Landrieu to Block OMB Nominee until Drilling Moratorium is Lifted, Permit Issuance is Accelerated

September 24, 2010

WASHINGTON — United States Senator Mary L. Landrieu, D-La., announced today that she will block the nomination of Jack Lew to be the Obama Administration’s Director of the Office of Management and Budget (OMB) until the moratorium on deepwater oil and gas drilling is lifted or significantly modified. Some economists have estimated that more than 46,000 jobs could be lost as a result of a six-month stoppage of offshore drilling, and the Obama Administration itself has estimated that as many as 12,000 workers could be laid off as a result of this arbitrary ban on oil and gas production in the Gulf of Mexico.

“Although Mr. Lew clearly possesses the expertise necessary to serve as one of the President’s most important economic advisors, I found that he lacked sufficient concern for the host of economic challenges confronting the Gulf Coast,” Sen. Landrieu wrote in a letter to Senate Majority Leader Harry Reid today. “The fact that the most acute of these economic challenges, the moratorium, results from a direct (and reversible) federal action only serves to harden my stance on Mr. Lew’s nomination. I cannot support further action on Mr. Lew’s nomination to be a key economic advisor to the President until I am convinced that the President and his Administration understand the detrimental impacts that the actual and de facto moratoria continue to have on the Gulf Coast.”

Despite being struck down in federal court, the Obama Administration’s six-month ban on deepwater drilling has been in effect since May 27. Although not officially covered by the deepwater moratorium, shallow water drilling has also been brought to a standstill. Before the BP spill, the Mineral Management Services (MMS) approved an average of three to six shallow water permits per week, or 12 to 24 permits on average per month. In contrast, since May, the Bureau of Ocean Energy Management (BOEM) has only issued five shallow water permits for new wells.

“In repeated meetings and correspondence with Secretary of the Interior Ken Salazar and Bureau of Ocean Energy Management Director Michael Bromwich, I have underscored how damaging this moratorium is to Louisiana, the Gulf Coast, and the nation. Unfortunately, I have seen no measurable progress,” Sen. Landrieu wrote. “I have written numerous letters to these officials decrying the Administration’s actions. I have supported litigation challenging the Administration’s moratorium. I have done everything within my power to get this Administration’s attention. But the policy remains in effect, and Louisiana’s economy continues to suffer.”

For months Sen. Landrieu has noted the devastating impacts of the deepwater moratorium and the de facto moratorium on shallow water drilling will have not just on rig workers but on nearly 3,000 businesses in Louisiana that provide support services for offshore drilling activity. In fact, on July 10, just two days before the issuance of the second moratorium – the Department of Interior estimated that a six-month moratorium would cost 9,000 direct jobs and 13,797 indirect jobs along with a freeze in $10.2 billion in industry spending. At a Small Business Committee hearing last week, Chair Landrieu said, “I find it stunning that the Administration was aware that their actions might eliminate nearly 23,000 jobs in an already faltering economy, and proceeded anyway.”

To view the full letter to Leader Reid, please visit here.

For a graphic showing the stalling of permits issued by the Obama Administration, please visit here. .

For graphics showing the detrimental economic effect of the drilling moratoria on the Gulf Coast, please visit here.

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