Obama to unveil offshore oil plan

Environmental opposition

For more than 20 years, drilling was banned in most offshore areas of the US outside the Gulf of Mexico because of concerns that spills could harm the environment.

in depth

Counting the Cost: Oil exploration

Obama’s plan offers few concessions to environmentalists, who have been strident in their opposition to more oil platforms off the nation’s shores.

Obama, who wants congress to move a stalled climate change bill,has sought to reach out to Republicans by signalling he is open to allowing offshore drilling, providing coastlines are protected.

The administration has been weighing the pros and cons of offshore drilling since it took office and put a hold on a Bush-era proposal which called for drilling along the East Coast and off the coast of California.

An administration official said, as part of the new updated plan, the government will conduct the first new offshore oil and gas sale in the Atlantic Ocean in over two decades as part of a lease sale 80km off the coast of Virginia.

Sizeable reserves

Seismic exploration in the south Atlantic and mid-Atlantic outer continental shelf of the US will determine the quantity and location of potential oil and gas resources to support energy planning.

The Bush plan had called for leases to be offered in November 2011 but it was not immediately clear whether the Obama administration would stick to that schedule.

A senior interior official said in January that drilling off Virginia’s coast would be delayed past the original 2011 leasing date.

The proposed Virginia lease area, located about 80km from shore, may hold 130 million barrels of oil and 1.14 trillion cubic feet of natural gas, based on interior department estimates.
   
In addition, the interior department will continue lease sales in the Central and Western Gulf of Mexico, which have proved to have sizeable reserves.
   
Much of the Eastern Gulf is currently under a congressional moratorium on oil and gas operations.

The interior department’s plan would open up about two-thirds of the available oil and gas resources in this region in the event that the moratorium is lifted, the official said.
   
Military training in the Eastern Gulf will be protected and drilling activities will occur more than 125 miles from the Florida coast.
   
Alaska lease ‘cancelled’
   
Proposed oil and gas leasing in Alaska’s Bristol Bay will be cancelled out of concern for protecting sensitive areas of the outer continental shelf from environmental dangers.

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This could affect companies like Royal Dutch Shell which has expressed interest in the region, as well as ConocoPhillips, BP and Statoil.
   
Four pending lease sales in the Chukchi and Beaufort Seas in North Alaska will be cancelled and those areas reserved for future scientific research to determine if they are suitable for further leasing.

At the same time, a previously scheduled lease sale in Alaska’s Cook Inlet will proceed.
   
Congress allowed a prohibition on offshore drilling to expire in 2008 and George Bush, the former US president, lifted a drilling moratorium that year.

Emissions curb

Environmental groups and some legislators continue to raise concerns about the impact increased drilling would have on coastal areas.

5,603 new hybrid vehicles have been ordered for the government fleet [EPA]

The US Geological Survey estimates the US Atlantic coast waters may hold 37 trillion cubic feet of gas and nearly four billion barrels of oil, while the Pacific Coast has 10.5 billion barrels of oil and 18 trillion cubic feet of gas.

To put that in context, the United States imports about two billion barrels of oil a year from the Organisation of Petroleum Exporting Countries (Opec) and is expected to import 2.7 trillion cubic feet of natural gas from all sources this year, according to the energy department.

The president’s Wednesday remarks would be paired with other energy proposals that were more likely to find praise from environmental groups.

The White House planned to announce it had ordered 5,603 new hybrid vehicles to convert the federal fleet to one of greater fuel efficiency.

And on Thursday, the Environmental Protection Agency (EPA) and the transportation department are to sign a final rule that requires increased fuel efficiency standards for new cars.