Obama drops plan for Atlantic drilling: Update
OREANDA-NEWS. President Barack Obama's administration has dropped plans to open the waters off the US east coast to oil and gas development.
The five-year offshore leasing plan that the US Interior Department's Bureau of Ocean Energy Management (BOEM) released today includes 10 potential lease areas in the US Gulf of Mexico and another three off the coast of Alaska.
But Interior does not intend to offer any leases off the US east coast, citing "current market dynamics, strong local opposition and conflicts with competing commercial and military ocean uses."
The US administration considered opening up the east coast to drilling in 2010 and again last year but ultimately decided against it. No oil and gas producer has drilled a well off the US east coast since 1984.
The plan offers areas with the highest resource potential, greatest industry interest and established infrastructure, US interior secretary Sally Jewell said today. The Interior program protects sensitive resources and supports development of domestic energy resources "to create jobs and reduce our dependence on foreign oil," she said.
The program calls for BOEM to hold two lease sales in the US Gulf of Mexico every year. But the agency will offer the leases on a region-wide basis, in a change from the current practice of holding alternating lease sales in the central and western Gulf and periodic sales in the eastern section.
The agency is proposing holding three lease sales for acreage off Alaska, one in the Beaufort sea in 2020, another in Cook Inlet in 2021 and one more in the Chukchi Sea in 2022.
Today's release kicks off a 90-day comment period on the proposal.
The decision to hold back drilling in the Atlantic offshore "appeases extremists who seek to stop oil and natural gas production," industry group the American Petroleum Institute president Jack Gerard said.
Oil prices were not a material factor, but the Interior considered broader market conditions in deciding not to open the Atlantic coast to drilling, Jewell said. The industry's enthusiasm for developing the Atlantic would be higher if prices were at a level seen two years ago, Jewell said. She cited strong opposition in the coastal states and objections raised by the US Navy and US space agency NASA among factors the administration considered in making its decision.
Interior released the 2017-2022 offshore leasing plan on the day when North Carolina and Florida hold their presidential primaries. The governors of Virginia, North Carolina, South Carolina and Georgia supported offshore drilling. But northeast states, many Democratic members of Congress and environmentalists have argued the risks are too high, as did some coastal communities that see drilling as a risk to tourism.
The US administration in March 2010 proposed opening the waters off the mid- and south-Atlantic states to drilling. But the Macondo spill in April 2010 made the plan politically untenable, and the Atlantic coast was subsequently dropped from the BOEM's 2012-17 leasing program.
The administration resurrected the idea last year, with the release of a draft plan for 2017-2022 that called for opening the waters off Virginia south to Georgia. But today, the Atlantic dropped off the leasing schedule in order to protect it for future generations, Jewell said.
Today's decision does not permanently close the door on oil and gas development in the US waters of the Atlantic, she said. A different administration in the White House may revisit the issue, and Congress could force a sale by legislation.
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