Offshore drilling

[UptonStellington]

I've been watching CNN for the past half hour, and I just saw a clip of Barack Obama saying something to the effect of: "Before granting more land to oil companies to drill offshore, I'd like to see them find something in all the land they already DO have, and if they can't, get somebody else in there who can!"

Aside from the issue of whether the government should be holding land back from oil companies in the first place, how exactly does offshore drilling work? Why DO the oil companies have so much "land" and are asking for more?

A few weeks ago, I saw James Hackett, president of Anadarko Petroleum, on CNBC talking about this issue. He said:

...We’re putting together an economically developable area, because remember, we’re drilling miles into the ocean sometimes, miles into the ground, without knowing there’s anything there. So to assume it’s on that one acre that you actually bought is crazy. And so what we’ll do is we’ll actually get ten or fifteen leases, and then we’ll drill, and then we’ll figure out if it’s there or if it’s on the next lease next door. And these things take time. You have to permit them. You have to shoot seismic to be able to do the right science, image it below salt. And then you go and drill it, if you’re lucky enough to get a permit, after you’ve done all your environmental studies.

But they’re talking about offshore. You go onshore, there’s places where we wait on permits for two months to two years. And even though it’s leased, it can’t actually physically be drilled. And that’s what people don’t really understand. With the environmental restrictions and environmental lawsuits, there are lots of places where we hold leases, [but] we’re not allowed to drill because the federal government that leased it to us actually won’t give us the permits.

Does anybody know any more about offshore drilling? My assumption is that the oil companies are looking to drill closer to the shore because it is easier to perform the seismic tests to see if there is recoverable oil. But, that's purely an assumption. Why, if they already have so much land, are they looking to get even more? Do they know there is oil in the land they are looking to get but to which they are refused access?

[01503]

I do remember hearing somewhere that most North American counties, such as Cuba (who I think is letting China drill there as well) are drilling in the Gulf of Mexico.

[K-Mac]

I don't know how accurate this website is, but they claim China is not drilling in the Gulf.

http://www.factcheck.org/askfactcheck/are_..._the_coast.html

[FeatherFall]

They also lend support to the idea that Obama's statement was misleading.

[gags]

My understanding is that there are certain areas where there is a higher probability of oil being discovered. It is those areas that the oil companies would like to lease, but are currently off limits. I also understand that the leases generally run for roughly 10 years, if the companies are not producing oil by the end of that time, the land reverts back to the government.

The one question that the Obama and Pelosi types never seem to get asked is the following: When oil is at $140 per barrel, why in the hell would the oil companies not be drilling in an area if they thought it had recoverable oil?

[Marc K.]

The one question that the Obama and Pelosi types never seem to get asked is the following: When oil is at $140 per barrel, why in the hell would the oil companies not be drilling in an area if they thought it had recoverable oil? [emphasis added]

Precisely, and of course "recoverable" means "economically recoverable" to any profit seeking entity. Which, much to their relief, excludes politicians allowing them to evade this fact. To them, allowing someone to drill for oil where none exists is just as valid as the "free market" of government mandated health care.

[agrippa1]

My understanding is that there are certain areas where there is a higher probability of oil being discovered. It is those areas that the oil companies would like to lease, but are currently off limits. I also understand that the leases generally run for roughly 10 years, if the companies are not producing oil by the end of that time, the land reverts back to the government.

The one question that the Obama and Pelosi types never seem to get asked is the following: When oil is at $140 per barrel, why in the hell would the oil companies not be drilling in an area if they thought it had recoverable oil?

The other question is: Why would we not lease land to the oil companies if we think that they won't drill there anyway? Wouldn't that be a great way to siphon off some of those windfall profits, without endangering the environment???

[gags]

Agrippa, that's a great question that reveals the intellectual dishonesty of the no-drill crowd.