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Fear of Drilling for Oil

July 6, 2008

In 1981, the U.S. Congress enacted a 1981 ban on offshore drilling because of environmental concerns based on an offshore oil spill off Santa Barbara, California in the 70s. As a result, gas and oil exploration has only been allowed in a few key places.

After listening to Americans and realizing their precarious political positions, politicians that once supported the ban are changing their minds. Even Senator John McCain now supports lifting the ban on national offshore drilling, allowing independent states control over their own coastal areas where oil exploration is concerned.

Senator Bill Nelson of Florida is incensed. “Oil companies and their allies are using the shockingly high price of oil and gasoline, which largely is the result not of a supply problem but speculative fever, to scare the public into thinking coastal drilling offers a real solution to our dependency on oil.”

Behind the scenes in 2006, the Senate opened up the Florida panhandle coastline for exploration, while protecting the remainder of the Florida coastline. Up to now, oil companies have not been willing to invest the capital necessary or accept the risk of drilling offshore in Florida. Three-dimensional mapping of the ocean floor to locate possible oil deposits could take several years based on typical exploration activity. Once a drilling site is located, oil engineers have around three miles of drilling below the ocean surface.

Even with the wonders of technology, success is not guaranteed. Generally, it takes years to produce oil or gas at a drilling site. In theory, billions can be invested without return on investment. Fortunately, based on what we know about big oil profits, oil exploration is highly affordable. Smaller drilling companies or companies primarily involved in exploration face risks in economic viability ranging up to $200 million per project and years before any return on money spent. Big oil can easily afford this kind of modest investment.

What are politicians afraid of? Are federal politicians fearful of losing power? How is allowing states the right to allow exploration a national disaster? Why are Bill Nelson and others afraid of lifting the ban on offshore drilling when the decision to release oil leases could rest in the hands of each state? Isn’t the right of each shoreline state to direct its own resources based on the desires of the citizenry? Isn’t allowing states to control their own oil destiny the democratic thing to do? Citizens within each state can successfully drive their own state legislature instead of having a federal ban and controls on drilling in the name of environmental wisdom.

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