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Offshore Oil Drilling Moratorium’s Aims, Effectiveness Debated

June 22, 2010 at 12:00 AM EDT
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The Obama administration vowed to appeal a federal judge's ruling, blocking the president's efforts to impose a six-month ban on deepwater oil drilling. Gwen Ifill gets two points of view on the environmental and economic consequences of halting oil exploration in the Gulf.
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GWEN IFILL: Next: Gulf state lawmakers rejoiced today, as the Obama administration’s plan to suspend deep-sea oil drilling was dealt a setback in court.

Oil continued to pour into the Gulf today, as a federal judge in New Orleans ruled to block President Obama’s effort to impose a six-month ban on deepwater drilling. In his decision, Judge Martin Feldman said the government shouldn’t have ignored the safety record of other oil rigs in the Gulf.

“Are all airplanes a danger because one was” he wrote? “Are all oil tankers like Exxon Valdez? That sort of thinking seems heavy-handed.”

A White House spokesman said the government would immediately appeal the decision. More than a dozen companies sued to overturn the ban after the Obama administration expanded what was initially a one-month suspension last May.

U.S PRESIDENT BARACK OBAMA: We will continue the existing moratorium and suspend the issuance of new permits to drill new deepwater wells for six months.

GWEN IFILL: Industry executives argued, the ban would cost tens of thousands of jobs and millions in lost wages.

Louisiana Governor Bobby Jindal, who has opposed the ban, praised today’s ruling and asked the federal government to let it stand.

GOV. BOBBY JINDAL, R-La.: The bottom line is this. The fact that the federal government can’t do their job shouldn’t cost thousands of Louisianians our jobs. What we’re saying very simply to the administration is, I hope they will reconsider this — this decision to appeal.

GWEN IFILL: Earlier this month, Interior Secretary Ken Salazar tried to reassure lawmakers on the Senate Energy panel that the ban would only be temporary.

KEN SALAZAR, U.S. interior secretary: It’s the pause button. It’s not the stop button, but it’s the pause button. And it’s a pause button so that we can make sure that, if we move forward with OCS drilling in the Outer Continental Shelf, that it can be done in a way that is protective of people and protective of the environment as well.

GWEN IFILL: Earlier today, at an oil conference in London, Transocean, the owner of the sunken rig, criticized the Obama administration’s approach.

CEO Steven Newman told reporters, “There are things the administration could implement today that would allow the industry to go back to work tomorrow, without an arbitrary six-month time limit.”

BP also came in for criticism. Protesters twice interrupted a speech by BP chief of staff Steve Westwell, who was standing in for CEO Tony Hayward. Other oil executives at the conference warned that the deepwater drilling ban would cripple world energy supplies.

The court decision did not end the debate. For more on what’s driving it, we turn to Rayola Dougher. She’s the senior economic adviser at the American Petroleum Institute, which opposed the moratorium. And Kieran Suckling, he’s the executive director of the Center for Biological Diversity, an environmental protection group that supported it.

Rayola Dougher, what did you think of the judge’s decision today?

RAYOLA DOUGHER, Senior Economic Adviser, American Petroleum Institute: Well, we welcome the decision. And I’m sure that the folks along the Gulf who stood to lose their jobs are pretty happy to hear that decision as well.

GWEN IFILL: Now, listening to the president again just now, I’m reminded that what his decision did was to suspend granting of permits for new oil drilling. Why was that — offshore deepwater oil drilling, why was that such a problem? RAYOLA DOUGHER: Well, because it’s going to impact thousands of jobs. It would have cost millions of dollars — well, actually, even over a billion dollars in terms of investment moving forward. It’s a big problem for the industry and for the people who would have been losing their jobs, especially in the Gulf.

The Louisiana senator — I mean the Louisiana governor said they could lose as many as 20,000 jobs just in the next couple of months alone. Last month, in the United States, in the whole country, we added 41,000 civilian jobs. So, this would have been a big impact on a region that is already reeling from the impact of this accident.

GWEN IFILL: Kieran Suckling, as you heard, the judge ruled, said that the president — actually used very tough language, saying that the president and the Department of Interior was arbitrary, that it was overreaching. Why is he wrong?

KIERAN SUCKLING, executive director, Center for Biological Diversity: Because deepwater drilling, as we have seen, is a very, very dangerous activity. Neither the oil companies nor the government has the capacity to fix a spill of that magnitude.

And, so, when you take an action that is irrevocable, that you cannot fix it if it goes wrong, you have got to be very, very careful. And the judge simply didn’t take that into account.

GWEN IFILL: Well, what is it that the administration could have done perhaps to avoid this outcome, perhaps, you know, I don’t know, a more temporary, the one-month halt that had originally been proposed? Why wasn’t that good enough?

KIERAN SUCKLING: Well, the problem here is very, very deep. You have got an agency, the Minerals Management Service, which is extremely corrupt and ineffective.

You have technology that is way out past our regulators’ ability to control it. So, it’s not a kind of quickie situation you go in and fix in a month. We really need to take that six-month time-out, figure out what we’re doing and stop this dangerous activity, until it’s done.

If we have another deepwater oil spill in the next six months, the government is already swamped in its ability to deal with this first one. It will be doubly catastrophic.

GWEN IFILL: Rayola Dougher, what about that? There’s this possibility — this has happened once. Why wouldn’t it happen twice?

RAYOLA DOUGHER: Well, look, we have had 30 years of operation in the deepwater in the Gulf of Mexico, operating safely all this time. The government took immediate action when this spill occurred and went back and inspected all of those rigs.

And they all passed inspection, so, move — and the industry formed task forces in the interim that reported to the Department of Interior on offshore safety, as well as offshore technology. So, we’re not waiting until the final commission comes forward. We’re taking action now.

But to assume that all of those other rigs are not safe, I think, is a stretch. And we do agree with the judge on that count.

GWEN IFILL: You mentioned jobs that would be lost as a result of this moratorium.

RAYOLA DOUGHER: Sure.

GWEN IFILL: There are fishermen and shrimpers and other people whose jobs would also be lost if this doesn’t get fixed right.

RAYOLA DOUGHER: Absolutely.

Well, I — well, everybody wants to see this fixed right. I mean, everybody is really focused on the safety issue and on safety moving forward. I don’t think anyone cares more right now about what happened, what to do, how to fix it than the men and women that work in this industry.

They are really focused on this issue right now, and — and out-front about it, and very concerned that it be addressed, and that it be addressed so that the American people really are reassured that this is safe, that we can do this, and that we can proceed.

GWEN IFILL: Kieran Suckling, this seems so much like it’s about calculating risk, relative risk. How do you do that in a case like this?

KIERAN SUCKLING: Well, it is about risk.

And I think what we can say about deepwater drilling is that it doesn’t fail often, but, when it does fail, it’s catastrophic. It’s very similar to the nuclear industry in that sense. And, up to now, we have been very cavalier about it, in saying, oh, it’s rare, it will be fine, and just ignoring that catastrophic impact. And those days are over.

GWEN IFILL: We’re talking, Rayola Dougher, about 33 wells of these deepwater wells, as opposed to, I believe it’s like 3,000…

RAYOLA DOUGHER: Sure.

GWEN IFILL: … 3,600 oil and — wells which continue to operate, which were not affected by this.

RAYOLA DOUGHER: All operating safely.

GWEN IFILL: So, why not just take these 33 offline?

RAYOLA DOUGHER: You would think that — that number sounds small, doesn’t it?

GWEN IFILL: Yes. Is there a lot of production?

RAYOLA DOUGHER: Absolutely.

It would be anywhere between 80,000 and 100,000 barrels a day just within a six-month period alone. And the thing about the jobs, there’s only about 250 people working on these rigs. They work in shifts, about 125 each. But then you multiply that times 33 rigs, you’re already up to thousands of people.

And then you multiply that by the three or four or five jobs that are supported by that job on the rig, and you have a very serious economic impact just in the jobs. But then, in terms of the income, the salary alone, the salary in one month from those jobs can be anywhere from $165 million to $330 million. That’s in wages lost.

And it has repercussions throughout the entire economy. And there’s no parameters on this. It’s six months and then what happens? We’re saying, we have done the inspection. We can move forward with new safety procedures, without shutting these rigs down.

These rigs shut down, they start moving to other — other areas of the world, we lose this production and we lose these jobs. And it’s at a critical time for Louisiana and for our nation. We can’t afford to do this.

GWEN IFILL: Mr. Suckling, what’s to say that a temporary moratorium does not become a permanent one?

KIERAN SUCKLING: Well, it may become a permanent one, but we, as a nation, have to go through a process of rationally figuring out what is safe, what risks are we willing to take?

And there will be an answer at the end of that. But to simply say let’s keep doing the risk while we study it simply doesn’t make sense, and to ignore the tens of thousands of people that lost their jobs this month due to BP’s oil spill, the billions of dollars that have been lost this month due to this spill, the taxpayer money, small business money, and say, we’re going to ignore all that, we’re going to put all those people at risk, because the only thing we care about is oil jobs, that is bad public policy, and it’s just unfair.

GWEN IFILL: A chance to respond.

RAYOLA DOUGHER: Listen, no one is talking about putting anybody at risk at all in these.

We’re — we’re talking about how to move forward, how to guarantee safety as we move forward. All of those rigs have been inspected. They all passed inspection. And we’re moving forward on the task forces to see if there’s anything else, if there are any gaps in this system. Is there any way to improve this moving forward? But it’s managing those risks.

GWEN IFILL: But I have to ask you, don’t we know that the Minerals Management Service hasn’t really been enforcing these inspections and these tests?

RAYOLA DOUGHER: Well, we do know that the men and women that work in these industry take these tests very seriously, and they do look to safety and they do it all the time. They build in redundant systems.

They are the first and foremost people that care about the safety and the viability of their operations. They have every reason to. Regardless of whether someone is looking over their shoulder or not, they are focused on, OK, what happened with technology? What happened with safety procedures? What is different? What can we do better? How can we do this? And they are doing it.

And they have a safe record for 30 years of doing it.

GWEN IFILL: Ms. Dougher, I gave you…

RAYOLA DOUGHER: So, they have a proven record.

GWEN IFILL: Pardon me. I’m sorry.

RAYOLA DOUGHER: OK.

GWEN IFILL: I gave you the first word. I want to give Mr. Suckling the final word.

KIERAN SUCKLING: Yes, it’s important to note that every single one of these 33 rigs out there was exempted from full environment review. So, they’re not known to be safe.

The Minerals Management Service dropped the ball. They did it once with BP, and it’s been catastrophic. And I just don’t think we can let it happen again. It’s time to stop, figure out what’s happening, and develop a good, rational, safe policy.

GWEN IFILL: Kieran Suckling of the Center for Biological Diversity, and Rayola Dougher of the American Petroleum Institute, thank you both very much.

KIERAN SUCKLING: Thanks for having us on.