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Proposed rule would cripple our economy and energy supply

By: Lori LeBlanc, Director of GEST
Guest Column  / HoumaToday.com

 

 

For the past 40 years, the U.S. has been the only oil-producing nation in the world prevented from selling its domestic crude oil to other countries willing to buy it.

This all changed on Dec. 18 when Congress ended the federal ban on crude oil exports, strengthening our national security and boosting the economic outlook for Louisiana-based businesses and energy support companies all along our Gulf coast.

It is expected that thousands of good-paying Louisiana jobs will be created as allies of the U.S. will now be able to buy crude oil from us rather than from Iran, Russia and other countries that are politically or economically unstable.

In addition, world markets will be more accessible to Louisiana companies working in technology and energy support roles. This is great news for our American economy, American jobs and American energy security.

What may be coming out of Washington next, however, could erase all of this promise offered by the lifting of the crude oil ban and inflict even greater, long-lasting damage to our economy and energy supply.

The U.S. Department of Interior’s Bureau of Safety and Environmental Enforcement has proposed a new rule on deepwater oil and gas development that could significantly impact Louisiana workers and businesses, exacerbating our current economic hardships.

If the rule is adopted as proposed, additional jobs will be lost, more local businesses will go under, local and state tax revenue will fall even further, and workers that remain in the Gulf will actually be at a greater safety risk.

America’s energy industry is committed to conducting offshore oil and gas development in a safe and environmentally sound manner, and in the past five years, government and industry have made continuous efforts to enhance safety offshore.

The proposed well-control rule, however, could ultimately increase risk and decrease safety by instituting a one-size-fits-all prescriptive approach that puts our offshore workers and the environment in danger.

The proposed well-control rule would also exponentially increase expenses for any company producing energy in the Gulf or other offshore waters, including operators, drilling contractors and service companies.

This would make some oil and gas projects simply too expensive to pursue, shutting down drilling operations in the Gulf and consequently America’s offshore energy production.

The result would be catastrophic impacts on jobs, our economy and our energy supply, not to mention federal OCS revenue.

After taking more than four years to write the proposed well control rule, BSEE released it on April 15 and allowed only 90 days for public comment on this far-reaching and complex rule.

It is now undergoing final revisions before it goes to the White House Office of Management and Budget for approval.

Just as we successfully fought the deepwater moratorium in 2010, your Gulf Economic Survival Team is working to reverse what could be a debilitating blow to American energy production.

GEST is gathering economic data to explain the true economic impact of the proposed well control rule on communities, workers and small businesses, and the hardship it will bring to the federal treasury with cuts to OCS royalty revenue.

We hope that these facts will sway the federal government to work with industry to modify the well control rule in a way that enhances rather than risks worker safety and jobs. Then, our nation can focus on the job creation and economic boost offered by the world markets now open to American crude oil.

Lori LeBlanc is director of the Gulf Economic Survival Team.