President Obama’s announcement yesterday to allow some new coastal oil drilling still bans drilling along the entire Pacific coast, the Northern Atlantic region, Bristol Bay in Alaska and large blocks of the Gulf of Mexico.
With the centerpiece of his energy policy — the cap-and-trade energy tax — stalled in the Senate, Obama now proposes to delay any new offshore drilling by at least another year to 2012.
In 2008, Congress and the Bush Administration lifted the decades-long Outer Continental Shelf (OCS) drilling moratorium after gasoline prices reached $4 per gallon. Yet Obama’s new proposal seeks to again place the majority of America’s energy resources under lock and key.
The plan tosses aside a new lease sale in the deep waters off of the coast of Virginia that was scheduled for next year. Obama would also allow for new exploration in part of the Eastern Gulf of Mexico before 2022 only if Congress approves.
House Natural Resources Committee Republicans released hard numbers yesterday on Obama’s new drilling ban:
• In 2008 "after the moratoria were lifted, the Bush Administration issued a 2010-2015 OSC leasing plan, and solicited comments on all aspects of the plan. The proposal included 31 OCS lease sales in all or some portion of the 12 of the 26 planning areas — four areas off Alaska, two areas off the Pacific coast, three areas in the Gulf of Mexico, and three areas off the Atlantic coast."
• " The Pacific Coast alone holds an estimated 10.5 billion barrels of oil — almost 75% of the total amount available off the U.S. coastline in former moratoria areas and 18 trillion cubic feet of natural gas."
• "The Northern Atlantic region, which will remain completely closed, contains an estimated 17.99 trillion cubic feet of natural gas."
• "In total, the new Obama OCS plan puts 13.14 billion barrels of oil and 41.49 trillion cubic feet of natural gas under lock and key."
• "The administration is delaying plans to drill in the Atlantic off of Virginia’s coast until 2012– discarding a lease sale that was scheduled to take place in 2011."
• "The administration will only consider development of the Mid-Atlantic, Southern Atlantic, Chukchi and Beaufort Sea following draft environmental study work to be conducted over the next year. It has NOT actually planned lease sales for these areas."
Of the 14 billion barrels of known OCS reserves, Obama’s plan locks up over 13 billion of them. One could hardly term Obama’s position “drill baby drill,” despite the mainstream media’s portrayal of it as such.
With average gasoline prices nearing 90 cents per gallon higher than the price at the pump a year ago (now closing in on $3 per gallon), higher gas prices this summer further enable chances of a Republican juggernaut at the polls come November. Obama is grappling for an energy fig leaf for his already beleaguered Democrat congressional comrades.
Furthermore, the President’s budget places burdensome new taxes on oil companies, making expensive outlays for exploration and drilling that much harder to come by. Obama’s fiscal 2010 budget hit the independent oil and gas industry with $40 billion in new taxes (see MANDATORY TERMINATIONS, REDUCTIONS, AND OTHER SAVINGS Page 4).
Rep. Charles Boustany (R-La.), whose district hugs the oil-and-gas-rich Gulf Coast in a state that ranks fifth in the nation for both crude oil and natural gas production, called the President’s new plan "schizophrenic."
“It’s nice to say you’re going to open up blocks for lease but then if you impose a tax policy that makes it cost prohibitive for these companies to take the risk that doesn’t do much good,” Boustany told HUMAN EVENTS. “I want to see a policy that’s not schizophrenic. I want to see a policy that’s solid in its pursuit of American-made energy. That’s what I’m hoping for and I don’t see those strong signals yet coming from this administration.”
When asked about the Obama budget that will knee-cap the small, independents who drill, produce and operate nearly 90% of America’s oil and gas wells, Boustany said:“I speak to the folks that run these companies. The risks that these companies take are immense. That’s why these tax provisions were placed into law back in 1913 to mitigate against the immense risk and to create the incentives for our companies to take on that risk and drill to produce American-made energy. You can’t impose those types of taxes on our companies who ramp up, go out and hire the necessary expertise and take the kind of risks to explore for oil and gas that leads to production.”
“It not only comes back to good, American-produced energy, but it’s also American jobs that we’re talking about at a time when unemployment is high and folks are struggling,” Boustany added. “What Americans want is an energy strategy that’s going to lead to good, American-made energy production and good American jobs.”