Nelson: Cheap oil doesn’t reduce need to drill off SC coast

Considering the glut of cheap oil in the world, it would be tempting to drop plans to open up new areas of the Atlantic Ocean to oil and natural gas drilling. But holding back on energy production would ill-serve South Carolina and other coastal states. Gov. Nikki Haley and the state’s congressional delegation are understandably not content to wait, citing the potential for economic development and reducing the nation’s dependence on imported oil.

A year ago, the Obama administration released a draft of its five-year plan to open drilling in the Atlantic Ocean off the coast of Virginia, North Carolina, South Carolina and Georgia. The plan can still be revised. The current oil glut notwithstanding, there are two reasons to proceed with drilling off the Atlantic Coast.

This is an energy-rich region. The Department of Interior’s Bureau of Ocean Energy Management estimates that the Outer Continental Shelf holds 4.72 billion barrels of recoverable oil and 37.5 trillion cubic feet of natural gas. But those figures are based on old data. Once drilling begins, estimates of oil and gas are usually revised upwards.

It could take a decade or longer for drilling to begin. By then, the energy picture could be very different than it is now. Instead of an abundance of low-cost oil, world supplies could be stretched tight, with gasoline prices double or even triple what they are today. Keep in mind that offshore oil and gas production has the potential to create thousands of jobs and significant revenue for South Carolina. A 2014 study done for the Palmetto Policy Forum projected that South Carolina would derive $15 billion in economic benefits from offshore energy production by 2035.

Drilling in the ocean is safer and more tightly regulated than ever before. The Atlantic coast hasn’t seen any new offshore oil and gas drilling in more than 30 years, since a few exploratory wells were drilled in the Baltimore Canyon trough about 100 miles southeast of Atlantic City from 1977 through 1984. It’s past time to auction offshore leases in federal waters from Virginia to Georgia.

This story was originally published January 25, 2016 at 12:18 PM.