The Deepwater Horizon spill could become a global oil “game changer” by spurring a deep and potentially costly rethink of the rules needed to keep offshore drilling safe.
Regulatory changes alone could jeopardize nearly one million barrels of new daily crude production over the next half-decade, the International Energy Agency said in a dramatic new analysis published Thursday.
In the Gulf of Mexico, a one- to two-year delay in new deepwater oil projects could lower output by 100,000 to 300,000 barrels per day by 2015. In other deepwater jurisdictions, including Brazil, Angola and Nigeria, a further 550,000 daily barrels “could be at risk, albeit there are no current indications that permitting in these countries is likely to be affected,” the agency reported.
The numbers far exceed those published by the U.S. Energy Information Administration, which has said the current six-month deepwater drilling moratorium could reduce Gulf of Mexico crude production by a more modest 70,000 barrels next year.
But the International Energy Agency believes the spill, which continues to gush and has already created regulatory reviews in the U.K., Norway, Brazil, Canada and China, has the potential to be a “supply-side game changer.”
“Emotion is understandably running high, and the way deepwater hydrocarbon developments are approved, operated and regulated will of course be thoroughly examined and potentially amended,” the agency said in its June oil market report.
The huge Gulf of Mexico crude spill has already raised serious questions about the ability of smaller companies to continue operating in the U.S. offshore, where some believe that tougher laws will raise the cost of business so high that only the largest companies can operate there.
