43
Offshore energy spurs Ohio’s economy
By Douglas A. POLK
The Department of the Interior released the highly anticipated five-year Outer Continental Shelf leasing plan last week. Unfortunately, the plan fails to recognize that our nation’s offshore energy resources are grossly underutilized, hampering energy security and dampening Ohio’s economic recovery.
President Obama, in his 2012 State of the Union, pledged to open 75 percent of our known offshore domestic energy resources for development. While that statement may sound encouraging on the surface, it doesn’t account for the yet-to-be-discovered resources in previously unexplored areas. Today, only 15 percent of our entire nation’s OCS is even available for leasing. This plan includes no new offshore areas until at least 2017 and thus doesn’t allow us to find out what may be available in any of the other 85 percent.
Oil, gas production
Despite this limited offshore access, the U.S. still produces 600 million barrels of oil and 4.5 trillion cubic feet of natural gas from the OCS each year. If new areas are opened for exploration and development, it is anticipated we could produce an additional 101 billion barrels of oil and 480 trillion cubic feet of natural gas, enough to power 10 million cars for 348 years and heat 10 million homes for 656 years. There is simply no reason these resources shouldn’t be accessed and that Ohio industry and workers cannot participate in the development of these resources.
Even though Ohio has no OCS shoreline, our state’s economy benefits from a robust offshore energy industry. As it stands today, more than three thousand Ohioans are employed by the offshore energy industry operating in the Gulf of Mexico. Imagine how many more jobs our state could support if the entire OCS was available.
The company I work for, V&M Star, a division of Vallourec & Mannesmann USA, employs more than 600 people in Ohio. These are real families making a real difference. Since the permitting slow down following the 2010 Gulf spill, we were able to shift our product mix from the offshore market to the booming onshore natural gas market. However, with our more than $650 million investment in Youngstown for a new pipe mill supplying the onshore shale and natural gas market, our current Youngstown mill needs to reach its full efficiency by producing products for the offshore market again. We were eagerly waiting for positive news from the five-year plan, which would have given us the confidence to continue to hire more Ohioans.
Homegrown energy
As Congress responds to this five year plan, they should take advantage of the opportunity missed by the administration and open the door to new areas to explore, new jobs for Ohioans, and new homegrown energy for the country.
Douglas Polk is Vice President for Industry Affairs at V&M Star/V&M USA in Youngstown.