Obama suspends oil permits

US President Barack Obama has extended a moratorium on new deepwater oil drilling and exploration in the wake of the Gulf of Mexico disaster, while denying his administration was too slow to tackle the crisis.

Gulf oil rig

The price of oil has touched a new high, fuelled by a weak US dollar. (Getty Images)

US President Barack Obama has extended a moratorium on new deepwater oil drilling and exploration in the wake of the Gulf of Mexico disaster, while denying his administration was too slow to tackle the crisis.

The federal government extended the existing moratorium on deepwater drilling and new permits for six months, Obama said, to await a presidential commission's report on the massive oil spill gushing from a ruptured BP-operated well.

"These actions are all guided by the need to take a cautious approach to offshore oil and gas operations," Interior Secretary Ken Salazar told reporters.

Salazar said the measure affects 33 deepwater wells in the Gulf of Mexico at various stages of development. If drilling has not begun, it will not be allowed to commence.

But if oil rigs have begun "spudding" these wells, they will be required to stop "at the first safe stopping point" and to secure the well, the interior secretary said.

Wells in shallow water -- depths of 500 feet (150 meters) or less -- will not be affected by the moratorium.

But a series of other measures to boost inspections and certification of blowout preventers -- a device that failed in the BP well -- would apply to these operations as well.

The controls are part of a wide-ranging overhaul of offshore oil and gas regulation to improve safety and avert a repeat of the Gulf disaster -- the worst oil spill in US history.

"I submitted a series of recommendations on a short-term and long-term basis" to improve safety, Salazar said.

"Some of these measures we can implement immediately. Others will take some time."

Salazar said the measures also included a reconfiguration of the Minerals Management Service, the troubled agency charged with supervising oil leasing and safety.

"We need to do significantly more work to create a much more robust agency," the interior chief said.

"We will be putting people in place to help run the functions of the newly configured agency to make sure we are protecting the people of the United States and the environment."

The MMS director, Elizabeth Birnbaum, whose stormy tenure lasted less than a year, earlier resigned following widespread reports the division had become too cozy with the industry it regulated.

The Obama administration also suspended planned exploration in two locations off the coast of Alaska and another off the coast of Virginia pending the review.

It pointed to the spreading slick to stress the need to focus on a comprehensive energy policy.

"More than anything else, this economic and environmental tragedy, and it's a tragedy, underscores the urgent need for this nation to develop clean renewable sources of energy," Obama said, pressing lawmakers to move forward on legislation promoting renewable energy sources.

"It's time to accelerate the competition with countries like China who have already realized the future lies in renewable energy and it's time to seize that future ourselves."

Salazar said that "it is our hope that... Democrats and Republicans alike understand the urgency" of such legislation.


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Source: AFP

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