By December 6, 2010 0 Comments Read More →

Continuation of Failed Policies

Don Briggs – Louisiana Oil & Gas Association –

Earlier this year in March, the Obama Administration announced plans to expand offshore drilling and allow oil and natural gas exploration off the coasts of New Jersey, Virginia, and the eastern portion of the Gulf of Mexico at least 125 miles off the coast of Florida.  Unfortunately, the Administration announced this week that they would rescind these future plans for offshore drilling expansion and move in a different direction.  In a public announcement, Secretary of the Interior Ken Salazar noted that the Eastern Gulf of Mexico that remains under a congressional moratorium and the mid- and south-Atlantic areas are no longer under consideration for potential development through the year 2017.

It’s no surprise that the Administration is looking towards the tragic BP oil spill as a justification to ban any new offshore drilling for the Eastern Gulf and the Atlantic and Pacific coasts for the next seven years.   Secretary Salazar clearly noted, “As a result of the Deepwater Horizon oil spill, we learned a number of lessons, most importantly that we need to proceed with caution and focus on creating a more stringent regulatory regime.”  Salazar continued by adding, “Our revised strategy lays out a careful, responsible path for meeting our nation’s energy needs while protecting our oceans and coastal communities.”

A great question for Secretary Salazar and the Administration is this, “Are we truly on a responsible path to meeting our nation’s energy needs when we limit access to over 99% of our nation’s offshore oil and gas reserves?”  Better yet, “If we shut off access to these vital resources, where are we going to get it?”  Supply and demand economics are fairly simple to understand.  If you limit access to create supply and the demand for oil continues to rise not only here at home but significantly in developing countries around the world, the obvious repercussion of this policy will result in higher energy prices for all Americans.

In reality, the Obama plan to expand offshore drilling was just that, a plan.  Technically, the Administration has nothing to rescind given that Congress gave no approval to open these areas for oil and gas exploration.  The announcement to shut off offshore access is nothing more than smoke and mirrors and political posturing.Although the expansion of new areas in offshore production are extremely important, at the moment, the most pressing issue the Administration should be working towards is alleviating the permitting gridlock caused by the recent deepwater drilling moratorium.  In his comments on the Administration’s decision, Secretary Salazar claimed, “We believe the most appropriate course of action is to focus development on areas with existing leases and not expand to new areas at this time.”  If it is the intention of the Administration to focus on areas already open for exploration, it is imperative that they ensure an adequate and streamlined permitting process and remove the de facto moratorium that is stifling growth in the Gulf of Mexico.

In the end, the continuation of a failed energy policy that shuts off access to our vast offshore reserves will pave the future road with higher energy prices, drastic unemployment, and will perpetuate our insatiable dependency on foreign sources of energy.

Posted in: Presidents Articles

About the Author:

The Louisiana Oil & Gas Association (known before 2006 as LIOGA) was organized in 1992 to represent the Independent and service sectors of the oil and gas industry in Louisiana; this representation includes exploration, production and oilfield services. Our primary goal is to provide our industry with a working environment that will enhance the industry. LOGA services its membership by creating incentives for Louisiana’s oil & gas industry, warding off tax increases, changing existing burdensome regulations, and educating the public and government of the importance of the oil and gas industry in the state of Louisiana.

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