18 December 2006 00:00 [Source: ICB]
US chemical industry leaders and energy producers have hailed Congress's opening of a small part of the eastern US Gulf region to oil and gas development but will press for broader offshore access next year. Final Senate passage of the modest offshore drilling package approved by the House means the measure now goes forward for the president's signature and enactment.
Under the bill, 8.3m acres (3.4m ha) of the eastern US Gulf will be opened to oil and gas development. Part of the new development area had been under a drilling moratorium imposed by Congress in the 1970s because of concerns about possible beach pollution.
Natural gas is the main feedstock for US chemicals manufacturing and has been under heavy pricing pressure since 1999. The chemicals industry and manufacturing interests supported a broader offshore development bill to open much of the US outer continental shelf (OCS) to drilling, but the Senate effectively killed that bill.
The much smaller bill finally approved by Congress "is an important first step toward eliminating artificial and unnecessary limitations on development of vital domestic energy resources," said Bob Slaughter, president of the National Petrochemical and Refiners Association. "We hope that additional action affecting other OCS areas will eventually take place."
American Chemistry Council (ACC) president Jack Gerard said the Congress vote was "an enormous victory in the fight against a six-year-old gas crisis that has been killing American jobs and making the US less competitive."
The ACC plans to renew its effort in the new year to win broader access to vast reserves of oil and gas in federally owned offshore areas - a potentially difficult task now that Democrats have won control of Congress.
"Beginning early in 2007, we look forward to working with members of the 110th Congress to discuss and develop a comprehensive natural gas policy," Gerard said.
A spokesman for the Natural Gas Supply Association said the congressional action "is only a first step... We will continue to highlight next year that access to our offshore energy reserves is key to US economic and business growth."
The gas producers association estimated that the first new gas from the eastern Gulf areas now open to development would not come onshore for perhaps two years.
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
Sample issue >>
My Account/Renew >>
Register for online access >>
|ICIS Top 100 Chemical Companies|
|Download the listing here >>|
Asian Chemical Connections