U.S. unveils final drilling plan, limits Arctic sales

WASHINGTON Thu Jun 28, 2012 5:03pm EDT

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WASHINGTON (Reuters) - U.S. oil companies will be allowed to drill in more areas of the Gulf of Mexico but won only limited access to the Arctic under the final version of the Obama Administration's five year drilling plan that was slammed by industry and some environmentalists.

The 2012-2017 plan calls for three potential lease sales in areas offshore Alaska but the auctions would not be held until the final years of the plan because of environmental concerns about operating in the Arctic.

"Put simply, this program opens the vast majority of known offshore oil and gas resources for development over the next five years and includes a cautious but forward-looking leasing strategy for the Alaska Arctic," said Secretary Ken Salazar.

The plan was called "too restrictive" by the American Petroleum Institute and criticized by Republican lawmakers who are sure to blast the drilling blueprint on the campaign trail.

"Today, the Obama Administration has announced a bleak future for American energy production by keeping 85 percent of America's offshore areas under lock and key and refusing to open any new areas to drilling," said Doc Hastings, Republican chairman of the House Natural Resources Committee.

The plan calls for 15 potential lease sales in six offshore areas, including in the Western and Central Gulf of Mexico, and the portion of the Eastern Gulf not currently under Congressional moratorium.

The oil and gas industry has criticized the Obama administration for tightening regulation of offshore drilling since the massive oil spill in the Gulf of Mexico in 2010. The spill also prompted the administration to backtrack on plans to open areas off the Atlantic coast to drilling.

Environmentalists criticized the new plan as risky, expanding drilling so soon after the explosion of BP's Deepwater Horizon platform that sent oil gushing uncontrolled into the Gulf of Mexico for three months.

"The plan is too aggressive, too broad and too rushed," said Regan Nelson, at the Natural Resources Defense Council. "We believe an array of critical safety and environmental issues must be addressed first before America puts more coastal areas at risk."

The plan is subject to a 60-day review in Congress before final approval. It is similar to an earlier version released by the Interior Department late last year.

Royal Dutch Shell is in the last stages of federal permitting to drill offshore Alaska in the Beaufort and Chukchi seas this summer in a plan that has been strongly opposed by environmentalists.

(Reporting By Russ Blinch; Editing by Sofina Mirza-Reid)

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