Posted on

Oil execs warn Obama

rhondathompson, [email protected]

Social Share

LONDON – Oil executives sent a strong challenge to Barack Obama yesterday, warning at a major oil conference that the American president’s ban on risky deepwater drilling would cripple world energy supplies.As a BP executive standing in for embattled CEO Tony Hayward was heckled by protesters, other industry leaders used the gathering to rally around the British company, arguing that eliminating deepsea rigs in the wake of the Gulf of Mexico oil spill was unsustainable.BP’s stock slid to a 13-year low yesterday in London, and the oil giant confirmed that Hayward was already in the process of handing over control of the Gulf of Mexico oil spill to managing director Bob Dudley.Obama slapped a six-month moratorium on deepwater drilling in the Gulf as part of his struggle to show that his administration was responding forcefully to the disaster. The decision halted the approval of any new permits for deepwater drilling and suspended drilling at 33 existing exploratory wells in the Gulf.A federal judge in New Orleans blocked the moratorium yesterday, and the White House promised an immediate appeal.The ban reflected growing unease about oil companies seeking to drill farther out to sea and deeper than ever before. The process is expensive, risky and largely uncharted – but the industry argues it is also necessary in a world where land and shallow water oil supplies are running out.Transocean Ltd. president and CEO Steven Newman, owner of the Deepwater Horizon rig where an April 20 explosion killed 11 workers and set off the worst oil spill in United States history, called the deepwater ban an unnecessary overreaction.“There are things the administration could implement today that would allow the industry to go back to work tomorrow without an arbitrary six-month time limit,” Newman told reporters on the sidelines of the conference in the British capital. “Obviously we are concerned.”Chevron executive Jay Pryor said the United States government’s move would “constrain supplies for world energy”.“It would also be a step back for energy security,” Pryor, global vice-president for business development at the United States company, told delegates at the World National Oil Companies Congress.The moratorium was challenged in court by an oil services company, Hornbeck Offshore Services of Covington, Louisiana, which claimed the government arbitrarily imposed the moratorium without any proof that the operations posed a threat. A federal judge in New Orleans, Judge Martin Feldman, yesterday lifted the moratorium.Hornbeck, which ferries people and supplies to offshore rigs, says the moratorium could cost Louisiana thousands of jobs and millions of dollars in lost wages. (AP)