Wednesday, October 17, 2012

Obama's Disastrous Drilling Ban

The Federal Government's ham-handed intervention into the offshore drilling business during 2010 has harmed the industry and offshore oil and gas production ever since. Drilling permits have remained stalled and oil/gas production on Federal lands has lagged the gains seen on private lands.  All this at a time of rising oil and gasoline prices.  Gulf of Mexico oil production during May, 2010 (Obama bans drilling in Gulf on May 2, 2010) is 47 million barrels. Gulf of Mexico oil production for July 2012 (latest month avail.) is 37 million barrels.

There is never an admission of responsibility or apology from this administration.  The pattern is that, everything gets fouled up with ham-handed regulation or outright malfeasance, then the cover-up and excuses continue until inconvenient events like re-election debates bring the issue back into the open.

Obama Shuts Down Drilling In The Gulf of Mexico
After the BP subsea well blowout in the Gulf of Mexico on April 20, 2010, the Obama administration banned all drilling in the Gulf of Mexico on May 2, 2010.  Rather than work with industry, the emotional overreaction has caused harm to the industry and loss of employment ever since.  The administration quietly lifted the ban on shallow water drilling a month later but permitting for all types of wells never recovered. This has lead to a 40% drop in drilling permits on Federal waters compared to the years prior to the BP drilling accident.

The initial ban was vastly too broad since there's a world of difference between the drilling of deep water wells (with subsea blowout preventers like the BP well) and the shallow water wells.  The shallow water drilling should never have been included. Drilling on fixed or mobile platforms and in shallow water is routine, safe and environmentally sound.  There's a also much higher number of shallow water wells being drilled than subsea wells, so the impact on ongoing oil and gas production has been great.

But even shutting down drilling for one day, week or a month is damaging to the industry--when those subjected to the ban don't have any idea how long the ban will be in effect.  Drilling rigs are very expensive and under day-rate contracts.  Even one day shutdown is serious to these operators.

An injunction against the overly broad drilling ban was issued by a Federal judge on June 22.  The Obama administration vowed to appeal.  Then a month later the Obama administration issued a new moratorium in July effectively the same as the old one to play "games" with the Federal judge.  It was rescinded in October 2010 before it too could be reviewed by the US Federal District judge.  

Obama Continues to Claim Everything's OK
On July 2 2010, Republican Representative from Louisiana, Bill Cassidy, said to Human Events,
It’s been over a month since President Obama claimed there’s no moratorium on shallow-water drilling. In the wake of the Deepwater Horizon explosion, all drilling in the Gulf was halted. The President announced that shallow-water drilling would resume but that companies would be required to re-permit under new safety guidelines.
But no shallow-water drilling permits—with the exception of two which were quickly rescinded — have been granted since the drilling moratorium was first announced on May 6th.
“We’re told by the government that the de-facto moratorium doesn’t exist,” Cassidy said.“By industry, by workers, we’re told that it does.”
Despite denials by (they themselves had better get their facts straight) claimed that there are only permit delays, Louisiana Senator Vitter said on July 11
Louisiana is still suffering from the job-crushing moratorium put in place after the BP oil spill. The Obama administration shut down the entire offshore oil and gas industry and thousands of jobs were lost because of it. Many Louisianians, including myself, pleaded for answers to why this happened, but we could never get a clear one.
There was in fact a de facto drilling ban as the permit process had ground to a halt.  Over and over again, the Obama administration's words do not match their actions.  This has been the norm in the Obama Administration.   How much of this lying does it take for people to get wise to this?  Sometimes, as in this case, it shows the "ham-handed" incompetence of your Federal government and the subsequent lies designed to deflect criticism and cover-up incompetence.  You see the same pattern with regard to the US Embassy attack in Libya and the subsequent cover-up and lies about the causes of the death of the US Ambassador there.

Now, fast forward to February 2011 and permits have been stalled now for 9 months.  From Bloomberg News,
The Offshore Marine Service Association, a group representing offshore service vessels and shipyards, urged the president to end what it called an informal moratorium on offshore drilling.
“President Obama claims to have lifted the Gulf moratorium, yet not a single deepwater permit has been issued in nine months,” Jim Adams, the association’s president, said in a release after the ruling. “As a result, thousands of workers are out of jobs, Americans are paying more for gasoline and heating oil, and our nation is becoming even more dependent on unstable nations for our energy needs.”
The Obama Administration In Contempt Of The Federal District Court
The judge, Martin Feldman, said in February 2011, that the Obama administration and Interior Department have continued to act in contempt of his order.  From Bloomberg,
Interior Department regulators acted with “determined disregard” by lifting and reinstituting a series of policy changes that restricted offshore drilling, following the worst offshore oil spill in U.S. history, U.S. District Judge, Martin Feldman of New Orleans ruled yesterday.
“Each step the government took following the court’s imposition of a preliminary injunction showcases its defiance,” Feldman said in the ruling.
“Such dismissive conduct, viewed in tandem with the re-imposition of a second blanket and substantively identical moratorium, and in light of the national importance of this case, provide this court with clear and convincing evidence of the government’s contempt,” Feldman said. 
Obama Tries to Claim 'Credit' for Increased US Oil and Gas Production
Fast forward to Oct 2012, we have an election debate where Obama tried to take credit for overall increased oil and gas production in our country.  Gee, if I didn't know better, he sounded like he was a member of the Tea Party!  In response, Romney correctly called-out the president by pointing out that oil and gas production dropped in Federal land (offshore) during the Obama Administration but rose smartly on private land.  So the president "lied" and got caught for once, but not from the Media!

This is news to people because the media has failed in their jobs.  If it wasn't for Romney and the debate, the President would have continued to get away with presenting himself, erroneously, as somehow responsible for generally higher oil and gas production-which is not true in any sense. He didn't build that!  He just wants to falsely claim credit for one of the few success stories in the country. Obama made similarly claims in earlier State's of the Union addresses as well.  Where were the fact checkers then??

An "All Of The Above" Energy Policy?  Really?
Many times, Obama has given "lip service" in favor of an "all of above" energy policy: that he is somehow in favor of oil and gas production in combination with all other sources of energy. But he's been AGAINST an "all of the above"energy strategy and has actively worked against oil and gas production and exploration by his deeds.  Permitting on Federal land is down about 40%.

Obama said in March 2012 during his endless campaign "I don't control oil prices."  He also said that "you just can't drill your way out of high oil prices."  Oh really?  Ask the people in North Dakota as their oil production is rocketing skywards.

War On Coal and Electric Utilities
Not only is he against oil and gas, his administration is in an open war on the coal industry and against electric power utility companies that burn coal for power production. What important energy source is NOT under attack by this administration?  Obama talks about upgrading the nation's power grid. But who owns the power grid?  It's the very utility companies that he's attacking.  The incoherence in this administration is staggering.

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