More Energy Needed

Should we drill off the coast of Virginia? Environmentalists and economists continue the debate as we search for solutions to fuel America's voracious appetite for oil.

There’s a fight on the horizon. Actually, just beyond the horizon—more than 50 miles east—way out in the Atlantic Ocean.¶ There, beneath the ocean floor, are untapped reserves of oil and natural gas. The question at hand is whether or not this fossil fuel should stay put or come out, and the looming battle promises to be long and bitter. There’s a lot at stake; drilling off Virginia’s coast could be very lucrative but quite risky. If nothing changes, the oil and gas will remain buried until at least 2017. There are indications, though, that several efforts this coming year will try to unlock those resources. The voices urging caution on this matter aren’t just the usual suspects, meaning drilling advocates face a steady uphill climb if they’re to see platforms in Virginia’s share of the Atlantic anytime soon.¶ The coming debate on offshore drilling might have happened three years ago. Back then, Virginia was poised to spearhead offshore drilling in the Atlantic Ocean, a plan supported by a federal policy that reflected President Obama’s “all of the above” approach to fueling America’s voracious energy appetite.

“We in Virginia recognize that there is no one silver bullet to solve our nation’s energy crisis,” State Senator and Virginia Beach resident Frank Wagner told the U.S. House of Representatives Committee on Natural Resources in 2009. “The solution must be thought of as a silver shotgun shell, with each pellet as important as the next.” A lot of politicians agreed with Wagner; the federal government prepared to sell leases to oil and gas companies off the coast of Virginia, adding the fuel there to the national energy supply.

The zeal to drill, however, stopped cold in April 2010 after the Deepwater Horizon accident, which killed 11 people and spilled roughly five million barrels of oil into the Gulf of Mexico. The federal government imposed a six-month moratorium on offshore drilling in the Atlantic, a move that was widely supported by a populace wanting to understand just what went wrong.

When that moratorium expired, the U.S. Minerals Management Service unveiled a five-year energy plan to begin in 2012. Virginia was not included. In fact, no East Coast state was part of the plan, effectively ending moves to tap Atlantic oil and gas until at least 2017. Or so it seemed.

For many pro-drilling Virginians, the commonwealth’s exclusion from the energy plan didn’t sit right. Several were downrightincensed. They saw it as a broken promise and began a quiet campaign to hasten the day that the waters off Virginia would reopen for drilling. That’s where Virginia offshore drilling stands now: officially off limits until at least 2017 but the target of political maneuvering that may allow exploration to begin within the next few months.

 

Thou Shall Not Drill

The slice of the Atlantic off Virginia’s coast that was originally slated for drilling is a 2.9 million-acre triangle 50 miles from nearest land. The western side of this area straddles the edge of the outer continental shelf far out in the ocean. In clunky government parlance, this area is named Outer Continental Shelf Mid-Atlantic Oil and Gas Lease Sale 220, or just Lease Sale 220. Even with binoculars, someone standing at sea level onshore can’t see Lease Sale 220; it’s hidden by the curvature of the earth.

That Lease Sale 220 is a remote, vast swath of ocean resembling a slice of pizza is about the only thing that opposite sides of the offshore drilling debate agree on. Virtually everything else is a point of contention, even seemingly factual measurements of what’s out there.

Take the amount of oil and gas. The federal government estimates that there are 130 million barrels of oil and 1.14 trillion cubic feet of natural gas beneath Lease Sale 220. The oil and gas industry thinks the amount of oil and gas there may be underestimated by a long shot, as were initial measures of reserves under the Gulf of Mexico.

Regardless of the amount of oil and gas under Lease Sale 220, proponents of drilling see the billions of dollars of fossil fuel there as a needed shot in the arm to the economy and a step away from reliance on foreign governments, some of which have abysmal human rights records, for the energy needs of the United States. Not so fast, say opponents. That entire amount of oil the government estimates is under Lease Sale 220 would be consumed by the United States in about six or seven days. The gas wouldn’t last much longer, roughly 17 days. Virginia is putting a lot on the line, opponents contend, for what amounts to a pittance.

When it became clear several years ago, even before the Deepwater Horizon accident, that Atlantic offshore drilling was moving forward, objections came from every environmental quarter. Opponents included the Sierra Club, the National Resources Defense Council, Southern Environmental Law Center and The Nature Conservancy, owner of the Virginia Coast Reserve, 14 barrier islands along the Eastern Shore, some of which are the closest points of land to the proposed drilling sites.

These groups maintained all along that the whole process, beginning to end, is environmentally destructive. A standard procedure before offshore drilling occurs, for instance, involves conducting seismic surveys to determine where the oil and gas actually is. The surveys, which measure the echo of thousands of high powered blasts from air guns, can disrupt migratory and breeding patterns of undersea animals, even proving fatal in some cases. Nat Mund is legislative director for the Southern Environmental Law Center in Washington D.C. “Instead of spending time and energy on oil and gas drilling, we’d like to see it spent on developing offshore wind resources,” says Mund. “Drilling is dangerous for people, the environment and for economies in the area.”

Oil and gas platforms are, in and of themselves, an environmental threat, says Mund. The byproducts from drilling for fossil fuels—rock, mud and water—often contain toxic chemicals that are released into the sea around wells. Low-grade, incidental leaks occur regularly, not big enough to make headlines, but damaging to the surroundings nonetheless.

There would have to be heavy development onshore, too, of facilities that have to accompany offshore drilling, and Mund is concerned this could cause harm to ecosystems from rig to refinery. “One thing that makes drilling in the Atlantic different than in the Gulf of Mexico, is that we don’t have the same infrastructure, the refining capacity, tanker facilities, and there will be conflict between those structures and the coastal environment.”

Throw in a major calamity, a hurricane or some other accident resulting in a spill, says the opposition, and the effects of such a disaster will ripple into economic sectors sensitive to the environment—exactly like those in Hampton Roads.

Take tourism, for instance. In 2010, the same year of the Deepwater Horizon accident, nearly 12 million visitors spent more than a billion dollars in Virginia Beach. That summer, Panama City, Fla., one city affected by the oil spill, saw a 15 percent drop in tourism after tar balls washed up on local beaches. A similar drop in local figures would mean the loss of roughly 1.8 million visitors and $150 million, opponents argue.

As the largest seafood producer on the East Coast, Virginia likewise relies heavily on the seafood industry. According to the Virginia Marine Products Board, the dockside value of Virginia watermen’s haul from the Atlantic Ocean, the Chesapeake Bay and its tributaries was more than $191 million in 2011. Many opponents to offshore drilling say the risks to Virginia’s bread-and-butter industries just aren’t worth it.

 

Drilling Equals Dollars

Mike Ward, executive director of the Virginia Petroleum Council, sees the Deepwater Horizon accident somewhat differently. That tragedy, horrible as it was, set new, high standards for safety and security in the offshore drilling industry, guaranteeing a future that offers profoundly more protection for workers and the environment. “I would never minimize the situation that occurred in the Gulf of Mexico in 2010,” he says. “That was a horrific accident, and the industry has learned a great deal from it. There’s no question that if anything was developed offshore of Virginia, it would be under a microscope, state of the art, following stringent government rules.”

Modern technology has not only made the prospect for Atlantic drilling safer and more efficient, but less disruptive, too. The offshore industry now has a smaller footprint, as new advances in horizontal drilling—moving a shaft laterally under the surface—has expanded the reach of a single platform.

Ward touts the economic benefits that Virginians will realize from offshore wells. There will be a ripple effect across other sectors of the economy. “The way to look at eventual production and development is that it’s a huge construction project,” says Ward. “A lot of activity is required to make that happen: workers, vendors, suppliers, ships, helicopters, everything that keeps that industry going.”

Ward points out that this should be of particular interest to people in southeast Virginia. “You have to look at the closest port for all that economic activity to occur,” he says. “Hampton Roads is right there. Everything would run offshore from that port.” And so far a lot of people agree with Ward.

Doug Domenech is Virginia’s secretary of natural resources, one of Gov. Bob McDonnell’s top advisors and advocates on issues involving energy and the environment. Domenech says that oil and gas drilling, along with renewable resources, have to be part of Virginia’s energy portfolio.

“Virginia and the rest of the county need energy,” says Domenech. “The Deepwater Horizon was a horrible tragedy in human and environmental terms. But there are 4,000 rigs operating today without a problem. Clearly things went wrong [on the Deepwater Horizon] that aren’t going wrong on all these other sales. There’s no reason to believe we couldn’t do this off Virginia safely.”

Domenech explains that increased oversight, both by the federal government and by the oil and gas industry itself, have made the already-small chance of another accident even lower. The benefits to Virginians outweigh the extremely remote chance of an environmental catastrophe, according to Domenech.

He cites an independent study estimating up to 31,000 jobs that will be created by offshore drilling. Hundreds of millions of dollars—roughly $365 million annually according to the Virginia Chamber of Commerce—will flow into Virginia’s economy.

There’s the matter of royalties, too. The federal government, which owns the sea floor in territorial waters, collects a portion of the money made from oil and gas drilling offshore. Federal law now directs all royalty payments to Washington D.C. But Domenech suggests that could change, and if the federal government shares royalties from oil and gas leases with Virginia, “that could help with transportation, education, all the kinds of issues we care about,” he says. Domenech thinks Virginia shouldn’t have to wait until at least 2017 to develop its offshore energy resources. He supported several efforts by Virginia’s congressional delegation, most of whom support offshore drilling, to pass legislation directing the Department of the Interior to open up Virginia’s portion of the Atlantic. A political move like this is not unprecedented; Congress has passed similar legislation before. The new session of Congress is likely to see several more efforts to start exploration and drilling as soon as reasonably possible.

 

Community Concerns

Domenech’s optimism seems to be shared by localities that stand to benefit from oil and gas exploration. Most are open to the idea of offshore drilling, or at least are not outright opposed. But local officials are discovering that support for environmentally responsible offshore drilling is not a simple matter; some of the voices of concern are coming from longestablished fixtures in the community.

For example, Virginia Beach spokeswoman Mary Hancock says that city council “supports offshore oil and gas drilling as long as it is safe and has no impact on military operations.” That last condition, for Virginia Beach anyway, might be a tricky dance indeed, since much of Lease Sale 220 overlaps parts of the ocean that the military uses extensively for training exercises.

To be clear, the Department of Defense (DOD) recognizes that there are various current and potential uses for the ocean. According to spokeswoman Eileen Lainez, “The Department of Defense is committed to working with the Department of the Interior and the Bureau of Ocean Energy Management to support the development of our nation’s offshore energy resources while ensuring our ability to conduct military training, testing and operations.”

There are large portions of the coastal Atlantic that wouldn’t interfere with the military. For example, in the U.S. Minerals Management Service Mid-Atlantic Planning Area, a stretch of the ocean from Delaware Bay to the North Carolina-South Carolina border, the DOD has recommended less than one-tenth of that area be placed off limits to oil and gas drilling.

But zoom into Lease Sale 220—the only part of the Atlantic that Virginians have been trying to open to drilling—and the percentage of restricted area increases dramatically. The DOD has recommended against any oil and gas drilling in 72 percent of Lease Sale 220. Among the activities conducted in that part of the ocean, according to a 2010 Pentagon report, were “live ordinance release and impact” and “aircrew landing qualifications (day and night).”

The military suggests no oil and gas restrictions on only 22 percent of Lease Sale 220, and drilling opponents fear that populating that relatively small area with oil and gas platforms is a disaster waiting to happen since commercial maritime traffic heavily utilizes that unrestricted space.

Along with numerous military bases, Virginia is also home to NASA Wallops Flight Facility in Accomack County on the Eastern Shore. Much of what’s done at Wallops is launching rockets; the facility is ideally suited for that mission, as it’s on the shore of the Atlantic Ocean.

The idea of setting up permanent platforms in the ocean is worrisome for NASA officials, according to spokesman Keith Koehler. “Whenever we do a launch we’re responsible for safety out there [in the ocean],” he says. Prior to launching a rocket, NASA contacts the Department of Defense and other parties that may have a presence near the rocket’s trajectory to bring the risk to life and property as close to zero as they can get it.

That diligence is not just to guard against some freak accident, but because many of the rockets launched at Wallops are suborbital. They’re research rockets and designed to have parts of them—motors and payloads, for instance—fall back into the ocean to be collected later. Putting oil and gas platforms in an area where rockets literally fall from the sky is not just a risky proposition, but one that could compromise NASA’s mission at Wallops. “We need to understand the exact number and placement of the platforms in order for us to do a safety analysis,” says Koehler. “But regardless of the numbers, it’s going to have an effect as to what we can offer, what type of launches we can perform.”

What’s clear from all the voices chiming in is that drilling off the coast of Virginia is not a black-and-white issue, not just a matter of deciding to retrieve that oil and gas or not. As Virginia and the United States chart a path to the future, the fuel that ultimately takes us there will only come after long deliberations and important discussions.

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