Why the US Still Needs Oil Drillers

By Minyanville Staff  JUN 08, 2010 3:10 PM

The moratorium on offshore drilling in America may do more harm than good.

 


Editor's Note: This article was written by Minyan Mike from Louisiana.

I've lived in Louisiana all of my life and worked as a lawyer for over 30 years. I have no particular love for the oil companies themselves, but their presence and employment is the economic backbone of my state as well as most of the Gulf Coast. Many, many families obtain their livelihood, directly or indirectly, from the oil industry. I have an intimate knowledge of how the oil field works and how the mechanisms of a rig perform based on a career of talking to people who work in the industry and countless deposition of oil-industry experts.

It's been interesting to watch the media coverage of the BP (BP) spill. It seems that all I hear are East Coast liberals and Washington insiders making statements that are mostly wrong and show they don't know exactly what they're talking about. It reminds me of when the anti-war protester Cindy Shehan, together with Jessie Jackson, were protesting in front of the Bush ranch in Texas and a neighbor of Bush's was shooting his shotgun. The media was all shook up. When they questioned the neighbor, he stated that he was simply sighting in his shotgun for hunting season. In response to that statement, I later saw a 30-minute news program on national news dedicated to the wisdom of sighting in a shotgun while the media was around. The program featured three highly incensed individuals who spent a half hour showing the world that they weren't about to let the truth and facts interfere with their opinions. They never even understood that you don't sight in a shotgun! Those same people are now "experts" on the drilling operations in the Gulf.

Everyone wants to hate BP right now. That's understandable. But what people need to understand is that drilling for oil isn't the same as selling bottled water. Those companies are on the bleeding edge of technology and what they do. They have the best and the brightest working on it and believe me, no expense is too great, no corner is cut. There's simply too much at risk to do that. The best of everything is used in a drilling operation. But if you're on the bleeding edge of something, mistakes and mishaps occur. I'm amazed that this is the first time that this has occurred given the conditions that drillers operate under.

"Cap and trade" as well as the moratorium on drilling goes to show you just how much those in the media and in Washington don't understand what's going on. When Obama was elected, the entire oil industry knew his position on "cap and trade." Their response was to halt whatever projects could be halted and stop all future projects. Efforts were made overseas. Now with the moratorium on offshore drilling, what's going to happen is that even more personnel and equipment will leave the US. Russia, for one, has been begging for rigs and people to come there, but were unable to lure American companies due to commitments in the US. There are only so many drilling rigs out there. I'm hearing that there are industry-wide decisions being made right now to abandon the US arena and to go overseas where there are no "cap and trade" hindrances and where there's government support, not opposition. If that happens -- and it looks like it will -- it will be a long time and will require a dramatic change in policies before they return. If the media and Washington think this will help to remove our reliance on foreign oil, they need to revisit the shotgun-sighting event.

There are many people I know who have stopped watching the news, feeling that there are too many opinionated, ill-informed people out there. I'm joining them. I want information when I watch the news, not someone's half-baked political agenda.
No positions in stocks mentioned.

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