Salazar: US to Announce Offshore Drilling Schedule Soon

WASHINGTON (Dow Jones), Nov. 24, 2009

U.S. Interior Secretary Ken Salazar lashed out at oil and gas companies, claiming that trade groups representing the industries have launched attacks on the Obama administration with all the hallmarks of "election-year politics."

The Interior Secretary delivered the rebuke as he announced plans to hold 38 auctions to lease federal lands for oil and gas drilling next year. Salazar said oil and gas companies need to decide whether to behave responsibly or to have their trade associations "behave like an arm of a political party." He declined to identify the trade groups by name. "They know who they are," he told reporters during a conference call.

The American Petroleum Institute, the most prominent industry trade group, didn't immediately return a call seeking comment.

Energy politics are becoming increasingly fractious as the Obama administration struggles to push energy and climate legislation through the U.S. Senate. Democrats have accused the energy industry of using trade associations and front groups to scare the American public about the Obama administration's agenda. Republicans have accused the Obama administration of disadvantaging oil, gas and coal industries. Both sides accuse each other of distorting the science behind climate change.

"We want oil and gas companies to engage with us and to be our partners," Salazar said. But he said the administration wouldn't tolerate some practices, such as opening up land near national parks to oil and gas drilling. Last month, the Interior Department indicated that it would block leases on eight parcels of land in Utah that were visible from areas such as Canyonlands National Park. It indicated that another 52 parcels might be placed off-limits.

The oil and gas industries have been unhappy with a number of new policies. In their view, the Obama administration has been dragging its feet on some of the country's largest leasing programs for offshore oil and gas exploration, by taking too long to respond to a federal appeals court that in April threw out some programs. Energy companies also say that uncertainty about the direction the Obama administration is taking makes it hard for them to function.

"Frankly, they're wrong," Salazar said. "The reason that there is uncertainty is because of the fact that, in the prior administration, there were shortcuts taken including leasing parcels that were next to national parks."

As for the court-challenged blueprint governing a program for new offshore leases from 2007 through 2012, Salazar said, as he has repeatedly in recent months, that he doesn't have "a specific date in mind" but that he hopes to do so "in the near future." He said the Interior Department is still reviewing the environmental effects of drilling in sensitive areas.  

Copyright (c) 2009 Dow Jones & Company, Inc.


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