Offshore Oil Back in Business, With a Few New Rules

Looks like somebody read Gov. Bobby Jindal’s letter. President Obama is soon to announce the new rules for moderate depth off shore drilling as early as this week, lifting the freeze on coastal exploration. You may recall a spokesperson for BP this weekend called the halt on exploration sensible, but hoped for a quick prognosis and reform in order for the industry to plan for the future. The White House didn’t miss a beat. Let’s hope when it comes to the bigger depths they include a mandatory relief well to accompany production as they do in some parts of Canada. Response Coordinator Admiral Thad Allen suggested that was a good idea just yesterday.

WASHINGTON—The Obama administration, facing rising anger on the Gulf Coast over the loss of jobs and income from a drilling moratorium, said Monday that it would move quickly to release new safety requirements that would allow the reopening of offshore oil and gas exploration in shallow waters.

Gulf Coast residents, political leaders and industry officials said delays in releasing the new rules, along with the administration’s six-month halt on deepwater drilling—both issued amid public pressure—threatened thousands of jobs.

Well-owner BP PLC, meanwhile, faces penalties “in the many billions of dollars,” for the Deepwater Horizon drilling disaster that has been spewing an estimated minimum 12,000 to 19,000 barrels of oil a day into the Gulf, said White House Press Secretary Robert Gibbs. The costs of the spill will “greatly exceed” the amount BP could recoup by selling any of the captured oil on the market, he said Monday.

read more at WSJ

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