?President Bush has called on Congress to immediately lift the ban on E&P offshore the U.S. and lifted the presidential ban that has been in effect since 1990.


“The only thing standing between the American people and these vast oil resources is action from the U.S. Congress,” Bush said during a presentation in the White House Rose Garden. “Now the ball is squarely in Congress’ court. Failure to act is unacceptable. And now Americans are paying at the pump.”


There are two prohibitions on offshore drilling, one imposed by Congress and another by executive order signed by the first President Bush in 1990. The current president, trying to ease market tensions and boost supply, is calling on Congress to lift its prohibition.
On June 18, Bush presented a four-part plan to secure America’s energy reserves for the short-term and bring some relief to the pumps and for the long-term, cut the nation’s dependence on foreign sources of oil and gas. The plan includes lifting the drilling ban, developing more oil shales, opening up a small area of the Arctic National Wildlife Refuge and helping streamline the process for permitting and building new refineries. According to Bush, drilling in less than 1% of ANWR could eventually yield as much as 10.4 billion barrels of oil.
Pritchard Capital Partners analyst Brian Uhlmer says Bush’s plan is an important first step.


“Although lifting the ban does not immediately open up the eastern Gulf of Mexico for drilling, we believe it is a positive first step,” Uhlmer said. “Congress also will have to lift its ban, and then blocks will have to be auctioned off in a lease sale. However, a potential increase in shallow-water drilling in 2010-2011 is very positive for all global jackup drilling contractors.”


The National Association of Manufacturers (NAM) is praising Bush. “We are encouraged by the actions of the president and urge Congress to show equal resolve by moving forward in a quick, positive and bi-partisan manner to lift its ban on offshore exploration,” says NAM executive vice president Jay Timmons. “This country is facing an energy crisis. It is imperative that every opportunity to reduce the cost of energy be taken. An appropriate place to start is by increasing our access to domestic resources.”


He adds that “the energy crisis is seeping into every part of our daily lives in America. Seniors and those on fixed incomes are struggling to pay their home-heating and -cooling bills; families are reprioritizing their budgets in order to pay for gas at the pump; and manufacturers are being forced to make difficult choices in order to keep their doors open. Lifting the presidential and congressional bans on offshore energy development is one commonsense solution that could produce enough oil to match America’s current production for close to 10 years.”


Congressional Democrats, joined by some Republican lawmakers from coastal states, have opposed lifting the prohibition that has barred energy companies from waters along both the East and West coasts and in the eastern Gulf of Mexico. And former presidents Bush and Clinton have sided against drilling in these waters, as has Congress each year for 27 years.


Democrats have been quick to attack the president’s plan. Sen. Barbara Boxer (D-California), says, “This proposal is something you’d expect from an oil company CEO, not the president of the United States. The president is taking special-interest government to a new level and threatening our thriving coastal economy.”


Bush says offshore drilling could yield up to 18 billion barrels of oil over time, although it would take years for production to start. “In the short run, the American economy will continue to rely largely on oil, and that means we need to increase supply here at home,” Bush says, adding that there is no more pressing issue for many Americans than gasoline prices.

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