Tuesday, March 29, 2011

Va. preparing to begin offshore energy development?

Governor McDonnell Applauds Congressional Legislation to Begin Offshore Energy Development in Virginia

RICHMOND – Earlier today, Congressman Doc Hastings (R-WA), Chairman of the House Natural Resources Committee, announced the introduction of legislation that would require the U.S. Department of the Interior’s Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) to proceed with previously scheduled, then arbitrarily cancelled, offshore energy lease sales in the Gulf of Mexico and 50 miles off the coast of Virginia by June 2012.

Speaking about the legislation, the Governor noted, “I applaud Chairman Hastings for taking this action. As we have seen firsthand over the past month in the form of rising gas prices, there is a real cost that comes with a failure to prudently and safely develop our domestic energy resources. Offshore energy exploration and development in the Commonwealth will put Virginians back to work, bring new revenues to our roads and renewable energy research, and will help our nation move a little bit closer to energy independence. It is past time that we became serious about finding solutions to our energy challenges. We will do that by utilizing all of our domestic energy sources, from offshore oil and natural gas to wind, solar, coal, nuclear and biomass. Virginia’s political leaders, employers, workers, drivers and families support safe and responsible offshore energy development. It’s time we get this done.”

On March 31, 2010 the President announced that lease sale 220 off the coast of Virginia would move forward, making Virginia the first state on the East Coast to be able to explore for and produce offshore oil and natural gas. On May 27, 2010 the President cancelled the lease sale effective immediately, announcing that no areas off the Atlantic Coast would be available for energy development in the next five-year plan (2012-2017). This means that the earliest a lease sale could even occur off Virginia would be in 2017.

Lease sale area consists of roughly 2.9 million acres offshore of the Commonwealth in the Mid-Atlantic Planning Area, at least 50 miles offshore. The bureau estimates that this area may contain 130 million barrels of oil and 1.14 trillion cubic feet of natural gas. According to a study by the Southeast Energy Alliance, offshore energy development in Virginia could create nearly 2,000 jobs in the Commonwealth and produce more than a half billion barrels of oil and 2.5 trillion cubic feet of natural gas. Virginia’s General Assembly has already passed bipartisan legislation making the official policy of the Commonwealth to strongly support offshore energy production, and directing future offshore energy revenues to transportation and renewable energy research.

1 comment:

Citizen Tom said...

Should be interesting to see who buys. I wonder if the Obama administration will allow the lease, but balk at providing a drilling permit.

Does a lease come with a drilling permit? I don't know, but I doubt it. When happen if the oil companies suspect the Obama administration will not approve a drilling permit? I think the probability is they will at best bid low for a lease, embarrassing McDonnell.