ATLANTIC BEACH — A group of industry representatives were in the county last week to talk about what they see as the benefits offshore energy exploration could bring to the area.
Advocates say oil and natural gas development in the Atlantic could create 55,000 jobs in North Carolina and generate $4 billion for the state budget by 2035 with revenue sharing in place – rewards opponents say cannot offset the related risks to coastal habitats and other industries here.
The group met Thursday with members of the County Economic Development Council, the Morehead City Ports Committee and also with the News-Times.
Their visit comes as the deadline nears for public comment on the U.S. Bureau of Ocean Energy Management’s environmental impact statement for the 2017-22 Outer Continental Shelf Oil and Gas Leasing Program. As part of its environmental analysis, BOEM is asking all stakeholders to help identify areas or issues of concern for evaluation. The public comment period for the scoping process began Jan. 29 and continues through Monday, March 30.
It also comes amid pending applications for federal approval of offshore seismic surveys that would be the first step in exploring for oil and natural gas resources, which the industry would like to see begin later this year.
The visiting industry group included David McGowan, director of the N.C. Petroleum Council, a division of the American Petroleum Institute (API) with about 625 members; Jeff Vorberger, vice president, policy and government affairs, with the National Ocean Industries Association, which has members from “all facets of the domestic offshore energy and related industries,” according to its website; and Albert Eckel, a partner with Eckel Vaughan, a Raleigh marketing and public relations firm that lists on its website PR work on behalf of the state tax reforms that were signed into law in 2013.
“We’re in a real critical stage for energy right now,” Mr. Eckel said as he introduced the others as part of the nonpartisan N.C. Energy Forum during the lunch meeting of the Morehead City Ports Committee at the Channel Marker Restaurant on the Atlantic Beach causeway.
He said the forum is an organization that seeks to improve the public’s understanding and support of opportunities related to the state’s energy resources.
“Our role is very simple: Create forums to educate stakeholders on key energy issues,” Mr. Eckel said.
Mr. Vorberger described his organization as a Washington, D.C., trade group. NOIA’s website lists as topics hydraulic fracturing and offshore energy development as being good for the state. Mr. Vorberger said perception of the offshore oil industry has been clouded by the Deepwater Horizon oil spill.
The 2010 accident, also known as the Macondo blowout, is considered the worst in the history of the petroleum industry, discharging about 4.9 million barrels into the Gulf of Mexico.
“A lot of folks don’t want to talk about the 50,000 wells drilled in the Gulf without incident. They want to talk about one,” Mr. Vorberger said.
He said there had been changes in the industry since and as a result of the Macondo disaster. Those changes include the industry’s creation of the Center for Offshore Safety; the government’s new federal safety rules; the collaborative Ocean Energy Safety Institute; the industry’s Marine Well Containment Co.; and the industry’s Helix Well Containment Group – all of which work toward prevention, containment and response.
“No one wants to see an incident like that happen again,” he said.
Similarly, safety guides the seismic surveying industry, Mr. Vorberger said. The technology available now is also “light years” ahead of that in place more than 30 years ago, the last time the Atlantic Outer Continental Shelf was surveyed. Due to technological advances, the existing estimates of 4.7 billion barrels of oil and 37.5 trillion cubic feet of natural gas are out of date.
Seismic surveying uses the release of compressed air into the water to create short-duration sound waves that reflect off subsurface rock layers and are measured by sensors towed behind the survey vessel.
“Essentially, this is an ultrasound of the earth,” Mr. Vorberger said.
He said there is no documented scientific evidence of seismic surveying adversely affecting marine life or coastal communities.
“Robust regulatory rules are in place to guide this activity,” Mr. Vorberger said.
According to NOIA, API and other industry groups, the sound produced during the surveys is comparable in magnitude to many naturally occurring and other manmade ocean sound sources, including wind and wave action, rain, lightning strikes, marine life and shipping.
Others disagree.
On Thursday, a group called Environment North Carolina released an analysis that details the threats seismic surveying and drilling pose to sea animals.
“The search for undersea oil and gas uses seismic airguns that fire bursts of sound at least as loud as a jet engine every few seconds for days or weeks on end. These bursts are audible underwater as far as 2,500 miles away, harming and even killing sea animals,” according to the group. “Marine life may be deafened, have their communication sounds drowned out by airguns, or be driven away from locations they would otherwise inhabit, including crucial breeding grounds. As many as 138,000 Atlantic whales and dolphins are projected to be injured or killed by the use of seismic airguns in the Atlantic offshore drilling regions, according to U.S. government research.”
Meanwhile, other coastal communities and their representatives are also voicing opposition.
According to a March 19 report by the Outer Banks Voice, Rep. Paul Tine, an independent whose district includes Dare County, has expressed opposition to the Obama administration’s recent decision to open areas off the North Carolina coast to exploration and extraction of oil and natural gas reserves.
“Under the current plan, there is no direct benefit to Eastern North Carolina,” he wrote in a letter to the federal Bureau of Ocean Energy Management. “While the discussion in the media continues to be that there will be economic benefits and revenue sharing in North Carolina to offset the risks of offshore drilling, the current conditions of the plan do not show that possibility.”
According to a March 9 report in The Hill, a Washington, D.C., newspaper, 12 Senate Democrats from the East Coast have asked the Obama administration to take Atlantic offshore drilling off the table.
The senators, led by Sen. Ed Markey, D-Mass., do not represent the states closest to the potential drilling but say drilling anywhere in the Atlantic “has the potential to adversely impact our states’ fishing, tourism and recreation industries, our coastlines and our environment,” according to a letter they wrote to Interior Secretary Sally Jewell.
Officials and municipal leaders in South Carolina and Virginia have also expressed concerns and opposition.
Proponents, including those in Carteret County on Thursday, say the seismic surveys and any subsequent drilling would take place beyond a 50-mile offshore buffer area. That’s far out of sight from coastal communities and, with respect to seismic surveying, certain areas would be off limits, including right whale and fish-spawning areas.
Mr. Vorberger told the ports group Thursday the energy industry can flourish and coexist with tourism and ecology. He used Port Fourchon, La., as an example. He said 90 percent of the nation’s oil flows through this port.
According to the Greater Lafourche Port Commission, which touts its facility as “the Gulf’s energy connection,” industry at Port Fourchon accounted for over $2.8 billion in sales revenue and over $650 million in household earnings in 2013 in Louisiana.
“All of this is done in concert, in coexistence with all the other users of the water down there,” Mr. Vorberger said.
Louisiana holds an annual Shrimp and Petroleum Festival on the Gulf Coast in Morgan City to celebrate that coexistence, Mr. McGowan of the N.C. Petroleum Council said Thursday.
“They can do that in North Carolina, as well,” he said. “There’s a tremendous role the port of Morehead City can play in this process.”
One attendee at the ports meeting Thursday was familiar with Port Fourchon. John Warren of Newport has worked for eight years as a chief mate on a well intervention ship, or plug and abandonment ship, used to seal off oil wells no longer used. Although employed in the industry, Mr. Warren said he’s not sure he’d like to see Morehead City become another Port Fourchon.
“I don’t want to be a hypocrite but I am on the fence,” he told the News-Times following the meeting. “I’m worried about how it impacts us, mainly the environment and the infrastructure. The trucks, that’s a big thing. How are we going to handle the trucks and the people who come with them? I’m not as concerned with life on the rig as I am with what does Beaufort Inlet look like.”
He noted comments that Port Fourchon sees 400 vessels each day.
“I’ve been there,” Mr. Warren said. “I’ve been in a line of 40 vessels making a run for the rock jetty and once you’re in, you’re committed. What does Beaufort Inlet look like? It’s bigger and better, trust me. We have 4 feet of tide, 3 knots of current – what does it look like if you take half of that, say 200 boats a day, what is that going to look like on a Saturday? That’s my concern. How are we going to handle that? Where are we going to put all the equipment? I want to see it done safely.”
Mr. McGowan said polling of North Carolina voters indicates bipartisan support. His organization touts a Jan. 15-18 Harris Poll of registered voters that indicates 90 percent of Republicans, 70 percent of independents and 55 percent of Democrats support offshore drilling. The opposition is not representative of public opinion, he said.
“A very vocal minority wants to see it stopped but the vast majority want to see it move forward,” he said.
Gov. Pat McCrory has expressed his support.
“It’s time the states be allowed to get off the sidelines and start producing jobs and energy for our economy,” Gov. McCrory is quoted as saying on an API handout distributed Thursday at the port group’s meeting.
Revenue sharing from offshore oil could help support harbor dredging and beach nourishment, in addition to other economic benefits, the governor has said. However, a recent budget proposal by the Obama administration would reverse a 2006 legislation for revenue sharing set to begin in 2017 and re-appropriate that money elsewhere.
The actual economic benefit to North Carolina goes beyond revenue sharing, Mr. McGowan said.
“Revenue sharing is an important part of the puzzle but it pales compared to the overall economic impact,” Mr. McGowan said.
Meanwhile, the next step in the BOEM oil and gas leasing, exploration and development process is the publication of a second draft of the environmental impact statement now out for public comment. That is expected in early 2016. A final draft is expected in early 2017. The final five-year program is expected to be announced later in 2017.
The earliest start for oil and gas lease sales would be in 2021. Exploratory drilling is at least a decade away, Mr. Vorberger said. Production would be even farther in the future.
“There’s a lot of time between now and then and a lot of room for additional conversation,” he said.
Contact Mark Hibbs at 252-726-7081, ext. 229; email mark@thenewstimes.com; or follow on Twitter @markccnt.
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