Yesterday marked the first oil and gas lease sale of the Obama Administration’s five-year program for the Outer Continental Shelf.
The federal government raked in $157.6 million from more than 20 million offshore acres up for lease in the western Gulf of Mexico.
Secretary of the Interior Ken Salazar praised this routine lease sale as part of President Obama’s “comprehensive, all-of-the-above energy strategy, expanding domestic production, reducing our dependence on foreign oil, and supporting jobs.” But the sale’s low returns show that oil and gas companies aren’t necessarily buying it. For context, the last sale in this region for 21 million acres attracted more than $337 million.
The fact remains that President Obama has not led with a strong hand to support growth of energy production on federal lands. Where he and his Administration have not actively blocked energy exploration and production, they have resorted to an environmentally directed “defeat-by-delay” strategy, racking up costs and uncertainty, which exacerbate the financial risks of oil and gas exploration.
Meanwhile, state and private lands have attracted the business and profit of oil and gas companies, outpacing development on federal lands on and off shore.
Along with allowing greater access (as he did in March 2010), President Obama should lead his Administration to create a dependable regulatory process that encourages domestic production. This would not only bring in more revenue for the federal government; it would also enable oil and gas companies—job creators—to invest in the economy, all without a federal dime being spent.