Is Offshore Oil Drilling a Good or Bad Idea?

Geek!This is James Robbins’s submission for the HP Magic Giveaway. Feel free to leave comments for this article as you see fit – your feedback is certainly welcomed! If you’d like to submit your own how-to, what-is, or top-five list, you can send it to me. Views and opinions of this writer are not necessarily my own:

Fuel prices are at an all time high around the world today, and yet again, the United States is in trouble on Wall Street. Americans are not traveling as much because of the increasing fuel prices. There have been many ideas about how to solve this issue, but only one will solve the problems of cost and independence from foreign oil. This solution is offshore drilling. Offshore drilling will provide this country with the opportunity to lower fuel and natural gas prices. It will also free the U.S. from the need to buy oil from countries in the Middle East without a significant risk to the environment.

In a world where gasoline and natural gas are pretty much essential, would it not be nice to be able to afford them. The country dividing controversy of offshore drilling has become a debating piece once again with the 2008 presidential election season under way. Some say that drilling in the Outer Continental Shelf (OCS) is too dangerous for the environment, and others say that we should drill our way to independence from high priced foreign oil. Foreign oil causes many problems for the United States. There are wars over oil and the price of it, as well as crude oil transport tankers running aground and devastating our coastlines. To stop these terrible things from happening, we must drill off our own coastlines. Environmentalists are convinced that drilling in the OCS would not reduce fuel prices for ten years, and they are probably correct to think that. On the other hand, if the OCS was opened to drilling, Middle Eastern leaders would see this, and immediately reduce the price of a barrel of oil drastically. This would be the psychological impact that is needed in today’s everyday life in the United States.

Furthermore, there are concerns that offshore drilling will cause major oil spills into the ocean. However, there has been only one offshore drilling incident off the coast of the United States. In January of 1969, off the coast of Santa Barbara, California, there was a blowout under a drilling platform. The blowout caused the loss of three million gallons of oil into the ocean. In contrast, marine transportation, in 1975 alone, lost about six hundred and thirty million gallons of crude oil into the ocean. The tanker incidents in 1975 lost more oil than the drilling platform off Santa Barbara’s coast in 1969. In 1976, another major oil spill soiled the panhandle beaches of Florida. This incident occurred by transportation of oil, not drilling it. This fact alone should be enough for everyone to realize that offshore drilling is safer than marine transportation, but environmentalists are holding firm to their conclusions.

The greenies (environmentalists) are saying that fish and oceanic life is at an extreme risk by the pollution that the drilling platforms are putting into the water. In the Gulf of Mexico, there are about 3,700 oil drilling platforms, and roughly 3,200 of them lie off the Louisiana coast. According to environmentalists, this would severely affect the commercial fishing industry, but is has not to date. Louisiana produces one-third of America’s commercial fisheries with no major oil spill ever. Nevertheless, environmentalists still say that drilling in the Outer Continental Shelf (OCS), will severely harm ocean life, when in fact, it has been proven that urban runoff and sewage treatment plants dump twelve times more petroleum into the ocean than the thousands of drilling platforms that reside in the Gulf. Mark Ferrulo is an environmental activist in Florida that has been quoted saying that Louisiana’s coast is “the nation’s toilet”, but most of the Red Snapper that is served in Florida’s restaurants are caught off Louisiana’s coast. The Gulf of Mexico has never been healthier. For example, off the Louisiana-Texas boarder lays The Flower Garden Coral reefs. They are unlike any of the Florida Keys reefs in the fact that they are surrounded by dozens of platforms that have been in operation for fifty years and are thriving. According to G.P. Schmahl, a Federal biologist who has worked in both places, “The Flower Gardens are much healthier, and more pristine than anything in the Florida Keys. It was a surprise to me, and I think it’s a surprise to most people”.

With natural oil seeps polluting our oceans at an enormous rate, something needs to be done to control it or stop it all together. There is actually more oil seeping naturally into the Gulf of Mexico than is spilled by rigs and pipelines. There has been a moratorium on oil drilling in the Santa Barbara bay for thirty-eight years. In that time, an estimated nine hundred barrels of crude oil has leaked from the drilling platforms. In comparison, the natural seeps have leaked an estimated two million barrels. Not only does this represent a $280 million dollar economic loss at today’s prices, it represents a serious environmental and public health problem.

Bruce Allen, a former JPL physicist who is a resident of Santa Barbara and a member of the air quality board discovered a serious air pollution problem. Allen discovered that airborne hydrocarbon contaminate levels can be as high as ten times that of Los Angeles. He said that most of Santa Barbra’s residents were surprised to find out that their oil and high priced gas problem is not a man-made one, it is natural. Allen says that the natural seeps are a result of being on an active geological fault line that is releasing the trapped oil, which is estimated at thirteen billion recoverable barrels in the Pacific Coast region. Allen believes that the environment will benefit from drilling the deposits by reducing the amount of oil and gas seepage. The National Academy of Sciences has found that less than one percent of the oil found in the ocean comes from offshore drilling platforms, where as the majority of the oil (62%) released into the marine environment is the result of natural seeps. Crude oil that seeps into the ocean in North America is estimated to exceed 47 million gallons and 180 million gallons worldwide.

The people who are against drilling in the Outer Continental Shelf do not think that there is enough oil around the United States to make a difference in the price of gas. Two federal bans have blocked the U.S. from gathering and exploring for oil in the OCS. The bans are an executive ban and a legislative ban. President George W. Bush lifted the executive ban on July 14, 2008 leaving only the legislative ban in place. If congress abolishes their ban on offshore drilling, oil companies will be able to find out exactly how much energy the OCS is holding. Because of the ban, it is an estimate that the OCS contains eighty-six billion barrels of oil and four-hundred twenty trillion cubic feet of natural gas. These estimates are likely to be very conservative because it is currently illegal to explore the OCS.

Technology used to find oil and gas deposits has come a long way in the past 40 years. Oil companies now use 3-D seismic and 4-D time imaging technologies to more accurately find the deposits instead of drilling exploratory wells to find it. Safety features of the platforms have also come a long way in the past forty years as well. All offshore wells now are equipped with storm chokes that detect damage to valves at the surface to shut down the well in the event of an emergency. Blow out preventers are now installed below the sea floor to prevent catastrophes such as the one in Santa Barbara in 1969, and sensors are now used to monitor the subsurface and subsea-bed conditions to prevent spills due to an unexpected change in well pressure. This new technology has drastically reduced the amount of spilled oil on the platforms. In recent years the offshore drilling platforms new safety features have been put to the test when two major hurricanes named Katrina and Rita barreled over top of them. This real life extreme test has proven that the platforms are much safer than they were in 1969 without any major oil loss. All of the safety features that have been implemented on the rigs worked just as they were supposed to.

In the year 2006, environmental organizations warned “Exploration and development of gas resources produces routine discharges of spent drilling mud, contaminated produced waters, and highly-toxic metals and hydrocarbon compounds into the marine environment, in addition to creating a demand for onshore gas processing facilities in sensitive portions of the coastal zone”. The fact is that the drill cuttings are now being used as raw material for rebuilding Louisiana’s wetlands, bricks, and even roads. Despite what the environmentalists have been saying, the evidence is clear about the drilling processes by products.

Next, people want to know what is going to happen to the rigs when they have pumped all of the oil out of the ocean that they can. Federal environmental experts in the 1940’s mandated that the rigs are to be removed once they have stopped producing. In 1993, some of the rigs in the Gulf of Mexico stopped producing and the oil companies tried to comply with the federal mandate, but the local anglers put up a fight to keep them since the fishing was so good. It turned out that the rigs are a huge benefit to the marine environment than anyone thought they would be. The rigs to reefs policy was implemented in light of this find. The RTR policy is beneficial to everyone involved. It saves the oil companies money because they do not have to dismantle the platforms and dispose of them on land. Moreover, it is beneficial to the marine environment because the rigs are the largest artificial reef complexes in the world. There are three methods to the RTR policy. The rigs can be completely toppled and submerged in the ocean, the rigs can be towed and placed, or there is a partial removal platform reefing method to create an artificial reef. The Minerals Management Service (MMS) encourages the reuse of obsolete offshore drilling platforms as artificial reefs in U.S. waters as long as the structures do not pose an unreasonable impediment to future mineral development.

Accordingly, offshore drilling is the best thing that could possibly happen to this country in the aspect of energy. The country would be better off financially because the oil companies would not have to buy oil from Middle Eastern countries, and the oil that they did purchase would be cheaper because of the psychological impact that drilling in the outer continental shelf has produced. The environmental impact would not be as significant as environmentalists have predicted. The insignificant amount of crude oil that will leak will actually help the coral reefs grow and be healthier around the country where drilling will take place.

10 thoughts on “Is Offshore Oil Drilling a Good or Bad Idea?”

  1. That’s a very informative article. I didn’t know about the environmental factor before. Now I’m all for offshore drilling.

    The other thing though is the fact that it’s Demand that truly affects the price of oil and gas.

    People around the world started consuming less gas, and the prices went down.

    We really need to get serious and build more economical cars, etc.

  2. You make several good points James, but the underlying dilemma is that the United States sits on only 3% of the world’s petroleum supply. Oil, like many other commodities, is sold in the free global market. This means that even if the United States increased US oil production by 20% — via drilling offshore, as you suggest — it would not correspond to a 20% reduction in gasoline prices. No, you must evaluate this increased production to the total world supply of oil. If Shell or Exxon drilled in Alaska, they could sell our American oil to Russia, China or whomever offered the highest bid. This is the basis of our free market system. If we increased the global supply by 2% — which is an optimistic expectation — you would only see a 2% reduction in oil and gasoline prices. Now given the genuine environmental issues involved, it seems reasonable to ask if this modest decrease in price is really worth the risk. I, like you, wish the United States was a veritable Saudi Arabia, but we are not. And it’s not the environmentalists fault that there’s no oil below our feet. I don’t see any reason to blame them for our respective frustration. It’s just the random luck of the draw. But if high gasoline prices are your concern I would imagine you would find it interesting that our country consumes 20 to 25% of the total petroleum supply, while constituting only 5% of the worlds population. Given our disproportionate excess, should we not at least entertain the prospect of conservation? Or modifying our gasoline cars to use electricity (a form of energy we can produce–both responsibly and realistically)? Best,

  3. If we don’t go ahead and set up some offshore wells, other Nations will be spilling our oil into the Ocean, and there will be nothing we can do about it. At some point we will need that oil to survive. Oil is used for much more than gasoline and diesel fuel and before long the supply will run short again. This was a wake up call and when the World’s economy comes back, so will much higher prices to put us into another Depression. Sure we need to modernize and have efficient autos and clean up our space, but high taxes and Al Gore would put a stop to all that with his Global Warming Swindle.

  4. Thanks for an informative post. I will now add to this politically correct crippling the economy issue. First off the environmentalists have digressed from sound policy to a religion that all is sacred and that we in the USA can do nothing correctly. Second they offer no solutions. Three the 3% lie is a intentional misleading lie. (see: The 3% is what we have drilled and pumping, the percentages are higher for what we have drilled and tapped, and what we have in known reserves and what we have in unproven reserves.

    The USA has the best environmental record in our country versus the rest of the world yet the greenies are silent about the record of drillers overseas. Hypocrites. I don’t know about you young kids under 30 but schools only teach politically correct revisionist history. I came back from Germany in ’75 and gas was (gasp!) 75 cents a gallon, double digit inflation and unemployment. Yeah it really was much worse back then unlike today. My point is both parties are gutless about moving forward, yet you and I are responsible for voting them back in over and over again. There is no easy solution but American have become mentally obese and very lazy and want a pain free solution just like the majic pill for losing weight. (right!)

    Another lie is the ten year lie. We the nation that mobilized to defeat enemies overseas twice within 50 years are what? To lazy, unwilling or what to do this again. Help me here because I still believe as a nation we can get this done in less then five years. The Alaskan line can be done in 18 months by our own congressman’s testimony.

    Call the Greenies what they are; Religious zealots that have historically offered only opposition and little money and engineering efforts to wards a solution. I have followed this since the 70’s .This is about a religion of saving mother earth. I’m calling them BS!

    Yes we have more oil reserves then Saudi Arabia, one has to quit feeding at the trough of the enviro-left networks.

    Enough oil? The Russians have shown high potential that petroleum is a abiotic process much like the gasses off the coast of California are showing it to be. High pressure high temps deep within the earth are a natural process of relieving pressure and we get petroleum Yeah its simplistic for illustration purposes but you get the point.

    The other ploy of the left is the guilt trip that we consume more then others and have less resources then others. Another lie of the left. You young readers need to study up on Karl Marx and understand the language of subtleties like democracy, progressive, fairness, etc. These are all social engineering ploys to bring us down to third world status. Oil is but one methodology of the big picture of the downfall of the US. Shame so many cannot see it due to lack of understanding what liberty and pursuit of happiness and the responsibility that goes along with it. Because as a nation if you did grasp it we would have demanded to throw the bankers and auto makers out on their cans for dereliction of duty. Instead you all have witnessed the greatest wealth transfer in history greater then the contrived great depression and yet we as a nation are (in the age of the Internet) clueless.

    Here take a bit to digest and learn how we all are being screwed:

    May God have mercy on us all………….

    So yes we need to drill now and fast, move the Middle east psychology towards dropping prices; and quit sending trillions of dollars overseas to a religious group of fanatics whose only appeasement is total annihilation or conversion towards Islam.

  5. I’ll be a devil’s advocate here and say that I oppose opening up the offshore drilling. I should also said that my opinion of the environmentalists and their arguments against it is pretty much the same as in the original post. I agree there are no real environmental or economic reason against it. There is a long prologue of history here, feel free to skip to the end.

    But the politics is more complex. The US is without dispute the richest and most technologically advanced country in the world. Still many European and Asian industrialized nations have basic infrastructures that are not only more advanced and environmentally friendly but even more cost efficient than their counterparts in the US. Why?

    The answer is simple. There is a wide gap in the amount and quality of political leadership in building national infrastructure between the US and these other countries. In Europe for example much of the national infrastructure was built after the destruction of the war by the government for the simple reason that, unlike the lucky bastards on the other side of the pond, Europe did not have access to anywhere near the amount of private investment to get the job done. Wars do that, which is why Europeans tend to be so much more sceptical about wars than Americans who don’t have the experience the damage war causes to the societies in the war zone. (And why the British who were saved from enemy occupation by the Channel are more likely to support wars than the Germans and French who grew up hearing stories of what it is actually like.)

    Anyway, the war forced Europe to rely on nationalized basic infrastructure when rebuilding to a modern society. In the US meanwhile building the modern infrastructure after the war happened largely on private investment. As the only industrialized nation that didn’t get devastated by the war the US was assured economic dominance and sufficient investment as long as the government gave some direction and didn’t actually prevent economic growth and development with bad laws and regulations.

    This difference in the economic realities combined with the cold war propaganda against communism (and people using the effects Reagans reforms had to support ideological dogma instead of just noting that he fixed the economy by fixing in hindsight obvious problems that no longer exist on the scale they did – because he fixed them, I mean seriously, if lowering the taxes were always the right thing to do even politicians would have noticed it after few centuries of trying, but sadly sometimes raising taxes is actually the better choice) resulted in European politicians who are comfortable in taking responsibility over matters of infrastructure and feel responsible for the infrastructure working because when they and most of the voters grew up the government still actually run that infrastructure and American politicians who are so indoctrinated against government interference on economy they actually have a strong preference on inaction even on things that are actually run by the government.


    The problem is that the power infrastructure needs to be reformed on a national scale if we wish to cut the environmental effects (and there are actually other problems as well) it has fast enough for it to matter at all. The private actors can do the actual work and even funding if need be. (Richest country in the world and all that.) What they can’t do is doing the governments work and lead the process by making the decisions and the commitment to those decisions on a national level. Even if we think of private corporations as charities that will spend stock owners money like water on fixing other peoples problems in order to gain the holy grail or some such nebulous reason, it is not their responsibility to take the responsibility for global problems. It is the governments job and responsibility to think about these issues and then lead the private sector by giving them regulations that tell them what are the right decisions to do in view of the big picture.

    There are probably some reading this that think that the market forces can determine what the right decisions better than the politicos can. You are absolutely right, the market forces will always find the best and most efficient solution. The problem is that the market forces act exclusively in the present and do absolutely nothing to prevent interim solutions that result in bad things or even very bad things in the future, some of which may be irreparable. To avoid this the actors in the market have to be smart and look forward in order to avoid decisions leading to bad things. The problem is that most actors only look forward a limited time because of the structural problems of people being paid to make decisions about other peoples property with incentives that actively reward focusing on the short term. So you would need specialized actors who get paid to look farther ahead and then guide other shorter term actors away from the bad decisions they see causing problems in the long term. Call these specialized actors the ‘government’, and you may see the problem with the US politics I am worried about.

    The markets require the government to avoid long term problems such as the environmental issues surrounding the greenhouse effect (or the foreign oil dependency), this is as it should be, worrying about such things is not the responsibility of private corporations. The problem is that in the US most politicians believe that they should not interfere with the economy unless absolutely necessary because thanks to historical accidents that has what can be made to look like a pretty good track record. So they will only do their job that the markets absolutely require them to do to work well, if there is a clear and present crisis that forces them to do so. In any other case even if they meddle in the markets it is only to look good in the next elections and deals with short term issues the markets could have dealt with without a single politician showing up for a photo-op, probably better as well. (Which explains why in the US most people see government interference in the economy as bad, most of it really has been.)

    So the problem of solving these problems in the US is not what to do, it is how to force the politicians to do the job they swore an oath to do and get paid for. And the reason I oppose off-shore drilling is because it reduces the pressure on the politicians without solving the long term problems. And reducing the pressure on politicians is just another way of saying that nothing will get done on the difficult issues requiring decisions the private sector has great difficulty doing without government support. So I think off-shore drilling should be blocked by any means until the politicians get off their collective butts and do their job. After that happens, I am all for it.

    Not trying to start an argument here or saying the posters before were wrong (I mostly agree actually), just saying that IMHO you also need to look at the bigger picture not just the specific issue and that the bigger picture can be argued to point to a ‘no’ even if the specific issue points to a ‘yes’. Really more trying to give another angle to look at it, than trying to claim I know the right solution.

  6. Very informative article.

    Here is a link where people can send comments to Obama and others in Washington about the need to keep the moratorium lifted.

  7. The oil companies are exporting crude to overseas markets and letting them drill more domestically or offshore would be a waste of our oil because we wouldn’t of received any benefit. Research how much crude oil, heating oil, natural gas, LNG, diesel, and gasoline is exported from this country and you would be shocked. Lots of the oil in the Alaskan Pipeline is shipped to Japan. The oil companies say they want to build more refineries and do more drilling, but I say they don’t need to do either until we stop all exports. We can never be energy independent as long as we continue exporting to other countries. Offshore drilling and onshore drilling in Alaska is extremely attractive to oil companies because one offshore well can equal fifteen onshore wells in production and drilling in Alaska produces large volumes of oil. For every barrel of oil we send overseas that’s another barrel of oil we have to import.


  8. This artical make a good argument pre April 20th 2010. What do you have to say about off shore drilling now?

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