Let’s Hear It: The Benefits of Safe Offshore Energy

Mark Green
Posted February 8, 2018

Federal officials have launched a series of public hearings on a proposed offshore leasing plan that will blueprint natural gas and oil development on the U.S. outer continental shelf (OCS) from 2019 to 2024. Hearings are scheduled in a number of coastal states including Florida (Thursday night), South Carolina (Feb. 13), Virginia (Feb. 21) and North Carolina (Feb. 26).

These are critically important to finalizing the kind of robust offshore leasing plan America needs to ensure its future energy security and beginning the process of pin. Florida Petroleum Council Executive Director David Mica:

“The inclusion of Florida in Secretary Zinke’s offshore plan is critical to enabling Floridians to reap the long-term benefits of affordable and reliable U.S.-produced energy and specifically secure Florida’s long-term economic future with new tax revenue, new jobs and new industries to support energy development."

As a nation, we have a tremendous opportunity to safely and efficiently harness our offshore natural gas and oil reserves. Three important points that should be prominent during the public hearing phase of this process:

1.      America Can Safely Develop Its Offshore Energy

Because of advances in technology, industry standards and experience exploring and producing in deep water, offshore development is safer than ever.

More than 100 exploration and production industry standards have been created or strengthened since 2010 – standards for well design, blowout prevention and safety and environmental management. The federal Bureau of Safety and Environmental Enforcement references 96 API standards in its offshore regulations. Safe seismic surveying is needed to locate energy reserves.

Meanwhile, the Center for Offshore Safety promotes the highest levels of safety among industry members by helping offshore operators develop safety and environmental management systems that establish training, safety protocols and safeguards to prevent potential incidents from escalating. Safety technology and response capabilities are continuously improving.

2.      Offshore Energy Strengthens America’s National Security

The U.S.  OCS is estimated to hold nearly 90 billion barrels of oil and more than 327 trillion cubic feet of natural gas that’s discoverable and could be developed. (Again, seismic testing is needed to tell us what’s out there.) Our industry strongly supports increased access to offshore reserves that will help strengthen our country’s security for decades to come.

Realizing America’s offshore potential begins with decisions made today. It can take seven or more years to develop natural gas and oil offshore:

We’ve seen Gulf of Mexico production coming back in recent years thanks to leasing decisions made up to a decade ago:

That’s why the current process to establish a leasing plan for 2019-2024 is so important.

3.      Offshore Energy Supports American Families

Our industry currently supports nearly 750,000 jobs from Virginia to Florida (see also PDFs for North Carolina, South Carolina and Georgia). Studies have estimated that increased offshore development could add tens of thousands of jobs in Atlantic coast states.

This is energy activity privately funded by natural gas and oil companies – which also would pay royalties to the federal government for leases as well as royalty payments when production begins. API supports revenue-sharing agreements for coastal states hosting natural gas and oil development off their shores, to ensure those states receive a fair share of revenues collected by the federal government from companies that are engaged in offshore development.

These are potentially big economic numbers with positive impacts for local and state economies – and also for individual households. During a U.S. House hearing last fall, South Carolina state Sen. Stephen Goldfinch said offshore energy is an issue for all South Carolinians, not just those with homes along the coast:

“Natural gas and oil exploration in the Atlantic could be an opportunity for our state to see much-needed additional economic improvements, investment, and job creation. … [I]t is imperative that you remember places like Andrews and Conway, and Georgetown, South Carolina, where the ‘golden egg’ of tourism hasn’t helped eradicate poverty. For those who live in Andrews and Conway and Georgetown, oil and gas would be their ‘golden egg,’ bringing non-seasonal, high-paying jobs … and hope for a prosperous economic future for the generations to come.”

The generational opportunity of offshore energy extends beyond one state. The economic and security benefits of safely produced offshore natural gas and oil would serve the entire country. That’s the discussion we should hear as these public hearings unfold.