US government 'likely' to unveil new drilling freeze

WASHINGTON — President Barack Obama's administration was "likely" later Monday to issue a reconfigured moratorium on deepwater oil and gas drilling, after a previous six-month freeze was blocked by a judge.

The announcement, which officials had previously said was imminent, was expected to be made by the Department of the Interior, an official said on condition of anonymity.

The US government extended the latest moratorium on deepwater drilling and new permits for six months, on May 27, as a political storm built over the massive Gulf of Mexico spill gushing from a ruptured undersea well.

But last month, a federal court blocked the moratorium after 32 oil companies and local officials argued it was causing irreparable economic harm in a region hard hit by the economic shockwaves from the disaster.

Then, the Fifth Circuit Court of Appeals last week denied the administration's emergency request to stay that judge's order pending appeal.

Interior Secretary Ken Salazar had said he would soon issue a new order to block deepwater drilling regardless of how the court ruled, and oil companies have not resumed operations due to the legal uncertainties.

Oil companies and Louisiana politicians railed against the moratorium, saying it would cause further economic devastation and that rigs and drilling plans should simply be inspected on a case-by-case basis.