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Government memo estimated job loss before drilling ban

WASHINGTON — The deepwater drilling moratorium in the Gulf of Mexico costs at least 23,000 jobs, according to a federal document that weighed the economic impact and alternatives to the drilling ban.

A six-month suspension would directly put 9,450 people out of work and indirectly affect nearly 14,000 other jobs, according to a memo from Michael Bromwich, the nation's top drilling regulator.

The July 10 memo to Interior Secretary Ken Salazar outlined several options regarding the suspension of offshore drilling.

Salazar issued a moratorium in June, but it was struck down by a federal judge in New Orleans after oil and gas drilling interests said it wasn't justified following the gulf oil spill.

The Obama administration issued a new moratorium July 13 — three days after the memo — that stressed new evidence of safety concerns. The White House hopes the revised ban will pass muster with the courts.

The moratoriums were put in place following the Deepwater Horizon rig explosion April 20 that killed 11 people. Millions of gallons of oil spilled into the gulf after the rig sank.

Some energy experts, engineering consultants and Gulf Coast leaders have joined the oil industry to ask Salazar to change his mind. Drilling was safe before the BP spill, they said, and gulf communities that depend on the industry were suffering unfairly.

Interior Department spokesman Matt Lee-Ashley said the agency has been very clear that the economic impacts of the moratorium would need to be addressed and noted the Obama administration secured an agreement with BP to set up a $100 million fund for affected rig workers.

"In light of the current risks of deepwater drilling as illustrated by the BP Deepwater Horizon spill and the potential impacts of another spill, the moratorium is necessary and appropriate. With that said, the worst-case economic impact estimates from three months ago have not been realized. The reality on the ground suggests that the impacts are less than we initially projected as a potential worst-case scenario," Lee-Ashley said.

Government memo estimated job loss before drilling ban 08/22/10 [Last modified: Sunday, August 22, 2010 12:13am]
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