I have to believe gas prices dropping below $2 just before the Christmas holidays took everybody by surprise and was seen as a gift to many of our wallets. After all, according to www.LouisianaGasPrices.com, Louisiana residents haven’t seen gas prices that low since 2008. Who could blame us for doing a little happy dance thinking about all the money we would save filling up each week?
After that initial excitement wore off though, I couldn’t help but think about how this latest price dip emphasizes the importance of the energy industry’s long-term investments in the deepwater Gulf of Mexico.
Sure, low gasoline prices immediately impact American consumers’ pocketbooks for the better. We all have more money to spend on things we like to do, such as eating out and vacationing. But as crude oil prices have dropped with global supply outpacing demand, this volatility has been particularly rough on the U.S. stock market and has created some uncertainty for some sectors of the energy industry. Long-term investments in deepwater, however, remain resilient, and offshore oil and gas are now more important than ever to our energy future.
In fact, Gulf of Mexico offshore oil production is headed into one of its biggest growth spurts in history. Gulf of Mexico production is expected to grow by 21 percent from 2014 to 2015, with an additional boost in 2016 to bring production to a peak of 1.5 million barrels of crude a day in the Gulf, surpassing a previous record set in 2009. The long-term, multimillion-dollar investments that have been made and continue to be made in America’s Gulf are resistant to today’s market fluctuations. These investments are the sources that will fuel this nation in years to come and continue to provide American jobs at an unparalleled pace.
A perfect example of this continued boom in deepwater production is Port Fourchon, Louisiana. This port at the tip of Lafourche Parish is America’s energy port, servicing 90 percent of rigs in the Gulf and playing a strategic role in providing 20 percent of America’s oil supply. Here, there are no signs the industry is holding back or even stuttering due to lower prices at the pump. The port continues to expand its water frontage, slips are leased even before construction is complete and investments planned for 2015 and 2016 are record breaking. As we can see at Port Fourchon, offshore energy production is a powerful economic engine that continues to make huge economic impacts to our local communities, state and nation, regardless of the price at the pump.
That is why it is more important than ever we aggressively advocate for increased access to offshore waters as part of the U.S. Bureau of Ocean Energy Management’s (BOEM) 2017-2022 Leasing Plan, which the federal agency is currently developing. Expanding federal waters open to energy production will reduce America’s vulnerability to the volatility of global energy markets and increase our own energy independence.
Currently, 87 percent of America’s offshore waters are off limits to drilling. This leaves only 13 percent of federal waters open for developing energy to heat our homes and fuel our cars — namely the Western and Central Gulf of Mexico and Alaska. Since summer 2014, Louisiana Mid-Continent Oil and Gas Association (LMOGA) has been actively involved in the five-year lease plan process, urging BOEM to not only maintain the existing exploration and development activities in the 2017-2022 plan but also to expand leasing into new areas where there has been little or no activity such as the Mid and Southern Atlantic, the Eastern Gulf of Mexico and the Pacific. A draft five-year plan was recently released, and LMOGA will be submitting comments on the draft as well as encouraging businesses and organizations throughout the state to do the same.
Expanded offshore production expands our economy. It’s as simple as that, and it’s a message clearly demonstrated right here in Louisiana at the bustling Port Fourchon. So, no matter what it costs to fill up your tank today, next month or next year, you can feel confident a booming offshore energy industry is working to keep you fueled up for years to come.
For more information, visit www.lmoga.com or call (225) 387-3205.
