Governors call for expanded offshore development

A February letter from the governors of North Carolina, South Carolina and Virginia began a strong push for oil and gas development off their shores. The February letter to Secretary of Interior Sally Jewell claimed that energy production from the Atlantic Outer Continental Shelf could create more than 120,000 jobs in the next 20 years.

 The debate then picked up speed when energy analysts noted that federal regulators had issued only 15 permits through April 30 for new wells in waters deeper than 500 feet, compared to 42 permits issued during the same period in 2012. The clamor continued in early May when oil and gas representatives gathered at a conference in Myrtle Beach, S.C., to urge the state to pressure Congress to allow development of the state’s offshore resources. 

The push to develop Atlantic coastal areas gained even more speed at this year’s Offshore Technology Conference at which the governors of Texas, North Carolina, South Carolina, Mississippi, Alabama and Alaska called for more federal offshore areas to be opened to exploration. The governors also made a pitch for a new revenue-sharing plan to allow states that border on federal leases to collect more royalties beginning in 2017. 

As the movement expands to explore and produce in coastal states currently off limits, it will be tempered by large uncertainties about the potential for oil and gas discoveries in these areas and by continuing objections by opponents in each of the states. Should the push to develop these areas succeed, however, the implications for offshore activity would be significant.

The American Petroleum Institute welcomed the release of the letter, pointing out that 87 percent of federally controlled offshore areas are off limits to energy production. 

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