Who decides where oil rigs can be built?



  1. 0 Votes

    Every juristiction – federal, state, county, city, foreign countries, etc. — has rules and regulations regarging limitations on oil drilling. That controls where companies CAN drill. Where they will drill depends entirely on geology and the history of the source rocks, reservoir rocks, seals, and the oil itself.

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      This is interesting. I have heard that BP wanted to drill much shallower but the EPA made them move deeper. Can the EPA have any bearing on where an oil company decides to drill their well?

    • 0 Votes

      It’s a complete myth that the environmental world, or the EPA, somehow “forced” oil companies into deep water, either in general or in any specific case. Shallow drilling continues right now, and will undoubtedly discover some relatively small oil and gas fields. They (big companies) are in deep water because that’s where the only likely undiscovered large-sized reservoirs lie. BP bid on that particular block because they were optimistic about its potential, and they could not have drilled “much shallower” because they did not have any rights to the shallower lease blocks. If they DID have rights to a shallow water lease block, then no one could have made them move to some other block that they (1) had no rights to and (2) had no optimism about drilling. The EPA probably has very little role in well siting anywhere – in the Federal offshore, there would be rules and regs administered by the notorious Minerals Management Service; on some Federal lands onshore there might be an EPA role but more likely just Dept of Interior, Forest Service, BLM, etc. – and in general state rules would probably be far more onerous onshore (but on Federal land, of course, Federal rules apply).

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