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Home » Online Forex Trading Blog » Obama Unveils Aggressive U.S. Drilling Policy

Obama Unveils Aggressive U.S. Drilling Policy

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Riding the wave of his health care legislation, President Barrack Obama unveiled sweeping environmental policy changes that are designed to provide short and long-term relief for the nation’s dependence on foreign oil.  Environmentalists are sure to raise the challenge flag on the sweeping changes.

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The President’s announcement revealed a strategy to open the East Coast waters and certain areas of Alaska and other areas in the Gulf of Mexico for oil drilling.  Under the plan, drilling could be initiated from Delaware to Central Florida on the east coast, in the northern waters of Alaska and would ask Congress to lift the ban on drilling in the Gulf Coast of Mexico.

There are no plans for drilling on the west coast.  The President also deemed Alaska’s Bristol Bay a national treasure and has halted all oil drilling activity in the area.

The Obama initiative is as much a reflection of past energy policy failures and lack of foresight as it is a forward thinking option.  The President referred to the need for this aggressive action to protect the country from foreign dependence on energy and to signal that current energy plans are too far in the offing.  Despite U.S. efforts to trim energy use, the savings cannot be reaped quickly enough.

“The answer is not drilling everywhere all the time.  But, the answer is not, also, for us to ignore the fact that we are going to need vital energy sources to maintain our economic growth and our security,” said Obama.

Political Undertones

The President will need the help of Republican sympathizers to enact this legislation.  The new policy has some appeal to Republicans.  George Bush III attempted to enable offshore drilling for years and had some success in 2008, when fuel prices hit all-time highs.  The Bush plan included west coast drilling.

Obama would incorporate other comprehensive climate change commitments.  Specifically, the President would like to further limit carbon emissions.

The flamboyant nature of environmental announcements leads to impassioned opponents.  These advocates were on hand Wednesday and broke out in mock cheers of Sara Palin’s rhetoric to “drill, baby, drill!”  Several vocal environmental groups immediately assaulted the new plan.

Traditionally, Obama has supported drilling as a function of a revitalized more comprehensive energy plan.  He has supported the use of more nuclear facilities, encouraged entrepreneurial endeavors in areas like wind and solar power and he has included enough stimulus dollars to make these things happen.

Republican Senate Leader, Mitch McConnell of Kentucky, threw mild support, an improvement, behind Obama’s announcement.  The plan outlines the initial lease-sale of an area 50 miles off the coast of Virginia.  This transaction could be completed as early as 2012.  The Interior Department announced that seismic studies, environmental reviews and public meetings in the involved regions would take place between 2012 and 2017.

Obama’s intention to open drilling in the Gulf of Mexico will need Senate cooperation.  There is currently a bill on the floor that proposes drilling within 45 miles of the Florida Coast.  Like everything in Washington, the process will entail agreement upon distribution of the proceeds from new oil and gas resources.

The President concluded the announcement by notifying the auto industry there would be new requirements for automakers to produce more fuel-efficient cars and trucks.  The new standards will include regulations concerning greenhouse gas emissions.

A New Direction

The agency that heads offshore activity is the Interior Department, whose Secretary Ken Salazaar, said Obama’s strategy “indicates a new direction that will balance both development as well as conservation.”  The key for Obama is the emphasis on balance as environmentalists feel betrayed by the aggressive stance.

Natural gas is certainly a viable energy source that will fit the Obama equation.  This resource is being viewed as a possible alternative to fuel vehicles.  It is believed that the Gulf of Mexico alone contains 161 trillion to 207 trillion cubic feet of undiscovered, economically recoverable natural gas.  Atlantic Coast waters can yield 37 trillion cubic feet of gas and 10.5 billion barrels of oil.

Currently the U.S. imports 2 billion barrels of OPEC oil each year as well as 2.7 trillion cubic feet of natural gas from other sources.

The State of Alaska and the Alaska economy are very intertwined in the upcoming decisions.  Governor Sean Parnell said 35,000 jobs depend on current drilling operations.  It is believed that Alaska’s northern outer continental shelf holds more than 25 billion barrels of oil and 120 trillion cubic feet of natural gas.  Rich resources in protected areas.

OPEC nations reacted ambivalently to the Obama announcement.

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About the Author -

Hiland is a professional writer with extensive entrepreneurial experience. He is a graduate of St. George’s School Newport, RI and the State University of New York at Albany where he majored in history. He has been active in the real estate business for 30 years and has founded and sold several businesses. Hiland currently writes for several financial sites and is a published author of the novel The Last Parade. He has recently completed a manuscript for a children’s book entitled Sami and The Minnow Man.

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