Offshore oil drilling in the US: what's at stake?


By Catherine Brahic Update, March 31, 2010 Today, the Obama administration has proposed opening huge marine areas off the Atlantic coastline, the eastern Gulf of Mexico and the north coast of Alaska to oil and natural gas offshore drilling. The areas affected include 68 million hectares of ocean. Many of the regions have never been drilled before. If approved, the proposal would end a long-standing moratorium on drilling along the east coast of the US. Original article, 13 August 2008:             Last week, Senator Barack Obama said he was open to considering a “careful, well thought-out [offshore] drilling strategy that was carefully circumscribed to avoid significant environmental damage”. The move was seen as a U-turn from the presidential candidate who had previously been opposed to George W. Bush and John McCain’s support for offshore drilling. All three have presented this as a way of bringing prices down at US gas pumps. Whenever offshore drilling or drilling in nature reserves is mentioned, environmentalists are rattled. In 2000, Bush made oil drilling in the Arctic Wildlife National Refuge part of his presidential campaign. With US voters hit hard by soaring oil prices, drilling looks like it could be a hot topic in this year’s election as well. But what is at stake? We review the US offshore drilling bans, and what lifting them would mean, in terms of energy and the environment. What is the offshore drilling ban? There are in fact two drilling bans. One is a presidential ban, which George Bush Senior signed in 1989 and George W. Bush lifted in July. The other is a Congressional ban, adopted in 1981. The congressional ban is stated each September in the Department of the Interior and Environment’s section of the Appropriations Act , which sets out national spending. “This is why the issue is so hot at the moment,” says Dan Weiss, director of climate strategy at the Center for American Progress, a US think tank. “The moratorium needs to be renewed soon or it expires.” Doesn’t drilling already happen offshore in the Gulf of Mexico? Yes. Exceptions to the bans have been approved in the past, mostly in the central Gulf of Mexico. In total, some 40 million acres are open to prospectors. The most recent exception that was made was in 2006 for 8 million acres in the eastern Gulf of Mexico off the coast of Florida. What area would be opened up if the Congressional ban was not renewed this year? The Congressional ban states that “no funds provided in this title may be expended by the Department of the Interior for the conduct of offshore preleasing, leasing and related activities placed under restriction in the President�s moratorium statement of June 12, 1998, in the areas of northern, central, and southern California; the North Atlantic; Washington and Oregon; and the eastern Gulf of Mexico south of 26 degrees N latitude and east of 86 degrees W longitude”. If the ban were not renewed on 30 September, any of these areas could legally be leased to offshore drilling companies. State governments decide whether or not to lease their stretch of continental shelf. The area at greatest risk is probably the eastern part of the Gulf of Mexico, off the western coast of Florida. The governor of Florida has previously said he was against offshore drilling but recently had a change of heart. How much more oil and gas would be available? Geological estimates from 2003 state that areas off the coast of California could contain the largest amount of unexploited oil and gas – 8 billion barrels and 344 billion cubic metres respectively. But governor Arnold Schwarzenegger has pronounced himself firmly against drilling, and leases would have to be issued with his approval. Estimates suggest the Eastern Gulf of Mexico could contain 4 billion barrels of oil. Bush and McCain have called for offshore drilling in order to lower oil prices. Obama also said he would consider the plan. How soon would drilling translate to cheaper prices? Not very soon. Drilling has not yet begun in areas that were opened in 2006, because of on-going negotiations over the leasing agreements. It could take another five to seven years for drilling to begin once the leases have been agreed. So two full presidential terms are likely to have passed by the time drilling begins. The US Energy Department’s forecasting arm has said opening the Pacific, Atlantic and eastern Gulf of Mexico regions to drilling would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. According to a 2005 document issued by the US Energy Information Association, using 2003 figures, areas across the lower 48 states (ie, not including Alaska and Hawaii) could yield 18 billion barrels of crude oil and 2 trillion cubic metres of natural gas if areas that are currently off bounds were opened up. In comparison, areas that have already been opened up to drilling as a result of exceptions to the congressional and presidential bans are estimated to hold 41 billion barrels of crude unexploited oil and 6 trillion cubic metres of unexploited natural gas. “Of all the oil and gas believed to exist on the Outer Continental Shelf, 82% of the natural gas and 79% of the oil is located in areas that are currently open for leasing,” says Nick Rahall, Democratic representative for West Virginia. What would be the potential environmental costs? Oil spills are often cited as a main concern when it comes to offshore drilling, but drilling companies are at pains to point out that spills are rare. Environmentalists say the top risk from drilling platforms is the wastewater they routinely discharge. Among others, this contains drilling fluids and heavy metals including mercury. According to the Committee Against Oil Exploration, a rig in the Gulf of Mexico rig dumps 90,000 tons of drilling fluid and metal cuttings over its lifetime. The contaminants accumulate in the marine food web and can affect the shoreline as well. The governor of North Carolina has said he is opposed to drilling off his state’s coast because of concerns that waste from the platforms might contaminate local beaches and have a negative effect on the tourism industry. Some groups are also concerned that building drilling platforms can affect whale populations. In eastern Russia, a Shell-backed project to build the Sakhalin II drilling platform has been blamed for disturbing local grey whales. Energy and Fuels – Learn more about the looming energy crisis in our comprehensive special report. Climate Change – Want to know more about global warming – the science, impacts and political debate? Visit our continually updated special report. More on these topics:
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