Thursday, June 09, 2011
My favorite company in my second favorite industry does it again:
Exxon Mobil said Wednesday it has discovered an estimated 700 million barrels of oil equivalent at a deepwater well off the Louisiana coast, a major find that a top House Republican argued should push the administration to speed up offshore permitting.
"This is one of the largest discoveries in the Gulf of Mexico in the last decade,” Exxon Mobil Exploration Company President Steve Greenlee said in a statement.
This, notwithstanding continued administration resistance to deepwater drilling:
Until October last year, the US government banned all deepwater drilling in the gulf, even for wells that had been started.
Since the ban was lifted, the Bureau of Ocean Energy Management, Regulation and Enforcement, the new offshore regulator, has issued drilling permits for the deep water at a much slower rate than its predecessor, the Minerals Management Service.
Since October, the bureau has approved 86 permits for deepwater drilling, but only seven of those have been for new wells, out of 41 applications for new well permits.
The integrated oil companies are a supply-chain miracle in the face of staggering political, regulatory, geopolitical, and geological obstacles. In so doing, they make us all prosperous. It is not in our interests to raise their rate of return hurdles without getting a substantial public benefit in return, yet that is exactly what the Obama administration has done in the last year. Remember that.
Harping, I would point out yet again that the economic idiots who are still hanging around the presidential staff need to convince him to remove as many obstacles as possible from domestic oil drilling. The anticipation of the vast new supplies coming from North Dakota, Pennsylvania, Ohio and the Gulf, not to mention Alaska, would immediately cause a collapse in oil prices. That's the same as an enormous tax cut on consumers. Added to a reform of corporate taxes, regulatory reduction and a reigning in of the FDA ( and, of course, a surrender on ObamaCare) and we would see an economic boom in this country. This is a very solvable problem, if political leadership really wants to solve it.