Washington D.C. - Today in a hearing before the Subcommittee on Energy and Environment, witnesses stressed the importance of offshore drilling and discussed both federal and industry efforts to address safety and response technology challenges in the wake of last year’s Deepwater Horizon oil spill.

“We all know it is impossible to completely eliminate risks associated with complex endeavors such as deepwater drilling, but we must continually work to reduce risks and to manage them in a way that allows our economy and American consumers to benefits American consumers, creates jobs, and allows our economy to grow from our vast supply of domestic offshore oil and gas resources,” said Subcommittee Chairman Andy Harris (R-MD).

Mr. Owen Kratz, President and Chief Executive Officer of Helix Energy Solutions Group, noted that “the industry has always developed innovative technologies and processes even in the face of the toughest challenges… Now, with the experience of Macondo behind us, we have learned how to fashion an even more appropriate and effective containment system. It is time to get back to work.”  After the April 2010 blowout, three Helix vessels were used to play a key on-site role in the Macondo Incident Control and Spill Containments efforts and were ultimately instrumental in successfully gaining control of the deepwater catastrophe. 

The Department of Interior estimates that in2009, 80 percent of offshore oil production and 45 percent of natural gas production took place in “deepwater” (water depth of 1,000 feet or greater), and industry had drilled nearly 4,000 wells to those depths, as well as about 700 wells in “ultra-deep” water depths of 5,000 feet or greater.

Discussing ongoing efforts to make deepwater drilling even more safe, Mr. David Miller, Standards Director of American Petroleum Institute (API) said, “We are using incident investigation findings to continue to improve the technologies and practices to achieve safe and environmentally sound operations.  As part of this process, we are working to develop new API standards and revisions of existing API standards, where necessary, to raise the bar of performance to a higher level.”

Miller also emphasized the impact of regulatory impediments on energy supplies and the economy: “Permitting delays and the moratorium have already led to a loss of 300,000 barrels a day in oil production since May 2010, according to the EIA’s Short Term Energy Outlook, and the jobs loss is no less disturbing,” he said

According to DOE’s Energy Information Administration (EIA), petroleum comprises 35 percent of total U.S. energy consumption, and supplies 94 percent of transportation sector needs.   In 2009, a little more than half of U.S. oil demand was met through imports; the rest was produced domestically at a rate of just over 5 million barrels per day.  Since peaking in 1970, domestic production of oil steadily decreased for almost 40 years, until increasing 7 percent in 2009 due to increased drilling in Federal waters off of the Gulf of Mexico.

The following witnesses testified today before the Committee:

Dr. Victor Der, ActingAssistant Secretary for Fossil Energy, Department of Energy

Mr. David Miller, Director, Standards, American Petroleum Institute

Mr. Owen Kratz, President and CEO, Helix Energy Solutions Group

Dr. Molly Macauley, Research Director and Senior Fellow, Resources for the Future