UPDATE: Chevron:Deepwater Drilling Halt To Have 'Lasting' Economic Impact On US
May 27 2010 - 10:08PM
Dow Jones News
Chevron Corp. (CVX) said Thursday that a drilling ban on
deepwater exploration in the Gulf of Mexico ordered by the federal
government will have a "lasting" economic impact on the U.S.
"Halting deepwater drilling will have lasting energy security
and negative economic consequences for our country," said Mickey
Driver, a company spokesman, in an email. "We believe responsible
drilling should be allowed to continue."
President Barack Obama ordered Thursday the halt of activities
at about 33 exploratory wells in the deep waters of the Gulf of
Mexico and also extended a moratorium on new drilling in the area
to six months.
Other companies with significant positions in the area, such as
Petroleo Brasilerio (PBR, PETR4.BR), BHP Billiton Ltd. (BHP) and
Anadarko Petroleum Corp. (APC) said they are still evaluating the
impact of the Obama administration's decision. Royal Dutch Shell
(RDSA) said it will work with the government during the drilling
suspension.
Driver said Chevron, one of the largest oil and gas producers in
the Gulf, acknowledged the administration's desire to fully
understand and address the underlying cause of the massive spill in
the Gulf of Mexico. The spill resulted from the explosion and
sinking of Transocean Ltd.'s (RIG) Deepwater Horizon rig, which was
leased by BP PLC (BP, BP.LN).
"We share the government's commitment to ensuring that all
companies are operating at the same high standards," Driver said.
Chevron participated in the Joint Industry Task Force, which made
recommendations to the Department of the Interior last week to
improve industry operating standards, Driver said.
"Chevron already uses many of these new proposed standards," he
added.
Chevron believes it's important that the oil and gas industry
restores the public and policy makers' confidence in the safety of
deepwater drilling operations by forthrightly addressing
misperceptions about safety in deepwater exploration, he added.
State-run Brazil's Petrobras said they are still evaluating the
impact of the six-months drilling moratorium extension.
Gustavo Tardin Barbosa, Petrobras America's chief financial
officer, said earlier this week the first oil from its Cascade and
Chinook projects in the Gulf of Mexico deepwater was scheduled to
be produced during the second half of this year, despite the
temporary ban in drilling. But these plans could change now due to
the fact the moratorium was extended to six months.
"We may revise our plans accordingly," Sophie Gates, a company's
spokeswoman, said in an email.
A spokeswoman for BHP Billiton said it's too early to determine
how the moratorium extension will impact the company's operation in
the Gulf. Earlier this week, BHP's Petroleum Division president,
Mike Yeager, said that the company's drilling plans could change if
the drilling ban was prolonged.
John Christiansen, Anadarko's spokesman, said the company shares
the President's commitment to ensure deepwater operations and
exploration are conducted in a safe manner and that it's evaluating
the impact of the government's decision on its drilling plans.
-By Isabel Ordonez, Dow Jones Newswires; 713 547-9207;
isabel.ordonez@ dowjones.com
(Alex Wilson in Australia contributed to this report)
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