Posted January 24, 2011
API executive vice president Marty Durbin had a good op/ed in the Houston Chronicle over the weekend. After looking at the oil industry's significant safety enhances since the tragic Macondo well accident last spring, Durbin looks forward:
"...The moratorium on deep-water drilling technically ended last October. Yet not a single deep-water drilling permit has been issued since. Some deep-water rigs are leaving the Gulf. We've been told by the Interior Department that permitting may never get back to the levels before the accident. We've also learned that 2011 may see no new offshore leasing, and the department is scaling back its next five-year offshore leasing plan.
Thousands of jobs have disappeared already. Revenue and energy production will be increasingly affected. The Energy Department says that new government policies in the Gulf will produce a cumulative production drop of 482 million barrels of oil from 2011 to 2018. That's about $50 billion of oil we will have to find elsewhere. It also translates to a decline in taxes, royalties and other revenue to government of more than $14 billion, which would cover the cost of our federal school lunch program.
We can have safety, energy production and the jobs it creates. Our vigilance on safety must and will continue. But progress has been made, we are safer today, and our commitment to safe operations and further improvements is strong. It's clearly time for our industry to be back at work producing the energy our nation needs."
ABOUT THE AUTHOR
John Felmy is API’s Chief Economist. He is responsible for overseeing economic, statistical and policy analysis and has over twenty-five years experience in energy, economic and environmental analysis. John is a Pennsylvania native and received Bachelors and Masters in Economics from Pennsylvania State University and a Ph.D. in Economics from the University of Maryland. He is a member of several professional associations including the American Economic Association and the International Association for Energy Economics.