A partial shutdown of the federal government appears so far to have had a limited impact on the oil and gas industry.
The current shutdown, the third to occur during the Trump administration, affects one-quarter of the federal government. It began at midnight on Dec. 21 after the White House and Congress could not agree on funding for a wall along the U.S.-Mexico border.
The Republican-led House, which will flip to Democratic control on Jan. 3, passed a short-term continuing resolution (CR) on Dec. 20 to fund the affected federal agencies through Feb. 8 and prevent a shutdown. But the CR, which included $5 billion for the border wall, faced grim prospects of passing the GOP-led Senate and wasn’t brought to the floor for a vote.
With neither side making overtures as of Thursday afternoon, the impasse appears headed to continue into the New Year.
According to reports, more than 380,000 federal employees nationwide have been furloughed across nine cabinet-level departments, including the Department of Interior. Funding for the Environmental Protection Agency (EPA) has also been affected. An additional 420,000 federal employees have been deemed essential and have to work without pay.
The Federal Energy Regulatory Commission, the Energy Information Administration (EIA) and its parent agency, the Department of Energy, are unaffected by the shutdown; funding for those agencies were included in a $147.5 billion “minibus” that passed Congress and was signed by Trump in September. The EIA told NGI on Thursday that it will release its weekly petroleum status and natural gas storage reports on Friday, Dec. 28.
EPA Acting Administrator Andrew Wheeler, in an email to employees on Thursday, said the agency “has sufficient carryover funds to continue to operate for the remainder of this week.” But he warned that if the shutdown continues through Dec. 28, “EPA will initiate orderly shutdown procedures. Should a shutdown occur, employees will be placed on furlough.”
According to a contingency plan at Interior’s Bureau of Land Management (BLM), the agency said it would furlough about 6,930 of its 9,260 employees. The contingency plan, which was unveiled in March, added that about 1,530 BLM employees would be deemed essential and continue providing a variety of services — including “inspections and enforcement for oil and gas” operations, and administration and regulatory work associated with the Trans-Alaska Pipeline.
BLM also signaled that permitting for onshore and offshore oil and gas leases would continue because it would retain employees “working on selected energy, minerals, grazing, and other associated permit activities for which the bureau charges a processing fee.”
Elsewhere, Interior’s Bureau of Ocean Energy Management is currently working on an Outer Continental Shelf Oil and Gas Leasing Program for 2019-2024.
Two government shutdowns occurred within three weeks of each other earlier this year. The first lasted for three days in January, while a second in February lasted only a few hours. The longest shutdown occurred during the Clinton administration and lasted 21 days, beginning in December 1995 and ending in January 1996.
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