By Erik Milito
March 3, 2021 at 5:00 am ET
President Joe Biden’s indefinite pause of new oil and natural gas leasing was made official with the cancellation of March’s Gulf of Mexico oil and gas lease sale. The Gulf of Mexico is dependent on the federal government for access, unlike the onshore which has some private and state land alternatives, and the real-world impacts of locking away access will regress climate and emissions progress and devastate good-paying American jobs in the Gulf Coast and beyond.
The highways that crisscross Texas, Louisiana and the Gulf Coast connect the women and men of a quintessential American story: the Gulf of Mexico oil and gas industry. Thousands of companies, and hundreds of thousands of workers, are aligned in their mission to safely and responsibly produce American energy.
A 2020 study commissioned by the National Ocean Industries Association looks at the impacts of Gulf of Mexico leasing and permitting bans on the United States. Eighty-three percent of the 345,000 jobs supported by the Gulf of Mexico industry are found in Louisiana, Mississippi, Alabama and Texas — but these are not the only communities to be impacted. The offshore oil and gas industry supports tens of thousands of jobs outside of the Gulf Coast. From buoy specialists in Maine to personal protective equipment manufacturers in Minnesota to software companies in Florida to automation experts in Connecticut, every state has jobs and economic investments dependent on the Gulf of Mexico.
Offshore oil and gas jobs are accessible, high-paying and for some families, the only economic lifeline they have. On average, oil and gas extraction jobs earn more than 150 percent of the average hourly wage of other employees. Many of these jobs only require a high school diploma along with some on-the-job, paid-for training.
Economic recovery is a stated core goal of the Biden administration. Americans are desperate for jobs as families struggle with the economic fallout from the COVID-19 pandemic. In 2019, spending and investment in Gulf of Mexico oil and gas had a $28.6 billion impact on gross domestic product. Our industry is a source of jobs and income that should be a beacon of hope for all.
Continued access in the Gulf of Mexico can be the sustained driver of good jobs that the Biden administration is looking for. Through 2040, the Gulf of Mexico could support an average of 367,000 jobs annually and generate $30 billion in annual spending. Furthermore, the more than $6.7 billion in annual government revenue will mean programs that play critical roles in climate mitigation — like the Land & Water Conservation Fund, which is funded entirely by the offshore oil and gas industry — remain funded and functional.
However, the energy-limiting path the Biden administration is currently following will deliver a bleak outcome for American families. Within three or four years, job losses from a Gulf of Mexico leasing ban would top 33,000 and would only continue to increase. By 2040, more than 190,000 jobs would be lost. While job losses would be concentrated along the Gulf Coast, every state would see jobs and investment disappear.
The women and men of the offshore industry have built the Gulf of Mexico into the premier energy producing basin. Gulf of Mexico production has a carbon intensity one half of other producing regions and the deepwater has the lowest greenhouse gas emissions of any source of oil production. Gulf of Mexico innovators are continuing the advancement of climate change solutions.
The Obama administration already reviewed the environmental impacts of the halted lease sale specifically for any impacts on climate change. Given the strong emissions and climate performance of Gulf of Mexico production, the Obama administration determined
Abandoning the Gulf of Mexico will sacrifice an incredible economic and emissions success story and deliver our energy opportunities to pollution havens like Russia and China. Instead of turning his back to the offshore, Biden should recognize the offshore opportunity to tangibly improve the lives of Americans. The offshore is a door to the economic, social and environmental opportunities Americans desperately need.
Erik Milito is the president of the National Ocean Industries Association.
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