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Washington Examiner


Obama's Rhetoric Versus Energy Realities

December 08, 2010

By Robert Bryce

Early next year, the Ensco 8503, a massive new drilling rig designed to work in water depths of up to 10,000 feet, will be towed out of the Gulf of Mexico to a drilling site off the coast of French Guinea. That departure will provide yet more evidence of the yawning gap between the Obama administration’s rhetoric about energy and the hard realities of energy in America today.

First, the rhetoric. In October, the Environmental Protection Agency approved an increase in the amount of ethanol that can be blended into the U.S. gasoline supply from 10 percent to as much as 15 percent. Agriculture Secretary Tom Vilsack praised the move, saying that increased use of ethanol “is an important step toward making America more energy independent.”

Ah, yes, energy independence—the catch-phrase that Barack Obama has been using for nearly five years. In early 2006, the ambitious senator from Illinois told the Governors’ Ethanol Coalition: “Now is the time for serious leadership to get us started down the path of energy independence.”

Since then, Obama has routinely offered the energy-independence canard. In April, during a visit to an ethanol plant in Missouri, he talked about ethanol’s ability to provide “new jobs” and “new independence.” On August 11, the president said that his administration would invest in “clean energy industry” that will “carry America to a cleaner, more secure and more energy-independent future.” About that same time, the White House issued a press release declaring that the 2009 federal stimulus package included measures that “enhance energy independence.”

Now fast-forward to December 1, when the Interior Department declared a seven-year moratorium on drilling off the East Coast or in the eastern Gulf of Mexico. That move comes on top of the ongoing ban on permits—a “permitorium”—on deepwater drilling in the western Gulf.

Shortly after the blowout of BP’s Macondo well, the administration rightly declared a moratorium on drilling in the Gulf to assess safety protocols on offshore rigs. Although that ban—at least in theory—was lifted in early October, federal officials are still not granting permits for drilling in water depths greater than 500 feet. The combination of the Gulf permitorium and the new seven-year ban on other offshore drilling, means that rigs like the Ensco 8503, and the companies that lease them, are stuck in Obama’s version of energy limbo. For instance, unable to get a permit to drill in the Gulf, Houston-based Cobalt International, which leased the Ensco rig for two years at a cost of more than $400,000 per day, had little choice but to sublet it to London-based Tullow Oil, which will now use it to drill offshore French Guiana.

Thirty-six percent of all domestic oil production comes from offshore. Halting new drilling means, of course, that the U.S. will have to import more energy. And given Obama’s seven-year ban, that will happen despite the enormous potential of places like the eastern Gulf of Mexico, a region which, according to federal estimates, contains about 20 trillion cubic feet of gas and 3.6 billion barrels of oil. Alas, those resources, as well as the ones in the Western Gulf, may as well be on the dark side of the moon.

The Ensco 8503, which cost about $450 million to build, is a marvel of engineering prowess and cutting-edge technology. But it will soon leave the U.S., taking hundreds of high-paying jobs with it.

If only the big rig could somehow produce corn ethanol. Then perhaps it would be a featured part of the Obama administration’s discussions about “energy independence.”

Original Source:



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