Business News

Sitting on the Shelf

by Jeremy Alford

Jindal, Vitter push to expand OCS drilling, but Interior Department is pushing back Louisiana’s top Republicans are pressuring the U.S. Interior Department to deliver on a plan first launched by former President George W. Bush that would open up new leases for drilling on the Outer Continental Shelf.

The public comment period on the Bush administration’s proposal ended in September, but state officials contend Interior Secretary Ken Salazar isn’t exactly warming to the idea.

Salazar recently criticized the plan as an “enormous sweep” and refused to detail the department’s progress when pushed during congressional testimony. Speaking to lawmakers, he promised only that the department would “move expeditiously on finalizing a new five-year plan for the outer continental shelf, and we will do that in the months ahead.”

The Bush plan could potentially let loose some 300 million acres off the Atlantic and Pacific coasts for oil and gas exploration from 2010 to 2015.

In a recent letter mailed to the Minerals Management Service, the agency within the Interior Department overseeing the plan, Gov. Bobby Jindal writes that the “importance of this draft proposed plan could not be overstated.”

The Outer Continental Shelf has some of the largest reserves of oil and natural gas in the nation, and Jindal says he believes Louisiana is uniquely positioned to benefit.

After all, an estimated 85 percent of the oil and 81 percent of the natural gas produced in the OCS already comes from Louisiana’s offshore waters, he adds.

Moreover, from the perspective of industry, the time is right — producers are bringing up oil that was thought to be unrecoverable just 10 years ago and some operations in the Gulf of Mexico are drilling 30,000 feet below the sea floor.

“Until recently, domestic policies have restricted access to most of our waters and energy supplies,” Jindal writes in the letter, “increasing the reliance and pressure on Louisiana to produce the energy required to power our nation… While I strongly support efforts to promote research, development and use of alternative energy sources (including nuclear and hydro-power), there is no question as to the prominent role conventional energy sources such as oil and natural gas will continue to play as part of our comprehensive energy plan.”

In a related move, U.S. Sen. David Vitter, R-Metairie, introduced an amendment in late September to the Interior-Environment Appropriations bill that would prohibit funds in the proposed legislation from being used to delay the implementation of the proposed Bush plan.

“I was very concerned with [Secretary Salazar’s comments] regarding offshore drilling on the Outer Continental Shelf,” Vitter said in a prepared statement. “Last year, the prohibitions on OCS drilling expired, allowing us to move ahead with a more sensible approach to gas and energy exploration that would allow us to greatly reduce costs on American families. Any further delay would stall that progress we made in clearing the way for increased exploration on the OCS.”

Moving forward, Jindal said the Minerals Management Service should add to the plan a revenue-sharing mechanism that would direct money back to state based on the energy they produce.

The governor said he would also like to see the plan address mitigation and other tools that would lessen the impact of drilling and exploration on coastal Louisiana.

For more information on the federal government’s proposed five-year program, visit