Analyst sees oil-and-gas drilling resumption ahead of GOP control

The FBR note explores the various challenges to resuming the permit process. Interior Department officials, in lifting the post-BP spill deepwater ban last month, said offshore drillers must demonstrate they’re complying with beefed-up safety standards.

Interior Department officials said last month they believed permits would be issued before year’s end but did not provide a specific timeline. FBR believes the Obama administration is “supportive” of drilling.

“Although investors and operators alike have been receiving mixed messages from the Obama Administration about its disposition toward the deepwater drilling sector, we continue to believe that the administration is committed to resuming activity once it can be convinced of the industry’s safety,” FBR predicts.

However, FBR notes a number of factors that could slow things down. Interior is still waiting on Congress to cough up most of the $100 million the White House requested for the agency’s expanded oversight.

“Moreover, according to the Department of the Interior, implementation of new regulations has required a learning process with the industry, including increased requirements for certifications, review of cementing and casing, and worst-case scenario estimates,” FBR states.