Administration Proposes New Energy Drilling

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Administration Proposes New Energy Drilling
The move would end a ban on drilling in environmentally sensitive areas along the coasts of Alaska and Virginia.

Both areas have been closed to new drilling for many years. The areas off Virginia are still covered by laws that prohibit new drilling in all areas along the Atlantic and Pacific seaboards. But Congress lifted the prohibition on Bristol Bay off Alaska in 2003, and President Bush lifted an executive order in January that had blocked drilling there through 2012.
Both proposals are part of a broader five-year plan to open up 48 million acres along the outer continental shelf to oil and gas drilling. Unless Congress objects within 60 days, most of the five-year plan will go into effect, though resistance has been voiced. Starting this year, the Interior Department plans to offer leases on about 8.3 million acres in the central region of the Gulf of Mexico, which Congress specifically approved for offshore drilling late last year.

But the department hopes to open up far more than that. It would offer leases on 37 million acres off Alaska, starting as early as 2008, in vast new areas in the Beaufort Sea, the Chukchi Sea and the Cook Inlet. None of those areas have been subject to a drilling ban, but none have been tapped before.

Starting in 2011, the Interior Department would also lease out 5.6 million acres in Bristol Bay along the Alaska Peninsula, an area that Congress closed off after the Exxon Valdez oil spill in 1989. If the plan can get approval from Congress, it would offer up three million acres off the coast of Virginia, starting in 2012.

not to mention:

Some environmental advocates said, however, that the proposed protections would be inadequate and could jeopardize fishing areas.

“The Bush administration is zeroing in on the most environmentally sensitive areas for offshore drilling,” said Richard Charter, a lobbyist for Defenders of Wildlife and co-chairman of the National Outer Continental Shelf Coalition. “These areas that they are characterizing as buffer zones are woefully inadequate when you consider that the Exxon Valdez oil spill traveled hundreds of miles in a matter of weeks.”

It is not clear how much fuel lies in the areas that would be made available. Interior Department officials estimated that the entire plan could produce 10 billion barrels of additional oil and 45 trillion cubic feet of additional natural gas over the next 40 years. That would be equal to about 16 months of the United States’ current oil consumption and about two years of its current consumption of natural gas.

The oil industry’s two big trade associations, the American Petroleum Institute and the Independent Petroleum Association of America, both praised the administration plan and urged Congress to open even more areas to drilling.

Royal Dutch Shell has been particularly eager to explore and develop the areas in Alaska, and has hired a number of former state and federal officials to help build popular support in communities near the proposed drilling areas.

If the administration does lease out areas in Alaska, companies may be entitled to a special reprieve from paying royalties to the government. In passing the Energy Policy Act of 2005, Congress extended what is known as “royalty relief” for deepwater drillers to cover oil and gas produced in “frontier areas” that are far from transportation centers.

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This page contains a single entry by Seth A. published on May 2, 2007 9:38 AM.

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