A barrel of petroleum sells for less than $45, and many oil companies balk at the massive investment in equipment needed to drill offshore when the price is lower than $85, analysts say.
Vincent DeVito, Interior’s counselor for energy policy, said a 45-day comment period will start Monday with a request for public comment in the Federal Register. DeVito said stakeholders, such as state governors, would be contacted for their input, as will the Department of Defense, which frowns upon exploration near bases and areas where ships conduct training exercises.
Royal Dutch Shell suspended drilling in the Arctic about two years ago when its oil exploration there produced a dry hole. The company said the result didn’t justify the massive risks and expense of drilling in the environmentally sensitive Arctic frontier.
DeVito said the Obama administration’s plan, to keep more than 90 percent of the outer continental shelf off limits, isn’t feasible given a recent Trump administration analysis showing oil production there could create 300,000 jobs.
“Our country has a massive energy economy, and we should absolutely wear it on our sleeves, rather than keep energy resources in the ground,” he said in a statement. “This work will encourage responsible energy exploration and production, in order to advance the United States’ position as a global energy force and foster security for the benefit of the American citizenry.”
On his way out of office in January, President Barack Obama banned offshore drilling in both ocean areas, removing regions that he said are “simply not right to lease.”