Obama’s Smart Move in Banning Drilling

The moaning was loud when President Barack Obama last week banned oil drilling offshore of the East Coast until 2017.

Politicians from Democratic Sen. Mark Warner to Republicans such as Congressman Eric Cantor and Gov. Bob McDonnell decried the move.

“It demonstrates a complete lack of confidence in (industry’s) ability to fix the problems experienced in the gulf spill, and no confidence in the ability of the U.S. government to better plan for and react to offshore emergencies,” McDonnell cited angrily in a statement. The governor has seen his grand plans to push with offshore drilling to help fund Virginia’s massive transportation problems squashed more than once.

Obama’s decision, of course, comes after the Deepwater Horizon disaster this past spring and summer which was the worst environmental predicament ever faced in the U.S. Some Virginians had hoped for a 2012 lease sale to exploit oil reserves that may or may not be out there.

Now comes the Wall Street Journal, not exactly an environmentalist rag, with a front page story that there has been a rash of close calls with offshore oil rigs over the past two years after decades of improving safety records. The Journal reviewed the records of the countries with the most experience with offshore drilling. The United Kingdom saw a 39 percent increase in serious incidents involving North Sea rigs. Australia likewise saw a spike including a near blowout such as the Deepwater Horizon situation. Norway say a 48 percent spike in incidents since 2008.

How come? The Journal says that there’s a mad rush to deep, offshore drilling because oil from shallow water areas is running out. Yet there aren’t enough experienced workers to handle the extra difficulties of drilling a mile or so down. The demand for profits and spotty enforcement also complicate deep water drilling.

Experts say that that disasters such as Deepwater Horizon are “low probability” but “high consequence.” “This accident was bound to happen,” says Nancy Leveson, an expert at the Massachusetts Institute of Technology who has studied the BP Deepwater mess.

The problem with people such as McDonnell and Cantor, and to some extent Warner, is that never seem to go beyond consulting with oil lobbyists when it comes to the dangers of drilling off Virginia. Or, they use data without much thought. McDonnell, for instance, has cited the supposed economic benefits from drilling according to an Old Dominion University report. But the author of that report says it was a quickie job and shouldn’t be taken seriously.

Virginia has a lot to lose in the event of an offshore rig disaster. Other industries (real ones) affected include seafood, commercial shipping and the military, all of which have questioned the need for drilling when it isn’t even clear the reserves are out there.

At least Obama has the sense to slow down the parade to offshore drilling.

Peter Galuszka


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12 responses to “Obama’s Smart Move in Banning Drilling”

  1. Here's an irony not noticed by many.

    McDonnell and his say that govt already spends too much, is wasteful and inefficient and instead of money money – we need to "starve the beast".

    so what does McDonnell do?

    he sets his sites on something NEW to tax.

    All the right-wing arguments about not taxing business because it hurts the economy and reduces jobs – is ignored.

    In stead of McDonnell promising that he would not tax offshore oil – he does the opposite.

    In other words, he's look for NEW, ADDITIONAL Tax revenues even as he maintains that the govt already taxes too much.

    He took the same approach with the ABC issue.

    It was not so much about privatizing it – but coming up with new taxes at the various distribution steps – to generate additional revenues to the state – the same State that he continues to say – does not need more money – but needs more cuts.

  2. James A. Bacon Avatar
    James A. Bacon

    Peter, Here's the key sentence in your post: "The Journal says that there's a mad rush to deep, offshore drilling because oil from shallow water areas is running out."

    Let me repeat: Oil from *shallow* water areas is running out.

    If drilling offshore in Virginia is limited to the continental shelf, the safety problems cited by the Journal are not a concern.

    McDonnell's challenge is to ensure that oil can be drilled off the Virginia coast safely. If it can't be done safely, then don't do it. If it can, then go ahead. But the problems of deep-water drilling in the Gulf are irrelevant to that debate.

  3. Jim – how do you "fix" the Chesapeake Bay when you "oops"?

    Surely you don't believe that drilling is a 100% safe activity.

    This is the same exact issue of Global Warming.

    There may be in some folks minds – an infinitesimal chance of disaster but they're willing to risk it – no matter how catastrophic the consequences.

    You have to match the risk with the consequences.

    A very low risk with a catastrophic outcome if there is a failure is not a reason to go forward.

    McDonnell could help his cause by outlining his approach to risk management and instead of looking to tax these companies – REQUIRE the creation of an insurance fund – capable of paying off fully – any damages that could result.

    If you can't afford the insurance for this – then we cannot afford the risk.

    Wouldn't that be a responsible approach to protect the Bay and the taxpayers of Va?

  4. Anonymous Avatar

    Why not be CONSERVATIVE and save the oil — if any exists — under the Continetal Shelf to supply the resources that only petroleum can provide for The New Bronze Age instead of extending the Mass OverConsumption Age for a few years?

  5. Anonymous Avatar

    There is no such thing as a safe oil rig especially when the oil industry is allowed to self regulate. BP is a perfect example and not just for its criminal activity in the Gulf. Its Alaska pipelines are complete maintenance nightmare and will become more hellish soon.

  6. Why not be CONSERVATIVE and save the oil —

    =================================

    I don't understand why anyone wants to develop american resources to reduce dependence on foreighn oil. A lot of Saudi ealth is invested in America, it is not like they have any desire to see us go under.

    Use up the overseas oil first, and let the US be the Saudi Arabia of the New Bronze Age as Anonymous calls it.

    However, I suspect the new bronze ae will be more business as usual, with more wealth for everyone, and more resources consumed:

    http://freakonomics.blogs.nytimes.com/2010/12/07/visualizing-mortality-history/

  7. You have to match the risk with the consequences.

    A very low risk with a catastrophic outcome if there is a failure is not a reason to go forward.

    ==================================

    Mathematically, this kind of thinking is incorrect, unless by catastrophic you actually mean infinite. At least that is what I was taught in Environmental Economics.

  8. If you can't afford the insurance for this – then we cannot afford the risk.

    ================================

    What, a Market solution?

    "From Wired: "As well as ticketing you when you run through a speed-radar too fast, the “Speed Camera Lottery” in Sweden also notices you when you come in at or under the speed-limit. It then automatically enters you in a lottery. And here’s the really smart part: the prizes come from the fines paid by speeders."

    Now, you thought I was crazy, but see how similar this is to my idea as to how the HOT lanes should be run?

  9. Gooze Views Avatar
    Gooze Views

    Jim,
    Who SAYS THAT OIL DRILLING OFF vIRGINIA WOULD NECESSARILY BE SHALLOW WATER? tHEY DON'T EVEN KNOIW IF THERE'S OIL OUT THERE.

    pETER gALUSZKA

  10. ken lewis Avatar

    You are a total IDIOT!!!Drill baby, drill! If we let 1 accident stops us drilling than what about other endeavors? I guess we should stop driving because someone had an accident,Stop using woodstoves and heaters because one caused a fire.If you goofballs had your way we would be back in horse and buggy. GET A LIFE- LOSER!!!

  11. total idiots or total idiocy?

    saying that we need to drill for more oil – essentially so that people can continue to drive SUVs solo to/from work every day is GOOFBALL!

    What is the reason why we as a country use TWICE AS MUCH vehicle fuel per person than virtually any other industrialized nation?

    Unlike most people in the rest of the world, we don't want to live near where we work and we don't want to ride mass transit but instead solo-drive 2 ton vehicles
    20-30 miles in one direction each morning and back the other way in the evening.

    and because of this – we need to "drill baby drill" in the Chesapeake Bay and deploy a military than is bigger than the next 10 in the world – combined – so we can "protect" our oil supplies.

    ha ha ha… talk about "losers"

    If we don't wise up pretty soon, we ARE going to be LOSERs in the literal sense.

    Anyone with half a brain should realize that most of the solo-driven cars at rush hour – are making the SAME DAILY TRIP from point A to B and back to A in the evening and there is no sane reason not to carpool, vanpool, bus for MOST OF THE DAYS even if SOME DAYS you cannot.

    I did this exact thing for 34 years and my car that I carpooled in …seated 4, got 30 miles to the gallon and it lasted 10 years and retired with 180,000 miles on it.

    I used about 1/3 the gasoline that I would have normally used if I did not carpool and I used about 1/2 or less of the gas that I would have used had I driven a pickup or SUV.

    This is what much of the rest of the world does in their daily home-to-work-to-home life and it is the reason why they use 1/2 the fuel that we do ..and why they do not need to "drill baby drill".

    We are a nation of idiots in this regard.

    and it gets worse.. the folks who want to drill baby drill now are engaging in further brain-corroding activities like tea baggerism.

    Gawd save us from our homegrown Neanderthals.

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