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Had someone informed Don Briggs last year before the BP oil spill began that the White House would impose a moratorium on deepwater drilling in the Gulf of Mexico, Briggs, president of the Louisiana Oil and Gas Association, would have found that hard to believe.

“These are billion-dollar investments, and the fact that with just the stroke of a pen, they would shut them down is something that if you would’ve told me that a year-and-a-half-ago, I never would’ve believed that could possibly happen,” Briggs said Thursday in a presentation hosted by his organization at the Windsor Court Hotel.

Briggs, in his annual “State of the Industry” keynote address, frequently criticized federal regulators for their response to the spill and the way they rebuffed efforts to open additional coastal areas for offshore drilling. “Every single corner and way we turn,” he said, “they’re against us.”

He told the crowd that he predicted a “golden age” for natural gas in the United States, saying that “it’s going to play a key role in everyone’s future.”

Briggs also expressed concern about the economic downturn that has lingered six months after the moratorium was lifted and has particularly impacted independent oil and natural gas producers, a group that, he said, holds 81 percent of oil-and-gas-producing leases in the Gulf.

A planned March lease sale of federally owned oil and natural gas drilling tracts in the central Gulf of Mexico was delayed as the Interior Department, which oversees offshore drilling under the Bureau of Ocean Energy Management, Regulation and Enforcement, continues to review the possible environmental impact of drilling.

Original Article

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Message from Louisiana Oil and Gas Association Pres. Don Briggs: Earlier this month, President Obama outlined his plans for a national energy policy by calling for a thirty-percent reduction in U.S. imports of foreign oil. A key factor in his energy plan is a call for the promotion and utilization of natural gas as a sustaining fuel to balance our addiction to unstable sources of overseas energy. The President’s acknowledgement of clean burning natural gas as a substantial energy source was certainly a positive message for the natural gas industry.

However, nearly a week later, the Administration announced that it would move to initiate a broad-based panel to be formed to examine potential risks associated with hydraulic fracturing. The Secretary of Energy Advisory Board (SEAB), an independent advisory committee to Energy Secretary Steven Chu, has been tasked with forming a subcommittee to study the impacts of hydraulic fracturing. According to the President’s blueprint for energy security, the subcommittee will consist of representatives from federal agencies, industry, environmental experts and states, and will “work to identify, within 90 days, any immediate steps that can be taken to improve the safety and environmental performance of fracking, and to develop, within six months, consensus on practices for shale extraction to ensure the protection of public health and the environment.”

The creation of this subcommittee comes at a time when the EPA is already in the process of conducting its study of the potential risks associated with hydraulic fracturing. The findings of the new subcommittee could potentially result in new federal rules and regulations over the hydraulic fracturing process in the next 90 to 180 days. In a recent Senate committee hearing, EPA Deputy Administrator Robert Perciasepe reiterated that the EPA has the authority to regulate natural gas drilling and is committed to doing so. Perciasepe commented, “We are taking action. EPA’s responsibility in oversight is one we are pushing forward in a very strong and strenuous way.” Hydraulic Fracturing is the key component to ensuring future oil and gas production in the U.S. Even though America is awash with an abundance of natural gas, most resources require unconventional methods of recovery and depend on this vital technology.

For over sixty years, state agencies have effectively monitored the implementation of hydraulic fracturing, setting guidelines and best practices. Since it became a commercially viable practice, the process has not posed any discernible risk to drinking water. Of the more than one million wells fractured in the U.S., not a single case of drinking water contamination has ever been recorded. Hydraulic fracturing is well-regulated and safe, and it has a proven track record. This technology helps fuel our economy by providing jobs and the energy needed to heat our homes, fill-up our cars, generate electricity and create the basic materials for such things as fertilizer and plastics of every variety. Federal oversight of this process will mean higher costs for all of these goods and services.

Double-talk and promoting economic uncertainty seem to be a recurring theme with the White House these days. It is difficult to find confidence while the Administration promotes the use of natural gas one day and then disingenuously seeks to implement overarching federal regulations on the most important process in extracting natural gas from the earth.

Original Article

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By LESLIE EATON

A year ago this week, states along the Gulf Coast braced for the economic fallout from the Deepwater Horizon spill. As the weeks passed, disaster loomed, with oil leaking and the government banning drilling far from shore. Tens of thousands of residents would be thrown out of work, experts and politicians warned; industries could disappear, bankruptcies would soar and entire communities might be imperiled.

A year later, many people have suffered economic pain, and unemployment is up along the Louisiana coast. But the number of jobs there has increased, federal data show. In fact, almost a year after the worst offshore oil spill in U.S. history, there is little sign of the economic devastation feared by everyone from the Louisiana Oil and Gas Association to the White House.

Business is looking up across much of the coast. Tourists are returning to the beaches of Florida and Alabama, where real-estate rental companies report bookings returning to pre-spill levels. (Last summer, lodging revenue dropped more than 30%).

Some of Louisiana’s coastal counties, called parishes, are collecting more sales-tax revenue, when they had expected double-digit declines. The $20 billion fund set up by BP PLC to compensate people for losses from the company’s runaway oil well has paid out more than $3.8 billion, though thousands of long-term claims remain unresolved.

New Orleans, already booming from post-Katrina rebuilding, benefited from an influx of spill-related business. Traffic at the airport last summer was the strongest since the 2005 hurricane and office space is at a premium, in part because of lawyers setting up shop for spill litigation, says Michael Hecht, president of Greater New Orleans Inc., a regional economic-development group.

Even cities with concentrations of oil-drilling employment are faring better than expected.

Lafayette, roughly halfway along the coast between Texas and Mississippi, saw a net gain of 2,400 jobs, an increase of 1.7%, from February 2010 to February 2011, according to the federal Bureau of Labor Statistics. Houma, which is southwest of New Orleans, added 3,600 jobs in the same stretch, an increase of 4%, far above the 1.1% gain notched by Louisiana as a whole.

The jobless rate in Houma climbed 0.8 percentage points in the February-to-February stretch, to 5.8%, while the rate in Lafayette rose 0.7 percentage points, to 6.3%. That remained well below the state’s 8% rate in February and the national rate of 9.5%, both before seasonal adjustments.

Of course, the broad trends mask pockets of severe pain for families and companies. Small businesses in particular have been damaged and don’t necessarily show up in statistical snapshots.

“It’s like trying to kill a dragon with a plastic spoon,” says Steve Vayda of his efforts to keep his Mississippi seafood stores operating. Before the spill he owned three markets inland from Pascagoula, Miss.; today he is down to two, and only one is open full time.

After government officials temporarily barred fishing in large swaths of the Gulf over pollution fears, he had to import oysters from Washington state and shrimp from Texas, Mr. Vayda says. High prices are turning his products from a local staple to a holiday treat, he adds—if people aren’t too fearful to eat them at all, despite repeated assurances from government officials that Gulf seafood is safe to consume.

The fate of the region’s fishing industry is unclear. A few fishermen who were hired by BP for cleanup and containment made so much money that they were labeled “spillionaires,” but that financial spigot has been turned off. And scientists are still studying the effects of oil and chemical dispersants on sea life.

The Obama administration recently issued 10 permits for deep-water drilling, and energy companies are hopeful that it will resume in a big way. That’s one reason they haven’t laid off the 20,000 skilled workers that some economists and industry groups predicted, said Don G. Briggs, president of the Louisiana Oil and Gas Association. “We gave all these doom and gloom figures and there’s no blood in the water,” Mr. Briggs said. “But that all depends on who you’re talking to.”

While some energy companies have been able to shift some work onshore, that’s not an option for those that operate boats or helicopters, or the suppliers—known in the business as “rope, soap and dope” outfits, dope being a kind of lubricant—that specialize in offshore supplies. He says he fears businesses that have been hanging on will soon run out of money—or patience.

One reason people along the Gulf Coast don’t sound as relieved as they might about so far dodging an economic collapse is that before the spill they had expected 2010 to be a banner year. Tourism groups in Gulf Shores, Ala., for example, were forecasting a 10% increase in business. Some shrimpers saw early signs of a record catch.

Rising crude prices, along with a surge in oil discoveries in the Gulf, gave energy companies the impression that they “were sitting pretty,” says Loren Scott, an economist who has studied Louisiana for four decades. “Everything looked more hopeful,” he says, “before the dadgum spill.”

Original Article