A presidential administration's conclusion inevitably produces retrospectives. Words like "legacy" are used when the reviews are favorable. Others that are less flattering appear more likely when it comes to Barack Obama's presidency and the oil and gas industry.
When it comes to the US Department of the Interior, which probably has more direct impact than any other on US producers, it looks now as if several changes in the last 8 years, under secretaries Ken Salazar and Sally Jewell, will be long-lasting-and not just because they're beyond the Congressional Review Act's reach.
Salazar arrived in early 2009 from the US Senate with clear concerns that the federal onshore oil and gas leasing process was flawed. He quickly canceled leases in Utah that the US Bureau of Land Management had awarded toward the end of 2008 because he felt the underlying resource management plan had been prepared hastily a few weeks earlier.
He favored a more deliberate approach that provided opportunities for public involvement sooner in the process. A BLM official later said DOI and BLM were never so naive to expect this to completely stop leasing opponents' lawsuits, but improve the government's chances of winning in court. This apparently has worked.
Producers nevertheless point to onshore production rates from tight shale formations on federally managed land that failed to climb in contrast to dramatic growth on state and privately held acreage during the US oil and gas production renaissance.
BLM's single biggest triumph in the Obama years was working with state agencies, oil and gas producers, conservationists, outdoor recreation groups, and other stakeholders to keep the greater sage grouse from being federally listed as a threatened or endangered species during Jewell's tenure. It showed how diverse interests can work together to reach a common goal.
Changes after Macondo
Offshore, the Obama administration's oil and gas legacy obviously was shaped in late April 2010 by the Macondo deepwater oil well blowout and subsequent spill into the Gulf of Mexico. It accelerated the US Minerals Management Service's restructuring into separate agencies with noncontradictory purposes. Most importantly, it compelled the oil and gas industry to develop the capability and resources to cap and better contain offshore leaks, and work to create much safer operating conditions.
The White House's climate emphasis the past few years regrettably stifled offshore oil and gas opportunities and research, culminating with Obama's removal of US Arctic and most of its Atlantic Outer Continental Shelf from future leasing.
A failure to let offshore geophysical contractors shoot 3D seismic along the Mid-Atlantic OCS is only one of several obstacles that could hurt future administrations. Ending Arctic oil and gas research is another.
Nick Snow
NICK SNOW covered oil and gas in Washington for more than 30 years. He worked in several capacities for The Oil Daily and was founding editor of Petroleum Finance Week before joining OGJ as its Washington correspondent in September 2005 and becoming its full-time Washington editor in October 2007. He retired from OGJ in January 2020.
