By Lori LeBlanc, LMOGA Offshore Committee Director for BIC Magazine
Like hunting and fishing, oil and gas is a way of life here. Louisiana proudly serves as the gateway to the Gulf, the front door to the boundless energy potential just miles off our coast and thousands of feet under the water’s surface. It is a job that Louisianans have done proudly and it has become a significant part of our culture, just as much as our bountiful hunting and fishing, wildlife watching, ecotourism, and unique food and music.
That’s the message I took to the U.S. House Subcommittee on Energy and Resources in July when I testified in a public hearing focused on evaluating federal offshore oil and gas development on the Outer Continental Shelf. As President Donald Trump, Interior Secretary Ryan Zinke and Congress begin to consider a new five-year OCS leasing program, LMOGA and our industry partners want to help everyone understand the substantial economic benefits Louisiana has reaped by serving as an offshore energy hub, and the potential benefits our entire country could realize by opening more of the OCS to oil and gas development.
Under the last administration, 94% of the OCS along the East Coast, West Coast, Gulf Coast and Alaska was off-limits to responsible development, despite interest from state and local governments and industry leaders. This means that, since the first Gulf well was drilled off the Louisiana coast 70 years ago, the Gulf of Mexico has produced 90% of all the domestic US crude oil from OCS territories. There is so much potential for growth and the numbers prove that expansion of OCS production would be a boon to our nation’s energy security, jobs, and national treasury.
In 2016, offshore production of crude oil in federal waters totaled more than 594 million barrels, which represented over 18% of total U.S. crude oil production, according to the Energy Information Administration (EIA). In January 2017, GOM crude oil production increased for the fourth consecutive month, reaching 1.7 million barrels per day. On an annual basis, oil production in the GOM is expected to continue increasing through 2018, based on forecasts in EIA’s latest Short-Term Energy Outlook.
The total economic impact of Gulf energy is immense. It creates jobs in every state in the U.S., with more than 650,000 jobs nationwide estimated to be linked to Gulf energy activity, along with tens of thousands here in Louisiana alone. In fact, the Interior Department estimates a $1 trillion net economic value for Gulf energy development over the past 20 years and the federal government has collected over $150 billion in revenues during that time. This revenue stream is one of the largest sources of annual deposits to the national Treasury, funding countless public services.
As the Administration and Congress explore opportunities for increasing offshore access for oil and gas development, we urge them to look to Louisiana and our long, distinguished history of successfully producing energy to fuel America. We are a shining example of how a robust offshore oil and gas industry can provide significant benefits to our local, state and national economies.
- Louisiana is first in OCS oil production and second in OCS natural gas production.
- Louisiana is first in revenues generated offshore with an estimated $5-14 billion deposited into the federal treasury each year.
- A 2014 study by Dr. Loren C. Scott indicates the offshore industry has a $44 billion annual impact to Louisiana and a $70 billion annual impact when related pipeline and refining activities are included.
- In 2013, energy jobs existed in all 64 Louisiana parishes with 17 parishes employing more than 1000 workers in the energy industry.
Gulf energy producers have been responsible community partners for more than a century, creating more jobs than any other industry in Louisiana and raising the standard of living and quality of life across our state. Industry has also invested hundreds of millions of dollars in projects to protect and restore our coastal wetlands and to promote worker safety.
We are showing the rest of the country that we can do it all! Opening more of the OCS to oil and gas development would spread these benefits to many more communities throughout the U.S. that are hungry for the economic engine that is America’s offshore energy industry.