Judge Rules California May Bar Offshore Drilling

A federal judge has effectively blocked new drilling off the California coast, ruling that the state first has to decide whether future drilling would impair the surrounding environment. The ruling comes on the heels of scheduled public hearings this month on the Minerals Management Service's draft environmental impact statement covering proposed drilling offshore Santa Barbara (see NGI, June 25).

The decision by U.S. District Court Judge Claudia Wilken of Oakland bars exploration in undeveloped tracts in federal waters off the California coast until the California Coastal Commission can review the impact on water quality, marine life, air quality and scenic vistas. Gov. Gray Davis and several environmental groups had filed a lawsuit two years ago to block development of 38 offshore leases that stretch from Port Hueneme to San Luis Obispo (see NGI, Nov. 22, 1999).

Already, California and federal moratoriums prevent new offshore drilling, but the moratoriums do not apply to many fields that were never opened to production but were leased between 1968 and 1984. The Clinton administration decided to allow companies to begin exploration on those leases on the grounds that states had no oversight role in the early stages of work.

However, Wilken's ruling states that federal law allows the state to decide whether drilling is consistent under California's coastal protection laws.

Peter Douglas, the executive director of the California Coastal Commission, who opposes offshore drilling, said that the California coast is different than when the leases were issued to the energy industry 30 years ago. He cited sea otter populations that are now in decline, and noted that marine sanctuaries have been established. Also, he said increased beach tourism is a big part of the state's economy, which could be hurt with more drilling.

Douglas said the commission would begin a review that should last several months to ensure that any future drilling activities conform to the state's rules. The commission has the backing of Davis, who contends that the leases are too old and conflict with coastal protection efforts.

Production already under way offshore in California waters and developed federal tracts will not be affected by the judge's decision. However, the MMS said it would continue with its plans to conduct public hearings in July on delineation drilling off Santa Barbara, noting that the district court decision was a technical opinion that did not preclude future drilling activities.

There also is another potential problem, and that is whether the California Coastal Commission itself actually has authority. Wilken's ruling comes after a Sacramento Superior Court judge ruled in April that the commission is unconstitutional as it is currently configured. The court ruled that the California legislature appoints too many commissioners to state agencies that operate as part of the executive branch. That ruling is being appealed by the Davis administration.

MMS estimates that in the past 32 years, the Pacific Outer Continental Shelf has produced more than 950 MMbbl and 1.1 Tcf. It estimates that about 400 MMboe remain to be recovered from the 43 producing leases and as much as another billion from the currently undeveloped leases.

©Copyright 2001 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.