How offshore drilling became a losing proposition

When the small town of Cape May, New Jersey, held a “Save our Seas” rally on a blustery Monday in March, close to 400 people showed up to protest offshore drilling or exploration.

That was a big number, says Vicki Clark, the president of the county’s chamber of commerce. “New Jersey is very partisan, but our entire congressional delegation is united in the position of opposing the administration’s plan for exploration and drilling in the Atlantic,” she says.

On one hand, she says, there are the threats to coastal economies and ecosystems from a spill. On the other, densely populated Atlantic states like New Jersey lack greenfield sites for oil refining infrastructure, so there’s limited investment upside. “It’s all risk and no reward for us,” she says.  

Now, a year after the Trump administration proposed opening up more than 90 percent of federal waters to oil and gas leasing, the administration is putting its plans on hold.

The reason, newly confirmed Interior Secretary David Bernhardt told The Wall Street Journal last week, is uncertainty in the wake of a recent court ruling in Alaska that reinstated an Obama-era ban on oil and gas drilling in much of the Atlantic and Arctic waters.  

But the original proposal was also met with near-universal disapproval along America’s coasts, uniting many Republicans and Democrats in a rare bipartisan pushback.

The “Drill, baby, drill” rallying cry of the 2008 GOP presidential campaign has shifted for many Republicans, especially those living along the coast. A pro-drilling sentiment and the promise of oil wealth and energy independence are still strong in conservative circles, but it now faces countervailing trends.

These include active grassroots organizing and education efforts; growing coastal economies that depend on tourism, fishing, and a healthy ocean ecosystem; and memories of the 2010 Deepwater Horizon disaster, which killed 11 people and caused the largest-ever oil spill in U.S. waters. 

Claire Douglass, a longtime campaigner against offshore drilling, says many people she talked to supported drilling in the abstract. “But when you help them connect the dots, of how it’s going to affect their own communities and their way of life, it’s a different story. It makes it more real; it’s more tangible,” says Ms. Douglass, national campaign director for the National Audubon Society, an environmental nonprofit. 

For months, both drilling advocates and those opposed have speculated over what the Trump administration’s final plan would be. The oil industry has long sought expanded access to offshore deposits even though U.S. oil production and exports are currently at record highs, primarily due to fracking. 

President Donald Trump’s initial plan was panned by governors along both coasts, including Florida's, whose Republican governor Rick Scott won an exemption that was seen as a political sop to help Florida Republicans in the 2016 midterms. But it was unclear if Secretary Bernhardt, who took over as acting Interior secretary in January and was confirmed earlier this month, would honor that agreement. 

Offshore oil and gas extraction in Alaska has long been controversial. Before leaving office, President Barack Obama issued an executive order to block offshore drilling in parts of the Arctic and Atlantic Oceans. Last month, a federal judge in Alaska ruled that Mr. Trump lacked the authority to overturn this order, dealing a major setback to his policy of expanding U.S. offshore production.

The administration is appealing the ruling, but the process is likely to take a while, and the ban remains in effect unless it is reversed.

“By the time the court rules, that may be discombobulating to our plan,” Mr. Bernhardt told The Wall Street Journal.

Finding common ground

Secretary Bernhardt also acknowledged in the interview that the opposition from coastal governors and lawmakers has been an issue and that finding common ground has been a challenge.

Those coastal politicians, regardless of political party, have in recent years become more firm opponents of offshore drilling, along with their constituents. For many of those constituents, the reasons are economic: Coastal economies are flourishing and depend on a healthy ocean ecosystem. Even seismic testing – which, in the Atlantic, would precede any potential drilling – can pose a threat to marine life before the risk of a colossal spill like Deepwater Horizon’s.

It’s an issue that can even help tip elections. South Carolina Rep. Joe Cunningham, a Democrat, won an upset victory last year – the first time since 1986 that South Carolina Democrats have flipped a House seat – largely on the basis of his opposition to offshore drilling.

In a statement last week on the administration’s decision, Mr. Cunningham drove home the point. ”This decision is the result of constant pressure from coastal communities, environmental groups, and elected officials who made it abundantly clear that offshore oil and gas drilling is dangerous, unwanted, and a threat to our economy and way of life,” he said.

Other coastal Republicans, including Trump loyalists and longtime supporters of drilling and energy independence, have taken note. In the past year, many governors and both local and federal lawmakers have urged a moratorium on drilling or seismic testing in the Atlantic.

“I support an all-of-the-above type energy policy,” says Buddy Carter, a Republican congressman from Georgia whose district stretches along the state’s coast. “But as much as I believe in offshore energy, I believe more strongly in state sovereignty. The people of the 1st District have made it known that they don’t want this yet until they get some answers.”

Representative Carter recently asked that Georgia be excluded from any offshore drilling plans. He complains that when the administration held public meetings about offshore drilling, they went to Atlanta. “The further inland you move, the less resistance you get,” he says. “The people who live on the coast – they’re the ones opposed to it.”

To some of those not on the coast, such opposition can seem extreme, given that it’s not yet clear whether drilling in the Atlantic is economically viable, absent seismic testing of reserves. 

“I’ve never seen an issue come up before where people just don’t want the information,” says Don Weaver, president of the South Carolina Association of Taxpayers, which supports seismic testing.

He’s skeptical about claims that seismic testing will harm marine life and wants to see the state benefit from offshore oil exploration, particularly if it becomes more profitable in the future. 

A tough sell in Florida

For areas like Florida’s Gulf Coast, where the prospect of drilling wells is more immediate and there’s strong interest from oil companies, opposition is even more solid. One reason: tourism and fears of what spills could do to tourist-dependent towns. 

Since the Deepwater Horizon disaster, “I have not met one person who could tell me that exploring in the Gulf waters and Florida state waters is a great idea,” says Robin Miller, president of the Tampa Bay Beaches Chamber of Commerce. While no tar balls washed up on Tampa Bay beaches after the spill, says Ms. Miller, widespread perception that the entire Florida Gulf coast was covered in oil drove tourists away; numerous local businesses suffered losses or had to close.

“If anyone could say there is anything to come out of that explosion that had anything positive, it’s the effects that it has had on the current political landscape on making a decision to drill in those waters,” Ms. Miller adds.

For now, it’s not clear when or if the Trump administration will be able to open up more federal waters for drilling. Opponents say the respite should give decision-makers even more pause about the wisdom of expanding drilling, especially at a time when U.S. fracking has raised oil production and exports to record highs.

“Our main message is that the Trump Administration’s approach is reckless,” says Andrew Hartsig, director of the Arctic program for the Ocean Conservancy. “The ocean is a vital food source for many people and a source of economic livelihood. They’re jeopardizing all of this in the push to expand offshore drilling.”