Chevron CEO: Backlog of offshore drilling permits is slowing US economy, offers solution…

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September 8, 2011

Chevron CEO John Watson testifiesWASHINGTON (Dow Jones)–The chairman and chief executive of Chevron Corp. (CVX) said Wednesday that the U.S. offshore drilling regulator needs more funding to handle permit reviews.

John Watson, speaking in Washington as lawmakers enter a season ripe with budget debates, rejected the idea that regulators were “trying to slow walk” offshore oil and gas permitting under the administration of President Barack Obama, saying instead that new rules put in place this year had created more work on each permit review.

“I don’t believe that Director Bromwich and his people are trying to slow walk permits. I don’t believe that,” Watson said, referring to Michael Bromwich, head of the U.S. agency that regulates offshore drilling.

Congress raised the budget for the offshore drilling bureau this year, but the agency has asked for more funding. The administration has suggested increasing fees on the industry to pay for extra staff, but Republicans have opposed that idea.

Watson stopped short of supporting higher fees. “Our industry pays its fair share of paying royalties, fees and taxes over time,” he said.

Watson said the agency should be “adequately funded” to enforce more stringent safety rules put in place after last year’s massive oil spill in the Gulf of Mexico.

“With the requirements that were put in place, there is pressure on staffing, there is a backlog of permits,” he said, arguing that allowing more drilling would help boost the economy and create jobs.

Watson said he opposed more federal regulation of shale gas drilling in the U.S., saying state regulators were capable of doing the job.

He also said he opposed efforts by the Environmental Protection Agency to regulate greenhouse gas emissions. “We will end up being more dependent on refineries overseas” if “onerous” regulations are passed, Watson said. Refineries like those operated by Chevron emit greenhouse gases.

Watson was speaking at a public event hosted here by the American Petroleum Institute and The Hill newspaper.

-By Ryan Tracy, Dow Jones Newswires

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