Yesterday at a Senate Energy and Natural Resources Committee hearing on the Interior Department budget, the topic of offshore oil permits by Interior set Sen. Mary Landrieu (D-LA) off against her party.
Landrieu did the best she could not to go over onto the other side, parroting the Democrat line that “we can’t drill our way out of this problem” of high gasoline prices…
“I would say to my Republican colleagues that we cannot drill our way out of this problem. We cannot drill our way back to $2 or $3 gasoline. I don’t want to engage in bumper sticker politics, but I do want to engage in good policy for this country.”
But that would only take the Senator so far before she had to hack away at Interior Secretary Ken Salazar. The latter showed up at the hearing loaded with rhetoric about how aggressively Interior is permitting offshore drilling and how oil production under his charge is exploding, and that was just too much for Landrieu to take.
What specifically set Landrieu off were a number of statements in Salazar’s testimony in the hearing. Here was one…
Since 2008, oil production from the Federal OCS has increased by 30 percent, from 450 million barrels to more than 589 million barrels in 2010. Balancing the need for safety and environmental enforcement, Interior currently manages over 35 million acres of the OCS under active lease. A recently proposed five-year oil and gas leasing program would make more than 75 percent of undiscovered technically recoverable oil and gas estimated on the OCS available for development.
Naturally, anybody who understands the issue of offshore oil production and the effect of the Obama administration’s drilling moratorium following the BP oil spill recognizes how disingenuous it is for Salazar to take credit for 2010 production numbers. First of all, that increase is solely due to leases and permits issued to oil exploration firms during the previous administration, and second, stopping at 2010 when 2011 figures are available doesn’t tell the story of what’s actually happening offshore.
But the fact is that oil production on federal lands, the majority of which is represented on the outer continental shelf Salazar brags about, fell off by 11 percent from 2010 to 2011. Strangely, a breakdown of that total into OCS production doesn’t exist through government sources; do a search for it at the Bureau of Ocean Energy Management site and you’ll get an error message instead of what you’re looking for. Safe to say, though, that if for most of 2010 Salazar’s agency refused to issue drilling permits it’s a sure thing that production in 2011 would fall off – if you’re not drilling you’re not finding oil and you’re not producing it, and producing wells do see their production drop off as oil comes out of the wells.
Landrieu was aware of Salazar’s disingenuous statements and couldn’t hold back, particularly after her moron colleague Al Franken spouted off about how ExxonMobil is making a record profit.
Salazar then tried to tout the lease sale Interior held in December, which was basically a disaster since shell-shocked oil companies refused to bid on all but 2 million acres of offshore seabed out of 38 million put up for lease. And that didn’t fly.
Salazar’s response to all this was hilarious in its transparent dishonesty: “We feel very comfortable that production is coming up.”
Landrieu is put in an impossible position by her party’s hostility toward Louisiana’s most lucrative industry; the state should be experiencing a massive economic boom considering the high price of crude and the widespread availability of it off our shores, but instead it’s more of a minor uptick for those lucky firms able to take advantage of what activity the federal government does allow. Offshore permits in the year since the Obama administration “lifted” its moratorium on drilling are down 10 percent from the year prior to the imposition of the moratorium, despite the fact that oil prices are up considerably and resource estimates in the Gulf indicate a colossal supply there.
That’s hardly “production is coming up.”
The Greater New Orleans, Inc. study Landrieu referenced was covered by WVUE-TV in New Orleans a month ago. Salazar and Franken should take note, as it might disabuse them of their fantasyland notion that federal policy isn’t doing harm to a vital national industry…
(Link in case the embed won’t load)
Again, there is no reason why, when crude prices top $100 per barrel, these companies shouldn’t be exploding at present. They’re not. Federal regulation and federal delays in permitting for exploration have caused a slowdown at a time when the downstream effects – better known as the price at the pump – are harming the economy as a whole.
Landrieu, despite her party affiliation, sees this. And while she obviously would like to be a good soldier for the Democrats, she knows there is no defense for what Salazar and his bosses in the White House are doing.