LAFAYETTE, LA — Federal agencies are making changes to bring more oil and gas jobs to the Louisiana coast, but U.S. Representative for Louisiana’s 3rd District Clay Higgins said the Bayou State could miss out unless Baton Rouge takes action as well.
The Bureau of Safety and Environmental Enforcement (BSEE) and The Bureau of Ocean Energy Management released a report indicating the Gulf of Mexico will now be treated as two separate provinces: shallow water and deep water.
To increase drilling, those investing in shallow water reservoirs will get a higher return on investments and their applications will be considered on a per-project basis.
In 2018, 97 platforms abandoned the continental shelf while zero new ones were constructed, but with federal reform and new tech which can locate previously untapped resources, Congressman Higgins said there is potential to reverse the trend.
“There’s a tremendous opportunity,” U.S. Representative Higgins told News 10. “We have done everything possible at the federal level to create this opportunity, and we need a little help from Baton Rouge.”
Congressman Clay Higgins said he is confident BSEE’s plan to make drilling in the Gulf of Mexico more profitable will work, “The prospect of new projects coming to the gulf in Louisiana is much greater now then it was two weeks ago.”
While offshore drilling is breaking production records, drilling less than 200 meters deep has declined for years. Higgins said reservoirs once thought dried up are getting another chance, “The shallow water fields that have been over the course of the decades abandoned have proven they can be productive again but with 21st-century technology.”
However, Higgins said there are still hurdles keeping investors from our state, “You’d rather go to Louisiana, but you’re almost guaranteed to get sued.”
He claimed states like Texas are taking investors and their jobs from Louisiana because they discourage lawsuits, “In order for it to work, we need an executive branch that’s at least willing to work with us on finding ways forward to restrict some of these unnecessary and frivolous lawsuits against the oil and gas industry.”
We reached out to oil and gas groups inside Louisiana. They supported the BSEE reducing royalty rates.
“The shallow waters of the Gulf of Mexico are vital to the success of Louisiana and especially the independent oil and gas producers and service companies. Reducing the cost of exploration and production will open the gulf to new investment and potentially new opportunities for coastal Louisiana. We applaud President Trump, BSEE Director Angelle, and our federal delegation and will continue to collaborate to create a robust oil and gas sector in Louisiana.”-Gifford Briggs, Louisiana Oil and Gas Association.
“Reducing royalty rates in the federal OCS is critical to encouraging industry investment in drilling new wells, creating much needed Louisiana jobs and once again revitalizing our local economies. Production may be up, but jobs are down, vessels are tied up, and our nation needs to stimulate offshore activity now more than ever.”-Tyler Gray, Louisiana Mid-Continent Oil and Gas Association.
While the royalty discounts will make cheaper drilling projects even cheaper, Higgins wants to see Louisiana be the first choice in the Gulf of Mexico and not the last.
“We should be leading the resurgence of the oil and gas industry, not trailing it,” Higgins said
These last couple of pieces were important to Higgins. He said his office has been working on getting this reform during his full tenure in office, but it isn’t the end of his fight.
He mentioned eliminating more burdensome federal regulations and making tax codes more flexible as some of his immediate focuses.