Outlook for The U.S. Offshore Industry Is Darkening

Oil & Natural Gas / Conventional Oil & Gas Resources

Date posted: 03/25/16

G. Allen Brooks opines that after enunciating an energy policy in March 2012 that was based on the concept of an all of the above resource strategy, President Obama has abandoned it in his recent energy policy actions. First, he rejected the Keystone XL pipeline, and now he is ditching the Atlantic Lease 260 sale from the proposed five-year offshore oil and gas lease sale program for 2017-2022. Even more recently, the President has directed that the government tighten air pollution standards for offshore drilling. The removal of Atlantic Lease 260 is a reversal of his previous policy calling for opening up the East Coast offshore to oil and gas exploration. This is the second time that acreage in the Atlantic Ocean has been bumped from proposed five-year lease sale programs. The first time was in 2010 when the President was siding with including an Atlantic lease sale in the 2012-2017 sale program, only to withdraw his support after the Macondo accident and resulting oil spill. In a March 15 2012 speech about energy policy, he stated that we can not have an energy strategy for the last century that traps us in the past. He indicated that we need an energy strategy for the future for the 21st century that develops every source of American-made energy. As explained in a report of the President Council of Economic Advisors a little over 2 years following the speech, the advantages of the President policy were set forth. The report pointed out that the U.S. is producing more oil and natural gas, is generating more electricity from renewables such as wind and solar (although nomuch), and is consuming less petroleum while holding electricity consumption constant via our 99 nuclear power plants. His energy policy was based on 3 tenants .. 1) To support economic growth and job creation, 2)To enhance energy security, and 3) To deploy low-carbon energy technologies and lay the foundation for a clean energy future that includes more nuclear energy.