Updated: Administration reverses offshore drilling plans

The Obama administration today reversed its plans to expand offshore drilling along the nation’s coastlines in a political retreat that was prompted by this summer’s oil spill in the Gulf of Mexico.

Interior Secretary Ken Salazar said the administration would block drilling in the eastern Gulf of Mexico as well as the south- and mid-Atlantic through 2017 as part of a plan that will govern leasing on the outer continental shelf from July 1, 2012 through June 30, 2017.

The administration’s plan to auction drilling leases for central and western Gulf of Mexico tracts next year also will be delayed. That means the sale scheduled for next March will now be delayed until late 2011 at the earliest, to allow time for the government to conduct a lengthy environmental assessment of the Gulf of Mexico that was announced last month.

Salazar said the administration’s “updated strategy” would allow federal regulators to focus on areas that have already been open for leasing and concentrate on continuing to beef up safety requirements for offshore drilling in the wake of the Deepwater Horizon disaster.

“As that oversight regime is put into place, we have revised our initial March announcement . . . to focus and expand our critical resources on areas with leases that are currently active,” Salazar said. And for those open Gulf areas, “we will do everything we can to proceed with the lease sales by the end of 2011 and in 2012.”

Today’s move reverses President Barack Obama’s high-profile March 31 announcement that the administration would take the first steps toward expanding offshore drilling along the mid- and south-Atlantic by allowing seismic studies of the region.

Administration officials downplayed the change, noting that the White House had not guaranteed any drilling in federal waters along the East Coast as part of its March announcement — just seismic studies that would pave the way for future exploration. And because a 2006 law bars drilling off Florida’s Gulf Coast until 2022, it would be up to Congress — not the administration — to first lift that ban before the government could sell leases for that area.

“It is important to remember that the preliminary study we were proposing in the eastern Gulf of Mexico . . . would not result in any leasing because Congress needs to act before any leasing in this area,” Salazar said.

Salazar stressed that seismic studies off the Atlantic Coast would still go forward, and emphasized that even with the decision to wall off some areas, there still are 29 million acres in the Gulf of Mexico that could be developed.

The administration also is still weighing whether to allow Shell to drill an exploratory well in the Beaufort Sea near Alaska next summer, although the company has warned that if it doesn’t get a decision soon, the project will not be feasible in the 2011 Alaskan drilling season.

Michael Bromwich, the director of the Bureau of Ocean Energy Management, Regulation and Enforcement, said his agency was considering Shell’s Arctic drilling plans but would “not be constrained by any artificial deadlines.”

“In the Arctic, which is a frontier area, where leases have been issued but there is limited development, we will proceed with utmost caution,” Salazar said. “BOEMRE will carefully review Shell’s application to determine if the project meets all existing and new safety standards and has robust spill response capabilities in place and will do so before a decision to move forward can be granted.”

To begin drilling, Shell needs an okay from the ocean energy bureau, as well as permits from the Environmental Protection Agency and other entities.

Today’s decision was cheered by environmentalists, who said it showed the Obama administration was heeding lessons learned by the oil spill. Margie Alt, the executive director of Environment America, said the decision is good news for “anyone who loves our beaches, who fishes in the ocean or who depends on a healthy coastal economy.”

But the move was blasted by oil and gas industry advocates, who said it was foolish and unnecessary. Bruce Vincent, the president of Houston-based Swift Energy and chairman of the Independent Petroleum Association of America, said the administration was “waging an unbridled war on America’s oil and natural gas producers” with a “misguided announcement that will keep even more taxpayer-owned energy resources further out of reach and under Washington’s lock-and-key.”

Read more reaction from industry officials and congressional offshore drilling advocates here. Read more reaction from offshore drilling critics here. You also can read highlights of the administration’s new offshore drilling plans.

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