Good Day for Oil and Gas Companies as US East Coast Officially Opens for Drilling
On 31st March 2010, the Obama administration announced comprehensive new regulations on offshore oil and gas drilling. Waters stretching from northern Florida to New Jersey would be opened for drilling.
Previously, the entire Atlantic coast had been off-limits to drilling, as per a presidential and congressional moratorium enacted in 1981. Under the old rules, offshore drilling had only been permitted off the western Gulf of Mexico states: Texas, Louisiana, Mississippi and Alabama.
A big part of the push for new offshore drilling was prompted by recent legislative amendments that would allow Atlantic coastal states to take a direct share of royalty revenue from offshore drilling in their waters.
Texas and Louisiana were the only states entitled to receive revenue from drilling in their coastal waters. No lease sale dates have been set. More disappointingly for the industry, the entire Pacific coast will remain off-limits to drilling. The opening of eastern Gulf drilling is the biggest prize as far as oil and gas companies are concerned. It will be interesting to see if the cash-strapped Florida government pushes the Obama administration and Congress to open the moratorium-laden waters.
Full article at: oil and gas companies
