Senator McCain calls for US offshore drilling

16 June 2008 21:30  [Source: ICIS news]

WASHINGTON (ICIS news)--US presidential candidate John McCain called on Monday for an end to federal moratoria that bar drilling off most US coastlines, saying that ending the bans would provide short-term relief for the country’s energy crisis.

 

Senator McCain (Arizona), the presumed Republican candidate for president in the coming US national elections, told a press conference that he will launch a campaign on Tuesday to lift the congressional and presidential moratoria that have blocked energy development in 85% of the US outer continental shelf (OCS) regions for 27 years.

 

He said he believes that simply lifting the offshore drilling bans would give immediate relief to soaring US gasoline and other energy prices.

 

“I think that this [lifting the offshore bans], and perhaps providing additional incentives for states to permit exploration off their coasts, would be very helpful in the short term in resolving our energy crisis,” McCain said.

 

US petrochemical producers and a broad coalition of manufacturing industries have been pressing Congress for years to lift the offshore drilling bans so that abundant oil and gas reserves in the outer continental shelf regions can be brought to market.

 

The US chemicals industry is heavily dependent on natural gas as a feedstock, and gas prices have increased five-fold since 1999 when they were around $2/m Btu.  Current natgas prices are in the $12 range.

 

McCain said that by keeping US offshore reserves locked up, “we’ve seen the impact of it in the form of food prices, the form of gasoline prices and the threats of inflation and indeed indications of inflation”.

 

He said opening the outer continental shelf to oil and gas development also would be an important step in the longer term goal of “eliminating our dependence on foreign oil and to reduce greenhouse gases through the development of alternative energy sources".

 

The outer continental shelf regions closed to drilling since 1982 are estimated to hold 115bn barrels of oil and some 633,000bn cubic feet (bcf) of natural gas.  The US consumes about 8bn barrels of oil and 22.5bcf of gas annually.

 

McCain’s opponent in the 4 November national elections, Senator Barak Obama (Democrat-Illinois), has indicated that as president he would maintain the bans on drilling off the US East and West Coasts and along Alaska’s lengthy coastline.

 

By launching a bid to lift the moratoria, McCain apparently wants to raise the offshore drilling issue as a major topic in the developing presidential campaign.

 

There is legislation pending in Congress that would allow individual states to request an end to the federal offshore drilling ban along their shorelines and give those states that allow drilling a share of federal energy royalties from that development.  McCain so far has not signed on as a co-sponsor of that bill, but his statement on Monday indicates he will throw his support to the measure.

 

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Author: Joe Kamalick
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