US judge blocks offshore drilling moratorium

This story was updated on June 22 with additional information.

Paula Dittrick
OGJ Senior Staff Writer

HOUSTON, June 22 -- A federal judge in New Orleans on June 22 blocked the US government’s 6-month moratorium on new deepwater drilling in the Gulf of Mexico, and a White House spokesman said the Obama administration plans to appeal.

US District Judge Martin Feldman issued a preliminary injunction against the moratorium in a civil case filed by Hornbeck Offshore Services of Covington, La., and some 30 other service companies against US Interior Sec. Ken Salazar.

Some plaintiffs provide drilling services while other plaintiffs ferry workers and supplies to offshore rigs.

Feldman made his ruling just a day after he heard arguments in the case in New Orleans.

“Plaintiffs will incur immediate and irreparable harm to business…should the court decline to grant the application for the relief requested,” Feldman said. Federal officials were “immediately prohibited from enforcing the moratorium” pending a full trial on the merits of the case, Feldman said.

But details were not immediately available on when industry expected that rigs might resume drilling.

The American Petroleum Institute issued a news release praising Feldman’s ruling.

“With this ruling, our industry and its people can get back to work to provide Americans with the energy they need, and do it safely and without harming the environment,” API said.

Obama’s administration had halted approval of new permits for deepwater drilling and also suspended drilling of 33 exploration wells pending completion of investigations into the cause of the Macondo well blowout and resulting explosion and fire on Transocean Ltd.’s Deepwater Horizon semisubmersible drilling rig on Apr. 20.

Hornbeck Offshore and other service companies said there was no proof that other deepwater operations pose a threat.

A 1-month moratorium initially was announced May 6, and on May 27, Obama extended the moratorium for 6 months.

API reacts
API said, “The administration acted appropriately in its immediate steps to inspect every rig in the gulf following the Deepwater Horizon explosion…. In addition, the oil and natural gas industry took immediate steps to review practices and equipment to ensure safety and environmental protection, through the formation of two industry-wide task forces.”

The task forces provided important insights to DOI. The first two task forces and two recently created ones are working to find ways to improve the safety of offshore operations, subsea well control, and oil spill response efforts, API said.

“The moratorium was an initial reaction to concerns about the safety of offshore oil and natural gas operations,” API said. “However, an extended moratorium would have a tremendous impact on the nation’s energy security—and cause significant harm to the region of the country that was already suffering from the spill—without raising safety or improving industry procedures.”

Contact Paula Dittrick at paulad@ogjonline.com.