By Scott Weeden, Senior Editor The federal government is not listening. US Department of the Interior Secretary Ken Salazar has been especially hard of hearing when it comes to opening up new areas of the Outer Continental Shelf (OCS). However, he has been trumpeting how much OCS acreage the government has offered to the industry – unfortunately it is all in the central and western Gulf of Mexico. His somewhat myopic view of opening the OCS to oil and gas exploration is represented in the OCS Oil and Natural Gas Leasing Program for 2012-17. Virginia Gov. Bob McDonell asked repeatedly for the Interior Department to schedule lease sales offshore Virginia. No sales were included. Now, South Carolina Gov. Nikki Haley and North Carolina Gov. Pat McCrory were joined by McDonell in writing a letter to Sally Jewell, the person nominated by President Barack Obama to replace Salazar, as a pre-emptive strike to get Interior to work with the states on OCS exploration and production. In the letter, the governors stated, “As governors, we strive to pursue policies that help create jobs and make energy more affordable while protecting our states’ natural resources. Over the past several years, a number of governors have expressed an interest in reforming offshore energy policy so that states can safely and prudently take advantage of abundant offshore resources.” The governors have their eyes on a much bigger prize – economic growth, as they said, “It’s estimated that energy production from the Atlantic OCS could create more than 140,000 new jobs within the next 20 years, and we hope you will ensure that the administration is a partner with the states on this issue.” On Feb. 22, McCrory announced he had joined the OCS Governors Coalition, a group formed in 2011 by chief executives advocating offshore energy production. “Pursuing responsible exploration and development of our offshore resources will help us reach our shared goal of greater energy independence and will create thousands of jobs,” McCrory said. Alaska Gov. Sean Parnell was named chairman of the group on Oct. 12, 2012. The coalition includes governors from Louisiana, Texas, Mississippi, Alabama, Virginia, and South Carolina. Hopefully, the new Interior secretary will be listening. The coalition “supports energy expansion through responsible resource development and advocates for offshore energy production to be included in a national energy policy.” It “also promotes discussion of offshore energy issues between the coastal governors and the federal government.” But, the discussion has to be two ways. A lot is at stake for both the states and federal government. About 30 wildcats have been drilled in the Baltimore Canyon area and another 10 wells in the Georges Bank from 1976-82. In case you wonder if the wells might be productive, five of the Baltimore Canyon wells tested at rates as high as 18.9 MMcf/d. Low natural gas prices and opposition to offshore exploration ended efforts in the mid-1980s. When it comes to energy independence, though, the potential in the Atlantic OCS could make a huge difference. As Parnell emphasized, “Developing America’s resources, both onshore and offshore, is essential to achieving a more sustainable, independent energy future.” The states are willing to talk. Now it is up to the federal government to respond. Hopefully there will be somebody in the administration that sees the advantage of tapping all the resources available – actually living up to the “all-of-the-above” policy the administration touts. Contact the author, Scott Weeden, at email@example.com.
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