IPAA independent petroleum association of america, america's oil and gas producers

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Nicole Daigle / Brendan Bradley
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For Immediate Release
July 23, 2010


Confirmed: Obama Moratorium Will Kill Jobs, Threatens America's Independent Oil, Natural Gas Producers

WASHINGTON - A study released this week underscores the significant damage the Obama Administration's moratorium on offshore oil and natural gas development will continue to have on the nation's economy and the tens of thousands of jobs that support the industry. The analysis also puts into context the damaging effects this wrong-headed, far-reaching policy will have on America's independent oil and natural gas producers.

The author of the study, IHS Global Insight, notes that "independent oil and gas companies currently account for about half of the nearly 400,000 jobs, $70 billion in economic values and $20 billion in federal, state and local revenue generated by the industry in 2009." Here are key findings from the study entitled "The Economic Impact of the Gulf of Mexico Offshore Oil and Natural Gas Industry and the Role of the Independents": 

The study forecasts that by 2020 an exclusion of the independents from the Gulf of Mexico would eliminate 300,000 jobs and result in a loss, over 10 years, of $147 billion in federal, state, and local taxes from the Gulf region. If the independents are excluded just from the deepwater, the job loss would be 265,000 jobs by 2020, and $106 billion in tax revenues over the 10-year period.


The Houston Chronicle reports this today about the study's findings:

At risk, according to a new report released Thursday by IHS Global Insight, an economic and political forecasting firm, are 300,000 jobs tied to independent energy companies that focus on exploration and production without downstream operations. 

If liability proposals or other initiatives block offshore drilling by the independents, the federal government could forfeit $147 billion in taxes and royalty revenue over the next 10 years, according to IHS' findings. 

The proposals also could suppress energy production in the Gulf of Mexico, IHS said, because independent energy companies are the largest shareholders in two-thirds of Gulf drilling leases and more than half of all deep-water leases.


In a recent San Angelo Standard-Times column, Texas Alliance of Energy Producers President Alex Mills writes this about IPAA's fight for access to American oil and natural gas, and the jobs and economic activity this production creates:

Bruce Vincent, chairman of the Independent Petroleum Association of America and president of Swift Energy Co. in Houston, said it best when he pointed out that President Obama said that the nation must stop the free fall of the American economy and get jobs growing again. Yet, they do just the opposite when issuing not one but two moratoriums.


Like IPAA, Gulf Coast residents overwhelmingly understand that the responsible offshore domestic oil and natural gas production is essential to keep their economy, and our nation, moving forward. Here are highlights from this week's "Rally for Economic Survival" in Lafayette, La., which drew 12,000 strong.

  • Lynn Oubre, a New Iberia native, said he attended the rally to ensure the administration hears loud and clear Louisiana's opposition to the drilling ban. "They ought to wake up and listen," Oubre said. "I don't think they'll do anything, but they'll listen." (Daily Iberian, 7/22/10)

     
  • "I think the risk to the local economy is greater than the risk to the environment right now," said machinist Andy Fuquay, 27, dressed in dark blue coveralls. ... "People are going to lose their jobs," said John Courville, 45, who works in Lafayette at CLM Equipment, which sells heavy construction equipment. (Los Angeles Times, 7/22/10)

  • Lafayette City-Parish President Joey Durel called the moratorium "the greatest risk to our economy" and a man-made disaster for both those inside and outside the oil and gas industry. The rally is not about partisan politics, he said, but rather "people who want to work who are being prevented from working by the American government. "That is not the American way," he said to applause. (The Advocate, 7/22/10)


And in an emotional editorial, the La. Town Talk newspaper writes this under the headline "'Survival' rally in Louisiana is a call to America":

The bottom line is this: The United States runs on oil, and you can't hit the brakes without causing significant economic damage. ... We urge him to review his notes and drop the draconian moratorium.

Rally organizers want people who participate in person or online to do two things: Make a one-minute video to say how the drilling moratorium will affect you, your business, your family, your friends and your community; and sign a petition posted online by the lieutenant governor's office that starts with this:

"The offshore drilling moratorium will be devastating to our Gulf Coast region, where hundreds of thousands of residents work in jobs that service the oil and gas industry. The impacts we are suffering from the BP oil spill are bad enough; the moratorium will cause massive layoffs and cripple our economies like never seen before."

That has started already, and the damage will not stop at the state line.

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IPAA is the national trade association representing oil and natural gas producers that drill 90 percent of the nation's oil and natural gas wells. These companies account for 68 percent of America's oil production and 82 percent of its natural gas production.