Oil trade groups: Drilling deregulation could create 190,000 jobs

SANTA BARBARA, CA - JULY 21: California brown pelicans fly near offshore oil rigs after sunset on July 21, 2009 near Santa Barbara, California. After months of partisan bickering over how to close the $ 26.3 billion deficit and begin paying the state's bills again, California Gov. Arnold Schwarzenegger and legislative leaders reached a tentative budget deal this week to keep one of the world's largest economies from falling into insolvency. Within the budget agreement, Gov. Schwarzenegger succeeded in having a proposal to expand oil drilling off the Southern California coast for the first time in more than 40 years. In 1969, the Santa Barbara Oil Spill from Union Oil Co. undersea drilling platform caused 200,000 gallons of crude oil to spread over 800 square miles of ocean and beaches and created a massive public outcry against drilling off the state's coast. During the 2008 presidential election, Republicans and Conservatives began pushing for renewed offshore drilling. The budget plan contains massive cuts in state spending and social services. Lawmakers can vote on the deal as soon as this week even as cities and conservation groups gear up to sue the governor and Legislature over emerging details that they disapprove of. (Photo by David McNew/Getty Images)

Almost 190,000 jobs could be created by 2013 if offshore drilling returns to pre-spill levels, according to a study sponsored by two oil trade groups, the National Ocean Industries Association (NOIA) and the American Petroleum Institute (API).

The study, conducted by Quest Offshore Inc., found that if permits for exploration and drilling returned to historic levels, and if backlogged requests were granted, 400,000 jobs could be supported across the United States with a GDP increase of $45 billion by 2013.

“The president says he wants ideas for putting Americans back to work right now,” said Jack Gerard, API president, during a conference call today. “So we urge him, again, to take a look at policies that will encourage oil, and domestic gas development.”

The offshore oil and natural gas industries suffered losses in 2008 due to the economic recession, the moratorium on deepwater drilling, and slowdowns in permits issued for drilling in the Gulf of Mexico. The study’s authors claim tens of thousands of jobs have been lost due to the downturn.

Gerard echoed the study’s conclusions, saying the United States has the opportunity to increase employment and secure “as much as 92 percent of [its] oil needs from North American resources.”

Both Gerard and NOIA president Randall Luthi agreed the industry needs the ability to explore newly identified petroleum deposits everywhere, including in East- and West-coast waters. Currently only 15 percent of the U.S. Outer Continental Shelf is available for exploration. (New border gun rules a distraction from Fast and Furious scandal, Issa says)

“We’ve got to get out there and have the opportunity to look,” Gerard said, “and the industry needs some insurance that this is serious — that there’s a leasing process in place to eventually commit the resources to go find what level of resources are available, and then to develop it at that point. So given those opportunities, I can guarantee you the industry will spend its money wisely. But you need to have the opportunity.”