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Rumsfeld Says Eastern Gulf Drilling Would Hinder Military Training; IPAA Disputes Claim

A group of independent producers last Monday took issue with Defense Secretary Donald Rumsfeld's claim that drilling in the eastern Gulf of Mexico would interfere with military testing and training activities in the region.

Rumsfeld weighed in on the oil and gas drilling issue at the request of Sen. Bill Nelson (D-FL), who sought the opinion of the Pentagon in October through Sen. John Warner (R-VA), chairman of the Senate Armed Forces Committee, and the ranking minority member of the panel. Nelson is a long-time critic of expanded drilling in the Outer Continental Shelf (OCS), especially off the coast of Florida.

In a letter last Wednesday, Rumsfeld told Warner that the Pentagon and the Department of Interior have an existing agreement that recognizes much of the eastern Gulf (areas east of the 'Military Mission Line') as "especially critical to [the Department of Defense] due to the number and diversity of military testing and training activities conducted there now, and those planned for the future."

Rumsfeld wrote that "in those areas east of the Military Mission Line, drilling structures and associated development would be incompatible with military activities, such as missile flights, low-flying drone aircraft, weapons testing and training."

Some believe that Rumsfeld's comments signal that it is now unlikely that the Bush administration will use its authority to immediately open up portions of Lease 181 in the eastern Gulf to leasing, as had been hoped.

The Independent Petroleum Association of America (IPAA), which represents independent oil and natural gas producers, "[does] not believe military training in the eastern Gulf of Mexico and offshore energy development is mutually exclusive," said IPAA President Barry Russell in a letter Monday to Rumsfeld. "Using today's technology, America's offshore oil and gas producers can develop the domestic energy resources our country needs without interfering with the vital mission of our nation's military."

He noted that "through the use of 'subsea' technology, many wellheads and other facilities are placed on the ocean floor rather than on the surface," which "greatly reduces the visual impact of oil and gas platforms and minimizes the 'footprint' production facilities would have on the area."

A number of gas industry groups are pressing the Interior Department to include the full area of the eastern Gulf not under moratoria, known as the "original 181 area," in its upcoming five year (2007-2012) leasing plan for offshore energy development. Interior's Minerals Management Service has said it will issue a draft proposed leasing program this winter.

Industry participants also are pressuring Capitol Hill lawmakers to pass legislation to allow drilling in currently prohibited waters. It's unlikely that Congress will take action on the issue this year, but Sen. Pete Domenici (R-NM), chairman of the Senate Energy and Natural Resources Committee, has indicated it will be a priority item in 2006.

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