Gulf of Mexico oil and gas lease sale plans fail to impress industry critics

01 27, 2012 by The Times-Picayune

President Barack Obama announced with a flourish Thursday that his administration is opening another 38 million acres of the central Gulf of Mexico for exploration and development with an oil and gas lease sale in New Orleans on June 20. But the administration’s critics in the industry and on the Hill, while welcoming the setting of a date, derided what the office of House Natural Resources Committee Chairman Doc Hastings, R-Wash., characterized as a “rather banal major announcement” of Obama’s plans for proceeding with “lease sales that were scheduled before he even took office.”

“We’re pleased to hear that the long-delayed central Gulf of Mexico sale will finally occur in June,” said Randall Luthi, president of the National Ocean Industries Association, a trade group. “However, this sale has been on the books since 2007 under the current five-year plan.”

“This sale is actually a melding of two previously scheduled sales: Central GOM Sale 216, originally scheduled for 2011, and Central GOM Sale 222, originally scheduled for 2012,” Luthi said. “In fact, seven sales scheduled in the 2007-2012 plan were flat out canceled — one off the coast of Virginia, one in the western GOM and five off the coast of Alaska. So, while we move one step forward today, we are already several steps behind.”

The president announced the lease sale in a speech in Las Vegas on his “all-of-the-above” energy strategy — a rhetorical coinage borrowed from House Republicans — that he talked about in his State of the Union address Tuesday.

The announcement was trumpeted in an administration news release Wednesday evening, embargoed until Thursday morning.

“When I saw this embargo deal last night I thought maybe it was something else and not just what was already going to happen,” Don Briggs, president of the Louisiana Oil and Gas Association, said Thursday. “At least he didn’t cancel it, and that is a good thing. They are going forward with a lease sale that was already planned and it wasn’t canceled.”

Briggs was preparing to speak before the Petroleum Club of Houston, a presentation that includes a slide showing in red all the stretches of the Outer Continental Shelf — including the Atlantic and Pacific coasts of the continental United States — that the administration has placed off-limits for drilling.

In his State of the Union address, the president said he had directed the Department of Interior to finalize the next five-year national offshore energy plan “to open more than 75 percent of our potential offshore oil and gas resources.”

But Sen. Mary Landrieu, D-La., said this was more rhetorical sleight-of-hand.

“Unfortunately, what the president proposed — making available 75 percent of the known recoverable resources — is already happening. His goal is the status quo because the known recoverable resources are in the western and central Gulf of Mexico — the two areas this country has always focused on to provide nearly 30 percent of our energy.”

“What we need is to expand our offshore efforts — by opening new areas, including Virginia, and developing more of our offshore energy resources here at home,” Landrieu said.

But leading environmental organizations see the move by the administration toward renewed exploration in the Gulf and perhaps beyond as wrongheaded.

“Coming only two years after the worst oil spill in U.S. history devastated the Gulf Coast — and without comprehensive reforms to government oversight and industry practices recommended by the National Oil Spill Commission and others — these moves could spell disaster for sensitive ocean areas and coastal communities,” Sarah Chasis, director of Natural Resources Defense Council, wrote in an online posting.

“Much of the oil is still in the Gulf, some fishermen still can’t catch enough to stay in business, and we still don’t know the full impact of the spill on marine life, including endangered species like sea turtles,” said Jacqueline Savitz, senior campaign director for the advocacy group Oceana. “Worse yet, the safety failures that led to the Gulf spill have not been addressed, and drilling remains as risky as it was before the spill.”