“All of the above” as an energy sound bite gradually morphed into actions to take coal out of the energy mix and now, on his way out the door, President Obama has issued a ban on drilling along the east coast and in the Beaufort and Chukchi seas areas of Alaska. This is an early Christmas present to environmental advocates who oppose fossil fuels simply because they exist. Based on actions and not words, President Obama only favors energy that is developed and promoted by generous subsidies.
Since almost no interest has been shown in the areas included in the Obama ban, it takes on the appearance of a poke in the eye to President-elect Trump who seems to recognize that abundant and affordable energy is an essential input to economic growth. While the provision of the OCS Lands Act has not been tested in court, it should be. No president should be able to issue a ban that persists in perpetuity without Congressional approval.
With an outlook for low to moderate crude oil prices for the foreseeable future and Shell Oil’s $7 billion experience finding no oil in the Chukchi Sea, the President’s action can only be interpreted as an act of petulance and slap in the face to the Trump Administration and petroleum industry. Self-imposed moratoria proved harmful during the period from the 1970s to the early 2000s and someday this one will also unless it is reversed. Eventually, technology and economics will make these areas appealing for exploration and production if oil and gas are found but with the ban in place, we would have to once again turn back to imports.
Claims that this action puts “environmental protection over economic uses” as the New York Times asserts is just more environmental hot air. Empirical evidence has no role when ideology drives the news. The record of offshore exploration and production over almost 50 years shows that it is possible to pursue and achieve both.
The President has received gushing praise from environmental groups like Greenpeace, which itself is telling. Although his economic achievements have been anemic at best—the slowest economic growth of any president since President Eisenhower, he goes out an environmental hero. Quite a legacy!