US Ends Deep-Water Drilling Ban
Posted by Gail the Actuary on October 12, 2010 - 3:45pm
The Obama administration announced today that it is ending the deep-water drilling ban that it enacted after the Deepwater Horizon oil spill. According to the Wall Street Journal,
Interior Secretary Ken Salazar, in a statement, said drilling in waters deeper than 500 feet can resume, so long as rig operators can demonstrate they comply with new safety regulations imposed since the April 20 Deepwater Horizon oil-rig explosion that began the three-month Gulf oil spill.
Among the new conditions on deep-water drilling: The chief executives of rig-operator companies must certify to the government that they comply with all safety regulations, and members of the industry must demonstrate they have the equipment necessary to contain a deep-water well blowout.
It is not clear how much impact this will have. According to Marketwatch:
Nevertheless, S&P Equity Research reiterated its negative fundamental outlook on the oil- and gas-drilling sector. “We would caution investors that the lifting of the ban … is in our view a necessary but not sufficient condition to revitalizing U.S. Gulf offshore-rig demand,” S&P analyst Stewart Glickman wrote in a note.
“We note that the permitting process for offshore rigs, both shallow and deepwater, has been and is likely to remain sluggish for some time,” he said.
The American Petroleum Institute's Energy Tomorrow site,
The American Petroleum Institute (API), while pleased that the moratorium has been lifted, expressed concern today that a de facto moratorium could be created by delays in the processing and approval of permits, which will reduce production, government revenues and American jobs, according to a statement by API President and CEO Jack Gerard.
Without lifting of the drilling ban, it would have expired on November 30. There is disagreement as to how much impact the drilling ban has had to date on jobs. According to one study, employment in the oil and gas industry in the five Louisiana parishes most dependent on the offshore oil and gas industry has remained relatively flat, because jobs created by the oil spill roughly offset those lost otherwise.
Contact
- Content: editors at theoildrum dot com
- Tech support: support at theoildrum dot com
License
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License.
S&P analyst Stewart Glickman wrote;
the permitting process for offshore rigs, both shallow and deepwater, has been and is likely to remain sluggish for some time,
He seems to think that even rushed safety and environmental reviews are too slow for his liking. Either he is completely clueless or he is an industry mouthpiece (or both)...
Drill, baby, DRILL!
I'm really thinking they should allow drilling everywhere just to show the people who think that will solve all our problems that they are wrong. I really think the myth of "the tree-hugger preventing oil independence" needs to be destroyed before we can get serious bipartisan support for peak oil related legislation.
Despite how much damage and wasted effort that might entail, I think there is a ribbon of truth in what you say about the public's understanding of energy.
One positive aspect of the limited drilling policy is that we buy oil overseas and safeguard our supply at home. When it becomes necessary, saving endangered species and pristine wilderness that no one will be able to visit will not block future drilling. I agree that the drilling and mapping supplies should be done now if we ever hope to see people take the finiteness of supply seriously.
"One positive aspect of the limited drilling policy is that we buy oil overseas and safeguard our supply at home."
The fact that much of the drilling equipment left the Gulf for other oily locales should tend to safeguard our supply at least temporarily. During cheap foreign oil controversies of the 70's one would occasionally hear political slogans such as "Burn America First" or "Strength Through Exhaustion". Unfortunately foreign oil is no longer cheap.
-- ANWR is a special case since the pipeline may someday freeze and become inoperative.
Will - Clueless about what? That the gov't won't slowly increase support for an activity that is its second largest source of revenue after the IRS? That the vast majority of politicans of both parties will push "drill baby drill" when gasoline hits $6 or $7 per gallon again? That the majority of Americans would ignore AGW even if a modern day Moses came with the word of God affirming AGW because acknoledging AGW won't allow BAU? That Americans will be continue to sacrifice our military to influence the distribution of oil?
I wouldn't call you foolish if you disagreed with my vision of the future. It would be simply a matter of you having much more faith in folks then me. And yes, this is the opinion of an industry mouthpiece. Maybe that might actually allow me some extra credibility from some folks: for 35 years I've worked at perpetuating a system that I knew wasn't sustainable when I started in 1975. I've watched from the sidelines of the reality as our political leaders were more than willing to keep pourng the Koolaid to the public. I see nothing in our political system (regardless of who controls the White House/Congress) today that makes me think this process will stop. Cheney maybe the poster child for "Our lifestyle isn't negotiable". But how many other politicans are on record for saying he was wrong? Pretty short list, eh?
Far be it from me to begrudge you your daily bread and how you made but I think that we are fast approaching a moment in time when the public might begin to notice that their Koolaid is getting lighter and lighter in hue and is losing its flavor and beginning to taste a whole lot more like plain ordinary water. The magic spell is starting to wear off.
So in that sense pushing the "Drill Baby Drill!" mantra and pulling out all the stops on it will just speed up the process of revealing the wizard behind the curtain to be a fraud. Sooner or later we will have to face reality, IMHO if we do it sooner we might be able to get on with doing what is necessary. The longer we wait the harder and more painful it will be. So in that sense I agree that we should let the Drill Baby Drill crowd put the pedal to the metal, at this point all the true environmentalists should go along with them just so they can be proven wrong sooner.
People know all they want to know. That is, when they go to the gas station, prices are affordable and the tank from which they are pumping the gas is infinitely large. There is plenty more where that came from as far as they are concerned. Since this is a wedge issue used by people like Sarah Palin, there will not be an honest discussion of energy.
The fact is, for the vast majority of people, peak oil is an abstraction. You might as well be explaining how fairies fly. It is impossible to explain something as complex as peak oil to someone who has little interest in understanding it. It is not and will not be on the vast majority's radar screen until is too late. Maybe most people understand that oil is finite (not even sure about that). But so what?
Planning and action on peak oil have to happen before it peaks. Many in the peak oil community think it it likely it has already peaked. Giving total free reign to the drill,baby, drill community won't change that. Discovering the wizard behind the curtain will mean nothing since it is probably already too late.
The world is mad, mad,mad and is heading towards the abyss.
And if someone like Sarah Palin is President at a time in the future when prices at the gas station have become unaffordable, someone like Goldman will come up with a couple of hundred billion of qubits created out of thin air to subsidize the price at the pump "temporarily", so that the non-negotiable party can go on while politicians kick the can down the road.
FM - I agree with you for the most part. I think where we diverge when it comes to the public reaction. There will come a time when they "understand" the limits. In fact, they've occasionally had a short term taste of such times in the past. But I have little doubt the public will embrace any concept of self blame. They will blame the govt, the damn oil companies, the damn Arabs, the damn etree huggers, etc. And since it is't their fault they expect others to pay for the developing situations. And they'll demand (and receive) what we probably be some very distasteful actions by TPTB. Color me a skeptic but after watching the pattern repeat itself for 35 years I just don't get a sense the public will suddenly evolve to a higher level.
Begrudge away. LOL. The public ignorance has made for an interesting career for me. Both good times, like now and the future, and bad times like when I drove a Yellow cab in the mid 80's. And all due to the system not taking a proactive approach to deal with our energy consumption in any way close to common sense.
Rockman,
I do believe all the more liberal types are going to wind up hating your guts for rubbing thier noses in an unpleasant but obvious truth;when push comes to shove, the demorats, when they are in power, are going to do exactly what the rethuglicans have been doing-pushing bau.
Mac;
Don't worry, the 'more liberal types' don't have any illusions about the Democratic Party.
As Nader says, they're only distinguished from the right by the speed with which their knees hit the carpet when a lobbyist enters the room.
The parties represent the 'Party', they are supported on a bed of funding and approval by the monied interests.
Bob
mac- I'm not exactly well received by my fellow Texacan conservatives either. LOL. Like you, I'm always a little shocked by how folks frame the situation in terms of political leanings. Sorta like the old joke about there being no atheists in fox holes. I don't think you'll see many liberals or conservatives sitting in line at the gas station begging to fill up at $8/gallon. It will just be a bunch of red blooded Americans willing to let their govt take whatever immoral action it requires to get back to BAU. Our friend was lamenting about the reaction should Palin be president when TSHTF. As if it will make any difference which party is in power. LOL. I had firsthand experience with our "peace loving" liberal cousins in my youth. Thus it's rather difficult for me to play the them vs. us card. The American public, both liberal and conservative, is very tolerant...as long as they have everything they want. And if they don't get it they'll tolerate however much collateral damage it takes to get it IMHO. Much of the world hates us now. Just wait till we stop being nice guys. LOL.
We tried, and failed, to get some of that deepwater action:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1067...
The problem is that it was a "gas" prospect. Oil is about 6 times more valuable than methane in today's market. Not to mention the Kiwi's wouldn't be a big enough market, so you'd have the added expense of liquefying and ship transport.
"But the U.S. still needs oil and gas from the Gulf Coast, Salazar said, even as the nation transitions to a clean energy economy."
http://content.usatoday.com/communities/theoval/post/2010/10/obama-aide-...
Is anyone else here surprised that the nation is actually "transitioning to a clean energy economy"?
past - I'm not...if you mean transitioning towards "clean coal" technology. LOL. For some reason the first thing that popped to mind when I read that: We are all transitioning towards death, too.
Don't see any transitioning in this neck of the woods.
We will rapidly transition to a clean energy economy just by doing nothing, as we are now. All of the cornucopian scenarios of renewable energy implementation require a level of interest and sacrifice totally lacking in the western cultures. There is a reason denial is so powerful a force. 99.9% of us really do not want to know. I often wonder what is it about me that makes me one of the tiny minority. Does anyone else feel that way?
Ok Treeman, I'll bite. How is powering your computer with wind/solar going for you right now? Oh, you mean you're NOT? Shocking.
Mine is powered with 100% clean renewable hydropower as a matter of fact, before you need to ask me about it. My concern about hearing everyone who "gets it" is their arguments tend to run along the line of everyone ELSE who doesn't "get it", getting in the way of "getting it". In other words before one talks about "others" sacrificing, one should do the sacrificing first, quietly and responsibly to see just how that shoe fits one wants another to walk in for more than a mile, but an entire lifetime. Enough individuals self-sacrificing who "get it" and the scales ultimately tilt. Unfortunately, that whole self-sacrifice thingy doesn't quite work right for Americans (and plenty of other countries too BTW), not unless the cameras are rolling and there's a big soapbox handy.
But what do I know? I'm just a tend to my own garden first kind of guy.
Mine is also powered with hydro. A 125KW unit we installed two years ago. I didn't complain about whether people were doing anything about it, just wondering why I and obviously a few others, see a situation others simply do not see.
Deep Water drilling won't stop the crop of "Miss Me Yet" billboards from proliferating across the nation and the world, nor will it stop the demise of civilization even though Iraq is slated to become the world's number one oil producer.