Rx for Job Growth, Federal Revenue and Energy Security: Drill, Obama, Drill!

The Gulf Economic Survival Team (GEST) is a consortium of large and small companies that have been negatively affected by the Department of the Interior’s bureaucratic overreaction to the BP oil spill. Earlier this year, GEST commissioned a study by IHS-CERA, a leading energy-oriented think tank, to determine what impact could be expected if BOEMRE (the Bureau of Ocean Energy Management, Regulation and Enforcement, DOI’s offshore regulatory arm) were to return to the pace of plan review and permit approval that was considered routine before the BP spill.

In anticipation of an Obama policy pronouncement on the economy and renewed stimuli on Thursday night, GEST sent a letter to President Obama, pointing out that a return to previous policy would quickly put 230,000 workers to work. Not only would it not cost the government a dime of stimulus money, it would generate revenue for the Treasury by the $billions. It would also enhance domestic fuel production, reduce imports and improve our balance of trade.

Swift action to reduce the growing backlog of plans and increase the pace of plan and permit approvals to explore for oil and natural gas resources in the deepwater Gulf of Mexico would increase employment opportunities in almost every state, boost tax and royalty revenues for governments, and help stabilize US energy security. And these benefits could materialize rapidly. Early alignment between the capacity to properly regulate oil and natural gas activities and the pace and scale of investment opportunities would capture the largest possible share of the activity gap, which in 2012 results in

  • 230,000 American jobs
  • more than $44 billion of US gross domestic product (GDP)
  • nearly $12 billion in tax and royalty revenues to state and federal treasuries
  • US oil production of more than 400,000 barrels of oil per day (bd) (equivalent to approximately 150 million barrels in the full year)
  • reducing the amount that the United States spends on imported oil by around $15 billion

The employment effects would not be limited to the Gulf states. One third of those jobs would be generated outside the Gulf region in such states as California, Florida, Illinois, Georgia, and Pennsylvania.

[Emphasis added. – Ed.]

GEST’s letter to President Obama can be found here. (pdf link)

The IHS-CERA study can be found here. (pdf link)

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