Offshore Drilling Group

Cindy Li, Sunny Kim & Erin McAliney

What Is Offshore Drilling?

Discovery of oil & gas resources underwater

Extract oil off the coasts of continents or in large lakes

Drilling units include: jackup rigs (200 ft), semisubmersible rigs (4000 ft)

A History of Offshore DrillingLate 1800s: Oilmen (after drilling from wells) notice ocean = best oil producer1887: HL Williams builds 300ft wharf into Pacific from Summerland, CA w/ drilling rig1947: enormous demand for oil in peacetime economyKerr-McGee Corp. drills 1st well from fixed platform offshore1950s: Industry evolves; 2nd largest revenue generator for US (US Submerged Lands Act ’53)1969: Santa Barbara Oil Spill gov’t regulates development of oil spill regulation & research (National Environmental Policy Act)1980s: 1st offshore horizontal wells drilled (reach 7500 ft or 1.5 mi)

A History of Offshore Drilling (cont.)

1982 Federal Oil & Gas Royalty Management Act: require oil & gas facilities built while protecting environment1983: President Reagan signs Proclamation 5030 est. US Exclusive Economic Zone (EEZ)Last 20 years: New depth records of 7625 ftShell Oil’s “Troll” platform the only manmade object seen from moon besides the Great Wall of China2010: BP Oil Spill in the Gulf of Mexico largest accidental oil spill in history raises questions over offshore drilling

Pros of Offshore Drilling

More domestic production less reliance on imported oil from politically unstable Middle EastLower gas prices increase supply of oil, which lowers gas pricesIncreased government revenues opening restricted areas may generate billions of $$$ in state & federal revenuesLives of Americans revolve around oil; almost a necessity

Cons of Offshore Drilling

Minimal price impact oil generated from drilling won’t be enough to affect world oil pricesCarbon emissions drilling contributes to emissions of CO2Environmental hazards many hazardous accidents that may kill people and damage the environment:

Oil = toxic to marine speciesAverage of 880,000 gallons of oil goes into the ocean a year

Disasters & accidents, e.g. BP Oil Spill

Interest Groups: Committee Against Oil Exploration (CAOE)

Anti-offshore drillingCampaign launched by

Culture Change websiteAgainst Obama’s announcement (in April, pre-BP) to open Eastern coastal areas to offshore drillingSeeks to conserve and protect ecosystems from pollutionBelieves that it’s time to find sustainable alternatives for oil

Interest Groups: Proponents of Offshore Drilling in General

There are no interest groups that specifically support offshore drilling, but there are general supporters

Believe that offshore drilling is environmentally safe enough

Do not consider offshore drilling the only solution, but the best we have right now.

Believe that The U.S. should be free to explore its own waters for similar oil reserves

Evidence for Pro Argument

Source: Minerals Management Servicehttp://www.2facts.com/icof_story.aspx?PIN=i1300640&term=offshore+drilling

Evidence for Pro Argument cont.

Estimated 85.9 billion gallons of oil still undiscovered along outer continental shelf

Lowers Gas Prices and is enough to fuel country for approximately 11 years

Promotes US energy independence

In five years, global deep-water production is expected to rise by two-thirds, to 10 million barrels a day, according to Cambridge Energy Research Associates.

Evidence for Con ArgumentThe Relative Impact of Offshore Drilling and Fuel Efficiency Standards

Source: Energy Information Agency (EIA)http://www.cepr.net/documents/publications/

offshore_drilling_2008_06.pdf

Evidence for Con Argument Cont.

22 years of increasing fuel efficiency standards saves 16 times more in fuel consumption than 20 years of offshore drilling

A 2007 study by the Department of Energy--which estimated that the oil produced by drilling in banned offshore areas would be unavailable for almost a decade and would be insufficient to affect oil prices

Recent Developments

Noble Corp, the second-largest offshore drilling contractor by fleet size, could get back to work in the U.S. Gulf by the end of this year.

October 21, 2010- The U.S. government lifted a moratorium on deepwater drilling in Gulf of Mexico imposed after the BP Plc blowout six months ago

Recent Developments Cont.

State of Alaska filed lawsuit over Arctic Drilling against the Department of the Interior on October 12, 2010

Obama Administration sets new rules for drilling:The rules will further increase the costs of drilling in shallow water and they will increase delays in permitting.

Public Opinion

Support for off shore drilling has decreased from 62% of Americans (august of 2008) to 42%.

9% of Americans believe that environmentalists intentionally sabotaged the oil rig.

Public Opinion

Political Parties

Republican Party “all of the above”

They support offshore drilling in an environmentally sound way .

63% of Republicans

Believe in energy independence. Encourages the production of all types of energy. (solar, wind, nuclear ect.)

Democratic Party“compromise”

Do not oppose it, but are not strongly for it either.

They favor the development of domestic renewable energy

34% of Democrats

Green Party “Leave the Oil in the soil.”

Opposes the toxic and environmentally-destructive national oil-based energy strategy.

Urges immediate investment in strategies that can have both a short-term and sustainable impact on our national energy strategy, such as solar, wind, and other non-polluting alternative energy sources.

Sources"History of Offshore." NOIA: National Ocean Industries Association.

2006. Web. 21 Oct. 2010. <http://www.noia.org/website/article.asp?id=123>."History of the Offshore Industry." Offshore Magazine. 2009. Web.

21 Oct. 2010. <http://www.offshore-mag.com/index/about-us/history-of-offshore.html>.

Medlock III, Kenneth B. "Opposing Views: 1. Resource Potential and Market Impact." Opposing Views: Issues, Experts, Answers. Web. 22 Oct. 2010.

<http://www.opposingviews.com/arguments/1-resource-potential-and-market-impact>."No Offshore Oil Drilling: Committee Against Oil Exploration (CAOE)." Culture Change. 3 Apr. 2010. Web. 21 Oct. 2010. <http://culturechange.org/cms/index.php?option=com_content&task=view&id=637&Itemid=1>."Oil Drilling." UXL Encyclopedia of Science. 2002. Encyclopedia.com. 21 Oct. 2010 <http://www.encyclopedia.com>.Sierra Club. "Opposing Views: Offshore Drilling Is a Dirty Business." Opposing Views: Issues, Experts, Answers. Web. 22 Oct. 2010. <http://www.opposingviews.com/arguments/offshore-drilling- is-a-dirty-business>.

Sources Cont.Baker, Dean, and Nichole Szembrot. "Offshore Drilling and Energy Conservation: The

Relative Impact on Gas Prices." Center for Economic and Policy Research. Web. 22 Oct. 2010.

<http://www.cepr.net/documents/publications/offshore_drilling_2008_06.pdf>.

Bradner, Tim. "State Notes Victory in Lawsuit over Offshore Drilling 10/21/10." The Alaska Journal of Commerce. Web. 22 Oct. 2010.

<http://www.alaskajournal.com/stories/102110/oil_snv.shtml>.

Editors, By The. "What's Behind Obama's Drilling Plan? - NYTimes.com." Room for Debate - NYTimes.com. Web. 22 Oct. 2010.

<http://roomfordebate.blogs.nytimes.com/2010/03/31/whats-behind-obamas- drilling-plan/>.

"Industry Steps Up Pro-Offshore Drilling Campaign | The Price of Oil." The Price of Oil | Oil Change International. Web. 22 Oct. 2010.

<http://priceofoil.org/2010/06/22/industry-steps-up-pro-offshore-drilling-campaign/>.

Institute for Energy Research. "Offshore Oil Drilling in Shallow Water: Good Safety Record, Less Risky." Canada Free Press. Web. 22 Oct. 2010.

<http://canadafreepress.com/index.php/article/29068>.

Reddall, By Braden. "Gulf Deepwater Drilling Freeze Thawing Slowly | Reuters." Business & Financial News, Breaking US & International News | Reuters.com. 21 Oct. 2010. Web. 22 Oct. 2010. <http://www.reuters.com/article/idUSTRE69K4C120101021>.

Sources Cont.

Fisher, Max. "How Oil Spill Changed Public Opinion on Offshore Drilling | The Atlantic Wire." Tracking the Most Influential Opinion Makers and Debates in Business and Politics | The Atlantic Wire. 31 May 2010. Web. 22 Oct. 2010. http://www.theatlanticwire.com/opinions/view/opinion/How-Oil-Spill-Changed-Public-Opinion-on-Offshore-Drilling-3595.

Democratic Views of Offshore Drilling « OntheWilderSide." OntheWilderSide. WP Designer, 02 Oct. 2008. Web. 22 Oct. 2010. <http://wilderside.wordpress.com/2008/10/02/green-republican-democratic-views-of-offshore-drilling/>.

"Current Political Issues | RNC: Republican National Committee | GOP." RNC: Republican National Committee | RNC: Republican National Committee | GOP. 2010. Web. 22 Oct. 2010. <http://www.gop.com/index.php/issues/issues/>.

Hall, Sam. "Governor Worried about Offshore Drilling | Mississippi Democratic Party." Mississippi Democratic Party. 02 June 2010. Web. 22 Oct. 2010. <http://www.mississippidemocrats.org/blog/2010/governor-worried-about-offshore-drilling/>.