Louisiana Governor John Bel Edwards has asked Congress to lift the pause on oil and gas leasing in the Gulf of Mexico and cited the possibility of 250,000 people losing their jobs. The governor spoke at a U.S. Senate Committee on Energy and Natural Resources hearing last week. Earlier this year, President Biden signed executive orders to help fight climate change, which included pausing new oil and gas leases on federal lands and cutting fossil fuel subsidies.
“In my view, we’ve already waited too long to deal with this climate crisis.” —President Biden
A few weeks ago, The Huffington Post reported that there has been some behind-the-scenes lobbying. The Louisiana Mid-Continent Oil & Gas Association (LMOGA) not only introduced top energy officials in Louisiana and New Mexico to one another, but it also provided the Louisiana official with industry talking points about how restricting oil and gas development would hurt Louisiana’s economy. The organization helped ghostwrite a letter for Louisiana’s governor to send to President Biden. The letter includes the argument that confronting climate effects depends on continued offshore fossil fuel development.
The article also noted that on the day before President Biden was expecting to sign his order, Lori LeBlank, vice president of LMOGA, emailed an Edwards staffer to request a meeting to “discuss the federal executive orders around the leasing and drilling permit bans on federal lands and offshore.” The article pointed out that LeBlanc falsely characterized the upcoming order as an all-out ban.
Last week, Governor Edwards went to Congress to share more of those talking points. The Louisiana Illuminator noted that Governor Edwards mentioned that 250,000 people in Louisiana are employed by the oil and gas industry. “If this pause turns into something longer than the word ‘pause’ suggests, we know that it will have a tremendously adverse impact on our state,” said Governor Edwards.
Amanda Lefton, the director of the Bureau of Ocean Energy Management, pointed out that the pause is limited to leasing and doesn’t affect the production or permit applications for existing leases. “There is continued production in the Gulf of Mexico and, therefore, there’s continued revenue that’s coming in,” she said.
“The word ‘pause’ by definition suggests there’s going to be a resumption,” said Governor Edwards. “We want the resumption, and we want it as soon as possible so that the worst impacts don’t happen. And that these people don’t lose their chance at supporting themselves and their families.”
The Oil & Gas Industry Wants You To Believe 250,000 Louisianans Will Become Unemployed If Biden Doesn’t End The Pause On New Leases On Federal Lands
I just want to quickly interject how deceptive this is here. The pause that he wants to be lifted doesn’t have anything to do with existing leases — only new ones and on federal lands. In my opinion, Governor Edwards is simply being used as a mouthpiece for LMOGA — it’s as if LMOGA is speaking at Congress through the governor.
Not all 250,000 employees are going to solely work on jobs related to new leases. The implication that the pause on the new leases will jeopardize 250,000 workers who will lose their jobs if President Biden doesn’t lift that pause is very manipulative and deceptive. There is a possibility that some would lose jobs or hours might get cut back, but not all 250,000 of them will be fired if President Biden doesn’t allow the oil industry free rein of the Gulf of Mexico.
The idea that the Biden administration’s energy agenda is the reason behind job losses in the oil and gas industry is silly and pure FUD (fear, uncertainty, and doubt). Lefton replied to this deceptive statement. “There’s a little bit more of a nuanced story here. We’re actually seeing a decline of jobs in the oil and gas industry over the years, in the past four years in particular,” she said. “I think it’s really important to think about what our opportunities are moving forward, and Gov. Edwards just spoke to one of those, which is how can we help transition communities to support new and growing industries like offshore wind.”
Kristen Monsell, a senior attorney with the Center for Biological Diversity, emphasized the urgency to end offshore drilling. “We don’t have time to wait — the climate crisis demands immediate, bold action,” she said. “It’s disappointing to hear the governor prop up offshore drilling while ignoring the immense damage it does in his apparent attempt to allow the oil industry to keep treating the Gulf as a sacrifice zone.”
Job Losses From Oil & Gas Industry In Louisiana Aren’t Caused By Biden
In November 2020, the LSU Center for Energy Studies released its annual report on the energy sector and The Advocate shared some key points from that study. Around 2,900 jobs in oil and natural gas production, oil refining, and chemical manufacturing are expected to be added back in Louisiana by the end of this year.
The article pointed out that Louisiana’s energy sector growth is likely to be stifled even as the economy recovers from the recession that was triggered by the pandemic. Note that this article and study came out last year — well before President Biden’s pause on oil and gas leases on federal lands.
The following is a direct quote from The Advocate:
“Corporations active in the energy industry, which includes oil and gas and petrochemicals, are under pressure by investors to curb or even eliminate major investments to preserve cash. Financing for aging fossil fuel infrastructure is more difficult to obtain while demand for oil and gas industry products remains much lower than before the public health crisis and related restrictions on the economy began about eight months ago.
“That means the jobs outlook for oil and gas production is bleak. Also, some multibillion-dollar liquefied natural gas export terminals in Louisiana are less likely to be constructed because of contracted demand triggered by the global economic downturn.”
In other words, the oil and gas industry is already struggling and will probably not hire people anyways. Additionally, it may cut jobs whether or not Biden lifts that pause. The article interviewed Dismukes, the executive director for the LSU Center for Energy Studies, who said, “We were looking at a pretty weak environment as we moved into 2020. That had started before coronavirus began to kick in.”
One example of this is that chemical manufacturers were expected to have surplus capacity through 2022 due to the curtailing of production, but were already below capacity before the pandemic even happened. Also, demand for domestic products from oil refineries has been lagging and utilization rates across the U.S. topped out at 70%. This made operations unprofitable.