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U.S. lifts ban on deep-water drilling

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Jack Gerard, president of the American Petroleum Institute, said the administration had taken "a step in the right direction, but lifting the moratorium will only be symbolic unless the department moves expeditiously to issue permits." He said that would result in "a de facto moratorium, which will continue to cripple the already hard-hit gulf region." Counting long-term and indirect losses, he estimated it could cost more than 175,000 jobs.

Third-party inspections

Bromwich said his agency had assigned 20 additional employees to oversee permitting, though it was still recruiting inspectors to examine whether rigs met the new requirements. These new rules include third-party inspections of plans for well design, casing and cementing, as well as blowout preventers.

"We'll be inspecting in a very careful and comprehensive way those rigs to make sure they're compliant with the new rules," Bromwich said, adding that while the deep-water rigs in the gulf underwent an inspection in the immediate aftermath of the Macondo spill, none of them have yet been inspected in light of the tougher regulations.

"We won't know [if they're compliant] until we begin to do those inspections," he said.

Shell Oil spokeswoman Kelly op de Weegh said that three of the six drilling rigs Shell has under contract in the gulf were certified by third parties and "ready to go." She said they were only awaiting drilling permits.

Gerard pointed to shallow water permit delays as an example of what worries deep-water drillers. Shallow-water operators complain that the bureau has issued only a dozen permits for new wells in the Gulf of Mexico the past five months. Jim Noe, general counsel for Hercules Offshore, said this has forced "a quarter of shallow rigs to remain idle."

Chris Moran, who runs a motel, restaurant and convenience store in Port Fourchon, La., said that the news had prompted happy rumors about which companies would start work first, and how many people they might hire.

"We basically invented . . . drilling, Moran said. "And now we're going to continue to be able to do it."

Moran has watched his regular customers vanish after their rigs were idled, though cleanup workers tackling the spill offset part of the loss in business.

Now, he said, "I'll be able to live my life without [having] to think about a career change."

In nearby Plaquemines Parish, where the town of Venice was the closest settlement to the Deepwater Horizon site, Parish President Billy Nungesser issued a statement saying: "The timing is right. As the oil spill cleanup slows down, all the businesses that support the industry need to return to work. Lifting the moratorium could be the catalyst we need to get all the oil industry businesses kick-started, putting people back to work and seeing this industry come back alive."

Environmentalists, for their part, lambasted the administration's decision to even entertain new drilling in the gulf.


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