Unique Original Articles » What Does the Oil Moratorium Entail?

The United States issued an oil moratorium on drilling of exploratory oil and gas wells in the Gulf of Mexico for six months. For the areas of the Gulf of Mexico that have already been drilled there is a ban denying further excavation.

The US Interior Department, after US President Barak Obama announced the widening Gulf of Mexico oil spill, stopped the ongoing and planned exploratory drilling off the US coastline. Immediately after the US president issued the ban, major oil and gas companies like Exxon Mobil and Marathon Oil halted their drilling operations.

As laid out in the ban oil and gas companies were ordered to “cease drilling new deepwater wells including sidetrack and bypass activities.” Sidetrack and Bypass wells are those that are drilled once the exploratory well have sunken into the ocean floor. When the initial well begins “spudding” Sidetrack and Bypass wells are used to resolve any resulting issues.

All deepwater wells that are located 500 feet or more below sea level are also included in the drilling moratorium. Deepwater drilling is not done until you reach depths of 1000 feet or more. The “notice of lessees” issued, confirmed what the Obama administration intended This was announced to reporters by US Interior Secretary Ken Salazar.

The Gulf of Mexico provides 25 percent of the oil used in the United States and 5 percent of the domestic gas supply. These percentages are based on the data provided by the Energy Information Administration, the same organization that classifies deep water drilling at over 1000 feet underwater. The effects of the six month drilling moratorium will not be felt immediately. However, in future, areas that get most of their oil and gas from the Gulf of Mexico will begin to feel the pinch.

Over 12,000 people will suffer from the ban, especially those whose livelihood and job rely on the closed rigs. 36 rigs have been closed down and 5 have moved off the coast of Egypt and other African countries. Some feel that the oil moratorium is leading to further economic uncertainty and employment uncertainty as well. In order to work around the ban some rigs have moved on to other regions of the world. For those companies who are choosing to wait out the ban are taking a huge risk.

An six month oil moratorium on the drilling of exploratory oil and gas wells was issued by the United States for the Gulf of Mexico.

The effects of the six month drilling moratorium will not be felt immediately. However, in future, areas that get most of their oil and gas from the Gulf of Mexico will begin to feel the pinch.

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