is going to be a fact-based deci­sion-making process on these major issues.

The Trump administration clearly under­stands the importance of pipelines and other infrastructure. Otherwise, you get natural resources that are stranded because you can produce it but there’s no way to get it out to American consumers. Infrastructure, based on what President Trump has talked about on the campaign trail, is something that is going to be emphasized. They are going to look at all of the different projects going on and what their status is and, based on the facts, will make an informed decision about what ought to happen, then move forward.

Investor Trump has also talked emphatically about revitalizing the coal industry. Is that a negative for natural gas?

Russell I don’t think so. One of the things affecting coal, oil and natural gas is pricing. Natural gas, because it is much cleaner has competitive advantages, so I don’t think it’s going to be a problem.

Investor Do you think Trump’s push for jobs and other manufacturing industries will have an indirect effect on the demand side of the equation?

Russell Sure. If you look at economies around the world last year, there’s been very little growth on the international level, and our growth has been minimal, between 1% and 2%. Just in the last three-to-four months it’s starting to pick up. When you say one of the focuses of what you’re going to do is increase economic activity, then everybody gets excited about it and starts making invest­ments and hiring people.

One of the impacts of the increase in oil and natural gas production in the U.S. is the benefit that gives the manufacturing side of the industry. You can manufacture things in the United States much cheaper than you could five years ago because of the abun­dance of oil and natural gas. It’s a positive all the way around.

Investor Trump’s vision for the industry almost sounds too good to be true—a cornu­copia of everything the industry has hoped for. What’s the likelihood he follows through on all of these promises?

Russell If you look at the people that President Trump has appointed, he seems to be following through pretty aggressively. He’s appointing people that are accom­plished in their fields and that are used to getting things done. There’s a big difference between having people, let’s say a college professor, handle a particular issue vs. some­body that’s run a large company. They are different skillsets.

Investor Will all this matter if oil and gas prices stay where they are?

Russell Yes, it will matter. The federal regu­lations I’ve mentioned have a negative impact on the industry with significant costs and in some cases substantial liabilities. If you take that off the table, that’s a meaningful benefit—it’s a burden on small businesses that’s been lifted. Is that more than price concerns? No. The price people get for oil and natural gas is the most important thing to look at. But these regulations that come out of Washington are not insignificant.

Investor Is it finally time for the U.S. to have a formal national energy plan, and if so, what should its mission be?

Russell The process that President Trump has talked about on the campaign trail is an energy plan. It’s going to be a refocus on markets, a reassessment of top-down controls and figuring out a better balance to have the safest, most efficient regulations for the energy industry, but at the same time protecting the environment. And it’s using the United States’ assets, whether oil and gas or manufacturing, to get the best for the United States. We feel that’s a recipe for a good, forward-thinking national energy plan. When you add in Mr. Trump’s emphasis on improving our infrastructure, it’s powerful.

Newly elected President Donald Trump campaigned on an energy platform to remove unnecessary regulations and to clear the pathway to American jobs.

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