THE VINE MARCH 31, 2010
The big news today is that Obama's reportedly planning to open up a bunch of new offshore areas to oil and gas exploration for the first time:
Under the plan, the coastline from New Jersey northward would remain closed to all oil and gas activity. So would the Pacific Coast, from Mexico to the Canadian border.
The environmentally sensitive Bristol Bay in southwestern Alaska would be protected and no drilling would be allowed under the plan, officials said. But large tracts in the Chukchi Sea and Beaufort Sea in the Arctic Ocean north of Alaska — nearly 130 million acres — would be eligible for exploration and drilling after extensive studies.
Back in 2008—during peak "drill baby drill" season—Congress let the federal moratorium on offshore drilling expire. Now this move pushes drilling slightly closer to reality. So what's Obama thinking here? One possibility is that he's looking ahead to the climate-bill debate in the Senate. A number of conservative Democrats and even some Republicans like Lisa Murkowski have said that new drilling has to be a key part of any big energy legislation that tackles carbon emissions. (A separate bloc of coastal Democrats, meanwhile, has warned that drilling would be a dealbreaker for them.)
Still, it seems bizarre to fork over this bargaining chip before the bill is even released. What kind of negotiating tactic is that? Especially since this move is going to infuriate environmentalists—the folks you want pushing for your climate bill. Note that the administration did the same thing with nuclear power, another item that could lure swing senators. Back in January, the White House proposed a massive expansion of the nuclear loan guarantee program without getting anything tangible in return from pro-nuke Republicans. John McCain still wanders around complaining that the administration's not "serious" about nukes. Now, maybe that's the point—offer an olive branch and watch Republicans swat it down and look unreasonable. Right on cue, John Boehner's already whining about Obama's drilling plan. Not sure that strategy makes sense, though.
Another possibility, meanwhile, is that this move isn't focused on the climate-bill debate and is geared more toward public opinion. According to the EIA, gas prices are expected to go up quite a bit this summer (probably shooting north of $3/gallon), and the administration may want to step out ahead of the inevitable teeth-gnashing and garment-rending over the issue. So this could be more about the midterms than rounding up votes in the Senate. Though, granted, this drilling announcement won't affect summer gas prices in the slightest.
And that leads to the separate question of how much oil will ever come out of these areas. After all, it's not like companies can just start drilling tomorrow. As The New York Times reports: "In many of the newly opened areas, drilling would begin only after the completion of geologic studies, environmental impact statements, court challenges and public lease sales. Much of the oil and gas may not be recoverable at current prices and may be prohibitively expensive even if oil prices spike as they did in the summer of 2008."