Posted January 25, 2018
Opening new access to federal natural gas and oil reserves – offshore and onshore – is vital to growing America’s energy renaissance. Yet, every now and then some suggest our industry isn’t interested in exploring and developing new areas, particularly offshore. They just haven’t been listening.
The fact is natural gas and oil companies strongly support increased access to offshore reserves and are saying so publicly – offering a number of strong reasons the federal government should create a robust offshore leasing program for the 2019-2024 timeframe. Here’s a sampling of company comments submitted to the federal Bureau of Ocean Energy Management (BOEM) in August:
Include As Many Offshore Areas as Possible
“This country can no longer afford to look to only the federal waters off the coasts of Texas, Louisiana, Mississippi, and Alabama to carry the burden of providing such a large portion of the offshore segment of our nation’s energy needs. As long as our economy continues to rely on hydrocarbon related energy for our quality of life and national security, we have no choice but to broadly diversify our domestic energy sources.”
“[A]t this point in the Five-year Program development process all OCS areas with the potential to generate jobs and new revenue by advancing America’s energy renaissance should be considered for inclusion in the Draft Proposed Plan. Anything less undermines the comprehensive process set forth in the OCS Lands Act and could have significant impacts on the U.S. energy policy options well into the future. We fully support keeping existing exploration production areas in the Gulf of Mexico and Alaska available for leasing in the 2019-2024 Five-year Program and also urge BOEM to make new areas in the Atlantic, Eastern Gulf of Mexico and the Pacific available for leasing as part of the program. … At this point in the Five-year Program development process we believe that it is important for BOEM's evaluation of the OCS areas to be all-inclusive (26 Planning Areas) and not prematurely eliminate areas that have resource development potential.”
“Despite the recent prolonged downturn in oil prices, OCS production reached levels of 1.6 to 1.7 million BOPD in 2016 and 2017. It is important to note that projects which may come into production now are the result of investment decisions and lease sales which took place years ago. Unfortunately, these production rates cannot continue in the absence of policies that encourage cost-effective OCS development and the opening of new areas to balance the expected declines in GOM production.”
“APC … strongly encourages keeping existing exploration production areas in the Gulf of Mexico available for leasing in the 2019-2024 Five-year Program. Anadarko urges BOEM to also make new areas available, particularly the Mid- and South Atlantic and the Eastern Gulf of Mexico, to meet long-term energy needs and secure U.S. energy independence.”
“Having a demonstrated commitment from BOEM to allow access to leases in the region is likely to encourage more industry participation and subscription to future seismic acquisition programs.”
Technology Expands U.S. Offshore Potential
“As technology improves and economic conditions change leases once deemed noncommercial evolve into viable drilling candidates with commercial potential. Because of this evolution, it is important to allow innovative companies the opportunity to pursue new leases and to test innovative geologic ideas and to employ advancements in technology for drilling and production. A continuous stream of new discoveries is needed to replace depleted reserves and help maintain or increase domestic production levels.”
“Developments in the Atlantic OCS will benefit from the industry’s latest advances and innovations in deep water technology. These technology advancements in real-time and remote monitoring, subsea infrastructure, directional drilling, and seismic imaging, to name a few, have resulted in safer, more reliable operations, increased efficiency, and smaller developments foot prints.”
“With approximately 94% of all federal offshore areas off limits, the offshore oil and gas industry has not had the opportunity to use its newest technology in the search for new oil and gas resources in those areas that have remained off limits for over 30 years.”
Energy Coexists with Military, Other Uses
“Approximately 65,000 wells have been drilled successfully in the federal and state waters of the U.S. Gulf of Mexico since World War II. All the while, our industry has co-existed with commercial and recreational fishing, military restricted zones, tourism, recreational activities, and even in the proximity of marine protected areas, including the Flower Garden Banks National Marine Sanctuary.”
“The decades of exploring and drilling in the Gulf of Mexico demonstrate compatibility and synergies can exist between the petroleum industry, tourism and fishing, which are vital to many coastal communities.”
Let’s mention a couple of other points contained in the companies’ comments.
First, industry’s technological advances and innovative approaches help ensure safety and environmental protection. Chevron:
“The oil and gas industry has proven, especially in the last 30 years, that it has the technical capacity and safety procedures in place to minimize the adverse impact on all aspects of the natural environment as it conducts its operations.”
As noted in this post, more than 100 exploration and production standards created or strengthened since 2010, the Center for Offshore Safety and safety technology and response capabilities – including advanced well containment systems and response equipment – are primary in that effort.
Secondly, it’s essential for policymakers and all Americans to take a strategic, long-term view of U.S. offshore energy. It can take seven or more years to develop offshore natural gas and oil:
The availability of energy from the U.S. offshore in the next decade or two will hinge on decisions made over the span of BOEM’s 2019-2024 leasing program. Statoil:
“The decisions made now will have long-lasting impacts on U.S. energy policy. To continue our march toward greater energy independence, bold, forward-looking decisions need to be made. Decisions on areas to include in the 2019-2024 OCS Leasing Program will have impacts well into the future. Therefore, we believe that BOEM should fully consider all areas for inclusion in the program and keep as many areas as feasible in the Draft Proposed Program.”
The United States is the world’s leading producer of natural gas, oil and refined products. To meet future domestic energy needs and to our energy position in the world, America should harness its offshore reserves. This strategy starts with a vigorous federal leasing blueprint that puts our offshore areas on the table for safe development. A Washington Post editorial puts it this way:
We have long supported opening more U.S. waters to offshore drilling. As long as the economy requires oil, it must come from somewhere, and better the United States than a country with much weaker environmental oversight. It is arrogant of Americans to benefit from the interconnected global oil market yet insist that their shores remain closed.
To remain an energy superpower the United States must plan for it – by thinking long-term and preserving options for safe offshore natural gas and oil exploration and production.
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.