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No Energy in the Executive

Can the Obama administration be compelled to approve offshore drilling?

Jul 4, 2011, Vol. 16, No. 40 • By ADAM J. WHITE
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"At some point this must end. With a permit, or without.” With those words, an exasperated federal judge punctuated his latest decision ordering the Obama administration to process applications to drill for oil and gas offshore. More than a year after the BP Deepwater Horizon oil spill caused the administration temporarily to halt the federal permitting process, Judge Martin Feldman of the Eastern District of Louisiana was prepared to accept no further bureaucratic delay by the federal regulators who continue to bottle up almost all drilling applications. 

Oil Rig

The court’s May 10 order would have been remarkable if only for its emphatic rhetoric. But even more noteworthy was the fact that the Obama administration—i.e., the Interior Department, with jurisdiction over offshore drilling—claimed to have ended its moratorium seven months earlier. 

Yet an unofficial moratorium is seemingly still in place. And Judge Feldman is joined in his frustration by restive congressmen of both parties, especially from the delegations of coastal oil- and gas-producing states. To force an end to the gridlock, the House has begun passing bills imposing deadlines on federal regulators’ review of drilling applications.

Congress’s frustration is understandable, but its strategy is underwhelming. New statutory deadlines, by themselves, will not end the drilling moratorium. Drilling proponents who pin their hopes on procedural “fixes” are setting themselves up for disappointment. 

That Congress feels compelled to order the Interior Department to -hasten the review of drilling applications shows how dramatically the Obama administration reacted to last summer’s Gulf of Mexico oil spill. Just 16 months ago, President Obama—surrounded by Interior Secretary Ken Salazar, Energy Secretary Steven Chu, climate “czar” Carol Browner, and other officials—announced an energy strategy that would include expanded drilling in the Atlantic and Gulf waters. That policy, he insisted, would be “guided not by political ideology, but by scientific evidence.”

The administration’s new strategy was shortly thereafter engulfed in a deluge of oil—BP’s Deepwater Horizon well erupted just three weeks later. Desperate to forestall more disasters, Salazar imposed a six-month moratorium on drilling in water deeper than 500 feet, including 33 wells then under construction. President Obama reiterated this ban in an Oval Office address two weeks later, urging that “we need to know the facts before we allow deepwater drilling to continue.”

But the administration’s commitment to a science-not-politics-based policy quickly proved to be empty rhetoric. Would-be drillers challenged the moratorium in federal court, and Judge Feldman issued his first of several decisions, concluding that the moratorium was far more expansive than the factual record warranted. Undeterred by the judge’s order, the administration “rescinded” that moratorium and imposed a virtually identical new one. Further litigation ensued.

When Salazar ultimately announced the end to that moratorium in October 2010, after months of litigation, pro-drilling advocates reacted with a distinct sense of skepticism. The American Petroleum Institute’s president warned that “without additional resources and a serious commitment by the government to process and approve permits .  .  . a de facto moratorium .  .  . will continue to cripple the already hard-hit Gulf region.”

And by all appearances, that warning has proved correct. According to the House Oversight Committee’s recent report, the administration’s official moratorium “was replaced by a ‘permitorium’—whereby drilling activity remained at a standstill not by operation of law—but because of inaction on the part of [Interior].” As proof of the “permitorium,” the House report noted that before the Deepwater Horizon spill, Interior had “processed and issued permits to drill in two weeks”; since the moratorium ended last year, only one new well had been approved. In the words of Judge Feldman, “Where there should be a queue” of applications receiving orderly review, “there is instead an untended pile.”

With the administration unwilling to accelerate the regulatory process, and the federal courts seemingly unable to effect change, Congress increasingly has sought to force the administration’s hand itself. Its most recent strategy is to impose new deadlines on federal regulators reviewing drilling permit applications. 

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