Secretary Zinke announces plan for unleashing America’s offshore oil and gas potential

US Secretary of the Interior Ryan Zinke announced the next step for responsibly developing the National Outer Continental Shelf Oil and Gas Leasing Program (National OCS Program) for 2019-2024, which proposes to make over 90% of the total OCS acreage and more than 98% of undiscovered, technically recoverable oil and gas resources in federal offshore areas available to consider for future exploration and development. By comparison, the current program puts 94% of the OCS off limits. In addition, the program proposes the largest number of lease sales in US history.

“Responsibly developing our energy resources on the Outer Continental Shelf in a safe and well-regulated way is important to our economy and energy security, and it provides billions of dollars to fund the conservation of our coastlines, public lands and parks,” Secretary Zinke said. “Today’s announcement lays out the options that are on the table and starts a lengthy and robust public comment period. Just like with mining, not all areas are appropriate for offshore drilling, and we will take that into consideration in the coming weeks. The important thing is we strike the right balance to protect our coasts and people while still powering America and achieving American Energy Dominance”

Earlier this year, 155 Members of both the US House and US Senate sent letters to Secretary Zinke in support of a new five-year plan that recognizes America’s potential for energy dominance.

The Draft Proposed Program (DPP) includes 47 potential lease sales in 25 of the 26 planning areas – 19 sales off the coast of Alaska, seven in the Pacific Region, 12 in the Gulf of Mexico, and nine in the Atlantic Region. This is the largest number of lease sales ever proposed for the National OCS Program’s five-year lease schedule.

In response to the DPP, IADC President Jason McFarland issued the following statement:

“Today’s draft proposed program is an important step forward in the legislatively mandated process that will ultimately determine the available leasing areas for oil and gas development on the US Outer Continental Shelf. The inclusion in the 2019-2024 proposed plan of waters off both the Atlantic and Pacific, along with areas in the Arctic and expanded areas in the Gulf of Mexico, represents a commitment by this administration to energy policies that will achieve their stated goal of US energy dominance in the world.

“IADC has long argued for access to areas that hold potential for oil and gas development. The EIA has projected a 48% growth in worldwide energy demand over the next 20 years, and to meet that need, we must have the ability to responsibly access and develop the abundant natural resources of the US both onshore and offshore. As an example, an estimated 3.3 bbl of oil and 31.3 tcf of natural gas are expected to be accessible off the coasts of Virginia, North Carolina, South Carolina and Georgia alone. The number and scale of the recoverable resources is large, and it can lead to thousands of new jobs and billions of dollars in investment that would result from such activity.

“Today’s announcement of the new draft proposed plan is an important step forward in ensuring the continued energy renaissance of the US, and IADC and its members will continue to support the Department of Interior as it works through the process of producing the Proposed Final Program.”

Release of the DPP is an early step in a multi-year process to develop a final National OCS Program for 2019-2024. Today’s draft proposal was informed by approximately 816,000 comments from a wide variety of stakeholders, including state governments, federal agencies, public interest groups, industry and the public. Before the program is finalized, the public will have additional opportunities to provide input. The 2017-2022 Five-Year Program will continue to be implemented until the new National OCS Program is approved.

“This plan is an early signal to the global marketplace that the United States intends to remain a global leader in responsible offshore energy development and produce affordable American energy for many decades to come,” Katharine MacGregor, Principal Deputy Assistant Secretary for Land and Minerals Management, said. “This proposed plan shows our commitment to a vibrant offshore energy economy that supports the thousands of men and women working in the offshore energy industry, from supply vessels to rig crews.”

Inclusion of an area in the DPP is not a final indication that it will be included in the approved program or offered in a lease sale, because many decision points still remain. By proposing to open these areas for consideration, the Secretary ensures that he will receive public input and analysis on all of the available OCS to better inform future decisions on the National OCS Program. Prior to any individual lease sale in the future, BOEM will continue to incorporate new scientific information and stakeholder feedback in its reviews to further refine the geographic scope of the lease areas.

“American energy production can be competitive while remaining safe and environmentally sound,” said Acting Bureau of Ocean Energy Management Director Walter Cruickshank. “Public input is a crucial part of this process, and we hope to hear from industry groups, elected officials, other government agencies, concerned citizens and others as we move forward with developing the 2019-2024 National OCS Program.”

The Outer Continental Shelf Lands Act requires the Secretary of the Interior, through BOEM, to prepare and maintain a schedule of proposed oil and gas lease sales in federal waters, indicating the size, timing and location of leasing activity that would best meet national energy needs for the five-year period following program approval. In developing the National OCS Program, the Secretary is required to achieve an appropriate balance among the potential for environmental impacts, for discovery of oil and gas, and for adverse effects on the coastal zone.

BOEM currently manages about 2,900 active OCS leases, covering almost 15.3 million acres – the vast majority in the Gulf of Mexico. In fiscal year 2016, oil and gas leases on the OCS accounted for approximately 18% of domestic oil production and 4% of domestic natural gas production. This production generates billions of dollars in revenue for state and local governments and the US taxpayer, while supporting hundreds of thousands of jobs.