President Obama to Cancel Offshore Drilling Projects; “The President’s Eyes Have Been Opened” About the Risks

By Ammu Kannampilly

May 27, 2010 6:48am

An Obama administration official says that President Obama has canceled the August offshore drilling lease sale in the Western Gulf and the lease sale off the coast of Virginia.

The announcement comes as the president and his administration face increased criticism for the failure of BP and the government to plug the leak and further contain the significant ecological damage to the region, and as he prepares to travel to the Gulf for a second time tomorrow.

"The president's eyes have been opened" as to the risks of offshore drilling, a senior White House official tells ABC News, in terms of the inability of the Minerals Management Service to reliably regulate the industry, and the inaccuracy of claims by the oil industry that companies are able to stop catastrophes like these from happening, and in the event that they do happen that the industry can contain the damage.

All of those assumptions have been proven false, the senior White House official told ABC News. So for now projects are being canceled or delayed.

The Virginia sale is being cancelled due to environmental concerns and concerns raised by the Defense Department, the official said.

Planned exploration off the coast of Alaska in the Chukchi and Beaufort seas is also being delayed pending the review of the Presidential Commission looking into the BP spill.

Last night in the Oval Office Interior Secretary Ken Salazar briefed President Obama and senior advisors on the 30-day safety review on offshore drilling. Later today the president will make public remarks in which he will discuss the conclusions of that report as well as announce new federal regulatíons for offshore drilling projects.

As the Presidential Commission further studies how to prevent a disaster like this from ever happening again, the Obama administration's moratorium on permits to drill new deepwater wells will continue for six months, the official said.

- Jake Tapper

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