Virginia's Offshore Opportunity
Jane Van Ryan
Posted April 1, 2010
Virginia yesterday became the first East Coast state to win approval for the development of offshore oil and natural gas resources.
Gov. Bob McDonnell, who has stated that he wants Virginia to become the "Energy Capital of the East Coast," applauded President Obama's announcement and renewed his call for federal legislation that would allow Virginia to share in the royalties from oil and natural production.
In a statement, the governor said:
"...to fully participate in the positive impact of offshore energy development, the Commonwealth must be included in all royalty and revenue sharing arrangements, in a manner equivalent to what the Gulf Coast states currently receive."
Last week, Rep. Bob Goodlatte (R-VA) introduced legislation with bipartisan support that would provide for offshore development revenue sharing between Virginia and the federal government. Virginia's legislature also passed a law that would allocate 80 percent of its portion of the revenues to transportation and 20 percent to renewable energy research and development.
The federal government estimates the proposed lease sale area contains about 130 million barrels of oil and 1.14 trillion cubic feet of natural gas, but other estimates say the figures could be significantly higher. ICF International says development in federal waters offshore Virginia could produce more than a half billion barrels of oil and more than 2.5 trillion feet of natural gas.
That's enough oil to power all 4 million cars in the state for more than four years, and enough natural gas to heat all 3.2 million Virginia households for more than 11 years.
Offshore development also will produce jobs, add $12 billion to Virginia's gross state product, and stimulate the economy without depending on a federal handout. It's a win-win proposition for Virginia and its citizens.
About The Author
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