U.S. offshore energy regulators have 30 days to act on five Gulf of Mexico drilling permits that the Obama administration’s offshore drill bans have delayed unreasonably, a New Orleans judge ruled today.
“The government is under a duty to act by either granting or denying a permit application within a reasonable time,” U.S. District Judge Martin Feldman said in his ruling. “Not acting at all is not a lawful option.”
Feldman ordered offshore energy regulators to act within 30 days on five permit applications filed by companies that have drilling contracts with Ensco Offshore Co., the Louisiana drilling company leading the legal challenge to the government’s offshore drilling bans.
The permits have been delayed anywhere from four to nine months by drilling suspensions regulators imposed in the wake of the worst offshore oil spill in U.S. history. Before the spill, permits were processed within two weeks.
“We are aware of the ruling and are reviewing it,” said Wyn Hornbuckle, a Justice Department spokesman. “We have no further comment at this time.”
Sean O’Neill, Ensco’s spokesman, didn’t immediately return a call seeking comment.
President Barack Obama temporarily halted all drilling in waters deeper than 500 feet in May, following the explosion and sinking of the Deepwater Horizon drilling rig off the Louisiana coast. After offshore companies and regional business and political leaders sued in June, Feldman threw out the ban as overly broad and punitive to the Gulf Coast economy.
Interior Secretary Kenneth Salazar promptly announced he’d find a new way to block offshore drilling and, in July, imposed an almost identical ban. When that ban was also challenged in court, Salazar withdrew it before Feldman could rule on its validity.
This month, Feldman found the government in contempt of his orders to discontinue what industry claimed was a de-facto drill ban, as regulators imposed new safety regulations and delayed processing of new permits. The government claimed the new rules and requirements were needed to prevent a recurrence of the Deepwater Horizon disaster, which allowed more than 4.1 million barrels of oil to gush from a subsea well owned by BP Plc.
“It is undisputed that these delays have put off indefinitely drilling in the Gulf of Mexico,” Feldman said in his 17-page ruling. “It is unclear when Gulf drilling will resume. The government’s assurances have been inconsistent.”
“The leaking well has been contained; the revised regulations are no longer new; and the threat of rigs leaving the Gulf becomes more forceful each day,” House Energy and Commerce Committee Chairman Fred Upton, a Republican from Michigan, said in a statement applauding Feldman’s order. “The permitting backlog becomes increasingly inexcusable.”
“This ruling says it’s not only inexcusable but that it violates the law,” said Sen. David Vitter, R-La.
Vitter said he’ll continue to block Senate approval of presidential nominee Daniel Ashe as head of the U.S. Fish and Wildlife Service until the administration “follows the law and issues deep water exploratory permits.”
© Copyright 2014 Bloomberg News. All rights reserved.