DALLAS —Lifting the Obama administration’s moratorium on offshore drilling could add nearly five million revenue dollars a day toward reducing the runaway deficit and significantly lower gasoline prices, according to new research from the National Center for Policy Analysis (NCPA).
“While President Obama says he supports deficit reduction, his administration’s policies are only contributing to the country’s deficit problem,” said report author and NCPA Adjunct Scholar Rob Bluey. “Federal revenue from offshore drilling is down sharply as a result of the Obama administration’s anti-drilling agenda. Every day the Obama administration delays new oil drilling, the federal government loses more oil company revenue that could be used to reduce state, federal and local deficits.”
“Oil companies pay an 18.75 percent royalty to the federal government on the oil produced. With oil currently trading above $100 a barrel, that equals $4.7 million in lost revenue each day,” Bluey said He notes that if the government’s own projections are accurate, that would amount to $1.7 billion this year. “The federal government could recoup the lost revenue almost immediately if it began issuing new permits for the Gulf of Mexico,” he said.
Bluey said that even though the drilling ban was lifted in October, 2010, oil companies have complained of a government “permitorium,” causing deliberate delays in the permit process.
“This research provides yet another reason why the Obama administration should cease its obstructionist tactics and allow more domestic offshore oil and gas production,” said NCPA Senior Fellow Sterling Burnett. “In an earlier paper, I argued that increased energy production on the OCS would be good for both the environment and for national security.”
The Fiscal Impact of the Offshore Drilling Moratorium full text: http://www.ncpathinktank.org/pub/ba743
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H. Sterling Burnett, Ph.D., is one of the country’s leading authorities on energy and environmental issues. He is the lead analyst of the National Center for Policy Analysis’ (NCPA) E-Team. Burnett’s area of expertise includes topics that affect every American, such as government environmental policy, offshore drilling, global warming, endangered species an public lands.
The National Center for Policy Analysis (NCPA)is a nonprofit, nonpartisan public policy research organization, established in 1983. Research topics include reforms in health care; Medicare and Social Security; retirement; taxes; small business policy; and energy and environmentalregulation.