Is Louisiana crying Wolf?

Thursday, July 29th, 2010
New Orleans, Louisiana

THE SKY IS FALLING, THE SKY IS FALLING
IN LOUISIANA AFTER OIL SPILL!

The “Rally for Economic Survival,” organized and orchestrated by the oil industry drew thousands to the Cajundome in Lafayette, Louisiana last week. “No Moratorium” and “Drill baby Drill” were the T-shirt slogans of the day. State officials made no bones about their willingness to have an open slugfest with the federal government. As the Lt. Governor ranted: “We are not going down without a fight.” All well and good, and there are certainly logical arguments against a long-term moratorium in the Gulf.

But perception is critical when any state is trying to take on the feds. Sure you can go to court. And Louisiana has had initial success with federal judges in New Orleans. No real surprise here, since all four federal judges in the process were loaded down with oil company investments. But the office of Minerals Management, the federal regulator in charge, can bring the permitting procedure to a slow crawl by holding hearings and requesting reams of detailed data extending the process so that it takes months, or even years to complete.

Current polls show a majority of Americans are in favor of a temporary moratorium, and major newspapers throughout the country have overwhelmingly supported a temporary halt in gulf drilling. If Louisiana is perceived as being too greedy and trying to bully the Feds into caving in on the current moratorium, will the rest of the country be supportive? The special needs of Louisiana in the wake of The Katrina and The BP disasters have made the state, rightfully or wrongfully, particularly vulnerable to the “perception factor.”

Louisiana officials continue to argue that there have been thousands of wells drilled in the Gulf of Mexico with only the one current spill. As one Louisiana congressman argued at a recent Washington hearing: “It’s almost an astonishing safe, clean history that we have there in the gulf.”

But the Washington Post reported just this week that federal records tell a different story. “They show a steady stream of oil spills dumping 517,848 barrels of petroleum into the Gulf of Mexico between 1964 and 2009. “The spills killed thousands of birds and soiled beaches as far away as Mexico’s Yucatan Peninsula. Altogether, they poured twice as much oil into U.S. waters as the Exxon Valdez tanker did when it ran aground in 1989,” said the Post.

Robert Bea is a University of California professor who has done extensive environmental studies throughout the Gulf. He has been a guest on my radio shows on a number of occasions. Professor Bea says that the issue of safety in the Gulf offshore drilling is similar to safety issues for airplanes or aspirin. There is a line or acceptability balancing risk and consequences. “The thing that is concerning is that we continue to work close to that line. Because of airline regulation, we get in an airliner with a level of comfort. I don’t have that same level of comfort when I go out to these offshore rigs.”

The state of Louisiana still has a case to make for lifting the moratorium, but it’s not one of “we’re completely right, and the feds are dead wrong.’” A logical argument could be made that whatever the past problems, the petroleum industries’ record was improving before the BP spill. It could further be argued that BP is unique in their bad safety record, and that other companies drilling in the Gulf have used advanced technology to greatly improve environmental protection. On balance, with the need for petroleum, and the significant economic harm that will take place with any long-term moratorium, the argument is in favor of continued drilling.

But how about the argument constantly made by Louisiana officials that all the deepwater rigs are in the process of picking up and moving elsewhere in a mass flight that would cause more economic havoc? And once gone, they will likely not come back to the Gulf. This type of exaggeration won’t help win allies.

It’s been over eight weeks since the announced moratorium, and 31 of the 33 rigs initially operating in the gulf before the BP spills are still there. The Wall Street Journal, certainly a pro drilling proponent, wrote this week that a continuing rig exodus is unlikely. “Oil companies have found few other promising reservoirs where they could immediately transfer their rigs. Moreover, an expected surplus of newly built rigs next year will make it easier to replace rigs that do leave. Most other industry observers agree. “The dire predictions will not come to pass,” said Amy Myers Jaffe, head of the baker Institute Energy Forum at Rice University.

“There is no reason rigs won’t migrate back,” said Tom Kellock, a consultant for ODS-Petrodata, a company providing market intelligence to the oil and gas industry. “Rigs come and go. Four rigs have actually arrived in the gulf since the May 27th moratorium announcement.”

There is a case to be made in favor of scuttling the existing moratorium, and it needs to be presented with a logical and fact based approach. Rallies instigated and paid for by the oil industry will not bring any meaningful results. And elected officials inflaming the locals with the threats of a doomsday moratorium scenario is counterproductive. With the federal government holding most of the good cards, some calmer heads in and about the state capitol in Baton Rouge need to take control of the dialogue.

This is not Louisiana’s first rodeo in taking on the federal government over oil issues. In the 1950s, then Louisiana Governor Earl Long was trying to reach an accommodation over state-federal boundaries with millions of dollars of oil ownership at stake. South Louisiana political boss Judge Leander Perez demanded that Long not give an inch to the feds, and argued that Louisiana should fight the case for as long as it might take. Long’s response became part of Louisiana political lore. “Hell Leander, you can’t fight the feds. They got the bomb!”
*****

“If you want to understand how big the federal government is, read selected portions of the Washington telephone directory containing listings for all the organizations with titles beginning with the word National.” ~George Will

Peace and Justice

Jim Brown

Jim Brown’s syndicated column appears each week in numerous newspapers and websites throughout the South. You can read all his past columns and see continuing updates at www.jimbrownusa.com. You can also hear Jim’s nationally syndicated radio show each Sunday morning from 9 am till 11:00 am central time on the Genesis Radio Network, with a live stream at http://www.jimbrownusa.com.