A coalition of about 36 industry groups last Monday urged a federal appeals court in Atlanta to reject a challenge to the the federal offshore permitting process that it contends could potentially halt all oil and natural gas exploration in the Gulf of Mexico (GOM).

The Independent Petroleum Association of America, National Ocean Industries Association, American Gas Association, the National Association of Manufacturers (NAM), U.S. Chamber of Commerce, the American Chemistry Council, Institute for Energy Research and a number of local chambers of commerce in the Gulf Coast region were among the parties that weighed in on the lawsuit brought by environmental groups challenging the Interior Department’s Bureau of Ocean Energy Management (BOEM) approval of an exploration plan proposed by Shell Offshore for the GOM. It was one of the first offshore exploration plans approved after Interior lifted the moratorium (see NGI, May 2).

The lawsuit was brought by Defenders of Wildlife, Center for Biological Diversity (CBC), Natural Resources Defense Council and the Southern Environmental Law Center in the U.S. Court of Appeals for the 11th Circuit in June. It targets exploration now under way by Shell Offshore, a Royal Dutch Shell plc subsidiary.

“Now that oil and natural gas production is finally resuming in the Gulf of Mexico, environmental groups are once again seeking to put the Gulf out of work,” said Karen Harbert, president of the U.S. Chamber’s Institute for 21st Century Energy.

In its amicus brief the chamber argues that the federal government’s “thoughtful and thorough assessment of the Shell exploration plan was anything but ‘arbitrary and capricious,’ as the plaintiffs have alleged.”

Robin Conrad, executive vice president of the National Chamber Litigation Center, the chamber’s public policy law firm, said, “The plaintiffs brought the lawsuit in an attempt to reimpose the offshore drilling moratorium that the secretary of the Interior and Bureau of Ocean Energy Management both determined was unnecessary.”

If the environmental groups win, “this case could have long-term, adverse impacts to all operators and all permits and permitting, and environmental analyses being used by the government to approve various types of offshore activities, not just new wells,” said NAM. “In essence, a court decision delaying this permit would likely grind the approval process for all existing offshore permits and approval to a halt again.”

The lawsuit seeks to torpedo Shell’s plan to conduct new deepwater exploratory drilling about 225 miles southwest of New Orleans in waters about 2,000 feet deep. In June Shell announced plans to go forward with activity in the Cardamom oil and natural gas field, a deepwater prospect in the GOM that is expected to produce 50,000 boe/d at peak production and more than 140 million boe over its lifetime (see NGI, June 13).

Cardamom, scheduled to begin full operations in 2014, is in Garden Banks Block 427. Shell Offshore Inc. got the green light for Cardamom’s exploration plan in March. BOEM said the project complied with strict new rules issued following an investigation of the Macondo well blowout last year.

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