Energy right on our shores – Washington Times – LUTHI


Energy right on our shores – Washington Times – LUTHI

.When the Interior Department released its five-year plan for our nation’s offshore energy resources late last month, it revealed that President Obama’s “all of the above” energy strategy excludes new areas for offshore natural gas and oil. The plan for the Outer Continental Shelf (OCS) fails to open access to any new areas on the East and West coasts and unnecessarily delays sales in Alaska, putting the nation further behind other countries that are expanding their offshore energy industries.

Fortunately, House Natural Resources Committee Chairman Doc Hastings, Washington Republican, is advancing legislation to fix the plan by expanding access to the OCS. My organization supports the legislation because the United States — thanks to a domestic energy boom driven by new exploration and drilling techniques mainly on state and private lands — realistically can set a course to dramatically reduce its dependence on Middle Eastern oil. The administration’s plan stands in the way because it leaves new offshore opportunities sidelined until 2017.

This is frustrating news for Americans, who time and time again hear the same empty promises about tapping into domestic energy resources when gas prices rise at the pump but never see follow-through. It’s worse for many of the millions of unemployed Americans who would jump at the opportunities the offshore energy industry and the sectors that support it could provide if only given a chance to find out how much oil and natural gas we have off our coasts.

Inexplicably, the new plan even restricts access to offshore Virginia, which was included in the previous five-year plan. This step backward flies in the face of bipartisan support for offshore development from the Old Dominion’s U.S. senators, its governor, a majority of the congressional delegation and the state legislature. Meanwhile, new land-based natural gas and oil operations in states such as North Dakota, Pennsylvania and Texas are supporting tens of thousands of new jobs in each state while providing much-needed new revenue to local and state governments. While the nation’s unemployment rate hovers above 8 percent, the oil and gas industry in North Dakota is actively seeking workers in a state that has an unemployment rate of about 3 percent.

States such as Virginia and South Carolina see what’s happening in other parts of the country and ask, “Why not us?” The key difference is that the energy boom in the nation’s interior is taking place on state-owned and private land. In fact, over the past year, oil production on federal lands and waters is down 14 percent, including 17 percent in the Gulf of Mexico.

If this proposed final plan moves forward without modifications from Congress, our country’s energy future will be worsened. It will hamper efforts to reduce our reliance on imported oil, and much-needed jobs won’t be created. Producing what we have offshore would generate as much as $1.3 trillion over the life of the resource for government at all levels. Leaving much of this out of the picture simply makes no sense. It’s not too late to change course. The Natural Resources Committee quickly passed Mr. Hastings‘ legislation last week, as should the full House and the Senate. There’s no time to waste.

Randall Luthi is president of the National Ocean Industries Association.



LUTHI: Obama’s dishonest energy promise – Washington Times

LUTHI: Obama’s dishonest energy promise – Washington Times.

Despite pledge, government hasn’t allowed drilling on 97 percent of coast

By Randall LuthiThe Washington Times

President Obama’s ambiguous call to “open” 75 percent of the country’s potential offshore oil and natural gas resources to exploration may sound generous, but the truth is, the areas containing those resources are technically already included in the upcoming 2012 to 2017 offshore leasing plan, and they are virtually the same areas where exploration and production have been allowed for decades.

Look beyond the president’s rhetoric to his record and it becomes clear that jobs and energy security are not high priorities for this administration. The shortsighted decision to deny the Keystone XL pipeline and the unnecessarily long moratorium on drilling in the deep waters of the Gulf of Mexico are but two examples.

Political uprisings and social unrest over the past year have highlighted the instability of oil-producing regions in the Middle East and North Africa, and the situation shows no signs of improvement. Just a few weeks ago, Iran threatened to shut the Strait of Hormuz, a critical transport route for 40 percent of the world’s oil. A robust domestic oil and natural gas industry can shield the U.S. market from such events and protect the American consumer. Unfortunately, our current policies have failed.

Around the same time as the Iranian announcement, the American Petroleum Institute unveiled a Quest Offshore Resources study showing that the deep-water drilling moratorium and subsequent permit slowdown forced 11 deep-water rigs to leave the Gulf of Mexico since 2010, taking their jobs and investments to the shores of Brazil, Africa and elsewhere. Those moves translated to a loss of $21.4 billion for our economy and an estimated 72,000 jobs in 2010 and 90,000 jobs in 2011, according to the study. We must do better.

An earlier Quest study rolled out by the National Ocean Industries Association showed that if permitting rates surpassed pre-2010 levels, 190,000 offshore industry-supported jobs could be created nationwide within the next two years without a single dime of government stimulus. The positive benefits of returning the Gulf-permitting rates to higher, more consistent levels are clear. But the Gulf represents only a portion of our nation’s offshore resources. Alaska’s outer continental shelf holds immense potential, with almost 10 billion barrels of oil and 15 trillion cubic feet of natural gas lying untapped beneath the ocean floor. Approval of exploration permits would mean 55,000 new jobs and $145 billion in new wages. The federal government would also see a significant amount of new revenue – approximately $193 billion.

There are also considerable resources off the coast of Virginia, where residents and state leadership support exploration. Unfortunately, the Department of the Interior has yet to allow the industry to move forward there. In addition to denying Virginia’s desire for an offshore lease sale, the department’s 2012 to 2017 proposed oil and gas leasing program keeps the eastern Gulf and the Atlantic and Pacific coasts off-limits to exploration and delays development in Alaska. This sends job creation elsewhere, and closes the door on economic growth.

Despite the vital revenue generated, jobs created, wages paid and increased energy security, less than 3 percent of the federal outer continental shelf is leased, leaving more than 97 percent of these resource-rich areas devoid of any permits. I cannot think of a more glaring, missed opportunity. We simply cannot continually place our nation at the mercy of hostile nations while we ignore our own energy potential. Significant oil and natural gas resources lie off our coasts and across our northern border, waiting to enhance our energy security and help stabilize fuel prices. We need to go get them. The time has come for Congress and the president to put aside rhetoric and ideological debates, pass meaningful legislation that will open our offshore domestic resources for exploration and development, stop sending our hard-earned dollars to hostile and unfriendly nations, and invest in America’s future.

Randall Luthi is president of the National Ocean Industry Association