The Costs of the Gulf Drilling Permit Backlog
by: Andrew Schneider, July 22, 2011 10:07:00 am
More than nine months after the Obama administration lifted its moratorium on oil and gas drilling in the Gulf of Mexico, the federal government's issuing of new permits remains slow. James Burkhard is IHS CERA's managing director for global oil.
"At the current lack of alignment between the regulatory process and the industry's capacity to invest, the US could lose out on 230,000 American jobs and 400,000 barrels per day of additional oil production in the Gulf of Mexico."
A shortage of offshore oil and gas inspectors at the Bureau of Ocean Energy Management, Regulation and Enforcement is at least partly responsible for the permitting backlog. The bureau recently switched to multi-person inspection teams for oil and gas rigs. It's also on a nationwide search to recruit petroleum engineers — both newly minted graduates and recent retirees — to fill its ranks.