Obama Administration Lifts Drilling Moratorium

The Obama administration is lifting the six-month moratorium on deep water oil drilling in the Gulf of Mexico imposed after the BP oil spill, officials said Tuesday.

The Interior Department scheduled a 1 p.m. news conference in which Interior Secretary Ken Salazar is to "discuss the current suspensions on deepwater drilling," the Interior Department said.

The administration has been under heavy pressure from the industry, regional officials, political leaders and businesses to lift the moratorium on grounds it has thrown workers off their jobs and damaged the economy. A federal report said the moratorium likely caused a temporary loss of 8,000 to 12,000 jobs in the Gulf region.

Louisiana Sen. Mary Landrieu, a Democrat, has blocked a Senate vote to confirm President Barack Obama's choice of Jacob Lew to head the Office of Management and Budget until the moratorium is lifted or significantly eased.

Congressional officials told The Associated Press that Salazar planned to lift the moratorium, on the condition that companies would first have to meet a host of new safety regulations. They spoke on condition of anonymity because they were not authorized to speak ahead of the official announcement.

Obama imposed the drilling moratorium following the April 20 oil spill in the Gulf of Mexico, the largest offshore spill in history.

White House spokesman Robert Gibbs said earlier Tuesday that the government was close to having the plans in place to lift the ban. When asked if he was saying the ban will be lifted this week, Gibbs said: "I do."

He emphasized that the move would include new requirements for those seeking to drill exploratory wells. Those entities and the companies they represent will have to prove they have the appropriate steps in place to contain a worst-case scenario.

The administration has already imposed new rules to make offshore drilling safer. The moratorium is set to expire Nov. 30.

The new rules include many recommendations made in a report Salazar released in May, including requirements that rigs certify that they have working blowout preventers and standards for cementing wells. The cement process and blowout preventer both failed to work as expected in the BP spill.

The April 20 spill, which was triggered by an explosion that killed 11 people, dumped an estimated 200 million gallons of oil in the Gulf. BP killed the well two weeks ago and expects to eventually pay at least $32 billion to handle the cleanup and damage claims.

Under the new rules, a professional engineer must independently inspect and certify each stage of the drilling process. Blowout preventers - the emergency cutoff equipment designed to contain a major spill - must be independently certified and capable of severing the drill pipe under severe pressure.

Companies also will be required to develop comprehensive plans to manage risks and improve workplace safety.

Even after the temporary ban on exploratory drilling is lifted, drilling is unlikely to resume immediately.

Michael Bromwich, director of the agency that oversees offshore drilling, said Tuesday it would take "at least a couple of weeks" after the ban is lifted before permits are approved.

Todd Hornbeck, CEO of Covington, La.-based Hornbeck Offshore Services, said lifting the moratorium would leave the industry in a "de facto moratorium stage" until the government fully explains how new drilling permits will be issued.

"We're still in the dark," said Hornbeck, who heads up one of the companies that sued to block Interior's initial moratorium. His company provides vessels and other services for the offshore industry.

"The devil is in the details, as they say, and the industry hasn't seen the final requirements for what we would have to do to be able to actually get a permit issued," he added. "Until that is done, lifting the moratorium may be just a moot or perfunctory act. ... Right now, I'm skeptical that it will be anytime soon that permits will be issued even if the moratorium is lifted."

Billy Nungesser, president of the Plaquemines, La., parish and outspoken critic of the moratorium, said lifting the ban "would be great news. At a time when the future is still uncertain on how quickly the fishing and shrimping and all will come back, we could use some good news."