Rystad Energy expects the Trump administration’s new oil and gas leasing plan to make 65 billion barrels of oil equivalent newly available to fossil fuel exploration and production companies, according to a new report by Reuters.
“Looking purely at areas that are potentially going to come out of restriction, we are talking about something closer to 65 billion boe,” Rystad senior analyst Sonia Passos said in a note.
The proposal, officially announced last week, has met with severe resistance in Florida, where the coastal tourism sector stands to lose from any accidental oil spills caused by the new drilling. Trump’s White House announced yesterday that waters around Florida would not be authorized for deep sea drilling after the state’s Republican governor took a strong stand against the draft plan.
Interior Secretary Ryan Zinke said, “I support the governor’s position that Florida is unique and its coasts are heavily reliant on tourism as an economic driver. As a result of discussion with Governor (Rick) Scott and his leadership, I am removing Florida from consideration for any new oil and gas platforms.”
Still, the remaining lease potential should generate plenty of new opportunities for fossil fuel majors, according to Rystad.
“The resource potential in the basins in the direct proximity to Florida, together may hold about 1 billion boe to 1.5 billion boe, so excluding those will not change the overall picture dramatically,” Passos told Reuters on Wednesday.
The Energy Information Administration now estimates that U.S. crude oil production could hit 11 million barrels daily by late 2019, overtaking both Saudi Arabia and Russia. This year, the EIA said, U.S. drillers could pump an average 10.3 million barrels per day, with growth this year seen at almost 2 million bpd, slowing down to 1.3 million bpd in 2019.