Offshore Oil Takes Center Stage: Again In A Bad Way

Offshore Oil Drilling Takes Center Stage – again in a bad way

On April 20, 2010, a blow-out at the Deepwater Horizon drilling rig in the Gulf of Mexico caused a three-month, 4.9 million-barrel oil spill – the worst in U.S. history.  As we approach the 1-year anniversary of the Deepwater Horizon-BP oil disaster, offshore oil drilling and exploration is once again in the media spotlight – and once again for reasons that are bad for the environment. 

The President’s Speech on Our Energy Security

On Wednesday March 30th, President Obama addressed a group of students and faculty members at Georgetown University in Washington, D.C., on America’s Energy Security. 

After a brief introduction and some comments on the March Madness college basketball tournament, the President turned to energy – citing turmoil in the Middle East, the Japan earthquake disaster, and rising American gasoline prices as the impetus that led him to launch this “new” energy plan for the nation.

The President continued with a good point: that we’ve seen high gas prices here in the US before – most recently during the last Presidential election cycle.  “Drill, baby, drill,” continued Obama, wasn’t “going to do anything to solve the problem.”  Nobly, the President acknowledges that there are no quick fixes to this problem and that demand is outpacing supply, and has been for quite some time (except for a downturn in the recession).  Focusing on the long-term, according to Obama, is the only real solution. 

Obama invigorated the crowd with quotes like: “We cannot keep going from shock when gas prices go up to trance when they go back down,” “We’ve known about the dangers of our oil dependence for decades,” we “cannot afford to bet our long-term prosperity, our long-term security on a resource that will eventually run out,” and “We can’t rush to propose action when gas prices are high and then hit the snooze button when they fall again.”

…and then he ignored his own advice and suggested an energy plan that reduces imports of oil by drilling more at home, investing in clean coal (that isn’t clean at all), and ignoring our skyrocketing energy exports.

After hypnotizing the students with gas-pump price analyses couched in collegiate metaphors designed to show that depending on oil is NOT good energy policy, the President said that he’s going to solve the problems of the present by:

-          Working with Canada and Mexico to give the US “stable and steady and reliable sources” of oil,

-          Sending US technology and “know-how” to Brazil to help that nation develop its vast offshore oil reserves,

-          Initiating a two-part plan in the US:

o        First, “finding and producing more oil at home,” and

o        Second, reducing dependence with cleaner alternatives and efficiency.

If three of the four ideas for our Energy plan involve finding, producing, and using more oil, that energy plan won’t go far toward ending a long-term struggle to move beyond oil addiction.  Add on top the fact that in the one clean idea (“alternatives and efficiency”), when he gets to the specifics, focuses, in great part, on natural gas imports, clean coal, and nuclear options – options that are not environmentally friendly. 

There are elements in his ideas on the second half of the at-home plan that touch on renewable energy technologies and electric cars, but overall, the President’s plan calls for the very thing he said wasn’t “going to do anything to solve the problem” – Obama is calling for “Drill, baby, drill.”

Specifically, Obama admits to expediting new permits, to the fact that last year we produced more oil offshore since 2003, that the administration approved twice as many permits in the last year as were actually drilled, that he will be giving “incentives” (read – more tax breaks) for oil companies that drill in leases they’ve bought but not yet tapped, and, most shockingly, Obama said:

“We’re also exploring and assessing new frontiers for oil and gas development from Alaska to the Mid- and South Atlantic states, because producing more oil in America can help lower oil prices, can help create jobs, and can enhance our energy security, but we’ve got to do it in the right way.”

If the President was serious about protecting the ocean environment, he would not have raved about recent expansions in offshore drilling permits, especially given the lack of real improvements in technologies for protecting against disasters like the BP Deepwater Horizon blowout (read on…). 

An oil policy designed to reduce our dependence on foreign sources would be based on these steps:

1)      Making energy conservation and efficiency his number one priority – instead of relegating it to the last few bullets in his outline.  Cars in Europe are significantly more efficient than cars here; building construction and repair is rebounding from the recession and we need to put standards for efficiency in place; existing gas stations need to be given incentives to add natural gas and electricity “pumps” for our new fleet.

2)      Prohibiting the ever increasing EXPORT of our domestic petroleum products which are now at an all-time high.

3)      Protecting our domestic natural gas by reversing the President’s ongoing policy of approving the export of trillions of cubic feet of domestically-produced natural gas to overseas markets.  In recent months, over a dozen liquefied natural gas companies along our coast have begun the process of applying to the Department of Energy for permission to export domestically-produced natural gas and gas that they previously imported for use by American consumers!  Why should we pay to import more expensive foreign gas when we have plentiful, abundant, cheap gas here, and why should we be exporting any energy products?

While the President’s Energy Plan touches on some lofty goals and a few commendable ideals, as a whole it doesn’t go far enough in protecting the public interest; it is politics as usual, plays to the interests of Big Energy, and clearly states his intention to expand offshore drilling, even in the Atlantic Ocean.

Blowout Preventer Shell-Game

Recently, controversy has arisen over the Obama Administration’s decision to grant 6 (as of March 31, 2011) new deepwater drilling and oil exploration permits – the first 6 new permits since the Deepwater Horizon disaster last April. 

New permits, according to the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE), must have the most up to date oil spill response plans possible, and must have addressed the “lessons learned” by the BP Deepwater Horizon blowout.  What are these lessons learned?  Specifically, the BOEMRE released a report this week that blowout preventers (devices at the seabed that were supposed to “prevent” blowouts) don’t prevent blowouts – even if they are installed perfectly and operating fully.  Basically, BOEMRE says there is no technology currently required by law or regulation that could have stopped the Deepwater Horizon disaster.

So, given the requirement to address this lesson learned and to have up-to-date spill response plans, what is happening in real life?  The first new permit issued by BOEMRE was to a company called Noble Energy, 46% owned by BP, for an oil drilling and exploration plan that (1) uses the same proven-to-be-ineffective blowout preventers, and (2) is based on an oil spill response plan completed in September of 2009 – seven months before the Deepwater Horizon spill occurred. 

Rachel Maddow, of MSNBC broke much of this story (HERE); recently, Representative Markey (D-Mass) called the Bureau to task and launched an investigation into this shell-game (HERE).

“These two examples of ineffectual oil industry responses to the BP spill calls into question the wisdom of moving forward with new deepwater oil drilling permits without better evidence that safety concerns are being properly addressed,” Markey said in his letter to the Director of the BOEMRE.  “If a blowout preventer can't stop a spill, and the oil industry is still relying on pre-Deepwater Horizon spill response plans, I have to ask how much has changed since the worst oil spill in U.S. history occurred nearly one year ago,” he concludes.

COA will monitor the Representative’s investigation – read this blog for updates!

Bills Introduced by House Republicans Aim to Open the Ocean for Oil

In the Republican-controlled House of Representatives, Natural Resources Committee Chairman Doc Hastings (R-WA) introduced three bills this week that, according to the official press release, will “expand offshore energy production in order to create jobs, lower energy costs, generate revenue to help pay down the national debt, and improve national security by lessening our dependence on foreign energy.”  Read the House of Representatives Press Statement HERE.

According to Rep. Hastings, 

"These bills will directly reverse Obama Administration actions that have locked-up America's vast offshore oil and natural gas resources.  The bills will end the de facto moratorium in the Gulf of Mexico and allow people to return to work, require lease sales to be held that were canceled or delayed by the Obama Administration, and lift the Obama Administration's ban on new offshore drilling by directing production to occur in areas with the most oil and natural gas resources. In contrast to the President's drill nowhere new plan, this is a drill smart plan. The majority of Americans support offshore energy production and these bills will allow it to move forward in a safe, responsible and efficient manner. With thousands unemployed in the Gulf region and gasoline prices nearing $4 per gallon, swift action must be taken to reverse course and increase U.S. energy production.”

Of course, there are a few things wrong with this statement. 

First, as we see above, the “de facto moratorium” that is mentioned is not actually real – the Obama Administration has for months been allowing existing leases to operate (in both shallow and deep water) and has officially allowed 6 new permits and will soon add 3 more.  Also, as many have pointed out, more drilling rigs have moved into the Gulf of Mexico than have left – meaning that there is more going on now than there was before the Deepwater Horizon disaster. 

Second, it has been proven time and time again that there is no connection between gasoline prices and drilling offshore in the U.S., so it is misleading for the Representative to try to not-so-subtly make this connection. 

Third, the Representative tries to show that there is a jobs-killing aspect to the decision not to drill for oil in areas where no drilling has yet happened – and that these bills will remedy this.  Logically, however, regions like the Atlantic Ocean, that never had offshore oil drilling (because of small, uneconomic deposits), lost no drilling jobs because of Obama’s decision not to drill here.  In fact, we think that the decision not to drill in the Atlantic likely went far toward ensuring the security of coastal jobs reliant on tourism, fishing, beach-going, and a clean coastal environment.  This plan to open drilling in the Atlantic Ocean threatens existing jobs – and cannot “put people back to work” that were never there working in the first place.

In the Senate, Senator Vitter (R-La) submitted a new bill (companion piece in the House submitted by Rep. Bishop (R-Utah)) that significantly changes the balance of power in the ocean and coastal zone – in favor of the oil companies.  Coupled with the Rep. Hastings bills, this series of legislation could change the way oceans are managed forever. 

These bills, as drafted, are:

H.R. 1229 - The "Putting the Gulf Back to Work Act"

-          This bill, in part, shortens the timeline that agencies have to review drilling permits to 30 days, limits the ability of courts to review agency actions on drilling permits, and prohibits attorney’s fees and court costs from being awarded – actions that are antithetical to an open government.

H.R. 1230 - The "Restarting American Offshore Leasing Now Act"

-          This bill specifically targets several areas of the ocean for immediate drilling approval, including parts of the Atlantic Ocean, with no environmental review - a dangerous precedent to set.

H.R. 1231 - The "Reversing President Obama’s Offshore Moratorium Act"

-          This bill requires the use of specific agency reports generated years ago that describe the Atlantic Ocean basin as having a wealth of oil – reports that have since been proven to be wrong, and it creates a system to pay oil companies for costs incurred in finding their own oil!

H.R. 1287 – The “3-D: Domestic Jobs, Domestic Energy, and Deficit Reduction Act of 2011”

-          The provisions of this bill relevant to New Jersey include the elimination of an entire stage of judicial review (district court decisions can only be appealed in the Supreme Court), a presumption of no significant impact if all environmental reviews cannot be completed within 9 months, and the bill forces certain decisions on environmental impacts depending on the status of the national unemployment rate.

Conclusions

Considering that Obama stated publicly (above) that he intends to facilitate an expansion of oil and gas drilling in the ocean and coastal zone, that the impacts of the Deepwater Horizon spill may have been drastically underestimated, that “new” safety measures by BOEMRE appear to be meaningless and useless in stopping a blowout similar to last year’s, and that Congress seems hell-bent on using and abusing the ocean as much as is physically possible, we’re going to gear up for a fight.  Clean Ocean Action, committed to stopping any and all oil and gas drilling in the Atlantic Ocean, will be keeping an eye on these issues and will report back.