Issuing Excuses, Not Drilling Permits; Obama Policy Chokes off Shallow-Water Energy Resources

Article excerpt


At a news conference held after the November midterm election, President Obama expressed interest in expanded natural-gas drilling in the United States, asking

rhetorically: "We've got .. terrific

natural-gas resources in this country Are we doing everything we can to develop those "Based on the problems encountered by companies that drill natural-gas wells in the Gulf of Mexico's shallow waters, the answer is clearly"no."

So what's holding up the process of developing the mature, accessible reservoirs of natural gas that lie just offshore?

Surely, it's not safety or environmental concerns. We've been drilling shallow-water wells safely and without major incident since 1949, when Harry Truman was in the White House and the Lone Ranger was debuting on television. Shallow-water drilling takes place in mature, predictable and well-known reservoirs. We use proven technologies and well-control equipment, with our blowout preventers located right on the rig, allowing for immediate access and constant inspection and maintenance. Over the past 15 years, more than 11,000 shallow-water wells have been drilled in the Gulf, with a grand total of 15 barrels of oil spilled in blowouts during that time.

What's actually holding up the process is little more than good old-fashioned bureaucratic sluggishness and gridlock. According to the website of the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), the majority of shallow-water permits that have been submitted in recent months have been approved. Yet this statistic, routinely cited by Interior Department officials hoping to demonstrate that Gulf drilling is proceeding as usual, masks deep-seated problems in the agency's regulatory approval process that are quietly suffocating the industry's long-term prospects.

To better understand what's behind the delays, let's take a close look at the BOEMRE's permit-approval process.

As of this writing, just 16 permits have been approved since April 20, an average of a little more than two per month over the past seven months - a significant decrease from before April 20, when an average of 7.1 permits were approved monthly. Moreover, behind the scenes, the BOEMRE is sitting on numerous other permit applications; the agency's website reveals that a slew of permits have been exiled into a bureaucratic Neverland in which permits that are submitted somehow don't reach the status of pending. In fact, the BOEMRE site suggests 21 permits for new wells are stuck in this category along with 2,661 submissions for an array of other shallow-water-related approvals. …