California Sues Interior Over Offshore Leases

The U.S. Department of Interior (DOI) is being sued by California Gov. Gray Davis, the California Coastal Commission and the state attorney general's office for granting extensions on 36 offshore oil and gas leases. The extentions were granted two weeks ago by DOI Secretary Bruce Babbitt.

The governor charges the lease extensions were granted without analyzing the environmental effects under the National Environmental Policy Act and without first allowing the Coastal Commission to analyze them under the federal Coastal Zone Management Act for consistency with state requirements. Under the act the Coastal Commission has the right to review requests for suspension/extension but the DOI never gave the commission that opportunity.

The leases in question, which are located off Ventura, Santa Barbara and San Luis Obispo counties in Southern California, were issued between 15 and 31 years ago at a total cost to producers of about $1.2 billion. Since then they have been through the regulatory wringer, including several state and federal environmental reviews and multiple suspensions. Nothing has ever been developed on them, but producers are eager to move forward with revised drilling plans. The leases are not subject to the drilling moratorium that was renewed last year by President Clinton. Leaseholders include Aera Energy (Mobil and Shell), Conoco, Nuevo Energy and Noble Affiliates.

The drilling extensions/suspensions issued by Babbitt are designed to enable the companies to move forward with their revised plans, which will be subject to a new environmental analysis conducted by the DOI. In a letter to California Coastal Commission Chair Sara Wan, Babbitt said the environmental reviews on each lease would take 18 to 45 months.

Gov. Davis and the state's Coastal Commission previously had expressed concerns about expanded offshore drilling, and Babbitt said last week he shares those concerns, which is why the DOI intends to conduct an environmental review.

"Sharing concerns about offshore drilling and issuing lease extensions? I don't know, but they don't seem to go together," said Deputy Attorney General Jamee Jordan Patterson. But that's not the issue. The problem is the DOI didn't give the state an opportunity to review the requests for extension, which by law it should have done, she said.

For some time, Davis had urged the DOI to withhold the lease extensions in an effort to let the leases expire. Most recently, he instructed California Resources Secretary Mary Nichols to identify all legal and administrative actions available to stop offshore oil and gas exploration and production on the 40 undeveloped tracks in the Outer Continental Shelf off California's coast.

"I have long been an opponent of offshore oil drilling," Davis said. "If it were left up to me I would impose a moratorium on these leases. A great deal has changed in 30 years which in my mind means these leases are out of compliance. We believe their actions are an incorrect reading of the law. To mix metaphors, California is entitled to be the engine, not the caboose on this train. We are entitled to have a say at the beginning of this process, not the end of the process."

Rocco Canonica

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