Blog Archives

Oil leaders, GOP allies, downplay administration’s seismic plans

image

House Natural Resources Committee chairman Rep. Doc Hastings, R-Wash, leads a committee hearing. (AP Photo/Kevin Wolf)

Posted on March 28, 2012 at 11:37 am
by Jennifer A. Dlouhy

The Obama administration’s announcement that it may allow seismic studies potentially paving the way for offshore drilling along the East Coast is political posturing designed to distract voters concerned about high gasoline prices, oil industry leaders and Republican lawmakers said today.

The administration’s move “continues the president’s election-year political ploy of giving speeches and talking about drilling after having spent the first three years in office blocking, delaying and driving up the cost of producing energy in America,” said Rep. Doc Hastings, R-Wash. “The president is focused on trying to talk his way out of what he’s done, rather than taking real steps to boost American energy production.”

At issue is Interior Secretary Ken Salazar’s announcement in Norfolk, Va., this morning that the government is assessing the environmental effects of allowing seismic surveys along the mid- and south-Atlantic that could help locate hidden pockets of oil and gas. If ultimately approved, the studies by private geological research companies also could help guide decisions about where to place renewable energy projects off the coast.

The Interior Department is issuing a draft environmental impact statement that assesses the consequences of seismic research on marine life in the area. The Obama administration had planned to release a similar document in 2010, before the Gulf of Mexico oil spill.

If the draft environmental assessment is finalized after public comments and hearings, the Bureau of Ocean Energy Management could give companies permits to conduct the studies off the coasts of eight East Coast states.

Salazar said that if the geological research turned up promising results, that could open the door to offshore drilling in the area within five years, even though the administration currently has ruled out that kind of exploration before 2017. A government plan for selling offshore drilling leases from 2012 to 2017 does not include any auctions of Atlantic territory.

“If the information that is developed allows us to move forward in a quicker time frame, we can always come in with an amendment,” Salazar said. “We’re not prejudging that at this point in time. My view is … we need to develop information so we can make those wise decisions.”

Industry officials noted that under federal laws, it could take years for the government to revise the 2012-2017 leasing plan, even if federal officials decided to pursue Atlantic drilling.

Erik Milito, upstream director for the American Petroleum Institute, said the administration is repackaging old news and old plans to make it appear it is making real progress to encourage more domestic energy development.

“This is political rhetoric to make it appear the administration is doing something on gas prices, but in reality it is little more than an empty gesture,” Milito said.

Randall Luthi, the president of the National Ocean Industries Association, likened the administration’s announcement to giving the industry “a canoe with no oars, since there are no lease sales planned anywhere off the East Coast.”

If allowed to conduct seismic surveys, geological research firms would ultimately give the resulting information to the government and sell it to companies eager to analyze the data.

But Milito questioned whether seismic companies would pursue the work, given that some of their best customers — oil companies — wouldn’t be able to use it to plan offshore drilling for years, if at all.

“Without an Atlantic coast lease sale in their five-year plan, the administration’s wishful thinking on seismic research has no ultimate purpose,” Milito said. “The White House has banned lease sales in the Atlantic for at least the next five years, discouraging the investment and job creation, and ultimately production, which would make seismic exploration valuable.”

Still, at least six companies already have told the government they want to conduct seismic research along the East Coast.

“We have gotten significant expressions of interest from companies in contracting for these seismic surveys,” said Tommy Beaudreau, the director of the Bureau of Ocean Energy Management. “I am confident that, assuming the process continues on the track we anticipate, that there will be significant interest next year in conducting these surveys.”

Geological research uses seismic waves to map what lies underground or beneath the ocean floor. The shock waves — which some environmental advocates say may harm marine life — map the density of subterranean material and can gives clues about possible oil and gas.

Seismic studies also help identify geologic hazards and archaeological resources in the seabed — information useful in determining the placement of renewable energy infrastructure as well as oil and gas equipment.

The existing seismic surveys of the Atlantic coast are decades old, and in the years since, “there have been enormous technological advances,” Salazar noted.

“We do need to have seismic moving forward so we can really understand what the resource potential is,” Salazar added.

Source

Obama’s Words Don’t Match with Action on Oil and Gas

image

Romina Boccia
January 30, 2012 at 3:30 pm

At this State of the Union address, President Obama proudly stated that “American oil production is the highest it’s been in eight years” and declared that his Administration would “open more than 75 percent of our potential offshore oil and gas resources.” While President Obama spoke favorably of the role that oil and gas development play in America, the President’s and his Administration’s actions don’t match with his words.

There are several areas where the President and his Administration are unreasonably hindering access to more oil and gas for Americans and threatening the industry with punitive measures:

  • Keystone permit rejection. The Keystone XL pipeline would deliver oil from our Canadian ally, relieve some of the pain of high prices at the gas pump, and create jobs in America. Nevertheless, and despite a State Department environmental review concluding that the project poses no significant environmental risk, the President chose to reject TransCanada’s permit application to build the pipeline.
  • Targeted tax hikes. The President continues to threaten the oil industry with targeted tax hikes. Under the rhetoric of eliminating subsidies for the industry, the President’s proposal would eliminate certain tax treatments for oil that are available to many industries, effectively singling out the oil industry for a tax hike.
  • Slowdown of production on federal lands. While American oil production has been increasing, the vast majority of that production is taking place on private lands. Production on federal lands is actually 40 percent lower than it was 10 years ago. The House Natural Resources Committee also reports that under the Obama Administration, 2010 had the lowest number of onshore leases issued since 1984.
  • Fracking regulation. Hydraulic fracturing (or “fracking”) is a proven oil and gas extraction process that should not be subject to overly burdensome regulations. The Environmental Protection Agency is currently considering federal regulation of the fracking process under the Safe Drinking Water Act. The problem is that the agency is following a procedure that even the Department of Energy criticized for its “selective focus” on “negative outcomes.”

Words alone will not make energy more abundant and affordable, nor will they create the energy-related jobs that would make the American economy stronger. If the President is truly concerned about increasing America’s energy access, he certainly has a funny way of showing it.

For policies in that direction, Heritage policy analyst Nick Loris explains in two papers how to make gas and electricity prices more affordable and how to create jobs and raise government revenue through energy exploration.

Source

%d bloggers like this: