by Leigh Goessl

Created on: June 22, 2010

On June 22, 2010, U.S. District Judge Martin Feldman, of New Orleans, Louisiana, blocked a six month moratorium on deepwater oil drilling in the Gulf of Mexico.  

The suspension of deepwater drilling in areas deeper than 500 feet of water was ordered by President Obama after the April explosion of the Deepwater Horizon rig, the disaster which has resulted in a steady stream of massive amounts of oil being spilled daily. In that directive, the President also placed a ban on new permits being issued.

Local government and commercial businesses are pleading their case. They feel the Federal government has not presented evidence to show that existing drilling operations are a hazard to the region and requested the Court to proclaim the suspension unfounded and unenforceable (CNN.com).

Apparently Judge Feldman agreed. He stated "an invalid agency decision to suspend drilling of wells in depths of over 500 feet simply cannot justify the immeasurable effect on the plaintiffs, the local economy, the Gulf region, and the critical present-day aspect of availability of domestic energy in this country" (CNN.com).

The White House said they would immediately appeal Feldman's decision based on the reasoning that more information needs to be gleaned from the investigation before allowing oil companies to continue drilling at these deep depths. According to the Federal Government this is a safety issue and the moratorium should be in place because if another drilling accident were to occur on top of the current BP spill, the consequences would be extremely disastrous.

White House spokesman Robert Gibbs stated such drilling "puts the safety of those involved, potentially puts safety of those on the rigs and the safety of the environment and the Gulf at a danger that the president does not believe we can afford right now."

The Obama Administration's stance is clear, they feel safety is vital and without having all the facts of what caused the Deepwater Horizon explosion and subsequent ongoing disaster, that no more deep drilling should continue until a handle has been gotten on this situation.

Elected local officials in the Gulf states are hoping the President does not appeal Judge Feldman's decision. Their view is many have already suffered so much in so many ways and to continue to ban the deepwater drilling would harm the industry from an economic perspective.

Their position is that it is not just the oil companies, but those who play supporting roles such as boat builders, repair and service personnel, and other small businesses who carry various roles to support the industry, are all suffering financially with loss of work and jobs with the stop order in place. Louisiana's Governor Bobby Jindal fears businesses will move to other areas off U.S. land to foreign waters which would be devastating to the local economy.

Questions are arising about a potential conflict of interest as Feldman's 2008 financial disclosure report showed holdings in multiple oil industry related investments which amounted to approximately $15,000; no current financial personal is available for the judge. Yahoo! News reports "Feldman did not immediately respond to a request for comment about his current holdings". Opposers of the moratorium ruling do concede those shares may have been sold off in the last two years.

Now a trial date must be set before any future move or suspensions on the oil drilling can be enforced.

Sources:

http://news.yahoo.com/s/ap/us_gulf_oil_spill

http://www.cnn.com/2010/US/06/22/gulf.oil.disaster/i ndex.html?npt=NP1

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