oil industry lobbying group is fighting back against mounting
resistance in coastal communities to proposed Atlantic offshore oil and
gas drilling with a multi-state advertising blitz touting the potential
benefits, but environmental advocates aren’t backing down.
ads promoting offshore energy development as safe, responsible and
economically beneficial began running Oct. 28 in North Carolina,
Virginia and South Carolina newspapers, including the Wilmington
Star-News. Radio advertisements with a similar message started earlier
in the month. Opponents say the ads are misleading.
Sturgill of Southport, the southeast campaign coordinator for national
conservation group Oceana, called the ad campaign a “desperate attempt
to stem the tide of growing opposition” to drilling on the Atlantic
outer continental shelf, or OCS, off North Carolina and other states.
information in the ad is from a flawed report, an old flawed report,”
Sturgill said of the ads paid for by the American Petroleum
Institute and its state affiliate, the N.C. Petroleum Council, or
NCPC. “They’re still using numbers that have time and time again been
proven to be inaccurate. They are grasping at straws. It’s smacks of
McGowan, NCPC’s executive director, said in a press release announcing
the campaign that the petroleum industry already supports more than
140,000 jobs in North Carolina. Oil and natural gas development in the
Atlantic OCS could create an additional 55,000 jobs for North
Carolinians, he said. It would also help drive down energy costs for
consumers and raise nearly $4 billion in state tax revenues by 2035 if
the state succeeds in getting a revenue-sharing agreement with the
Carolinian voters embrace safe, responsible offshore energy
development,” McGowan said. “With new technologies, offshore energy
development is safer than ever and continues to drive coastal U.S.
economies while existing with tourism and fishing. This opportunity is
important to North Carolina’s future, expanding job opportunities and a
key engine for the state economy.”
declined the opportunity to respond to critics of the campaign,
including Sturgill. “At this point, we are going to let the press
release serve as our public comments on the ad campaign,” he said.
press release echoes the projections that appear in the ads, which are
tailored for the individual states. However, the ads disclose that the
figures come from a 2013 report by Quest Offshore Resources, a
Texas-based company that does research for the industry.
said the report had been widely discredited. He pointed to a more
recent study by Doug Wakeman, an economics professor at the Meredith
College School of Business in Raleigh and a member of the N.C. Coastal
Federation’s board of directors. Wakeman contends the report’s
employment and economic projections are questionable.
a matter of where they actually expect to be most successful in terms
of drilling,” Wakeman said in June. “The place where the most
attractive oil deposits are is fairly well north along our coast.
Does that mean oil production and those jobs would go to more to places
like Virginia Beach and the Norfolk area?”
oil prices are also a critical factor in trying to determine the
economic benefits of drilling for the state, Wakeman explained. Higher
prices not only mean greater profits for the oil companies, he said,
but they also encourage drilling in economically marginal places.
oil sells at $120 a barrel, as it did a couple of years ago, deposits
that are expensive to drill, such as those in the deep-water Atlantic,
are profitable, Wakeman said. They become less profitable as the price
Quest report and industry proponents suggest untapped natural oil and
gas resources in the Atlantic could prove to be huge – 1.34 million
barrels of oil equivalent per day by 2035. The Quest report was
released in December 2013 before the federal Bureau of Ocean Energy
Management, or BOEM, announced its proposed leasing program for the
mid-Atlantic. The 2017-2022 offshore oil and gas leasing program
unveiled in January includes a 50-mile barrier and one lease sale in
2021 in federal waters off the Atlantic coast stretching from Virginia
report does not consider the 50-mile buffer. It assumes leasing in the
mid- and south Atlantic would begin in 2018 and does not include the
single-lease sale cap. Those restrictions have an effect on the numbers
in the Quest report, which has been routinely cited by politicians,
including Gov. Pat McCrory.
said the report assumed that the amount of oil that would be found with
new technology would mimic what’s been found in other places. The
economic projections in the report can be regarded as “likely
overestimates,” he said.
terms of lower prices, consumers may not notice a difference at the
pump. Though nearly all domestic oil is kept in the U.S., the
Organization of Petroleum Exporting Counties, or OPEC, still sets gas
prices. Consumers in Alaska, which has the lowest gas tax in the
country, still pay about 50 cents more per gallon than in North
Carolina. Gas prices in other oil-producing states, including Texas and
Louisiana, aren’t much cheaper than what North Carolinians pay today.
Riggs, an East Carolina University geologist and an expert on the North
Carolina coast and its offshore waters, is also critical of industry
projections. During a recent talk sponsored by the Sierra Club in
Morehead City, Riggs noted that numbers cited by the industry were the
same almost 30 years ago, in 1988, when a moratorium on drilling was
put in place.
also noted that in citing the potential economic benefits for the state
– “with smart legislation (drilling) could generate almost $4 billion
in revenue for the state in the next 20 years,” the ad states – the
study assumes the federal government will share royalties from lease
sales and production with the states. Such an agreement exists only on
the Gulf Coast and that program is out of favor, with federal officials
working to eliminate it.
revenue-sharing bill for the East Coast states has been introduced,
pushed by McCrory and the state’s pro-drilling Republican senators,
Thom Tillis and Richard Burr. But the Obama administration’s Interior
Department is opposed because the measure would add to the federal
County Shore Protection Officer Greg “Rudi” Rudolph recently told the
county’s beach commission that if a revenue-sharing were to pass, he
believes the president would veto it. Obama is proposing that offshore
revenue sharing in the Gulf be used instead for “broad natural
resource, watershed and conservation benefits for the entire nation.”
It’s part of his $4 trillion budget, unveiled in February.
Secretary Sally Jewell was widely quoted as saying revenue sharing for
select Gulf Coast states should be re-examined to provide “a fair
return to the taxpayers across the whole United States.” She said the
Land and Water Conservation Fund would be a good place for the money to
go. Others have noted that the revenue sharing for the Gulf was enacted
only after Hurricane Katrina devastated the area in 2005, and was
largely seen as an effort to help repair the area’s economy.
industry ad also states that, “71 percent of North Carolinians agree
(that) safe and responsible offshore oil and gas development works for
North Carolina,” but Sturgill said that level of agreement is doubtful.
coastal towns – including Emerald Isle, Morehead City, Beaufort and
Atlantic Beach in heavily Republican Carteret County – have responded
to local opposition to drilling by adopting resolutions. Wilmington,
Carolina Beach and others are on record as opposing offshore seismic
testing and drilling. More than 85 East Coast communities have approved
similar resolutions. Opponents cite the potential damage to the tourist
and fishing industries. Sturgill mentioned other polls which disagree
with the industry’s numbers.
said opposition has continued to grow. He said the anti-drilling
movement has “exploded,” with the pace of resolution-adopting growing
rapidly and the sentiment spreading inland, all the way to the state’s
not just coastal residents who care about the coast and what happens to
it,” he said. “People all across the state view the coast and its
natural resources as treasures. They don’t want to see the
infra-structure that goes with the oil industry at our coast. They
don’t want to risk the loss of those treasures for a small number of
jobs and a very limited supply of oil. It’s not worth it.
are seeing through the industry’s blatant propaganda,” Sturgill added.
“They know there is plenty of credible evidence out there to put to
rest the industry’s claims. They’ve seen it
article is provided by Coastal Review Online, an online news service
covering North Carolina's coast. For more news, features, and
information about the coast, go to www.coastalreview.org.)