Getting Lease for Oil Drilling is Just the Start

HOUSTON—The national debate over opening more offshore areas to oil and gas exploration has begged the question: Just what are the companies doing with the tens of millions of acres they're already leasing from the federal government?In particular, congressional Democrats who oppose President Bush's plan to expand offshore drilling point to 68 million acres of federal land and offshore sites now leased by oil companies that sit idle.It's part of nearly 2 billion acres overseen by two federal agencies -- the Bureau of Land Management and the Minerals Management Service -- that have potential for oil and gas exploration, the bulk of which is strictly off limits.The acreage includes vast stretches of land that spread out over Nevada and reach north and east over the Rockies, thinning as they stretch toward Canada to disparate specs on the map.There are smaller and more isolated patches to the east along the mountain ridges of Appalachia and further to the south above the Gulf of Mexico, and huge chunks of northern Alaska and lesser stretches on its southern banks.A huge chunk of the overall acreage is the U.S. Outer Continental Shelf, the zone of federal waters extending about 200 miles offshore.The 68 million acres under lease to oil companies has potential reserves to nearly double U.S. oil production and increase natural gas output by 75 percent, the Democrats claim.So why the lack of activity, particularly when oil prices are at historic levels?
It depends on your definition of "activity."An oil company can spend several years after it negotiates a lease securing the permits and other approvals it needs to begin actual production.
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