Oil chiefs urge offshore drilling

WASHINGTON (AP) - Executives of the biggest oil companies sought to convince lawmakers Wednesday that expanded offshore drilling will produce jobs and help the nation's economy, although new leases in areas that have been off limits would not be issued for years.

"We can help put America on the road to economic recovery," said Larry Nichols, chairman of Devon Energy Corp., as the executives testified before the House Natural Resources Committee.

Marvin Odum, president of Shell Oil Co., warned against being "lulled again into complacency" because of low oil prices. He said access to oil and natural gas off the Atlantic and Pacific coasts will help meet future energy challenges.

"Producing more of our offshore energy will create jobs and fuel economic recovery," said Odum. An executive from ExxonMobil Corp., estimated 76,000 jobs would be created from new drilling in areas that until recently have been under a congressional drilling ban.

And the executives said states and the federal government would reap billions of dollars in new royalties and fees.

But the companies also stand to make billions of dollars from expanded offshore oil and gas development. ExxonMobil Corp. and Chevron Corp., which also was represented at the hearing, combined made $69 billion last year.

Congress last October ended the broad drilling ban across 85 percent of federal offshore waters from New England to the Pacific Northwest. But the Obama administration has shown little interest in pushing new leases.

Recently Interior Secretary Ken Salazar scrapped an ambitious offshore drilling plan, including energy development along both the Atlantic and Pacific coasts that had been left over from the Bush administration. He said he wanted to review the entire issue of expanded offshore drilling.

"Let's call it what it really is, a moratorium, not a delay," Rep. Doc Hastings of Washington, the ranking Republican on the House committee, said Wednesday, referring to Salazar's action.

Even under the Bush plan, new leases for areas that had been blocked off would not have been available until 2011-2014. Energy industry experts have acknowledged that it likely would take five to seven years for oil to be produced from new leases.

While the Obama administration has emphasized the creation of "green" jobs by spurring development of renewable energy such as solar, wind and biomass, the oil executives argued that new access to offshore oil and gas resources also will produce significant economic benefits in jobs and revenue.

"America needs the energy, needs the jobs," Gary Luquette, president of Chevron North America Exploration and Production Co., told the committee.

Rep. Nick Rahall, D-W.Va., the committee's chairman, said he was not against expanded offshore oil drilling but that "the American people deserve to understand the risks and benefits ... that offshore drilling will bring."

The Interior Department has estimated that waters off the Atlantic and Pacific coast and in the eastern Gulf of Mexico, which for a quarter century were off limits, contain about 18 billion barrels of oil.

That "is a drop in the bucket of what we will need to sustain our economy and meet our energy needs," said Rahall, adding that automobile fuel efficiency improvements required by Congress a year ago will save twice as much oil as could be produced from previously off limits