Obama U-turn on offshore drilling

Obama on Offshore Drilling

President Obama backed himself into a corner by deciding to try and please everyone on the issue of offshore drilling in Federal waters. As a result when it came to reaching a final conclusion on the matter, some groups were going to be left very disappointed. As it turns out, it will be the environmentalists.

Obama will announce plans today to open large sections of the eastern Gulf of Mexico and an area off the Virginia coast for oil and natural gas drilling.

"To set America on a path to energy independence, the president believes we must leverage our diverse domestic resources by pursuing a comprehensive energy strategy," said a statement provided by an administration official, who did not want to comment on the record ahead of the president's announcement.

A compromise on health-care?

On March 3 this year, NG Oil & Gas speculated that we might not see any further offshore drilling leases granted during Obama's first term. We reported that the six-month delay that the Obama administration put on approving offshore drilling leases in federal waters looked set to become a three-year ban as Obama's ongoing indecision on the issue appeared to near its conclusion.

But since then Obama has managed to get his beloved healthcare reform bill through the Senate. The decision to unveil a broad blueprint for oil and natural gas drilling along the nation's coastlines is a clear attempt to win back some of the Republican support lost amidst the health-care reform melee.

Drilling expansion was granted off the Alaskan coast last year, and now the Eastern Gulf is likely to see more activity as the administration plans to sell drilling leases in 2.9 million acres off the coast of Virginia - though it was unclear whether that sale would happen in November 2011, as originally planned by the Bush administration.

Reducing dependence on foreign fuel

And the president is also expected to endorse opening up more of the Eastern Gulf of Mexico for drilling - including areas at least 125 miles off the Florida Coast.

The long-awaited plan more specifically represents an attempted compromise among pro-drilling lawmakers, the energy industry and environmentalists that make up the president's political base.

Ignoring, for a moment, the manner in which the Obama administration has stumbled towards this decision it is almost impossible to argue with the primary reason behind the plan - increasing energy security.

America currently imports over 60 percent of the oil it consumes, therefore reducing America's dependence of foreign fuel has become an absolute priority. Early in his presidency, Mr Obama said US reliance on foreign oil posed a real threat. Outlining his energy priorities, he said the country would not be held "hostage to dwindling resources, hostile regimes, and a warming planet".

Staking out the middle ground

But he also called for greater fuel efficiency and an "energy economy" aimed at creating millions of jobs through the development of the nations renewable energy technology industry. Thus far this has proven to be one of the major successes of Obama's tenure, but renewable technology makes up such a tiny percentage of the nations generation, traditional sources of fuel remain crucial to America's energy and economic future.

Two of America's biggest rivals in the global oil and gas market, Russia and China, have recently hinted at exploiting any decision by Washington not to expand its offshore oil and gas assets, thus presenting a direct threat to America's energy security.

Whereas this may initially sit well with pro-drilling lobbyists, it was far from clear whether the Obama administration will achieve their more immediate political aim: winning crucial Republican support for energy and climate change legislation due to go before the Senate in the next few weeks.

The New York Times writes: "While Mr Obama has staked out middle ground on other environmental matters - supporting nuclear power, for example - the sheer breadth of the offshore drilling decision will take some of his supporters aback."

Time will tell as to whether this carrot is big enough to lure back the Republican lost in the lead up to this announcement.

Related Articles:

No more offshore drilling under Obama | Offshore drilling still high on the agenda | The importance of our indie oil producers

Daniel Jones

Daniel is a Politics and Philosophy graduate from Cardiff University where he also worked as a section editor on the award winning student newspaper. After university he joined an IT support company where he was a B2B online writer. He loves anything to do with sport and joined GDS in July 2009.

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