The People of America's Oil and Natural Gas Indusry

Time to Get Back to Work in the Gulf

Mark Green

Mark Green
Posted October 4, 2010

Government and industry experts, media and individuals across the country are talking about the negative consequences of the administration's offshore drilling moratorium. And while Interior Secretary Ken Salazar last week issued new safety rules for offshore drilling, there was no mention of when the moratorium would be lifted.

The moratorium is a jobs killer and unnecessary, given the immediate actions taken by industry and government to improve drilling and operations to enhance safety and environmental protections. The longer the moratorium stays in place, the greater the chances of significant and lasting harm to the economy.

A new report shows that during the six-month moratorium, the Gulf could lose more than:

  • 19,500 jobs--40 to 60 percent higher than administration estimates;
  • $5 billion in economic activity; and
  • Nearly $240 million in state and local tax revenues.

Projections aside, the moratorium's impact is real: At least five of 33 Gulf deepwater rigs have left or are departing for foreign oilfields, taking American jobs with them. U.S. companies are reporting layoffs while countries such as Canada and Brazil are racing to develop new sources of oil and natural gas.

There's also the de facto moratorium on shallow water drilling. Only seven permits for new shallow-water wells have been issued since April, and 15 of 46 shallow water rigs are idle.

A drilling slowdown hurts more than just oil companies. There are more than 16,000 small businesses servicing the five Gulf states, employing more than 153,000 people. These are people with families and communities to support and taxes and bills to pay--and they, their families and communities are taking a hit because of the moratorium. The moratorium also reaches well outside the Gulf Coast in terms of its impact--vendors that provide vital business support and services to Gulf operations are located as far away as Pennsylvania and Illinois.

It is unnecessary to shut down a major part of the nation's energy lifeline while working to add to offshore safety. We can resume operations while continuing to build on safety improvements already implemented or underway.

ABOUT THE AUTHOR

Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.