Offshore-Drilling Decision Makes Waves

The top executive of the American Petroleum Institute expressed surprise at the Obama administration's decision today to pull back its expanded offshore-drilling policy and disputed comments made by Interior Secretary Ken Salazar that indicated the oil and gas industry will be able to continue to develop offshore.

"The announcement today is one of great disappointment, frankly a surprise, a reversal of position based on where the president was in just March," API President and CEO Jack Gerard told National Journal shortly after the announcement.

In light of the Gulf of Mexico oil spill, Salazar today retreated on policy President Obama announced before the disaster that expanded offshore oil and gas drilling in the Gulf of Mexico and along the Eastern Seaboard.

"The plan we announced in March was based on our best science at the time," Salazar told reporters on a conference call. "There has been significant additional information that has been gained since April 20 until now."

Salazar announced today that areas in the Eastern Gulf of Mexico, which remain under a congressional moratorium, and the Mid- and South-Atlantic areas off the Eastern Seaboard will no longer be considered for development through 2017. The Western and Central parts of the Gulf of Mexico and three areas in Alaska, the Cook Inlet and Chukchi and Beaufort Seas in the Arctic, will continue to be considered for potential leasing before 2017, Salazar said.

In explaining the administration's decision to reconsider its policy announced in March, Salazar continued to point to the lessons learned from the oil spill and referenced the 29 million acres that are already under lease but that have not been developed. "There is plenty of opportunity for oil and gas companies to develop those additional resources," Salazar said.

In response, Gerard said it's not accurate to say those 29 million acres will have the oil and gas resources that companies will need to provide energy for the country and jobs for the local economies.

"You can't produce oil and gas where oil and gas doesn't exist," Gerard said. "The 29 million acres are in ongoing phases today to determine whether there are oil and gas resources present and if they can be developed. It's a red herring to suggest somehow that there is oil and gas waiting to be developed."

Democratic lawmakers, including Sens. Robert Menendez of New Jersey and Bill Nelson of Florida, are praising the administration for its announcement today. Republicans and oil-state Democrats are, not surprisingly, expressing concern about the announcement and what type of detrimental impact it could have on the nation's economy and job creation.