A couple of years ago, at the urging of the oil lobby, the Obama Administration signaled that it was about to open up federal oil and gas leases on the Outer Continental Shelf. Then came April 20, 2010 and BP‘s Deepwater Horizon disaster, which changed everything.
The massive oil spill prompted a government-imposed moratorium on deepwater drilling in the Gulf of Mexico (which has only been slowly lifted over the past six months) and a complete review of federal offshore leasing policy.
This week Secretary of the Interior Ken Salazar released the Proposed Outer Continental Shelf Oil and Gas Leasing Program for 2012-2017, which makes more than 75% of recoverable oil and gas resources in federal offshore areas available for exploration and development by the private sector. The 15 potential lease sales include 12 in the Gulf of Mexico and three off the coast of Alaska.
This should come as good news to the American Petroleum Institute (API, which represents 480 oil and gas companies) and which was deeply opposed to the Gulf of Mexico moratorium. In recent months it has been urgently pushing oil and gas development as the best way to grow the US economy and improve the job market. True to form, the API simply called the Interior Department’s new plan for the Outer Continental Shelf leasing program “a good first step” while asking for more.
The Obama Administration is obviously trying to thread the political needle between advocating policies that enhance economic growth while trying to allay the concerns of the environmental lobby. Enhanced safety systems and improved oil spill containment systems are built into the Gulf of Mexico lease plans. In Alaska, while a handful of leases will be made available for exploitation, they significantly are not scheduled to be opened up until late in the 5-year plan to allow for further scientific study and data collection, and longer term planning for spill response preparedness and infrastructure in the fragile Arctic environment, and to be ready for the disruptive impact of drilling activities of Native Alaskan communities.
Major areas of federal leases are not covered by this plan. The Straits of Florida remain under a congressionally-mandated leasing moratorium until 2022, and new leases off the coasts of California, Oregon and Washington remain out of reach, barred by a tri-state governors’ agreement in 2006.