Five years after “Drill, baby, drill!” entered the United States' political lexicon, there's a new push for offshore exploring and drilling, led in part by U.S. Sen. Tim Scott.
The official word
“South Carolina's only substantial energy resource is its system of rivers and lakes, which provides for substantial hydroelectric power generation. South Carolina's industrial sector accounts for nearly two-fifths of State energy consumption.”
U.S. Energy Information Administration
The South Carolina Republican is working on legislation to give companies a green light to survey the South Atlantic coast for oil and gas deposits — and to tap into them.
Scott's bill isn't likely to get introduced until next month, but he said it would offer the state a new source of revenue and jobs.
“I think we have it finished,” he said. “We're just fine tuning.”
However, one expert said that the long-standing national debate over lifting the drilling ban is driven more by politics than economics — and that it won't have any effect off South Carolina, where studies have shown there's relatively little oil and gas.
The House passed a related bill — the Offshore Energy and Jobs Act — last month to lift the drilling moratorium in coastal waters.
The vote broke largely along party lines. U.S. Rep. Mark Sanford, R-S.C., was one of only five Republicans to vote against it. The four others were from New Jersey.
Sanford said in a statement he was bothered by how the measure would limit state authority.
“The bill gave the federal government sole authority and final say on all negotiations with oil and gas parties,” he said. “As well-intentioned as this bill is, I still fundamentally believe that including a state's perspective is vital.”
Scott's bill would take a different approach.
He said the seismic survey of the Atlantic Coast's deposits would be made public to encourage as much competition as possible for the leases.
“We would engage in a process a little differently than what they do on the Gulf Coast,” he said. “We would provide the information from the seismic to hopefully create more bidders, a more competitive bidding process.”
Scott said his bill will call for states to receive 37.5 percent of the revenues generated off their coasts — and for public-private partnerships from schools and entrepreneurs to form the workforce needed.
Also, he said under his bill, no rig would be built any closer than 25 miles to shore.
“We'll probably not see rigs off the South Atlantic coast, maybe ever, and that's good news, frankly,” Scott said. “It's a 25-mile to 50-mile buffer zone, so for the first 25 miles, you won't see any permanent standing edifices whatsoever. ... Sitting on the beach in South Carolina you wouldn't be able to see it.”
Sanford said the House bill would let a rig be built about three miles off shore “in plain sight from the beaches of the Isle of Palms or Hilton Head, with no ability of anyone in the state to impact that decision.”
Sanford said he is writing a bill that would give states the final say on drilling within 12 miles of their coast. “This is generally accepted as the end of the line of sight from the coast,” he said. “Beyond that point, I don't believe the state has a compelling economic interest.”
Hamilton Davis of the Coastal Conservation League said he shares Sanford's concern that states are cut out of the process under the House proposal.
He said states should be allowed to do their own cost-benefit analysis — looking at potential jobs, revenue and environmental impacts — before agreeing that drilling off their shores is a smart move.
“There is no meaningful dialogue that can take place there,” Davis said. “It's just go do it, cross your fingers and we'll hope it works out for the best interest of South Carolina.”
Meanwhile, some have said the drilling debate — at least as far this state goes — is relatively pointless.
Mitchell Colgan, chairman of the College of Charleston's Geology and Environmental Geosciences Department, said if waters off South Carolina held promising oil or gas reserves, there already would be rigs out there.
“All of the mineral management studies of this area off the coast of South Carolina have shown that there are no oil reservoirs,” he said.
“For an oil reservoir to be economically viable requires there to be a fairly good-size reservoir,” he said. “Even if one can identify a reservoir, and this oil is technically recoverable, it does not mean that it is economically recoverable.”
Colgan said the recent fracking boom — spurred by new technology that allows energy companies to extract more oil and gas onshore — has changed the supply and demand picture from four years ago.
“I don't know if I'm a great supporter of President Obama, but under his administration, we've gone through a great transformation with oil and gas,” he said. “It's the fracking. We're not finding any new oil fields. What we're doing is going back to old fields and extracting oil that in the past we would have had no access to.”
Reach Robert Behre at 937-5771.