Obama's six-month moratorium overturned by federal judge

By Ross Densley | 06/23/10 - 10:57

Federal judge has overturned embargo

The six-month moratorium issued by the Obama administration to suspend offshore drilling in light of the environmental disaster in the Gulf of Mexico has been blocked by a federal judge.

The six-month plan came in light of the 50,000 barrels of oil spewing into the Gulf of Mexico every day, which had seen offshore drilling u-turns from both President Obama and Californian Governor Arnold Schwarzenegger, who had previously championed further drilling off the Californian coast.

"An invalid agency decision to suspend drilling of wells in the depths over 500 feet simply cannot justify the immeasurable effect on the plaintiffs, the local economy, the Gulf region and the critical present-day aspect of the availability of domestic energy in this country," judge Martin Feldman said.

John Houghtaling, the CEO of Ocean Therapy Solutions told NG Oil & Gas that the six-month drilling ban "could finish Louisiana off," referring to the affects on the state after the devastation of hurricane Katrina and the loss of jobs for oil workers if the moratorium were upheld.

"[The] 33 rigs deep water rigs [in the Gulf of Mexico] are ... going to pull anchor, and they're going to go to Brazil and Africa. So this [could be] a major problem," he said last week.

Fossil fuel infrastructure

The overturned moratorium will come as a blow to environmental groups and those championing alternative energy, who saw the disaster as an opportunity to make inroads into the fossil fuel infrastructure which accounts for 98 percent of current energy production.

"The tragedy unfolding on our coast is the most painful and powerful reminder yet that the time to embrace a clean-energy future is now," President Obama told the nation from the Oval Office last week.

However, if the moratorium is overturned, it would mean continued reliance on fossil fuels, something that, not surprisingly, top executives from BP and Transocean have stressed is pivotal if global demands for energy are to be achieved.

"The world does need the oil and the energy that is going to have to come from deep water production going forward.

"Therefore, the regulatory framework must still enable that to be a viable commercial position," Steve Westwell, BP's chief of staff said.

The White House said it would be appealing the decision.