The U.S. Chamber of Commerce Institute for 21st Century Energy and a number of other groups on Thursday touted the launch of an initial well containment response system that provides the industry with new capabilities in the event of another deepwater incident in the Gulf of Mexico (GOM).
"The launch of a new well containment response system is the result of an unprecedented $1 billion joint effort by America's leading energy companies to ensure that deepwater drilling is as safe as possible," said institute President Karen Harbert.
"Industry has stepped up to the plate, and now government should do the same and end the de facto moratorium to get the Gulf back to work for all Americans," she said. Harbert estimated that the U.S. sent $72 billion more to foreign countries for oil and gas imports in 2010 as a result of the moratorium.
The calls to open the Gulf come on the same day a federal district judge granted a preliminary injunction ordering the Interior Department's Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM) to act within 30 days on five pending permit applications to drill wells in the deepwater GOM (see related story).
The containment system was developed by the Marine Well Containment Co., a non-profit, independent organization founded by ExxonMobil Corp., Chevron, ConocoPhillips and Royal Dutch Shell (see Daily GPI, July 23, 2010). Earlier this month, BP plc announced plans to join the other producers (see Daily GPI, Feb. 2). The company was established following the blowout of BP's Macondo well in the Gulf of Mexico.
The system, based in the GOM, operates in water depths of up to 8,000 feet and can process up to 60,000 b/d of liquids.
Much like the U.S. Chamber of Commerce Institute for 21st Century Energy, the American Petroleum Institute also called on the Interior Department to end the de facto moratorium in the GOM, noting that the U.S. oil and gas industry has completed the final requirement necessary to return to production.
"The oil and natural gas industry's more than 60-year history of safely drilling more than 42,000 offshore wells, our unprecedented response to last year's Gulf accident, our ongoing efforts to raise the bar on safety standards, and our record of workplace safety, all speak to our commitment to safety," said API CEO Jack Gerard. "The readiness of the Marine Well Containment Co. and the systems necessary to respond to a deepwater drilling incident, show this industry has met every requirement for resuming operations in the Gulf and is ready to get back to work providing the energy this country needs."
Earlier this month, in a letter to oil and natural gas company CEOs, BOEM Director Michael Bromwich wrote, "The most critical missing piece in the process of approving applications for permits to drill in deep water is the demonstration of well control and subsea containment capability." As recently as five days ago, during a speech in Houston, Bromwich indicated that offshore production could move forward, once containment technologies were in place, saying, "This containment issue, which has attracted a great deal of attention in recent weeks, is the principal issue that has delayed our ability to issue deep water permits, and I am confident that this capacity will be demonstrated soon."
Now that the Marine Well Containment Co. has successfully completed testing of its system's capability, the API reiterated that all requirements have been met.
"Every day that goes by without production in the Gulf means that a U.S. worker sits onshore, while workers in other countries produce the resources we will use here at home," said Gerard. "And as the millions of oil and natural gas industry workers watch as their industry waits for Washington to decide their fate, millions of workers whose jobs are supported by the U.S. energy industry wonder when the impacts will roll through the U.S. economy."
Aric Newhouse, senior vice president for policy and government relations for the National Association of Manufacturers (NAM), also called for permits to begin flowing again. "The announcement today by the Marine Well Containment Co. demonstrates the commitment the private sector has made to safety and it is now time the administration move forward by lifting the drilling moratorium. Manufacturers who make and supply equipment, services, engines, boats and materials such as steel and concrete have experienced the harmful economic ripple effects of the administration's drilling moratorium and lengthy permitting process.
"The administration must act and begin granting permits so production can resume in the Gulf of Mexico. As our nation continues to face an unemployment rate of over 9%, now is the time to act. Manufacturers know high-paying jobs will be created and our economy will grow if permits are granted and deepwater drilling can resume."
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