Drillers May Face Months of Waiting Even After Obama Lifts Deep-Water Ban

President Barack Obama’s administration may agree to an early end for its moratorium on deep-water oil and gas drilling while backing new regulations that may keep rigs idle for months afterward. Obama is likely to lift the drilling ban in October, ahead of its scheduled Nov. 30 expiration, said Michael McKenna, president of MWR Strategies, an oil industry consulting firm in Washington. Heightened scrutiny of drilling’s risks may delay the resumption of operations by companies such as BP Plc and Apache Corp. until mid-2011, McKenna said. The administration halted drilling in waters deeper than 500 feet after BP’s Macondo well in the Gulf of Mexico blew out April 20. Government officials from Gulf Coast states say the moratorium is ravaging a regional economy already hit hard by the spill, putting the White House under political pressure to end the ban early, McKenna said. “Lifting the moratorium is almost unimportant,” McKenna said in an interview. “It’s how different the regulatory regime is going to be after. The end game here is to make it a very, very difficult and time-consuming regulatory process.”...more