Energy & Entrepreneurs

ExxonMobil's Find in the Gulf of Mexico

by Raymond J. Keating

On June 8, ExxonMobil reported a big oil find in the Gulf of Mexico. That's good news for energy consumers, including entrepreneurs and small businesses.

In a statement, the company announced "two major oil discoveries and a gas discovery in the deepwater Gulf of Mexico after drilling the company's first post-moratorium deepwater exploration well."

Steve Greenlee, president of ExxonMobil Exploration Company, added: "We estimate a recoverable resource of more than 700 million barrels of oil equivalent combined in our Keathley Canyon blocks. This is one of the largest discoveries in the Gulf of Mexico in the last decade. More than 85 percent of the resource is oil with additional upside potential. We plan to work with our joint venture partners and other lessees in the area to determine the best way to safely develop these resources as rapidly as possible."

A Times-Picayune report included, "Chris John, president of Louisiana Mid-Continent Oil and Gas Association, said the discovery represented ‘a critical milestone that indicates a bright and robust future for the oil and gas industry in the Gulf of Mexico,' and added that the billions of dollars and countless workers associated with developing the prospect will support a range of workers, ‘from boat operators and helicopter pilots working off of Louisiana's coast to the engineers stationed on the rig.' ... And state Natural Resources Secretary Scott Angelle said the discovery will help support the local businesses and communities ‘in a positive way'..."

All of this speaks to the availability of domestic energy resources, if government allows the market and the industry to work. This point was hit upon in several congressional statements released in response to the ExxonMobil announcement. Consider the following, for example:

• Congressman Jeff Landry (R-LA) declared, "I'm not surprised Exxon found oil where it said it would find oil. If BOEMRE would be more proactive in removing barriers rather than impeding the permitting process - especially when it involves companies who have proven to drill safely in the Gulf of Mexico like Exxon, then we would be further down the road in weaning America off foreign oil and reducing our energy prices."

• Congressman Bill Flores (R-TX) said, "Exxon's significant oil and natural gas discovery in the Gulf of Mexico today further confirms the urgent need for the Obama Administration to lift the ban on new offshore drilling. This is exactly why Republicans have been applying pressure on the Department of Interior to issue offshore permits. Our country has vast amounts of untapped taxpayer-owned energy resources that continue to sit idle while high gas prices squeeze the budgets of families and small businesses, thousands of Americans remain out of work and our country continues to rely on dangerous foreign sources of oil. The energy policies of the Obama Administration have resulted in the loss of hundreds of thousands of barrels of domestic oil production each day. However, it is not too late to change our country's course of action. Exxon's discovery today proves that expanding access to these areas that contain the most oil and natural gas reserves will increase our domestic energy production and spur American job creation right away."

• And Congressman Steve Scalise (R-LA) observed, "This latest find by Exxon in the Gulf of Mexico is great news that reinforces what many of us have said all along: by exploring for our natural resources here at home we can create thousands of good jobs and reduce our dependence on Middle Eastern oil. It's time that President Obama ends his permitorium on domestic drilling and allows people to go back to work drilling safely for energy in America. More than 13,000 people have lost their jobs as a result of this Administration's failure to understand how critical it is to let people get back to work, and discoveries like this further emphasize the devastating impact of the recent moratorium and permitorium. In order to lower the price of gas at the pump and decrease our dependence on Middle Eastern oil, it is vital that we are allowed to explore safely for our own domestic resources, while creating thousands of high paying jobs in the process."

Energy markets, of course, are global. The U.S. clearly benefits from additional discoveries and supply. In particular, the development of domestic resources adds to the security and stability of oil supplies, and of course, boosts the many U.S. firms, including small businesses, that are involved in energy development and production.

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Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.