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FRONT PAGE CONTRIBUTOR

Offshore Drilling: How Obama Can Have His Cake and Eat It Too

By including areas of the East Coast, Eastern Gulf of Mexico and offshore Alaska in its new Five Year OCS Leasing Plan, the Obama Administration would appear to be throwing a bone to the “Drill. Baby, Drill” crowd.

Of course, everyone expects that there’s a quid pro quo in the deal: in exchange for this Open Access, you will support some form of Cap and Trade proposal. Isn’t that about it, Senator Graham?

But don’t mistake oil and gas leasing as a green light for an oil operator to “Drill. Baby, Drill”. An oil and gas lease is full of all kinds of “subject-tos”. Most significantly, an operator’s ability to drill and explore a lease is subject to his ability to secure the requisite approval from the various government agencies that issue permits for that activity.

So, theoretically, the Feds could issue a lease, but if one of the regulatory bodies refuses to issue a permit, there’s no drilling.

But that would never happen, would it?

Well, it did, less than two weeks ago.


Montana oil leases suspended

BILLINGS – A federal judge has approved a first-of-its-kind settlement requiring the government to suspend 38,000 acres of oil and gas leases in Montana so it can gauge how oil field activities contribute to climate change. …

[Note: These are leases that have already been sold by the BLM. Operators have put up their money but have done no drilling pending resolution of this case. - ed.]

Under the deal approved Thursday by U.S. District Judge Donald Molloy in Missoula, the Bureau of Land Management will suspend the 61 leases in Montana within 90 days. They will have to go through a new round of environmental reviews before the suspensions can be lifted.

“We view this as a very big deal, if a modest first step, in the BLM addressing climate change in oil and gas development,” said plaintiffs’ attorney Erik Schlenker-Goodrich. “It’s quite a dirty process, but there are ways to clean it up.” …

A parallel lawsuit challenging 70,000 acres of federal lands leased in New Mexico remains pending.

A BLM spokesman, Greg Albright, said reviewing lease sales for climate change would be a first for the agency. How it will be done was still being worked out, and it was unclear if the BLM would adopt such reviews as a standard requirement.

[emphasis added]

Bear in mind that these two cases represent 108,000 widely dispersed acres in areas that have been under oil and gas development for decades. These permits are make-work for the bureaucrats and their consultants and allow the environmental “stakeholders” to drag out developemnt and make it easier for the interested operator to pull up stakes and go elsewhere.

If it’s this easy in Montana and New Mexico, offshore areas will be a piece of cake.

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