US lifts its ban on Gulf drilling early but toughens up regulation

THE AMERICAN government lifted its ban on deepwater drilling yesterday, weeks ahead of its 30 November deadline.

The Obama administration said drilling can resume once companies comply with new drilling rules and show they have adequate blow-out containment resources. The ban was put in place after the Deepwater Horizon disaster in April, which killed 11 workers and resulted in America’s biggest ever oil spill.

There is still uncertainty about exactly when drilling will resume, as wells need to pass independent inspections as part of the new rules.

“There is a difference between lifting the moratorium and securing the drilling permits needed to return to work,” said oil company Shell, which operates the Perdido well in the Gulf of Mexico. “It’s imperative to ensure agencies have the capacity to process the back log of drilling permits in a timely manner and consistent with the new safety rules.”

KBC Advanced Technologies consultant Mark Routt said: “That uncertainty itself can lead to rigs moving away or companies pursuing opportunities elsewhere. We continue to have a cloud over what’s going to happen here.”