Trump Seeking Biggest Offshore Drilling Increase in Decades

Photo: Shutterstock / marchello74

By Jennifer A. Dlouhy (Bloomberg) — The Trump administration is poised to open the door to selling new offshore drilling rights from the Atlantic Ocean to the Arctic Sea, igniting a fight with coastal residents worried about oil spills befouling beaches and jeopardizing tourism dollars.

The proposal — set to be the most expansive such offering in decades — is a response to President Donald Trump’s April order encouraging the Interior Department to auction drilling rights in Atlantic waters that former President Barack Obama ultimately ruled out after a backlash from communities up and down the U.S. East Coast.

The plan, set to be unveiled in the coming days, will propose auctioning oil and gas drilling rights in the Arctic Sea, the Atlantic Ocean, the eastern Gulf of Mexico and possibly Pacific waters around the U.S., said people familiar with the program who asked not to be identified before a formal announcement.

Trump’s proposal will meet the same opposition that encouraged Obama to scrap proposed Atlantic drilling, vowed Sierra Weaver, a senior attorney with the Southern Environmental Law Center, a conservation group.

“We know there’s a bull’s-eye on the southeast,” Weaver said. “The coast woke up last time around, and they definitely know what’s at stake, they know they need to raise their voices, and they now know what their coast is worth.”

The Interior Department’s draft is only an opening bid — and the plan could change after public meetings and required environmental reviews. Nonetheless, it will illustrate the Trump administration’s interest in giving the oil industry new places to drill offshore, well beyond the Gulf of Mexico that has been developed for decades.

That is expected to also include Pacific waters off the U.S. West Coast, despite opposition from lawmakers for California, Oregon and Washington state. The government last sold oil leases off the coast of California decades ago, and there has been opposition to offshore drilling in the region since a 1969 oil spill near Santa Barbara.

“We expect the administration to propose offshore drilling nearly everywhere in our U.S. oceans, including off Florida’s Gulf Coast, the Atlantic, the Pacific, and even in the harsh conditions of the Arctic,” said Diane Hoskins, campaign director for the marine conservation group Oceana. Such a move would “ignore widespread and bipartisan opposition to offshore drilling including more than 150 municipalities nationwide and over 1,200 local, state, and federal officials.”

It also would flout the wishes of the governors of North Carolina and Virginia who expressly asked that the Trump administration leave their states out of any new offshore drilling plan.

Still, the administration’s plan dovetails with the wishes of oil industry leaders who lobbied the Interior Department to sell drilling rights in the U.S. Atlantic as a way to complement existing oil production in the Gulf of Mexico. They also have pushed the Trump administration to sell drilling rights in Arctic waters north of Alaska and in the eastern Gulf of Mexico — where federal law bars new oil leasing through 2022.

While most U.S. waters are technically open for oil and gas development, the activity can only take place on leases sold under the government’s five-year plan. The coming draft proposal is an initial milestone in the Trump administration’s creation of a new plan for selling offshore oil and gas leases from 2019 to 2024, designed to replace an Obama-era program that runs through 2022.

The legal process for assembling that drilling blueprint starts broad, with the number of potential sales and the available acreage often whittled down as regulators move from an initial draft to a proposal and ultimately, the final program. Once offshore areas are yanked out, they can’t be easily restored.

“We should keep as many options on the table for our future oil and gas and energy needs,” said Erik Milito, a director with the American Petroleum Institute. “The decisions that are being made now are really decisions about five, 10 and 15 years down the line. We don’t want to prematurely take areas off the table that may be critically important for our energy and national security down the road.”

Like Trump’s Interior Department, the Obama administration also initially considered selling oil and gas leases in the Atlantic and the Arctic Oceans in a draft version of its 2017-2022 offshore oil plan. But that administration ultimately jettisoned the idea and Obama went even further in December 2016 by indefinitely withdrawing more than 100 million acres of the U.S. Arctic from future oil and gas leasing.

© 2018 Bloomberg L.P

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