BOEMRE Scraps Planned Gulf of Mexico Lease Sales

During today's press conference, Secretary Salazar and Director Bromwich spoke about the Administration's reversal from its March 2010 position on the 2012-2017 five-year plan. Specifically, plans to hold lease sales in both eastern waters of Gulf of Mexico and the Mid-Atlantic coast have been scrapped. Progress in the Artic will be retarded, too.

Additionally, during the Q&A session of the press conference, Director Bromwich stated that the lease sale scheduled for March 2011 will likely be pushed out. It was mentioned that, pending further environmental analysis, this sale would likely be held near the end of calendar year 2011.

For the most part, the rhetoric from both Salazar and Bromwich was repetitive in nature to what has previously been discussed and with little concrete information to back up their opinions. For instance, they discussed new lessons learned from science as supporting the decision to reverse the objectives outlined last March. But when pressed for specific details on the science, their responses lacked any clear examples of detailed new found items that stemmed from the issues. Similarly, both parties continue to put forth a unified front about making the operations safer. With that we cannot argue, because obviously if the administration does not allow new drilling, then the likelihood of another oil spill is non-existent.

The icing on the cake came when it was argued that the 29 million out of 43 million acres already leased, but currently not being developed, would more than offset any new leases offered in previously unavailable regions. This also ignores the diminished permitting activity that, as of yet, has not produced any new deepwater drilling since the moratorium was lifted in October. We note that according to the BOEMRE website, just nine shallow water APD permits have been approved and no deepwater permits have been approved since the moratorium was lifted on October 12, 2010.

The National Ocean Industries Association commented, "The delay of at least two years of scheduled lease sales shows a lack of understanding of oil and gas production. A lease sale is only one step in the process and doesn't necessarily mean production will occur. Likewise, the argument that there are 29 million acres available for development shows a lack of understanding that oil and gas reserves are not located everywhere nor uniformly located under all 29 million acres."


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