Fox News Interviews President Art Gelber
Recently, Gelber & Associates President Art Gelber was interviewed by the Fox News Network regarding the Trump Administration’s recent proposal to open up more areas to offshore to oil and natural gas drilling. Fox selected approximately 15 seconds of a twenty-minute interview, so we’d like to share some more balanced insight into the topics that were omitted.
Art Gelber, Fox Global News
The Trump Offshore Drilling Plan...
Good News for a battered industry
The offshore oil and gas business has been in decline since the shale drilling boom took hold in 2009. The huge resource base and lower costs in the Marcellus, Bakken, Eagle Ford, Haynesville, and Permian Basins were enough to put economic pressure on the offshore operations. To make matters worse, ire from the public over BP’s infamous Macondo oil spill in 2010 further pressured offshore operators with added safety and permitting requirements.
The Trump proposal aims to reverse some of the safety requirements implemented after the Deepwater Horizon spill, but more significantly, the proposal aims to open nearly all the federal offshore areas to leasing. This includes areas in the Arctic, Pacific, and Atlantic Oceans, as well as the Eastern Gulf of Mexico.
The Macondo blowout was an unmitigated disaster by BP and TransOcean, and the arrogance demonstrated cannot be tolerated. Nonetheless, the offshore drilling and operating business could use a shot in the arm and has proven in the time since that it can operate safely and responsibly. Unfortunately, soon after Trump and his Interior Secretary Zinke made the blockbuster, media grabbing announcement, they quickly followed by taking offshore Florida out of consideration as a political concession to its Republican governor. This offshore area near Florida in the eastern Gulf of Mexico was one of the most highly desirable areas, and the gesture towards Florida makes the proposal appear to be not much more than a pig in lipstick. Sad!
The areas not taken off the table have been untouchable for a very long time. In order for drilling to occur and resources to be found, these areas will require advanced study and testing such as seismic surveys. Seismic studies and the like are where this will begin, and if this data is gathered, the potential for drilling will follow. Such large tracks newly opened for seismic assessment could alone be an impetus for the offshore industry.
Nevertheless, the 2020 elections are not far away by oil and gas exploration standards, and any proposal by the Trump administration could easily be reversed. This makes going out on a limb to reap rewards from an investment in these newly accessible areas much less attractive. Meanwhile, the action in US will continue to be in the onshore shale formations, with any offshore focus staying international.