Exxon Mobil defends its oil find in Gulf of Mexico

Trying to kill more jobs

What does Hugo Chavez and the U.S. Interior Department have in common? They both have overstepped their bounds to grab control of their respective nation's precious resources from private enterprise where all the private investing, risk taking and heavy lifting work was done. Chavez nationalized the Venezuelan gold industry and it appears that Hugo Chavez has squeezed every penny he can out of his nation’s energy industry leaving it a shell of its former self. Now he wants get his greedy hands on and steal the profits and investment from private enterprise so he can loot the gold mining industry like he did the oil industry. He can now drive it into the ground and steal the future of evenly Venezuelan man, woman and child. He will pillage everything that is good in that country until it is all used up and use it for his own gain.

Now the most activist Department of the Interior in our nation's history is trying to change the rules and seize from Exxon Mobil one of the largest oil finds ever in the Gulf of Mexico. I thought that we were a better country than that. Not only has the Obama ban on offshore drilling cost us thousands of jobs, it now appears that they are trying to take back leases from Exxon Mobil on a never before used technicality that will steal billions of dollars of profits from this US corporation that has acted in good faith.

In a blockbuster article in today's Wall Street Journal you will see how the Department of the Interior is attacking free enterprise and running rough shot over the rule of law trying to take back leases secured by Exxon Mobil. The Wall Street Journal says that, "The massive Gulf of Mexico discovery contains an estimated one billion barrels of recoverable oil that was discovered by Exxon Mobil yet the Interior Department, which regulates offshore drilling, says Exxon's leases have expired and the company hasn't met the requirements for an extension.

It appears that in its greed, the Interior Department is changing the rules in part because after Exxon Mobil took all the risk and told them how valuable the leases are, they now want to take them back and re-offer them to the highest bidder. The Wall Street Journal says that, "The Texas behemoth faces the sobering prospect that it may have made the largest discovery ever in the Gulf of Mexico only to lose it. Tens of billions of dollars of oil could slip through its hands because it failed to follow federal rules for getting a lease extension while it moved forward with plans to get the oil out of the ground. Exxon spokesman Patrick McGinn said the company expected to get the extension, which he said was traditionally granted as a matter of course. "You state your case and you got it. [This] was unexpected.” They also say, "Exxon's lawsuit said the government has granted "thousands" of extensions over time. It said the government's denial of its extension relied on legal interpretations that it "had never before applied and had never before articulated." If you are anti-oil and anti-jobs you can take a part of your government and use it to send a political message to your critics.

Exxon Mobil has dared to use its free speech to criticize the government and now they are paying the price. Exxon Mobil partner Statoil asserted in its lawsuit that no request for an extension for a deep-water development "had ever been denied". Perhaps because in America when you do business you are supposed to do it in good faith. America is a country where in business your word is supposed to be your bond. A country where they don't change the rules to try to cheat private enterprise out of money.

In the meantime while the government puts the screws to Exxon Mobil, more jobs are being lost. It is obvious that the Obama administration's disdain for an industry that is roughly 7 and a half percent of our nations GDP and an industry that could account for a substantially larger part in the future is now just a political talking point for an administration. Their zeal to favor their Green Energy Lobby special interest has come before the interests of everyday Americans. They are just killing good, high paying jobs because this industry is wildly successful! It is obvious by the policies of this administration that they are against good high paying jobs. Unless you move to Brazil or something.

Phil Flynn is senior energy analyst for PFGBest Research and a Fox Business Network contributor. He can be reached at (800) 935-6487 or at pflynn@pfgbest.com.

About the Author
Phil Flynn

Senior energy analyst at The PRICE Futures Group and a Fox Business Network contributor. He is one of the world's leading market analysts, providing individual investors, professional traders, and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline, and energy markets. His precise and timely forecasts have come to be in great demand by industry and media worldwide and his impressive career goes back almost three decades, gaining attention with his market calls and energetic personality as writer of The Energy Report. You can contact Phil by phone at (888) 264-5665 or by email at pflynn@pricegroup.com. Learn even more on our website at www.pricegroup.com.

 

Futures and options trading involves substantial risk of loss and may not be suitable for everyone. The information presented by The PRICE Futures Group is from sources believed to be reliable and all information reported is subject to change without notice.


Comments
comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome