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Santa Barbara County Comments on the 2002-2007 Draft Five-Year OCS Leasing Program

January 23, 2001

Mr. Ralph Ainger, 5-Year Program Manager
Minerals Management Service (MS-4400)
Room 2324
381 Elden Street
Herndon, Virginia 20170

RE: Comments on the 5-Year Leasing Program and EIS

Dear Mr. Ainger:

The Board of Supervisors of Santa Barbara County, California submits the following comments for your consideration. We appreciate the opportunities that the Minerals Management Service (MMS) provides for public input on the preparation of 5-year leasing programs.

This Board fully concurs with the MMS' decision to exclude the Pacific OCS Region from the 2002-2007 leasing program. As stated in the MMS notice of December 12, 2000, this region is one of several geographic areas subject to a leasing moratorium by Executive Order through June 30, 2012. It is also subject to a leasing moratorium by Congressional action through September 30, 2001, with opportunities for renewal.

Accordingly, the Board of Supervisors would like to take this opportunity to identify several reasons that substantiate the wisdom of not leasing additional tracts in the Pacific OCS Region particularly offshore Santa Barbara County. Previous impacts to California onshore producers also causes some concern about the intensity of leasing offshore Alaska. Lastly, we wish to share some observations about questions of adequate environmental review that have arisen during preparation of Environmental Impact Statements for previous leasing programs. As directed by the MMS notice, these comments are divided into two separate sections.

Comments on the Preparation of the 2002-2007 Leasing Program

Pacific OCS Region

Five basic reasons illustrate the wisdom of not pursuing any leasing of new Pacific OCS tracts in the forthcoming 5-year leasing program.

  1. Historic experience - Previous experience with leasing oil and gas tracts offshore California was akin to the great Oklahoma land rush, but produced rather poor results with regard to the national energy picture.

    · 10 lease sales conducted offshore California between 1963 and 1984 yielded a grand total of 371 leases.
    · Only 12% of these leases were ever produced to date, while 79% expired, terminated, or were relinquished by the lessee, most without ever being explored for oil and gas.
    · Those that were developed fed an already glutted, heavy-oil market in the western U.S.
    · With new sources of production from Alaska's North Slope and the Pacific OCS, many California onshore producers were forced to shut-in wells and fields for more than 1½ decades and, in some cases, to abandon wells and entire fields prematurely.
    · The undesired result of prematurely replacing California's onshore production with Pacific OCS production provides a very important lesson when considering future OCS leasing plans.

  2. Current status - The considerable delays in developing OCS leases remaining offshore California illustrates the wisdom of not pursuing further leasing in the POCS.

    · Only 54% of the remaining 79 leases offshore California have been produced (or are located within producing units).
    · That means 46% of the remaining leases offshore California have yet to be produced. According to current plans and estimates, only 17% of these undeveloped leases may commence production by 2007. Another 36% are not expected to produce, if at all, until after 2015. Given the long delays in developing many existing leases, the MMS is preparing a programmatic EIS to address environmental impacts associated with renewing dated Exploration Plans for 15 undeveloped leases. This renewal process runs concurrently with the preparation of the next five-year leasing program.
    · The 79 remaining leases are concentrated mostly offshore Santa Barbara and Ventura counties. Any consideration of new leasing would make no sense given this status. These two counties have had, and continue to have, their hands full with issues associated with offshore oil development.

  3. Adequacy of information for making leasing decisions - The 1989 conclusions of the National Research Council remain valid: there is inadequate information to make leasing decisions offshore California. More research remains to be done, peer-reviewed, and addressed with affected parties before any thought of new leasing offshore California.

  4. Preponderance of unresolved issues - Outstanding issues with current leases, including issues with adequately protecting coastal and environmental resources, should remain the primary focus of federal attention in the Pacific OCS. New leasing would only exacerbate potential resolution of issues such as:

    · The disposition of platforms upon termination of leases.
    · The improvement of operating procedures to prevent recurrence of oil spills.
    · The assurance that all OCS oil production will be transported via the safest mode - pipeline - to its final refinery destination where it is manufactured into final products.
    · The consistent application of due diligence to lease terms.
    · The decentralization of decision-making to the state and local governments via authority granted under the Coastal Zone Management Act and other statutory measures.

  5. Impact assistance - A stable stream of federal funds to local governments remains an elusive promise. Such assistance is necessary to help local governments plan and prepare policies in advance to leasing, respond to leasing and other OCS actions in a meaningful way, and enhance a host of resources adversely affected by OCS leasing and development.

Alaska OCS Region

We are concerned about potential, unnecessary adverse effects to California that may result from leasing in the Alaskan OCS Region. Along with Pacific OCS oil production, the influx of Alaskan crude oil into the western U.S. market in previous decades resulted in a substantial and prolonged oversupply of crude oil. This period of glutted market conditions detrimentally impacted California producers, including those situated in Santa Barbara County. Several wells have been shut-in for many years and some wells and fields have been abandoned much earlier than necessary. Meanwhile, marine tanker shipments from Alaska to California subjected the California coast to unnecessary environmental risk from oil spills, due to increased marine tanker trips from Alaska. Such experience provides a very important lesson when considering future OCS leasing plans. Such plans must take particular caution to consider regional market dynamics so we don't repeat past mistakes of subjecting our coasts to unnecessary environmental risk, while producing more oil than we need.

Lessons Regarding Previous Environmental Reviews of 5-Year Leasing Programs

The Board encourages the MMS to substantially improve environmental review of leasing programs, considering previous experience and controversy over the adequacy of previous environmental reviews.

  1. Better define and explain the steps in the leasing and development process, including lease terms, future environmental reviews, and situations that could preclude development of a tract or area identified for leasing in this program. Also clarify the intent of the program with regard to its relevance to the nation, region, coastal communities, and marketplace.
  2. Replace the overly general examination of the past with focused and thorough analyses of impacts associated with future leasing, including size and location. This improvement alone would help to avoid many previous mistakes that led to unrealistic, intensive lease sales offshore California.
  3. Conduct more thorough analysis of the risks of oil spills, including that inherent with human error. Acknowledge the substantially limited capability of clean up measures and the secondary effects they beget. Such capability is limited under the best of weather conditions and is essentially useless under inclement weather. Also acknowledge the risk of spills from marine tankers.
  4. Recognize and address the laws, goals, and policies of the affected coastal states and local communities.

We thank you for the opportunity to comment and look forward to the MMS' commitment to preclude any new leasing in the Pacific OCS Region in the forthcoming leasing program.

 

Respectfully submitted,

 

Joni Gray, Chair

CC: Governor Gray Davis, State of California
      Walter Rosenbusch, Director, MMS
      San Luis Obispo County Board of Supervisors
      Ventura County Board of Supervisors

 

 

 
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