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Interior announces offshore-drilling plan, scaled back following Gulf spill
The Interior Department on Tuesday announced a proposed five-year offshore oil-and-gas leasing plan that’s far less expansive than what the Obama administration envisioned before the BP oil spill.
The plan formalizes the White House’s retreat from opening areas off the Atlantic Coast and deep into the eastern Gulf of Mexico, which was contemplated before the April 2010 explosion of the Deepwater Horizon rig.
It envisions 10 total lease sales in the central and western Gulf of Mexico, which is already open to development, that would begin next year and would expand acreage available to oil companies. It also includes two sales — in 2014 and 2016 — in eastern Gulf regions that aren’t off-limits.
But it abandons plans for leasing off mid-Atlantic and southeastern states. It also scuttles plans to allow leasing in large eastern Gulf regions that are currently under a congressional ban.
President Obama had floated the idea of leasing these Atlantic and Gulf regions in the 2012-2017 timeframe a month before the BP spill.
The new proposal also calls for two sales in Arctic waters off Alaska’s coast, but they are not scheduled until 2015 and 2016, to allow further analysis of environmental and infrastructure needs in the fragile seas.
In a separate process, Interior is weighing requests from Shell Oil to begin drilling in Arctic waters next year on leases obtained years ago.
Interior Department officials stressed that the 2012-2017 leasing plan provides major tracts for oil companies to buy leases, stating in a news release that it “makes more than 75 percent of undiscovered technically recoverable oil and gas resources estimated in federal offshore areas available for exploration and development.”
“Expanding safe and responsible oil and gas production from the [Outer Continental Shelf] is a key component of our comprehensive energy strategy to grow America’s energy economy, and will help us continue to reduce our dependence on foreign oil and create jobs here at home,” Interior Secretary Ken Salazar said Tuesday in a news release.
“This five-year program will make available for development more than three-quarters of undiscovered oil and gas resources estimated on the OCS, including frontier areas such as the Arctic, where we must proceed cautiously, safely and based on the best science available.”
The plan’s scope is not a surprise: Interior officials announced they were scaling back the planned leasing expansion last December.
The plan comes, however, at a time of intense political criticism of the Obama administration’s energy agenda from congressional Republicans and GOP presidential hopefuls, who are calling for much wider drilling.
The House passed a GOP-led bill in May that would mandate a massive expansion of offshore oil-and-gas leasing, including wide areas off the Atlantic, Pacific and Alaskan coasts. The bill passed 243-179, with 21 Democrats in support.
The administration’s energy announcement Tuesday also arrives as President Obama’s overall energy agenda is under a microscope.
The White House is weighing TransCanada Corp.’s application to build a major pipeline linking Alberta’s oil sands projects to Texas refineries, a plan that’s attracting intense lobbying from environmental groups battling the pipeline and major business groups pushing for its approval.
Interior officials defended the offshore leasing plan Tuesday.
“The Proposed Program ... reflects the need for a regionally tailored approach to offshore development that accounts for issues such as current knowledge of resource potential, adequacy of infrastructure including oil spill response capabilities, and the need for a balanced approach to our use of natural resources,” Interior stated in its news release. “The majority of lease sales are scheduled for areas in the Gulf of Mexico, where resource potential and interest is greatest and where infrastructure is most mature.”
A senior official with the American Petroleum Institute, the industry’s biggest trade group, attacked the plan Tuesday, calling it a “good first step” but arguing it should have gone much further.
“This is a missed opportunity to open additional areas that could have helped address rising energy demand, create American jobs and reduce the federal deficit,” said Erik Milito, the group’s director of upstream and industry operations.
— This post was updated at 12:16 p.m.
