Offshore DrillingOffshore Drilling

IntroductionIntroduction• Offshore drilling is searching for Offshore drilling is searching for

petroleum and gas below water petroleum and gas below water surface, mainly in seas and surface, mainly in seas and oceans.oceans.

• It started in 1891 in Grand lake st. It started in 1891 in Grand lake st. Marys, Ohio.Marys, Ohio.

• Since then, the number of offshore Since then, the number of offshore wells increased dramatically in the wells increased dramatically in the US, until the number of wells in the US, until the number of wells in the Gulf of Mexico Gulf of Mexico ONLY ONLY reached an reached an increasable 3858 wells.increasable 3858 wells.

• Drilling in the USA takes place in Drilling in the USA takes place in many places, which are Alaska, many places, which are Alaska, California, Gulf of Mexico (Texas, California, Gulf of Mexico (Texas, Louisiana, Alabama, and Louisiana, Alabama, and Mississippi), And the great lakes at Mississippi), And the great lakes at Michigan*.Michigan*.

BenefitsBenefits• Offshore drilling is the US is Offshore drilling is the US is

accounted for producing about accounted for producing about 27% of the oil and 14% of the 27% of the oil and 14% of the gas in the entire nation.gas in the entire nation.

• In 2007, offshore wells produced In 2007, offshore wells produced 492,000,000 barrels of oil, 492,000,000 barrels of oil, however, by 2013 it is expected however, by 2013 it is expected that the gulf of Mexico that the gulf of Mexico ALONEALONE will produce 686,000,000 barrels.will produce 686,000,000 barrels.

• Petroleum is one of the Petroleum is one of the industries that needs high industries that needs high employment rates, so in addition employment rates, so in addition to the oil price, investments will to the oil price, investments will offer a lot of jobs to American offer a lot of jobs to American people.people.

CostsCosts• Petroleum is a costly Petroleum is a costly

industry in the first place.industry in the first place.• Offshore drilling is more Offshore drilling is more

costly due to various costly due to various reasons(?).reasons(?).Shallow water drilling costs Shallow water drilling costs 1 ~15 M$, it can reach* 1 ~15 M$, it can reach* 30M$ in medium depths and 30M$ in medium depths and even 100M$ in high depths.even 100M$ in high depths.

• The deepest well in the The deepest well in the world is recorded by 3 world is recorded by 3 B$ B$ until it started producing. until it started producing. “Pardido, Texas”“Pardido, Texas”

US Federal-State US Federal-State RegulationsRegulations• Every country in the world own the waters until 22 Km from Every country in the world own the waters until 22 Km from

the shores, and it can mine in those waters freely.the shores, and it can mine in those waters freely.

• US federal government in the beginning was the supervisor US federal government in the beginning was the supervisor of all the offshore wells in the USA.of all the offshore wells in the USA.

• In 1953, the congress passed a law called “The Submerged In 1953, the congress passed a law called “The Submerged Land Act” that gave the state the ownership of wells till 6 Land Act” that gave the state the ownership of wells till 6 Km from the shore (Except for Florida and Texas,17 Km), Km from the shore (Except for Florida and Texas,17 Km), and another law called “The outer Continental Shelf Act” and another law called “The outer Continental Shelf Act” gave the Federal government the owner ship of deeper gave the Federal government the owner ship of deeper wells.wells.

Restrictions on Offshore Restrictions on Offshore DrillingDrilling• In jan,28In jan,28thth 1969 a blowout happened off coast of California, 1969 a blowout happened off coast of California,

leading to prohibit farther drilling in California and Florida as leading to prohibit farther drilling in California and Florida as well, and the prohibit continues…*well, and the prohibit continues…*

• In 1972, A bill passed to ban offshore drilling to protect marine In 1972, A bill passed to ban offshore drilling to protect marine life, over the time the congress adding more paces to the ban life, over the time the congress adding more paces to the ban until it covered the west, east coast, and eastern gulf of Mexico.until it covered the west, east coast, and eastern gulf of Mexico.

• In 1990, Bush Sr. issued an executive order to ban federal In 1990, Bush Sr. issued an executive order to ban federal waters from drilling at Texas, Louisiana, Mississippi, Alabama, waters from drilling at Texas, Louisiana, Mississippi, Alabama, and parts of Alaska, Clinton extended it till 2012, yet Bush Jr. and parts of Alaska, Clinton extended it till 2012, yet Bush Jr. rescinded it.rescinded it.

• In 2002, a bill banned drilling in the great lake, and in 2005 t In 2002, a bill banned drilling in the great lake, and in 2005 t became permanent.became permanent.

• Until 2022, large parts of the gulf of Mexico is off-limits.Until 2022, large parts of the gulf of Mexico is off-limits.

Restrictions on Offshore Restrictions on Offshore DrillingDrilling

Debates in Offshore DrillingDebates in Offshore Drilling

• Energy Independence Energy Independence ArgumentArgument

• Fuel Price ArgumentFuel Price Argument• Military TrainingMilitary Training• Oil Spills ArgumentOil Spills Argument• Endangered SpeciesEndangered Species• Alternative resourcesAlternative resources• Relations With CubaRelations With Cuba

Brazil Offshore DrillingBrazil Offshore Drilling• In 2011, Obama made In 2011, Obama made

his first visit to Latin his first visit to Latin America by visiting America by visiting Brazil.Brazil.

• In a speech addressing In a speech addressing the President Dilma the President Dilma Roussef and the Roussef and the Brazilian Nation, Obama Brazilian Nation, Obama stated that they will help stated that they will help Brazil in drilling, and Brazil in drilling, and when they extract Oil US when they extract Oil US will be their best will be their best costumer!!costumer!!

Brazil Offshore DrillingBrazil Offshore Drilling• In addition to that, Barack Obama gave In addition to that, Barack Obama gave

an order to the Import-Export bank to an order to the Import-Export bank to send Brazil 2 Billions U$ for their drilling.send Brazil 2 Billions U$ for their drilling.

• This caused a lot of debates, some This caused a lot of debates, some people say that it is better than the people say that it is better than the middle east, while the others say that middle east, while the others say that USA is still an energy slave….USA is still an energy slave….SO what SO what do you thinkdo you think??