Permitorium Issue Brief

Since lifting the deepwater drilling moratorium in October 2010—established in the wake of the
Deepwater Horizon incident—only one new exploratory drilling plan in the Gulf of Mexico has
been approved. While the industry has taken this time to reevaluate its operating standards, the
government—according to federal data—has left more than 100 offshore drilling plans awaiting
approval, leading to a so-called “permitorium” on access to domestic energy resources. The
permitorium not only harms the drilling companies directly affected by these idled leases, but
also the countless businesses supported by the oil and natural gas industry—the lifeblood of the
Gulf economy.

In fact, because of the permitorium, seven deepwater drilling rigs have already left, or are
planning to leave, the Gulf to relocate to waters off the coast of South America and Africa.

Safe offshore drilling operations and increased domestic access are not mutually exclusive. As
the industry and government work together to ensure oil and natural gas are developed safely,
the administration must also efficiently approve drilling permits to provide access to the reliable
and affordable domestic resources on which our nation depends.

Access to resources in the Gulf of Mexico is essential to America’s energy and

economic security.

 According to the U.S. Energy Information Administration (EIA), offshore production in the
Gulf of Mexico accounts for 29 percent of total U.S. crude oil production and 13 percent of
total U.S. natural gas production.

 The eastern Gulf of Mexico alone could hold 3.8 billion barrels of oil and 21.5 trillion cubic
feet of natural gas, according to a 2006 study by the Minerals Management Service.

 With the EIA’s estimation that the world will require 49 percent more energy by 2035, access
to domestic energy resources will be crucial to meeting rising demand.

The development of domestic energy resources benefits the U.S. economy and
taxpayers.

 Oil and natural gas companies provide billions of dollars in revenue to the federal
government. In 2008 alone, the government collected nearly $18 billion dollars from Outer
Continental Shelf leasing and production activity.

 Based on data from the EIA, the oil and natural gas industry provides the U.S. Treasury with
an average of more than $95 million each day.

 The oil and natural gas industry provides more than $1 trillion in contributions to the U.S.
economy annually, or 7.5 percent of total GDP, and supports more than 9.2 million
American jobs, according to a PricewaterhouseCoopers study.