Alliance Formalizes Position on North American Free Trade Agreement

FEBRUARY 1, 2018


WICHITA FALLS, TX – As the process for reworking the North American Free Trade Agreement (NAFTA) continues, the Texas Alliance of Energy Producers Board of Directors cemented the association’s position on NAFTA after President Donald Trump’s remarks at the World Economic Forum in Switzerland indicated that he may terminate the agreement and begin the negotiations anew.

In anticipation of possible changes to the trade agreement, Alliance staff and consultants analyzed NAFTA’s influence on Texas independent oil and gas production.  Alliance Petroleum Economist Karr Ingham cited several key figures in his report:

  • natural gas exports to Mexico have increased by well over five times (445%) since 2010, including an estimated 30% in 2017 alone;
  • the U.S. became a net exporter of natural gas in North America  by year end 2017 due in large part to rapidly expanding natural gas exports to Mexico;
  • exports of crude oil to Mexico have increased by some 320% since 2010;
  • exports from Texas account for 16% of all U.S. exports; and
  • shipments to Mexico and Canada account for nearly 50% of Texas exports.

“NAFTA was born on January 1, 1989, and has become a part of our daily oil business lives,” said Alliance Chairman Bob Osborne. “NAFTA is important to Texas, and if renegotiated, its impact on our markets for oil and gas needs to remain positive and profitable.”

In addition to NAFTA’s many quantifiable, positive impacts, imports from Canada have displaced significant amounts crude oil imports from OPEC and other more volatile suppliers.

“The heavier grades of crude oil imported to the U.S. from Canada are a necessary part of the U.S. oil supply mix,” said Alliance President John Tintera. “Many U.S. refineries were built to handle those grades, and require heavy crude to make several vital consumer products.”

The Alliance Board of Directors this week passed a resolution reaffirming the Alliance’s commitment to maintaining a profitable and thriving trade climate for the oil and gas industry, and will continue working with government officials to ensure that if renegotiated, NAFTA will:

  • retain a low/zero tariff trade structure in a way that continues to foster the expansion of unfettered energy trade and investment between the United States, Canada, and Mexico;
  • be enacted with no sunset provision;
  • retain its current form if an agreement cannot be reached as a result of the current negotiations.

“The North American Free Trade Agreement is an energy economics success story by virtually every measure,” said Ingham. “It has contributed to growth and jobs in the Texas and US oil and gas industry, it is providing new markets for domestic energy production, and is lowering the costs to consumers in all three countries. Taken as a whole, North America is on the verge of achieving energy self-sufficiency – a longstanding goal that has enjoyed significant advancement under NAFTA.”


– – –   E N D   – – –


EDITOR’S NOTE: The Texas Alliance of Energy Producers represents more than 2,500 independent oil and gas producers in Texas. It has offices in Austin, Houston, and Wichita Falls.


For additional information, please contact:

Karr Ingham, Petroleum Economist
806-373-4814 (office) or 806-433-5309 (mobile)

John Tintera, President, Texas Alliance of Energy Producers