Administration reverses offshore drilling policy in eastern gulf, Atlantic

By Juliet Eilperin and Steven Mufson
Washington Post Staff Writers
Thursday, December 2, 2010; 12:00 AM

The Obama administration announced Wednesday that it will not allow offshore oil drilling in the eastern Gulf of Mexico or off the Atlantic coast through 2017, reversing two key policy changes the president embraced in late March.

The revised Interior Department drilling plan, which took industry officials and many environmentalists by surprise, will also delay the next two lease sales in the central and western Gulf of Mexico. It marks a sharp political shift by the White House - yanking concessions to conservatives and oil companies - in the wake of the massive BP oil spill and the collapse of comprehensive climate legislation.

Interior Secretary Ken Salazar told reporters that the decision to remove large swaths from the 2012-17 offshore lease plan was "based on our nation's experience with the Deepwater Horizon oil spill." Instead of opening up new areas to oil and gas exploration, Salazar said, the United States should "focus and expand our critical resources on areas that are currently active."

Salazar said the department would also gather new environmental information about drilling off the coast of Alaska, potentially postponing activity there.

The move eliminates the prospect of any drilling taking place off the coast of Virginia for several years, although as recently as eight months ago state and federal officials had envisioned holding a lease sale there in 2011. On March 31, President Obama declared his administration would study the prospect of energy exploration off the Atlantic coast from Delaware to Florida, along with areas in the eastern gulf and in Alaska's Chukchi and Beaufort seas.

Virginia Gov. Robert F. McDonnell (R), who spoke to Salazar by phone Wednesday, called the new policy "an irresponsible and shortsighted decision."

"It demonstrates a complete lack of confidence in the entrepreneurial spirit of American industry and its ability to fix the problems experienced in the gulf spill, and no confidence in the ability of the U.S. government to better plan for and react to offshore emergencies," said McDonnell, who had made drilling off Virginia's coast one of his top priorities.

"The cost of today's decision will be seen in major lost job opportunities, surrendered economic growth and increased dependence on foreign sources of energy, from nations often hostile to American interests," he said.

Criticism was bipartisan. A spokesman for Sen. Mark Warner (D-Va.) said that "while it is appropriate to take the time to incorporate lessons learned from the gulf disaster, Senator Warner sees no reason to delay this process for what realistically could be another seven years or more."

Offshore oil production from state and federal waters accounts for 9 percent of U.S. liquid fuel consumption and 32 percent of U.S. crude oil production. The Interior Department draws up five-year plans for lease sales to companies seeking to explore federal waters, which begin three miles from shore. If oil or gas is discovered, commercial production can begin some years later. The next five-year plan starts in 2012.

Interior said the lease sales scheduled for March and August 2011 in the central and western gulf would be postponed until the end of next year, if not later.

In addition, Interior will conduct a "supplemental" environmental analysis of Shell's plan to drill an exploratory well in the Beaufort Sea next summer. Officials said that Interior was "processing" Shell's permit request but that the new analysis will require another public comment period, ending Dec. 22. Shell has warned that delays could jeopardize its ability to prepare in time to drill next year.

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