An oil tanker passes near DCOR LLC's Edith offshore oil and gas platform in the Beta Field off the ... [+]
The Trump administration has decided once again to butt heads with the state of California. The issue now is not over vehicle fuel standards but rather, it is about drilling off-shore in public areas. The measure would give oil and gas producers access to 725,500 acres from central to northern California.
The move is consistent with the president’s positions on increasing domestic oil and gas supplies. But it makes a stronger political statement than it does a practical one: while companies can apply for leases to drill, they must still overcome legal and regulatory hurdles. In other words, environmental groups will contest this in court even before any entity may try and get a permit to drill. And all that risks is topped by the fact that drilling is unproven in those waters.
Moreover, “In California, we're already well on our way to energy independence and we're doing it in the smart way. This is 2019, not 1920. We don't need to jeopardize our health or our environment to develop the energy sources we need,” California’s Attorney General Xavier Becerra said.
Specifically, the Department of Interior’s Bureau of Land Management said on Friday that up to 37 new oil and gas leases will be developed over 20 years in the contested region. The move would end a six-year moratorium that began in 2013 when a federal judge ruled that the fossil fuel companies had not given adequate attention to the environmental impact from hydraulic fracturing.
In May 2019, though, the bureau completed its examination and concluded that any future drilling would be both safe and wildlife-friendly. It emphasized that its decision does not authorize any production — just the ability to apply for leases. The bureau also said that 3,000 jobs and $620 million in tax revenue could be generated from allowing drilling off the coast of central California.
Interestingly, California now produces nearly 10% of the nation’s oil, which is on par with that of Alaska. Among the leading developers there are Chevron Corp. and Occidental Petroleum, as well as Plains Exploration, Linn and Breitburn. Altogether, at least 32 drilling sites exist both on land and offshore, which have operated safely. Still, a pipeline did burst in 2015, which released 123,000 gallons of crude oil near Santa Barbara and which killed uncommon wildlife — a case that led to a guilty verdict against Plains All American Pipeline Co.
The Calculus
Even with the current economic and political risks, producers may choose to go ahead and apply for the leases: new technologies may change the calculus.
“Safely used for more than 60 years throughout the oil and gas industry, the process in California typically produces liquid oil rather than natural gas and has never been shown to adversely affect the state’s environment, drinking water supply or pose any risk to nearby residents,” says the Western States Petroleum Association.
Fracking, of course, is the method by which producers extract tight oil and gas — a process that uses a concoction of water, sand and chemicals to break those deposits free from the rocks where they rest a mile beneath the ground. The California Council on Science and Technology issued a report in 2015 that cautioned against drilling in the region’s shallow waters, saying that the chemicals could invade drinking water supplies.
At the same time, California is setting the national pace when it comes to dealing with carbon emissions and the transition to a clean energy economy. By 2050, California hopes to have cut its greenhouse gas emissions by 80%. California has already enacted several measures — everything from a cap-and-trade program to renewable portfolio standards to more fuel efficient vehicles. It’s also heavily involved in water conversation, battery storage and energy efficiency.
State lawmakers have therefore passed bills that would outlaw any pipeline infrastructure from crossing the state — a clear effort to block Trump’s moves to expand oil and gas drilling rights there. The current governor is expected to sign the legislation. The measure complements one approved by former governor outlawed any state agency from granting the right to add new pipes and piers to move fossil fuels from federal waters to state land.
“This reckless move is the toxic convergence of Trump’s climate denial, loyalty to the oil industry and grudge against California,” Clare Lakewood, a senior attorney at the Center for Biological Diversity, said in a press statement.
Oil and gas companies are used to taking risks. And while they may apply for leases, they are unlikely to start producing in the sensitive areas just off of the California coastline. There will be less bruising battles than this one — especially because the state has branded itself the denizen of the 21st Century green economy.
SEE ALSO:
Some Oil And Gas Companies May Want To Drill In The Arctic Too
