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Associated Press

Judge Blocks Gulf Offshore Drilling Moratorium

Michael Kunzelman

Breaking: Look for updates as this story develops.

NEW ORLEANS – A federal judge in New Orleans on Tuesday blocked a
six-month moratorium on new deepwater drilling projects imposed in
response to the massive Gulf oil spill.

The White House said the administration would appeal.
It had halted approval of any new permits for deepwater drilling and
suspended drilling at 33 exploratory wells in the Gulf.

Several companies that ferry people and supplies
and provide other services to offshore drilling rigs asked U.S.
District Judge Martin Feldman in New Orleans to overturn the moratorium,
arguing it was arbitrarily imposed.

Feldman agreed, saying in his ruling that the Interior Department failed to provide
adequate reasoning for the moratorium. He said it seemed to assume that
because one rig failed, all companies and rigs doing deepwater drilling
pose an imminent danger.

"An invalid agency decision to suspend drilling of
wells in depths of over 500 feet simply cannot justify the immeasurable
effect on the plaintiffs, the local economy, the Gulf region, and the
critical present-day aspect of the availability of domestic energy in
this country," Feldman wrote.

The moratorium was imposed after the April 20
explosion on the Deepwater Horizon drilling rig that killed 11 workers
and blew out the well that has spewed millions of gallons of oil into
the Gulf.

The Interior Department said it imposed the
moratorium so it could study the risks of deepwater drilling. But the lawsuit filed by
Hornbeck Offshore Services of Covington, La., claimed there was no proof
the other operations posed a threat.

The moratorium was declared May 6 and originally was
to last only through the month. President Barack Obama announced May 27
that he was extending it for six months.

In Louisiana, Gov. Bobby Jindal and corporate leaders
have opposed the moratorium, saying it will result in drilling rigs
leaving the Gulf of Mexico for lucrative business in foreign waters.
They say the loss of business will cost the area thousands of lucrative
jobs, most paying more than $50,000 a year. The state's other major
economic sector, tourism, is a largely low-wage industry.

In its response to the lawsuit, the Interior
Department said the moratorium is necessary as attempts to stop the leak
and clean the Gulf continue and new safety standards are developed.

"A second deepwater blowout could overwhelm the
efforts to respond to the current disaster," the Interior Department

The government also challenged contentions the
moratorium will lead to long-term economic harm. Although 33 deepwater
drilling sites were affected, there are still 3,600 oil and natural gas
production platforms in the Gulf, the government said.


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