Trevor Thielen Offshore Drilling: An American Controversy

While the 1969 blowout temporarily swayed public opinion away from increased offshore drilling, the energy crisis of the 1970s reaffirmed American’s desire for domestic oil production.⁶⁸ Congress sought to ease concerns over increased oil production by striking a balance between environmental impact and the need for increased exploration. In 1977, Congress passed the Clean Water Act, which regulated the discharge of pollutants into surface water. The next year, 1978, Congress amended the OCSLA by specifying the need to “conserve the Nation’s natural resources; develop natural gas and oil reserves in an orderly and timely manner; meet the energy needs of the country; protect the human, marine and coastal environments; and receive a fair and equitable return on the resources.”⁶⁹ Through these efforts Congress attempted to assure national security and reduce the nation’s dependence on foreign sources of energy.⁷⁰ Consequently, as foreign oil supplies became increasingly unreliable, American offshore oil production hit its peak in the 1970s, producing around ten million barrels of oil per day.⁷¹

Eventually, the 1970s energy crisis ended and the American public began to reevaluate the costs of offshore drilling proliferation. As environmental conservation gained acceptance many coastal states chose to moritize their coastal waters. Consequently, Congress received pressure from environmental groups and coastal states to implement similar moratoriums in federal waters. In response to the public’s concern for the environment, Congress passed the first federal offshore drilling moratorium in 1981.⁷² Contained within the annual Interior and Related Agencies Appropriations Bill, the moratorium restricted the leasing of 736,000 acres off the coast of California. The following year, in 1982, Congress extended the moratorium to the waters off the eastern coast of the United States. As a result, the moratorium eventually encompassed all federal waters with the exception of the Gulf of Mexico and the coast of Alaska.⁷³

While the congressional moratorium was seen as a victory for environmentalists, the method in which it was implemented yielded one fundamental disadvantage. Contained within the annual appropriations bill, which becomes effective every October 1^st and expires every September 30^th, the moratorium required renewal annually or it would expire.⁷⁴ As a result, the battle over offshore drilling was fought on a continuing basis as the issue was revisited each year. Consequently, the congressional moratorium became a customary feature within the annual appropriations bill for more than two decades.⁷⁵

In 1989, the Exxon Valdez oil spill occurred in Prince William Sound off the coast of Alaska. Characterized as one of the largest environmental disasters of all time, the tragedy caused public support for offshore energy exploration to diminish. In response to the public’s outrage and distain, President George H.W. Bush, in 1990, issued a Presidential Directive to the Department of the Interior to discontinue specific leasing activities.⁷⁶ The presidential moratorium, a near duplicate of the congressional moratorium, restricted drilling operations in federal waters off the eastern and western coasts until 2002 while allowing limited drilling in the Gulf of Mexico and in certain waters off the coast of Alaska.⁷⁷ In 1998, President Clinton extended the presidential moratorium an additional ten years, until 2012.⁷⁸

Although the presidential moratorium implemented no greater protection than was already in place under the congressional moratorium, it was hailed as a victory for opponents of offshore drilling. With both the congressional and presidential moratoriums in place, the perception arose that Americans had finally come to value the ocean for its environmental preservation rather than for its energy resources. Additionally, the implementation of dual moratoriums by coequal branches of the government was seen as making the task of expanding offshore drilling in the future very difficult. In the event that public perception of offshore drilling shifted, the task of undoing the regulatory structure implemented by both moratoriums was viewed as requiring a nearly insurmountable amount of political capital. Nevertheless, in 2008 a cloud of dissention arose in the United States as a tempest of public opinion formed the perfect storm, resulting in the washing away of both moratoriums, thereabout drastically transforming the nation.

B. End of an Era

When both the congressional and presidential moratoriums were first enacted, the price per gallon of gasoline was slightly more than one dollar.⁷⁹ As worldwide demand increased, sources of energy that were once inexpensive and abundant became costly and scarce. Today, the United States consumes roughly 20.8 million barrels of oil per day, representing nearly a quarter of the total global demand.⁸⁰ It is estimated that by the year 2030, demand in the United States will rise to almost 23 million barrels of oil per day.⁸¹ At the same time that demand for energy has continued to rise, domestic oil production has steadily declined. Over the past thirty years oil production has been cut nearly in half. In recent years, the United States has produced about five million barrels of oil per day.⁸² In light of the nation’s pending energy crisis, the nation was poised to reevaluate its energy policies.

In 2008, as oil prices surpassed four dollars per gallon, a majority of Americans began to reconsider their opinion of offshore drilling. In a poll conducted in May 2008, 57 percent of respondents stated that they favored offshore drilling, while 41 percent stated they were opposed.⁸³ Other polls conducted at nearly the same time reported even more disproportionate figures. One poll stated that 74 percent of respondents support offshore drilling for oil in the United States’ coastal waters.⁸⁴ Needless to say, many Americans found themselves frustrated and disillusioned with the steadily rising cost of energy. As pressure mounted for a solution, the congressional and presidential moratoriums came to be viewed not as a means of maintaining environmental preservation but rather as an obstacle blocking America’s progress in its quest for a lasting solution to the nation’s energy needs.

As a result, on July 14, 2008 President George W. Bush, confronted with record setting oil prices, issued an executive order that lifted the presidential moratorium first implemented by his father eighteen years earlier.⁸⁵ Speaking in the Rose Garden of the Whitehouse, President Bush stated, “[t]he time for action is now.”⁸⁶ Mindful of the fact that the congressional moratorium remained in effect, President Bush said Congress was “the only thing standing between the American people and these vast oil resources.”⁸⁷ Adding, “Failure to act is unacceptable” the President set the stage for a confrontation between the Whitehouse and the democratically controlled Congress.⁸⁸

During the late summer of 2008, with the presidential moratorium lifted, attention turned toward Congress. As both the congressional moratorium and the annual federal budget neared expiration on September 30, 2008, Democrats appeared poised to include a provision extending the moratorium within the upcoming continuing resolution appropriations bill.⁸⁹ Realizing that without the bill’s passage the government would shut down, the Congressional Democrats intended to thwart the President by daring him to veto funding that was necessary to operate the entire government. As tension mounted between President Bush and Congressional Democrats the pressure felt by many members of Congress became more than they could bear.

In the midst of an election year, many members of Congress who previously supported the congressional moratorium found supporting the unpopular subject difficult. Congressional Democrats eventually realized that they could not produce the votes necessary to overturn a presidential veto. Fearing that voters would blame them in November as obstructionists, Congressional Democrats found that support for renewal of the congressional moratorium had eroded.⁹⁰

Consequently, Congress passed and President Bush signed on September 30, 2008, a funding bill that contained no mention of offshore drilling.⁹¹ The following day, October 1, 2008, the congressional moratorium expired, effectively opening up billions of acres for leasing exploration. President Bush, having achieved a political victory against Congressional Democrats stated “This Act…will allow us to reduce our dependence on foreign oil.”⁹² For proponents of offshore drilling, who endured nearly three decades of moratoriums, the day was hailed as “Energy Freedom Day.”⁹³ By contrast, environmentalists who had fought long and hard to keep the moratoriums in place viewed the day as a setback.

Today, the debate over offshore drilling continues. Opponents of offshore drilling are hopeful that a new Congress and/or the new President, Barack Obama, will re-implement the moratoriums, though to date no steps have been taken to do so. Nevertheless, both opponents and proponents of offshore drilling recognize the final chapters of the offshore drilling debate have yet to be written. Consequently, both sides have waged public interest campaigns seeking to gain popular support for their positions. Analyzing the dialog within this debate provides critical insight toward understanding the controversy over offshore drilling.

In 2006, while addressing a joint session of Congress, President Bush signified American’s mounting energy crisis by stating that the United States was “addicted to oil.”⁹⁴ The president’s statement highlighted the urgent need to find a lasting solution to the national security concern caused by the nation’s reliance on foreign oil. While the President brought the issue to the forefront, the problem of the United States’ growing energy deficit is nothing new. Over the past fifteen years the nation’s consumption of oil has steadily increased by over twenty percent.⁹⁵ Although the United States is the world’s third largest oil producer, nearly sixty percent of the total oil consumed is imported at an average cost of $20 billion per month.⁹⁶ While, most Americans are in agreement that the nation is faced with a growing energy problem, disparity rages as to what role, if any, offshore drilling should play in reaching a lasting solution.

The chief argument made by proponents of offshore drilling is that imported oil makes the United States vulnerable to oil producing countries that are hostile to American interests.⁹⁷ If domestic oil production increases, as supporters argue, the United States’ trade deficit would be lessened and oil rich nations would hold less leverage over United States’ foreign policy.⁹⁸ By contrast, offshore drilling opponents argue that the nation’s energy crisis is an immense problem and that we simply cannot “drill our way out.”⁹⁹ Opponents point to the fact that the United States consumes three times the amount of oil produced domestically and as a result is forced to import roughly fifteen million barrels of oil per day.¹⁰⁰ Consequently, opponents argue that even if drilling was expanded off every coast and inside every national park, the United States would still be unable to produce enough oil domestically to offset the nation’s ever growing demand for energy.¹⁰¹

Additionally, although both the presidential and congressional moratoriums have been repealed, the Energy Information Administration (EIA) has acknowledged that the oil recovery process will be lengthy.¹⁰² The EIA has predicted, based upon the time it takes an oil company to find and identify a drilling site, secure a lease, build the infrastructure and ultimately recover the oil, that there will not be a significant increase in oil production or drop in oil prices for nearly twenty years.¹⁰³ In reaction, Congressional Democrats have called President Bush’s actions in lifting the presidential moratorium “a political stunt.”¹⁰⁴ California Senator Dianne Feinstein said the President was “deluding the American public into believing that new offshore drilling is a quick fix to four dollar per gallon gasoline. Nothing could be further from the truth.”¹⁰⁵ As a result, offshore drilling opponents argue that increased drilling will do nothing to reduce the nation’s demand for foreign oil.

While offshore drilling proponents concede that new supplies of energy may take several years to develop, they argue that increased offshore drilling will provide both short-term and long-term solutions to the nation’s energy problems. In the near term, proponents argue, the prospect of an increased energy supply will drive down speculation by commodity investors resulting in the immediate lowering of gas prices.¹⁰⁶ Likewise, in the future, as domestic oil production begins to yield results, proponents argue that increased supply in the market will lower the price of gas even further. Many republicans such as Senator George Voinovich of Ohio assert that had drilling been expanded “ten years ago…we wouldn’t be in this predicament [we are in] today…We can afford to wait no longer.”¹⁰⁷ Proponents of offshore drilling contend that the time for action is now.

By contrast, opponents of offshore drilling argue that increased drilling will have a negative impact on gasoline prices. They argue that the promise of a plentiful supply of cheap energy is unrealistic and that the markets will not be easily manipulated into a false sense of security. Opponents point out that oil companies have an interest in keeping gas prices high and are unlikely to welcome a reduction in their bottom lines.¹⁰⁸

Furthermore, offshore drilling opponents reject a common argument used by many offshore drilling proponents. Opponents argue that many widely held public opinion polls, which show that a majority of Americans, two-thirds, favor increased drilling for oil and gas, are unreliable.¹⁰⁹ Opponents point out that many experts have been critical of common polling questions that often ask respondents if they would support drilling in order to reduce the price of gas. Such questions, opponents contend, are misleading because they presume a direct cause and effect relationship between increased drilling and the reduction in oil prices.¹¹⁰

Ultimately, the chief argument raised by offshore drilling opponents is that offshore drilling distracts the country from its pursuit of alternative sources of energy.¹¹¹ Opponents argue that the real solution to the nation’s energy crisis is to embrace innovation that encourages conservation and efficiency.¹¹² They contend that offshore drilling is a short-term solution for a long-term problem and is being used to calm the fears of Americans afraid of the prospect of actually having to conserve their energy consumption.¹¹³ Offshore drilling opponents recognize that the nation’s reliance on fossil fuel will not be broken easily or quickly. Opponents contend that before allowing drilling expansion, oil companies should take advantage of the five thousand offshore leases that they already hold and that are not being used. Speaker of the House, Nancy Pelosi, stated “it’s time to tell the oil industry you already have millions of acres to drill. Use it or lose it.”¹¹⁴ Ultimately, opponents argue that as Americans we should strive to curb our appetite for oil and gas rather than feeding its insatiable hunger.

Proponents of offshore drilling contend that Americans have many wasteful energy habits that should be addressed. However, they argue that relying on alternative sources of energy alone is unrealistic. Proponents contend that fossil fuels are essential in order to maintain our economy and standard of living.¹¹⁵ They acknowledge that as demand for energy increases, every aspect of our lives as consumers is affected.¹¹⁶ As a result, the United States cannot afford to turn its back on any source of energy.¹¹⁷ In the future, more energy, not less, will be required. In addition, proponents of offshore drilling assert that oil companies would welcome the opportunity to drill in locations where they already hold leases. However, because oil companies frequently lease promising tracts that inevitably prove to yield nothing, forcing oil companies to rely on these areas would be futile.¹¹⁸

Today, the debate between offshore drilling opponents and proponents continues as the nation faces the tough decision of choosing which direction to take. While a majority of Americans currently support expanded offshore drilling, proponents are cautious of the fact that public opinion is capricious. A single disaster a sea, such as the 1969 Santa Barbara oil spill, could be all that is necessary to reignite a firestorm of public opposition. Consequently, with the exception of a high profile man-made disaster, opponents and proponents of offshore drilling disagree as to the environmental impact caused by normal drilling operations. Both sides charge one another with manipulating the issue in order to gain public support. Ultimately, the national controversy concerning offshore drilling is most thoroughly understood by analyzing the arguments surrounding offshore drilling’s impact on the environment.

In recent years, concerns associated with global warming have prompted many Americans to adopt a greater awareness for the need to preserve the environment. In light of the environmental conservation movement, offshore drilling opponents have reeled against the negative impacts that they perceive are caused by drilling operations. By contrast, proponents of offshore drilling argue that advances in drilling technology now allow for safe, environmentally friendly drilling.¹¹⁹ As stewards of the environment they assert that offshore drilling actually benefits the environment in many ways, such as by creating artificial reefs for fish.¹²⁰ Overall, the complexity associated with addressing offshore drilling’s impact on the environment is immense. Taken as a whole, the issue mirrors the greater challenge of determining whether or not to support or oppose offshore drilling’s expansion.

The primary environmental concern raised by opponents of offshore drilling is the occurrence of another oil spill similar to the 1969 Santa Barbara spill in which over three million gallons of oil was released into the ocean.¹²¹ Opponents assert that, due in part to the wind, waves and tide, once a spill occurs, oil spreads for miles resulting in catastrophic damage to marine life, human health and ocean-based commerce such as fishing and tourism.¹²² Although the Santa Barbara oil spill resulted in legislation that mandated federal oversight over all drilling operations, opponents contend that as offshore drilling expands, another large scale disaster will be inevitable.¹²³ Additionally, opponents cite the fact that, on average, 880,000 gallons of oil are spilled each year into the oceans as a result of offshore drilling.¹²⁴ During the 2005 hurricane season alone, opponents contend, 743,000 gallons of oil were spilled as a result of Hurricanes Katrina and Rita.¹²⁵ Consequently, opponents argue that, because of its disaster-prone nature, allowing offshore drilling to continue means risking the environment in the process.

In contrast, offshore drilling proponents argue that since the dreadful 1969 Santa Barbara oil spill, regulations have been implemented that ensure against large scale spills. Proponents acknowledge that today federal inspectors closely monitor drilling operations and in the event that a deviancy is discovered inspectors have the power to impose monetary penalties or even shutdown an entire facility.¹²⁶ Likewise, improved drilling technology has allowed offshore drilling operations to maintain a 99.99 percent safety record and of the millions of barrels of oil extracted only 0.0001 percent ended up in the oceans.¹²⁷ Proponents further assert that during the hurricane season of 2005 Hurricanes Katrina and Rita destroyed or seriously damaged over 100 drilling platforms. Nevertheless, they acknowledge that because of state-of-the-art automatic shutoff valves, located underwater, the amount of oil spilled was greatly reduced.¹²⁸ Finally, offshore drilling proponents commonly cite a recent report by the National Research Council in which it was discovered that offshore drilling operations are responsible for only two percent of the total oil in American waters. In contrast to offshore drilling, the report stated that 63 percent of the oil in North American oceans was the result of natural seeps in the earth’s crust.¹²⁹

Opponents of offshore drilling argue that the environmental impact caused by offshore drilling goes beyond oil spills. They contend that the drilling process permanently alters the ocean floor and churns up enormous amounts of waste and toxins that are dangerous to marine life.¹³⁰ Additionally, because drilling rigs are used and reused around the world, opponents argue that species that attach themselves to a rig’s surface are re-colonized in new habitats where they eventually upset delicate ecosystems.¹³¹ Opponents also contend that seismic equipment used to survey future drilling sites alters the behavior of whales, seals and dolphins.¹³² Ultimately, for many offshore drilling opponents they simple believe that it is unfair for the entire nation to burden coastal states with the responsibility of enduring the effects caused by the nation’s energy demands.¹³³ Opponents argue that many coastal communities rely heavily on industries such as fishing and tourism. They contend that the negative environmental consequences these industries face due to offshore drilling outweigh the benefits.¹³⁴ Consequently, in coastal states offshore drilling opponents have coined the term “NIMBY" standing for "Not In My Backyard." In these areas, opposition to expanded offshore drilling has resembled tension usually reserved only for hazardous waste facilities.¹³⁵

In contrast, proponents argue that offshore drilling provides an overall net benefit to the environment. They reference Section 388 of the Energy Policy Act of 2005 which grants the Secretary of the Interior authority to use oil and gas structures on which drilling operations have ceased for alternative purposes including domestic commercial fisheries, research, education, recreation, telecommunications, desalinization, hotels, military outposts, staging supply areas, and urgent medical care facilities.¹³⁶ In some instances, existing platforms have even been refitted to serve as base mounts for wind turbine generators and as crew quarters for workers at sea.¹³⁷ Proponents contend that offshore rigs and platforms also function as artificial reefs for marine life, where compared to the open water, fish populations may be 20 to 50 times higher. ¹³⁸ Additionally, they assert that offshore operations have actually staved off the natural discharge of oil and gas that would have otherwise been released in the ocean. Proponents reference the coast of California where two underwater pyramid shaped structures were erected over a gigantic natural gas seep and ultimately prevented millions of cubic feet of gas from being released into the environment.¹³⁹ Consequently, for many proponents, opposition to offshore drilling by coastal states is viewed as threatening to the greater interest of the entire country.¹⁴⁰ By contrast, proponents argue that offshore drilling is safe, environmentally friendly and indispensable.