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With BP spill under control, U.S. looks at drill ban

NEW ORLEANS — Now that the worst offshore oil spill in U.S. history has effectively been stopped, the White House is considering an early end to its moratorium on deepwater drilling.

But nearly four months after the April 20 explosion at the Deepwater Horizon oil rig, regulators have only started to make good on promises to overhaul drilling. Tough measures are stalled in Congress. A $1 billion emergency response network proposed by the industry won't be operational for a year.

Congress also is considering measures that could make the gulf one of the strictest places on the planet for offshore drillers to work. Bills in the House and Senate would lift the $75 million cap on liabilities for economic damages — such as lost wages, shortened fishing seasons or lagging tourism.

Interior Secretary Ken Salazar has halted deepwater drilling until Nov. 30, saying the BP spill demonstrated the industry wasn't prepared for a massive underwater blowout. He has ordered rigs to re-examine their equipment and safety procedures, and next month plans to order new safeguards for blowout preventers.

Before drillers can return to the deep water, however, Salazar said the industry should be able to show that it's capable of responding to and containing future blowouts.

Some energy experts, engineering consultants, Gulf Coast leaders and oil industry lobbyists have asked 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.

That argument appears to have gained traction, even among people most affected by the spill, now that BP is close to plugging the well for good.

Billy Nungesser, president of hard-hit Plaquemines Parish, La., said he has seen attitudes change in his community now that the disaster is easing. Even though oil has been washing ashore for months and he has fought constantly with BP and the government over their response, Nungesser thinks the ban should be lifted. Offshore drilling means jobs.

According to the most recent state data, the oil and gas industry supports more than 320,000 jobs in Louisiana and generates more than $12.7 billion in household earnings.

George Hirasaki, a Rice University engineering professor who was involved in the oil containment effort in the Bay Marchand field off Louisiana after a rig burned in the early 1970s, agrees.

"I think what is needed is improved standards and procedures, and not just restrictions on drilling," Hirasaki said.

The moratorium bans exploratory drilling, but not production. At an estimated 1.66 million barrels per day, gulf oil production accounts for about 30 percent of domestic output. However, the government estimates 2011 production at just 1.54 million barrels per day — equal to 2009 levels — in part because no new wells are being drilled.

The United States is expected to import 9.11 million barrels per day this year. Opponents say the moratorium will only boost the need for foreign oil, but the government currently forecasts a drop in imports next year because of increased domestic production onshore.

With BP spill under control, U.S. looks at drill ban 08/14/10 [Last modified: Saturday, August 14, 2010 9:24pm]
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