The Raleigh Report
From the Office of Cullie Tarleton
January 26, 2009
Earlier this week, House Speaker Joe Hackney and Senate President Pro Tempore Marc Basnight officially established a joint study committee to consider the financial and environmental implications of oil and natural gas exploration off our state’s coast. This is a critical issue now as our nation continues to work toward energy independence. The possibility of “off shore” drilling has been a controversial issue across our state. It will be the role of this study committee to examine all sides and all issues before making any recommendations.
This study group will be the last group appointed before the General Assembly reconvenes next week. A group of legislators will be appointed later to review the group’s work and to work on any legislation that may be needed to carry out its recommendations. I will carefully monitor this new committee’s meetings and recommendations. Once the legislature receives their report, I’ll share it with you or at least the highlights and recommendations.
I am excited to return to Raleigh and work on your behalf and I hope you will continue to share your ideas and questions with me as we tackle difficult issues.
Thank you as always for your support and your interest in state government.
Committee Members
The Offshore Energy Exploration Study Committee consists of 24 members, with Speaker Hackney and Sen. Basnight each appointing 12 members. The co-chairs of the committee are Douglas N. Rader, a scientist for the Environmental Defense Fund, and James Leutze, a former chancellor of the University of North Carolina at Wilmington.
Committee Charge
The committee has been asked to do study several issues related to offshore drilling. These complicated issues include:
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The implications of leasing federal waters off North Carolina's coast to energy companies for oil and natural gas exploration.
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Relevant federal law and the state’s legal authority with regard to offshore drilling.
The potential impacts on the nation's energy supply, including estimates of what oil and natural gas might exist off the state’s coast.
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The potential financial impact of proposed exploration on the State of North Carolina, including effects on the economy, tourism, the commercial fishing industry, the impacts of a more industrial coastline, and ensuring a share of state profits.
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The environmental impacts of creating an oil and natural gas industry along North Carolina's coastline, including possibilities of spills, effects on water quality, air quality, marine life and contributions to global climate change.
The committee will hold public hearings in North Carolina’s coastal region to get feedback about how offshore drilling could potentially influence their communities and may also meet in other places around the state.
The committee is authorized to establish an advisory group comprised of university faculty and scientific experts to assist in gathering and analyzing data so that the committee may provide more informed recommendations to the General Assembly.
More on Offshore Drilling
Offshore drilling is a complex matter. The following information was released by the Department of Environment and Natural Resources to help North Carolinians better understand the offshore drilling issue. I hope it may be of some help to you.
Who is in charge of offshore drilling/leasing decisions?
The Minerals Management Service of the U.S. Department of Interior manages the mineral resources on 1.76 billion acres of the Outer Continental Shelf (OCS). The Outer Continental Shelf (OCS) consists of the submerged lands, subsoil, and seabed, lying between the seaward extent of the States' jurisdiction and the seaward extent of Federal jurisdiction. The state jurisdiction extends for 3 nautical miles off the coast of North Carolina. The federal jurisdiction over the OCS extends 200 nautical miles.
What would be the basic process for the decision maker to get an offshore drilling program in place?
The OCS Lands Act requires the Department of Interior to prepare a 5-Year Program that specifies the size, timing and location of areas to be assessed for federal offshore natural gas and oil leasing. A 5-Year Program consists of a schedule of oil and gas lease sales indicating the size, timing and location of proposed leasing activity the Secretary determines will best meet national energy needs for the five year period following its approval. An area must be included in the current 5-Year Program in order to be offered for leasing. The current 5-Year Program is from 2007-2012. However, the Department of Interior has proposed moving up the next program by two years to 2010-2015.
In August of 2008 MMS solicited comments on moving the program up to 2010 and is currently reviewing 180,000 comments. A new draft proposed program should be completed by January 2009 at which point there will be another comment period. The final proposed program and final environmental impact statement should be completed in early 2010 with the new program in place by mid-2010. Absent congressional action, this is the fastest a new program can be in place.
What amounts of oil and/or natural gas have been projected for areas off our coast?
No interest in oil and gas exploration has been shown off the North Carolina coast except for the Manteo Exploration Unit (MEU). The MEU is comprised of 21 blocks, each a little less than 9 square miles in size and approximately 45 miles from Cape Hatteras (see attached map). The estimated potential reservoir (by federal and industry geologists) if discovery is made is 5 trillion cubic feet of natural gas with a field life of 20-30 years.
What role does the state have in offshore drilling decisions?
Under the Coastal Zone Management Act states have the authority to review federal activities, licenses and permits that have reasonably foreseeable effects on any land or water use or natural resources of the coastal zone. This authority is known as a consistency determination. Federal activities must be consistent to the maximum extent practicable with the enforceable policies of a coastal state's federally approved coastal management program. North Carolina may review the following stages of oil and gas development under the "consistency" authority:
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Development of MMS-5 Year Plan: (see above);
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Lease sale: the "bulk" lease sale that allows companies to bid for particular lease areas;
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Plan of exploration: the plan of how a company will explore in order to determine if they will develop their lease site;
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Plan of development and production: this lays out the plan for producing oil or gas from the lease site.
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