Well, we all pretty much saw this one coming, didn’t we? President Obama announced at the end of March that he would open new areas along the East Coast and the eastern Gulf of Mexico to new drilling. He even made a comment about how safe offshore drilling had become. About three weeks later, the Deepwater Horizon exploded.
Smiley N. Pool/Houston Chronicle
Not much happening here
Now, the White House said its going back on its plans. All drilling in the new areas is halted through 2017. At the same time, lease sales for the central and western Gulf set for March will be pushed back until late next year, and perhaps longer.
The industry is predictably outraged, but I suspect few oil and gas executives expected the outcome to be any different.
The administration argues that it needs to focus on areas of existing drilling activity and work on beefing up safety regulations before it begins expanding the areas it has to oversee.
Of course, now that Obama has enacted a pay freeze for all federal employees as a symbolic gesture towards cutting the deficit, it’s going to be more difficult to attract qualified regulators to monitor offshore drilling.
And while the industry can stomp its collective feet, it needs to stop treating the BP Macondo disaster as a lone incident. While BP’s culture of cutting corners may have contributed to the disaster, the blowout raised serious questions about industry’s preparedness, procedures, and safety equipment.
Despite the rhetoric, the industry knew this decision almost as soon as the Deepwater Horizon sank and oil began leaking from the broken riser.