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The Bureau of Ocean Energy Management of the Department of the Interior published a 33-page Interim Final Rule covering new oil and gas drilling regulations for the Offshore. Buried within the bowels of this beast is a perfunctory assessment of the impact of the rules on the economy and on small business in particular.
The impact on domestic deepwater hydrocarbon production as a result of these regulations is expected to be negative, but the size of the impact is not expected to materially impact the world oil markets. The deepwater GOM [Gulf of Mexico] is an oil province and the domestic crude oil prices are set by the world oil markets. Currently there is sufficient spare capacity in OPEC to offset a decrease in GOM deepwater production that could occur as a result of this rule. Therefore, the increase in the price of hydrocarbon products to consumers from the increased cost to drill and operate on the OCS is expected to be minimal. However, more of the oil for domestic consumption may be purchased from overseas markets because the cost of OCS oil and gas production will rise relative to other sources of supply. This shift would contribute negatively to our balance of trade. [Page 22 of the document.]
This is rather stunning on several levels.
The actions of this Administration are naive, ill-considered and contrary to the self-interest of our Nation. I swear to Aqua Buddha, we’d get better governance from the Student Government of a major university.
Note that this is an “Interim Final Rule”, not a “Notice of Propsed Rulemaking”. The rule went into effect 10/14/10, but there is a 60-day period of public comment until 12/13/10. Mail or hand-carry comments to:
Department of the Interior
Bureau of Ocean Energy Management, Regulation and Enforcement
Attention: Regulations and Standards Branch (RSB)
381 Elden Street, MS–4024,
Herndon, Virginia 20170–4817
Reference: ‘‘Increased Safety Measures for Energy Development on the Outer Continental Shelf, 1010–AD68’’ in your comments and include your name and return address.
Cross-posted at VladEnBlog.