The Fuse

Trump Administration Proposes Large Expansion of Offshore Drilling

by Matt Piotrowski | January 04, 2018

The Trump administration on Thursday announced a draft proposal to offer offshore blocks to oil and gas drillers throughout most of the U.S. outer continental shelf (OCS). The five-year plan would open areas in the Arctic, Atlantic, and Pacific oceans to drilling, which represents a big shift from previous administrations. In what would be the largest lease sale ever, the Interior Department has proposed 47 auctions in more than 90 percent of the OCS. The proposal highlights the Trump administration’s desire to make the U.S. an energy superpower with a massive expansion of drilling.

The five-year plan would open areas in the Arctic, Atlantic, and Pacific oceans to drilling, which represents a big shift from previous administrations.

Today’s proposal follows a number of years of uncertainty about drilling in the OCS, following extensive debate on opening areas off the Atlantic Coast. In 2016, the Obama Administration reversed course on its previously announced plan to allow bidding on Mid-Atlantic OCS blocks during the 2017-2022 planning period.

The scope of oil and gas resources in the entire OCS is unclear, as testing and mapping have not been conducted in a number of areas since the 1980s, and research methods and technology have advanced significantly in the decades since. The most recent assessment completed by the Department of Interior, released in 2011 and updated to include current estimates for the Atlantic OCS in 2014, said undiscovered technically recoverable resources for the entire OCS is 90 billion barrels of oil. Including gas, the total is 148 billion barrels of oil equivalent.

DOI OCS estimates

The lease sales would include 19 off the coast of Alaska, seven in the Pacific Region, 12 in the Gulf of Mexico, and nine in the Atlantic Region. The added supply would improve energy security for the U.S., which is now experiencing an oil production boom as a result of hydraulic fracturing. “Oil and gas development in the Atlantic has been restricted for decades, and by responsibly opening up our offshore resources we will have more domestic energy options that will strengthen our energy security,” said SAFE’s CEO Robbie Diamond in a statement.

It remains critical to balance environmental preservation and energy extraction so that accidents such as the Deepwater Horizon spill do not occur and set back efforts to increase production in federal waters.

It is important that drillers and regulators maintain the most rigorous performance, safety, and environmental standards for offshore activity. It remains critical to balance environmental preservation and energy extraction so that accidents such as the Deepwater Horizon spill do not occur and set back efforts to increase production in federal waters.

The Trump administration’s proposal has angered environmentalists and will be subject to public comment, environmental review, and litigation. “Just like with mining, not all areas are appropriate for offshore drilling, and we will take that into consideration in the coming weeks,” Interior Secretary Ryan Zinke said in a news release. “The important thing is we strike the right balance to protect our coasts and people while still powering America and achieving American energy dominance.” The proposal announced Thursday is one part of a multi-year process for a final five-year OCS program for 2019-2024.

The proposal will face challenges by coastal governors, including Republican Rick Scott of Florida, who voiced his opposition on Thursday. All three West Coast governors, as well as those in North Carolina and Virginia, also oppose expanding offshore drilling in their waters. Today’s oil price environment is another hurdle. It’s unclear how much interest the industry will have for drilling in OCS areas. Although prices have doubled since early 2016, large, billion-dollar offshore projects that take years to complete are still not attractive for many drillers.

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