Sunday, July 11, 2010

President Obama sends American jobs to Egypt

The first oil drilling rig is leaving the Gulf due to President Obama's moratorium on drilling. It's heading off to Egypt.
Diamond Offshore announced Friday that its Ocean Endeavor drilling rig will leave the Gulf of Mexico and move to Egyptian waters immediately — making it the first to abandon the United States in the wake of the BP oil spill and a ban on deep-water drilling.

And the Ocean Endeavor's exodus probably won't be the last, according to oil industry officials and Gulf Coast leaders who warn that other companies eager to find work for the now-idled rigs are considering moving them outside the U.S.

Devon Energy Corp. had been leasing the Endeavor to drill in the same region of the Gulf as BP's leaking Macondo well, which has been gushing crude since a lethal blowout April 20.

But Diamond announced Friday it will lease the rig through June 30, 2011, to Cairo-based Burullus Gas Co., which plans to send the Endeavor to Egyptian waters immediately.

Devon is one of three companies that has cited the deep-water drilling ban in trying to ease out of contracts to lease Diamond rigs. Diamond, a drilling company, said it expects to make about $100 million from the deal, including a $31 million early termination fee it recovered from Devon.

Larry Dickerson, CEO of Houston-based Diamond, signaled that other of his company's rigs could be relocated, too.

"As a result of the uncertainties surrounding the offshore drilling moratorium, we are actively seeking international opportunities to keep our rigs fully employed," Dickerson said. "We greatly regret the loss of U.S. jobs that will result from this rig relocation."
Just what the Gulf region needs. More lost jobs. And just as critics of Obama's moratorium predicted will happen. It doesn't matter that federal courts found the President's reasoning so weak that they struck down his ban. Companies can't afford to risk multi-million dollar investments in such uncertainty.

And uncertainty is Obama's specialty. As Allan Meltzer wrote a couple of weeks ago, Obama's policies are causing uncertainty.
Two overarching reasons explain the failure of Obamanomics. First, administration economists and their outside supporters neglected the longer-term costs and consequences of their actions. Second, the administration and Congress have through their deeds and words heightened uncertainty about the economic future. High uncertainty is the enemy of investment and growth.
Businessmen don't invest in creating new jobs when there is so much uncertainty about health care costs, taxes, cap and trade, government bailouts of their competitors, or how the Obama administration will interpret labor provisions. The list goes on and on of how this administration discourages job growth by their very policies. And these jobs going from the Gulf to Egypt are just one more example. President Obama kills jobs. Unless they're government jobs or union jobs. Then he uses your tax money to provide more.