Offshore drilling in Virginia is an economic winner

Last week the U.S. reached a tragic and avoidable milestone in its dependence on foreign oil: On Monday, the total value of oil imports eclipsed $200 billion for 2011. This is money that without a doubt could have been better spent creating American jobs or paying down our escalating debt.

Which is why legislation recently introduced by Virginia Sens. Mark Warner and Jim Webb represents such a significant opportunity for the commonwealth. The Virginia Outer Continental Shelf Energy Production Act of 2011 would speed up the approval process for Lease Sale 220, a 2.9-million-acre tract lying at least 50 miles off Virginia's coast that is estimated to hold more than 130 million barrels of oil and 1.1 trillion cubic feet of natural gas. Based upon federal assessments of the Outer Continental Shelf, the total resource potential offshore in Virginia's and its adjacent waters is 750 million barrels of oil and 6.6 trillion cubic feet of natural gas.

It's important to note that these are conservative estimates based on seismic tests performed decades ago using technology that was far less advanced than what is used today. Thus, these estimates can reasonably be expected to grow once new offshore tests are performed, which the Warner-Webb bill requires.

Perhaps most important for Virginians, the measure would give the commonwealth half of all leasing revenues for conservation efforts, clean-energy technologies, transportation and other infrastructure projects. Although Virginia current enjoys a budget surplus, this added revenue could be used as a reserve to shield the state from the impacts of future economic downturns. Other bipartisan legislation currently being considered in the Senate Energy and Natural Resources Committee — authored by Sens. Lisa Murkowski of Alaska and Mary Landrieu of Louisiana — would extend a similar revenue sharing plan to all states.

The Warner-Webb bill is supported by Gov. Bob McDonnell and both candidates for U.S. Senate from Virginia, Democrat Tim Kaine and Republican George Allen. And with so many economic benefits to be reaped from safe offshore exploration, it's little wonder why Democrats and Republicans across Virginia have voiced their approval.

Virginia's energy opportunity is indeed enormous, but consider the impacts nationwide if the federal government made a broader push for responsible energy production:

• Approving permits to drill in the Chukchi and Beaufort Seas in Alaska could provide the United States with 1.3 million barrels of oil per day and restore capacity to the critical Trans-Alaska Pipeline System. A recent study by Northern Economics finds that moving forward with responsible oil and gas development here would create more than 54,000 new jobs nationwide and generate nearly $200 billion for federal, state, and local governments.

• Issuing the Presidential Permit for the Keystone XL pipeline would deliver 700,000 barrels of oil per day from the Dakotas, Oklahoma and Alberta, Canada, to Gulf Coast refineries. Approval has been stalled for years, and vital oil supplies are piling up in Oklahoma and never reaching refineries in Texas, which means less gasoline and diesel and, in turn, higher prices at the pump. Numerous studies have shown the project to be environmentally safe, and the additional oil would dramatically lessen our dependence on unstable regimes in the Middle East.

• Finally, restoring the Gulf of Mexico to pre-spill production levels would put thousands of people back to work and replace the 130,000 barrels per day that the Gulf will not be producing due to the permitting slowdown in the region.

All told, the combination of these three actions and the passage of the Warner-Webb bill would increase domestic oil supplies by more than 2.2 million barrels per day and create more than 116,000 jobs nationwide, including nearly 2,000 jobs in Virginia alone according to a report from the Southeast Energy Alliance.

Virginians and citizens across America are demanding a smarter energy policy that expands domestic supplies and helps put millions of Americans back to work. The Warner-Webb legislation could make Virginia the model for a stronger energy future that creates jobs and maximizes the benefits to local stakeholders.