March 8, 2018
Ms. Kelly Hammerle
National OCS Oil and Gas Leasing Program Manager
BOEM (VAM-LD)
45600 Woodland Road
Sterling, VA, 20166-9216
Ms. Hammerle,
The Business Alliance for Protecting the Atlantic Coast (“BAPAC”) submits these comments regarding the U.S. Bureau of Ocean Energy Management’s (“BOEM”) 2019-2024 Draft Proposed Outer Continental Shelf Oil and Gas Leasing Program (“DPP”) and Notice of Intent to Prepare a Programmatic Environmental Impact Statement.
Formed in September of 2016, BAPAC’s mission is to ensure the long-term health and economic vitality of the Atlantic seaboard through responsible stewardship of the coastal and ocean waters. Today, from Maine to Florida we have over 42,000 Atlantic Coast business and 500,000 commercial fishing family supporters of our prime objective of opposing offshore drilling and testing for oil and gas off the Atlantic Coast.
These supporters include business organizations including state and local chambers of commerce and associations representing hotels, restaurants, commercial fishing, marine industry and tourism. Supporters also include hundreds of individual businesses that have signed numerous petitions against seismic testing and oil drilling off the Atlantic Coast.
The business organizations supporting BAPAC:
Atlantic Avenue Alliance (VA Beach)
CABA-Climate Action Business Association
Cape May County Chamber of Commerce
Carteret County Chamber of Commerce
Center for a Sustainable Coast
Chesapeake Sustainable Business Council
Greater Ocean City Chamber of Commerce
Green America’s Green Business Network
Lowcountry Local First
Lynnhaven River NOW
Maine Coast Fishermen’s Association
Marine Industries Association of South Florida
Miami Beach Chamber of Commerce
New Jersey Tourism Industry Association
New Jersey Restaurant & Hospitality Association
Northwest Atlantic Marine Alliance
Ocean City Hotel-Motel Restaurant Association
Outer Banks Chamber of Commerce
Savannah Riverkeeper
South Carolina Small Business Chamber of Commerce
Virginia Beach Restaurant Association
Virginia Beach Hotel Association
On August 17, 2018, in response to a BOEM request for information (“2019-2024 national Outer Continental Shelf Oil and Gas Leasing Program), the South Carolina Environmental Law Project submitted BAPAC comments which are attached as additional BAPAC comments for this current request.
These previously submitted comments are still valid today and address each of the eight factors BOEM must consider when determining the timing and location of offshore oil and gas exploration, development, and production.
However, this submission will examine only three of these factors to expand BAPAC comments.
An equitable sharing of developmental benefits and environmental risks among the various regions
and
The location of such regions with respect to other uses of the sea and seabed, including fisheries
Developmental benefits can only truly be determined after consideration of developmental costs. While the petroleum industry likes to tell each state that drilling for oil off their coast will result in tens of thousands of new jobs, the reality is that this large number of promised new jobs could only result from the development of on-land infrastructure to move, store and process oil. Clearly, even if offshore drilling were permitted in the Atlantic, each coastal state would not be targeted for such industrialization. Thus, the petroleum industry’s promise of jobs to every state is a “pipedream.”
However, let’s assume that offshore drilling for oil in the Atlantic were permitted and based on anticipated Atlantic OCS oil reserves the petroleum industry selected a single state for the needed industrialization (the strong state opposition to this scenario will be addressed later).
Today nearly 1.4 million jobs and over $95 billon in gross domestic product are created along the Atlantic Coast by businesses in the tourism, commercial fishing and recreation industries. The consequences of petroleum industrialization of one area in one state, according to the oil-drilling advocates, would create up to 35,000 new jobs.
Even if there never was an oil spill or leak from the drilling and transportation efforts, the tourism crowd-out by the industrialization would easily match or exceed the number of new jobs. Tourists will not visit and spend their money in an area that has been industrialized. The impacted local tourism business community would suffer and eventually collapse. While the petroleum industry will say that the new jobs will replace the tourism jobs, the net jobs benefit will be approximately a wash.
BAPAC contends that there is not an equitable share of developmental benefits to existing tourism businesses, which will never be compensated for their loss while the petroleum industry would financially benefit.
However, the above analysis assumes no oil spills and leaks. The reality would be much different for the environment and related current businesses and jobs.
When you drill, you spill.
The federal government admits that oil spills are inevitable and has even predicted the number of spills every year per every 1,000 barrels of oil produced. The Bureau of Ocean Energy Management reports 2,440 oil spills in the Gulf between 1964-2015 and 497 oil “accidents” in 2016. Federal records show that 20% of all oil spills are due to human error. One Gulf oil rig has leaked over 232,850 gallons of oil since 2004 and the owner, Taylor Energy, says that the leak cannot be stopped.
While every spill would not be at the level of the 2010 Deepwater Horizon Gulf spill, a review of the causes of that spill and its economic consequences is instructive. (Attached is a summary of the Deepwater Horizon spill prepared by Dick Wilderman.)
As a result of this human-error caused spill and in addition to the 11 men killed and 17 injured, Louisiana’s leisure-visitor spending dropped by $247 million in that year alone. Six weeks after the spill, Gulf Coast hotel cancellation rates rose to 60%, and 84% of the hotels reported difficulty booking future events.
The impact on the Deepwater Horizon spill to existing businesses was staggering. In November of 2013 the SBA Office of Advocacy released a report (No. 417), “Small Business Impacts Associated with the 2010 Oil Spill and Drilling Moratorium in the Gulf of Mexico.” Here were two of its findings:
- The closure of fishing areas not only affected the commercial fishing sector, but also the seafood processing plants and distribution centers.
- The oiling of the shoreline and commercial fishing areas closures brought recreational fishing to a standstill. The loss of income at this level affected the outfitters, guides and associated businesses, as well as the restaurant and accommodation industry. Tourism activities also came to a halt, except for the hotels and motels that rented rooms and businesses that provided goods and services to clean-up officials and the press.
While oil-drilling advocates claim that offshore drilling is much safer today, again the reality is quite different.
Following the Deepwater Horizon spill, the Bureau of Safety and Environmental Enforcement (“BSEE”) put in place two new rules recommended by a bipartisan national commission to address production safety systems and well control, critical to helping prevent similar disasters. Now the BSEE intends to roll back these rules and once again rely on the oil and gas industry to police itself, thus abdicating the federal government’s responsibility to protect our water and land from corporate behavior that prioritizes profits at the expense of local economies.
Even the ability of oil-producing states and the federal government to respond to spills and leaks is being curtailed. The Trump Administration has proposed eliminating revenue sharing from oil leases with Gulf states. Such revenue sharing has never been approved by Congress for any other states. In addition, Congress has let expire the 9-cents-per-barrel tax on both domestic and imported oil and related products that feeds the Oil Spill Liability Trust Fund. Clearly their would be no quick relief along the Atlantic Coast from spills and leaks.
Which brings us back to the issue of equitable sharing of developmental benefits and environmental risks to not only the selected Atlantic Coast petroleum industrialized area but to the rest of that state and adjacent states.
When the inevitable spill and leaks occur, as predicted by the federal government, we can anticipate similar economic consequences as reported in the Office of Advocacy study mentioned above. Jobs associated with the commercial fishing, seafood processing plants and distribution centers will be lost. Recreational fishing will be halted creating job loss to outfitters, guides and associated businesses. Restaurants, hotels and their suppliers will take a significant economic hit, and thus eliminate jobs. Whatever tourism activities that have managed to survive after the industrialization of the area will finally succumb to the oil industry and its consequences.
No longer will any new jobs from petroleum industrialization simply displace an equal number of existing jobs in an area, oil spills and leaks will result in a net job loss for the area. So while the petroleum industry continues to benefit, the local impacted economy will we devastated. There will be no equitable sharing of benefits even within the industrialized area.
However, job loss and economic harm won’t just be in the petroleum industrialized area of one state. The oil spills and leaks where ever they occur in the Atlantic will have a negative impact on the entire state, adjacent states and possibly the entire coast.
Oil spills and leaks do not recognize state borders. The Atlantic currents will move the oil depending on where the spills and leaks occur as well as toward shore. As a result, the states that did not “benefit” from industrialization will still pay the economic price of oily beaches and water with the accompanying loss of tourism dollars and thus jobs. Commercial and recreational fishing will be curtailed in those areas along with the jobs that depend directly and indirectly on these industries dependent on a healthy ocean.
These spills and leaks have a lasting negative impact on affected local, state and multiple states even after a clean-up. Today as a result of offshore oil drilling, hotels on the Gulf and Pacific Coasts provide wipes to those walking on the beach to remove oil and tar balls off their feet. This negative consumer experience must have an impact on the quality of a beach experience and the subsequent decision both the length of stay or even the location of the vacation.
The Atlantic Coast beaches do not have such a tar ball problem. Pro-drilling advocates say that tar ball issues are caused half the time from natural oil seepage in the ocean. However, in a 2008 satellite survey and analysis used to identify likely reserves of oil below the ocean floor, NASA found no natural seepage along the Mid-Atlantic OCS (attached). Thus, the inevitable tar balls on Atlantic Coast beaches and the negative impact on tourism will be the result of only offshore oil drilling.
BOEM’s consideration of the two factors addressed in this section can clearly only conclude that offshore oil drilling on the Atlantic Coast would not be an equitable sharing of developmental cost versus benefits or environmental risks versus benefits. The petroleum industry would be the overwhelming beneficiary when weighed against the impact to the local industrialized area, the rest of that state and the other Atlantic Coast states.
Also, commercial fishing and fisheries would not be compatible with any offshore oil drilling location and the inevitable spills and leaks.
There would be only one clear winner with offshore oil drilling and industrialization of an Atlantic Coast area—the oil industry.
Laws, goals, and policies of affected States which have been specifically identified by the Governors of such States as relevant matters
The Governor of Maine is the only Atlantic Coast governor supporting drilling for oil and gas off the shore of his state. The rest have all loudly expressed opposition to offshore drilling with the exception of the Governor of Georgia, who has expressed concerns at this time.
As a result of its Governor’s protests, Florida has been told that at the end of the planning process it can expect to be excluded from a new five-year oil leasing plan because it “is unique and its coasts are heavily reliant on tourism as an economic driver.”
More recently, New Jersey Congressional leaders were given the indication that their state would also eventually be excluded from a new five-year plan based on its low oil reserves, lack of onshore infrastructure and unanimous Congressional bipartisan opposition.
It is clear that every Atlantic Coast state is unique when it comes to its coast. Every Atlantic Coast state depends on tourism to drive its economy. No Atlantic Coast state has onshore infrastructure required for petroleum industrialization. Every state has bipartisan, even if not unanimous, Congressional opposition.
The elected leaders of the Atlantic Coast—from the Governors of all but two states, the Congressional delegations, state legislators and local government officials—have overwhelmingly rejected allowing offshore drilling for oil off their coasts. The policy of the affected states is clear. Drilling for oil and gas on the Atlantic Coast OCS should not be allowed.
Conclusion
After BOEM completes its consideration of all the required factors (all of which are addressed in the comments from other and in our August 17, 2017, comments), it should come to the same conclusion as it did for the 2017-2022 OCS Oil and Gas Leasing Proposed Program (attached).
In March of 2016 BOEM stated:
After taking considerable effort to better understand these issues as well as the application to the Atlantic of all the Section 18 factors, the Mid- and South Atlantic Program Area lease sale proposed in the DPP is not included in the Proposed Program.
However, BOEM should not only exclude the Mid- and South Atlantic Program Areas, it should exclude every Atlantic Coast Program Area from Maine to Florida.
Sincerely,
Frank Knapp Jr.
President & CEO
Business Alliance for Protecting
the Atlantic Coast