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The Facts About Energy Exploration

Decades of experience has proven that offshore energy exploration is safe, and advanced technologies make it even safer. 

Between 1980 and 1999, offshore operators have produced 7.4 billion barrels of oil in U.S. waters, according to the U.S. Coast Guard,[1] with a release rate of less than 0.001 percent. [2]

Natural seepage of petroleum from the Earth introduces about 150 times the amount from OCS oil and natural gas activities. [3] “In North America, the largest and best known natural seeps appear…[in] the Gulf of Mexico and the waters off southern California.” [4] 

According to the U.S. Minerals Management Service (MMS), “The environmental record of the Outer Continental Shelf (OCS) program has been outstanding – there has not been a significant platform spill in the last 35 years.” [5]

Offshore oil and gas producers are subject to stringent regulatory oversight; they operate under 17 major permits and must follow 90 sets of federal regulations.

Multiple environmental safeguards for offshore exploration are in place.  Technological advances have significantly reduced potential for releases during production.  New offshore platforms and wells feature extensive blowout prevention and well controls. All offshore wells have storm chokes that detect damage to surface values and shut in the well to prevent spills.  Blowout preventers located at the seafloor have sensors that continuously monitor subsurface and subsea-bed conditions.[6]

Environmental safeguards for offshore exploration have been proven in the most demanding circumstances – including last year’s Gulf Coast hurricanes that hit the heart of the U.S. energy industry:

• Almost 3000 offshore platforms were in the direct path of Hurricanes Katrina and Rita.  Despite that exposure and the destruction of 113 offshore platforms and damage to 460 pipelines, MMS reported that there were no significant oil spills from offshore platforms.[7]
• “There were no accounts of spills from facilities in the Federal OCS that reached the shoreline, oiled birds or mammals, or involved any discoveries of large volumes of oil to be collected or cleaned up,” according to MMS. [8]
• The offshore oil losses reported as a result of the hurricanes (17,652 barrels (bbl))[9] is less than one percent of a single day’s production in the Gulf of Mexico (1.5 million bbl).[10]
• Over the same two month period during the 2005 hurricane season, natural seepage of oil from the Earth sent 10 times as much oil (170,000 barrels) into the Gulf of Mexico as offshore platforms contending with the massive storms.[11]   
• Safety technology worked properly: Spills in the Federal OCS from the hurricanes were minimal “due to the successful operation of the safety valves that are required to be installed at least 100 feet below the mudline in each wellbore, of which no failures have been identified as of July 2006,” according to MMS.[12]
• Procedures were executed properly as well: “All OCS facilities in areas threatened by the storms’ approach were shut in prior to the hurricanes so that oil losses were mostly limited to the oil stored on the damaged structures or contained in the individual damaged pipeline segments,” according to MMS.[13]

Energy production rigs often become “artificial reefs” that benefit marine life and fishing industries.  According to MMS, “Recycling retired natural gas and oil structures (platforms) as artificial reefs has proven to be an effective tool for fishery management.  Fish, fishermen, divers, fishing support industries, coastal communities, the petroleum industry, and others have all benefited when retired and obsolete production platforms, already popular with offshore fishermen, are reevaluated and converted for continued use as fishery enhancement resources in the marine environment.” [14]

According to the Nature Conservancy of Texas, “Several of our preserves are home to ongoing oil and gas operations while at the same time providing excellent habitat for wildlife.” [15]

Natural gas is just that – a natural gas that dissipates into the air.  That makes natural gas exploration and production especially safe.  Natural gas contributes to a cleaner environment while acting as a bridge to the alternative energy sources of tomorrow.

Natural gas “is the oldest and lightest of the fossil fuels.” It is “non-toxic,” and “readily dissipates when not confined.  Natural gas is lighter than air and dissipates rapidly in open areas.”  Natural gas is “colorless” and “odorless.” [16]  Allegations of “spills” of natural gas affecting beaches have no scientific basis.

“Natural gas is the cleanest burning fossil fuel. Complete combustion of natural gas produces only heat, carbon dioxide and water vapor. When used in place of more polluting energy sources, it helps improve air and water quality.” [17]

As a clean, efficient energy source, natural gas can help bridge the gap between the energy needs of today and the alternative energy sources of tomorrow. It is important to remember that many of the alternative energy sources being considered – including ethanol and hydrogen – themselves rely on large amounts of natural gas.  If Congress is serious about exploring exciting new energy sources that require natural gas, it must get serious about expanding access to natural gas supplies.[17]

Over the past two decades, the federal government looked to natural gas as a cleaner fuel for power generation.  As a result, U.S. demand for natural gas went up significantly.  Since the 1990s, there has been a 35 percent spike in natural gas consumption by the utility sector.  If Congress continues to drive up demand for natural gas, it must provide greater access to supply.

The solution to America’s natural gas crisis is conservation, efficiency, alternative energy sources and expanded supplies of natural gas. 

Renewable sources of energy are part of the solution, but cannot alone meet America’s energy needs.  According to the U.S. Minerals Management Service, “Despite a continuing emphasis on expanding renewable sources of energy, petroleum products and natural gas are projected to account for about 61 percent of domestic energy consumption in 2030, only slightly less than today’s share.” [18]According to MMS, “Much of the growth in the Nation’s energy demand will have to be met by OCS production, especially from new frontier areas in the Gulf of Mexico, if further increases of imported supplies are to be avoided.” [19]

Conservation, efficiency and fuel diversity are important and should be supported in federal policy. The Energy Policy Act of 2005 did much in these areas.  In order to ensure that these beneficial provisions are carried out, Congress needs to fully fund them through the appropriations process.

The nation has abundant natural gas resources that could be used to help end America’s natural gas crisis and meet the nation’s energy needs.

“The [Interior] Department's Minerals Management Service puts the latest OCS “total endowment” of natural gas resources at 633 trillion cubic feet.  “Total endowment” is “known resources” plus “undiscovered resources.” [20] 

“According to the MMS data, the interim update's mean estimate pegs gas resources in the gulf's eastern planning area at nearly 32 tcf.” [21] That would bring enough natural gas to market to heat ten million homes for 45 years.  The OCS accounts for 23 percent of all domestically produced natural gas. 

Longstanding moratoria prevent us from determining America’s actual natural gas reserves. “There is more uncertainty in resource estimates for those areas of the OCS subject to long-standing moratoria or presidential withdrawal. In areas like the north, mid- and south Atlantic, most of the west coast, and portions of the eastern Gulf of Mexico, the last acquisition of geophysical data and drilling of exploration wells occurred more than 25 years ago and in some cases nearly 40 years ago.[22]

“The Nation and the energy debate would benefit from a better understanding of the resource potential, including the gas or oil “proneness” of areas, and the ability of the OCS to contribute significantly toward meeting future domestic demand.” [23]

A low percentage of drilled vs. leased areas does not indicate that there are large amounts of resource available, but not being drilled.  When a lease sale occurs, it takes time to prepare for drilling.  And when drilling does begin, the drilled area is still surrounded by substantial undrilled areas as producers explore how much resource is there. 

Because of regulatory and technical requirements, drilling does not occur immediately after a lease sale.  Before drilling, seismic activity and analysis take place and “the Secretary [of the Interior] solicits comments from coastal State Governors and localities, tribal governments, the public, the oil and natural gas industry, environmental groups, affected Federal agencies and Congress…The entire process takes from 18 to 36 months to complete.” [24]

State-of-the-art technology for detecting hydrocarbons allows industry to drill one portion of the area and relinquish the other part back into the inventory to be leased.  MMS collects information that estimates or predicts the oil and natural gas potential of an unexplored area, which is sold to oil companies.  “Industry uses the geophysical and geological data to determine which blocks have potential for economic accumulation of oil and natural gas.” [25]

President Bush, members of Congress and Governors have hailed alternative energy sources as key to America’s energy future.  But the nation’s pursuit of ethanol, hydrogen and other alternative sources isn’t possible without natural gas. 

Natural gas is used for ethanol production.  Ethanol uses corn as a primary feedstock, and corn requires large amounts of fertilizer, which is produced from natural gas.