Six month moratorium on new deep water well permits; lease auctions off Virginia and Alaska coast put in suspension. Partial ban on new spuds-
There is finally action by the Administration on oil leases and permits to drill in various places off-shore. It is expected that today the President will announce there will be no new deepwater wells spudded (to begin drilling) in the next 6 months. Oil lease auction sales in the western Gulf of Mexico and off the Virginia Coast are said to be canceled. A freeze or cancelation of lease auctions is very important because once bought, cancellation of a lease by the government requires the government to repay the leaseholder. That can require a lot of money.
Lease sales and spudding in the Arctic Ocean (oh, my god, they were going to do that?) are on hold.
Meanwhile, we are waiting to see if BP was successful in their “top kill” of the big oil gusher under the Gulf of Mexico.
It occurs to me that one reason why the Administration might have been slow on this is that BP holds an important card. If BP walks away, it’s not like the government has the knowledge or the resources to kill the gushing, ruined well.
AP source: Obama extends stop on deepwater wells. By Erica Werner and Charles Babington. Associated Press.
Update on May 28. U.S. to stop drilling already underway on 33 deepwater rigs! Reuters.
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Tracking the Oil Spill in the Gulf (map). New York Times.
