Vast new oil production in Gulf should help save
Chevron and two other companies have announced that they have produced oil from a vast reserve beneath the Gulf some 175 miles off the coast of Louisiana. It could increase U. S. reserves by 50 percent which would make us far less dependent upon foreign oil.
This is very important news for Louisiana because most of this production will be managed out of our oil port in Fourchon at the southern tip of Lafourche Parish. Even more important is the fact that Congress is about to start negotiations on bills designed to give our state a percentage of oil royalties collected on production beyond the three-mile state limit.
The announcement by Chevron should alert Congress to the importance Louisianaís coast plays in making our country less dependent on oil from the Mid-East. And by building up our coast, we will be much better able to handle the management of such an enterprise.
There are two bills that will be negotiated by Congress after its current recess. The House bill is much more favorable to Louisiana because it gives us 35 percent and more of royalties collected on all production past that three-mile limit in the future.
The Senate bill, which is puny in comparison, would give the state only a percentage of royalties on new leases within a certain area. It would take years to get production and royalties from such new leases and the state may not derive any revenue from it until the year 2018. By then, our coast could be pretty much gone.
We hope this new development stirs Congress to negotiate in the direction of the House bill which could provide us with $6 billion for coastal restoration within the next few years and $2 billion a year thereafter. The restoration is expected to cost $15 billion and then a yearly amount to keep it restored.
The hard-headed senators who donít mind giving interior states a big share of royalties produced on federal lands within their borders should begin to see the justice in giving Louisiana a share of production off its shore when our coast is so important to that production. Weíll soon know just what effect this development has on them.
It could be the break we need to make Louisianaís coast whole again with a big enough buffer zone between the Gulf of Mexico and populated areas to withstand the threat of major hurricanes. Our future is beginning to look brighter.
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