Jim Letourneau's Blog

Investing, Technology, Travel, Geology, Music, Golf. I think that covers it.

Force Majeure Hits Offshore Drillers in US

A chain is only as strong as its weakest link and in the world of deepwater drilling, BP has snapped a critical segment of the US energy industry. Offshore drillers are faced with a time out that us going to cripple a big part of the Gulf Coast states economies.

Interior Secretary Ken Salazar has blocked new permits for six months and suspended 33 deepwater operations, including Walter's. Drilling in waters less than 500 feet deep will be allowed to continue, as will production activity in deep waters. nytimes.com

This is creating some bargains in the oil patch but it could take a very long time before these bargains offer any sort of positive return for investors.

Is this the Three Mile Island of offshore oil exploration in the US?