The battle over the global energy race is heating up. By now, you might even say it’s on fire. Every move is crucial, and time is of the essence. If the U.S. wants to reign supreme in oil production as forecasts predict – toppling Saudi Arabia and Russia – it must take advantage of every opportunity.
U.S. offshore oil production and its future exploration is paramount in the U.S. undertaking of this global feat. It will also prove to be an integral part of the American economy.
And so it goes. One Republican, Kevin Brady, seeks to put more power into state hands when it comes to oil and gas. Last month, he introduced the “More Energy More Jobs Act” that would grant states authority to designate areas off their coastlines to develop gas and oil as they see fit, and with it, create more jobs.
Brady, a senior member of the House Ways and Means Committee and chairman of the Joint Economic Committee, released this statement in regards to his plan, according to Chron.com:
“America may never reach true energy security as long as 85% of our offshore areas remain off-limits to oil and gas development. This innovative approach allows willing states to nominate potential offshore areas for the federal draft 5-year lease plan. And it directs the Interior Department to conduct the economic and environmental studies that are the important first steps for inclusion in the lease plan. As a result, Washington will no longer be able to disqualify these important areas for purely political reasons.”
It’s time to unlock the full potential of U.S. energy. By allowing state governments to offer suggested developments for offshore drilling, the bill would force the federal government to do environmental reviews and resource estimates, setting the stage for further production.
Last Wednesday, bill H.R. 2231, or the “Offshore Energy and Jobs Act” was voted on and passed by the House in a vote of 235-186. The amendment is based off Brady’s “More Energy More Jobs Act,” and it saw 16 Democrats join the Republican initiative.
The bill would essentially lift federal government barriers on offshore oil production and allow for more U.S. exploration.
The vote came after the President threatened to veto the bill, and it expands upon similar legislation the GOP passed last year to include coastlines of Virginia, South Carolina, southern California, and Alaska.
The House also voted on Friday for the Obama administration to develop a new five-year plan to allow the development of oil and gas leases that show the most promise. A draft would be due July 15, 2014 and reach approved status by July 15, 2015.
Passing on offshore energy development to the states would more readily open up energy resources. As the economy stands on shaky ground, more energy means more jobs, more tax revenue, and benefit to the states as they manage their budgets.
All the large oil and gas companies are set to benefit from a move towards state-regulated power – they have the finances for high startup costs and are already in position.
The most active companies on federal shores in 2012 and 2013 are ConocoPhillips (NYSE: COP), Royal Dutch Shell Plc (NYSE: RDS-A), BHP Billiton Ltd. (NYSE: BHP), and Anadarko Petroleum Corp. (NYSE: APC).
Our analysts have traveled the world over, dedicated to finding the best and most profitable investments in the global energy markets. All you have to do to join our Energy and Capital investment community is sign up for the daily newsletter below.
Next Step for Offshore Oil
Republican supporters assure contenders of such legislation that the bill in no way would harm the environment. They realize how important drilling is for the economy, but they also know it needs to be done safely and responsibly.
Still, the Senate is unlikely to take up the legislation, and as I mentioned before, the Obama administration already warned of a possible veto.
But Democrats can’t just turn the other cheek anymore. Drilling practices are becoming safer every day as Americans become more aware of the environment around them. And the offshore reserves would strengthen U.S. oil production and lead Americans back to the strong economy they once had.
In this global energy race, no other country is sitting back and letting its resources go to waste. Maybe to say “waste” is a bit hasty, yet the U.S. seems dead set on doing just that. Still, U.S. oil production is booming.
But when you see an opening, you’ve got to take it. For the U.S., it lies in offshore oil production.
If you liked this article, you may also enjoy: