HOUSTON -- Houston's economy will be hit hard as the government puts new rules in place that will block all new offshore drilling in the Gulf of Mexico, according to experts.
Dr. Lee Hunt, president of the International Association of Drilling Contractors, estimated Thursday the local job losses from the expanded moratorium on drilling, which includes both deepwater and shallow-water areas, would be in the tens of thousands.
From 25,000 to 80,000 people immediately, he said. By immediately, I mean over a 90-day period.
The industry is still getting mixed signals on the status of new permits. One was issued Wednesday for a shallow-water well and then taken back the next day.
The biggest impact, though, is not the 6-month deepwater moratorium on new drilling, but the immediate end to currently permitted projects.
There are 33 rigs that are currently in various stages of shutting down. More than half of those are getting ready to leave the Gulf if nothing changes.
The solution is to allow current permit holders to operate, Hunt said.
If we do all of that, that cascading nightmare of consequences doesn't happen, he said.
That's why on Thursday afternoon the IADC sent a letter to Secretary of the Interior Ken Salazar. In it, the group asked what drillers need to do to resume operations at the currently permitted sites.
Hunt said that resumption of activity could make a billion-dollar difference.
We don't have layoffs. We don't have disruption. We don't have hundreds of small businesses in industrial parks all over Houston they don't have to lay off workers and close their doors, he said.