Oil-Rich Gulf Coast to get ‘oil-free zone’
Oil-rich Gulf Coast residents will soon be able to take their cars off the road, and they’re doing so to save money on fuel and maintain access to the world’s oil and gas reserves.
The oil-rich oil patch in the Gulf of Mexico is one of the most economically productive regions in the world, but its oil is finite and the industry is increasingly dependent on foreign supplies.
And with no oil fields or pipelines in sight, the region is in a precarious situation.
Now, the oil industry is looking to its own residents to help the industry in its transition to a low-carbon future.
The Oil & Gas Association of the Gulf (OGGA) announced Wednesday that it has agreed to establish an oil-free area, or WPA, in the area where it plans to build a pipeline that would carry liquefied natural gas (LNG) from a tank farm in Alabama to the coast.
It will be in the same area where the company hopes to build an LNG terminal.
“We’re looking for people that want to work with us to help with the transition and to help keep the oil and the gas out of the ground,” said John W. McNeil, executive vice president of OGA.
“We have a number of people who have been working on it for years.”
McNeil said he hopes the WPA will provide a buffer zone for residents who want to use the roads, sidewalks and other areas that are not open to the public, like beaches, but have no access to gasoline.
The WPA could be in a few months, he said.
The announcement comes at a time when the oil patch is looking for ways to diversify its economy.
In the past two years, U.S. crude oil production has fallen more than 70 percent, and the nation’s production of natural gas fell 20 percent.
It is one reason why the U.N. is calling for a major global oil and natural gas price spike in the next few years.
McNeil says the oil-poor region is the only place in the country where there are no pipelines.
The Gulf is a major oil producer and is home to a number companies that are dependent on imported oil and are planning to build new pipelines to ship oil and LNG from the oil sands to refineries in the Midwest.
The proposed LNG export terminal, known as Keystone XL, is expected to cost about $20 billion.
In addition to the WSA, OGA will also be helping to build the Keystone Pipeline that would connect the Gulf Coast and Ohio to refiners in Illinois.
The plan to set up the Wpa is expected soon.
The agency plans to hire more than 150 people and open up up to $250,000 in grants to help businesses, municipalities and residents with transportation and housing needs.
The money will go to businesses in areas where they have a significant impact on the economy, said McNeil.
The WPA was approved by the Gulf Oil &Gas Association and will be funded by $2.8 million in federal loans from the U,S.
Department of Energy, $1.5 million from the Energy Department, $500,000 from the State Department and $100,000 by the State Council of Governments.
The Gulf region has been one of OGI’s biggest supporters in recent years, with more than $300 million in grants since 2010, McNeil said.
The group has about 1,000 members and a $2 billion annual budget.
In an interview, McNeill said he is confident the WAP will help reduce greenhouse gas emissions.
“The oil will be out of our system and we’ll see a huge reduction in emissions from this project,” he said, noting that he and the other executives of the oil sector are committed to making sure that the oil produced from the WSPA is used to meet the energy needs of Gulf communities.
McNeill said that the WSP will provide jobs for the people of the region and will help to provide jobs to those who don’t have the resources to make the transition to low-cost energy.
He said the project is expected not only to produce jobs, but also to provide opportunities for those with a low level of education.
McNichanes’ proposal will also help to address the water shortages that are plaguing many communities in the region.
“If we don’t fix this, we will see water issues, we’ll have water shortages for years,” he predicted.
McNeal said he and other OGI executives will meet with the State of Alabama to help find ways to improve the WFA.
“It’s going to be very difficult to go back to the status quo, because this is not an easy project to do,” McNeil added.
The OGA’s McNeil hopes that the project will be completed in a matter of months.
He expects to be able get the project up and running by the end of next year.
The next step will be to start construction of the pipeline, which will