In a move aimed at undercutting critics of his energy policy, President Obama will announce measures intended to spark a substantial increase in domestic production of oil and natural gas, and to put pressure on oil and gas companies to exploit their federal leases more quickly.
In his Saturday internet address, Mr. Obama offers a blanket extension of all the oil and gas leases in the Gulf of Mexico that were affected by the moratorium imposed after the Deepwater Horizon oil spill, the worst in the nation's history. The move is part of legislation passed by the Republican controlled House, earlier this month, in a vote that drew substantial Democratic support.
Mr. Obama wants to fold the increased domestic production into an energy policy that already includes developing alternative energy sources and increasing vehicle and building energy efficiency, with the goal of reducing the country's dependence on foreign oil by a third in the next 10 years.
In his internet address, the President will also note Attorney General Eric Holder's investigation into possible fraud in oil markets; an effort to address concerns about gasoline prices though officials say there's little likelihood of lowering them in the short term.
Mr. Obama's aides say domestic energy production has risen to its highest level in eight years under his watch, but the moves announced today seem aimed at satisfying the 'all of the above' energy policy supporters who say increased domestic production of oil and natural gas should accompany the development of renewable energy sources.
The President will announce plans to hold lease sales in the Western and Central Gulf of Mexico by the end of the year and to hold more frequent lease sales in Alaska's Prudhoe Bay, a move requested by that state's Republican Senators. Officials say of 37 million acres available for lease offshore only 2.4 million were actually leased last year.
Aides say Mr. Obama still does not support opening the Arctic National Wildlife Refuge to oil and gas exploration for environmental reasons, but some of his proposals are likely to concern some environmentalists. He wants to open more areas of the National Petroleum Reserve Alaska, while recognizing there are some areas of the NPRA that are still too sensitive for drilling.
He has also ordered an accelerated environmental impact statement on the effects of drilling in the Mid Atlantic, though it's still not clear if there are economically attractive deposits there. Such drilling would likely be several years away.
The President also wants to offer 'incentives' to oil companies to more quickly develop leases on federal land. Officials say 70 percent of the leases in the Gulf of Mexico and 50 percent of onshore leases are neither being explored nor developed. The plan calls for a sliding scale of royalties that would be lower if the leases are developed in the first 3 years, and would rise to a rate more commensurate to the royalties paid states and private land owners if the leases were not exploited.