Feds move on Virginia oil drilling

In a sea zone near N.C. Outer Banks

WASHINGTON -- The federal government on Thursday made its first move toward oil and natural gas exploration off the coast of Virginia -- just northeast of the Outer Banks.

The U.S. Department of Interior issued a call for public comments as it begins to consider the potential environmental effect of offshore drilling. The environmental work is the first step in opening 2.9 million acres of waters to a lease sale scheduled for 2011. The area under consideration is at least 50 miles offshore.

The agency's move will be followed closely by environmental groups and states in the Southeast, along with business groups eager for more energy development.

"In some ways, North Carolina is the next place after Virginia that ... the federal government would like to go," said Michael Gravitz of Environment America, a coalition of state environmental organizations. "Virginia is the first chink in the Atlantic Coast armor."

Polls show that most Americans want more domestic energy production, but many worry about the potential influence on coastlines that are relatively untouched by industry.

"You need to look at the impact that it may have in coastal Carolina," said N.C. Senate President Pro Tem Marc Basnight, whose district includes Dare County. "Not Virginia. Virginia has a lot of activities around their bays."

Gov. Mike Easley wants to review Thursday's development, and Gov.-elect Beverly Perdue said she wants to ensure that states share the money earned from leasing the nation's oceans to energy companies.

The issue of offshore drilling dominated political conversation through much of the past election season, as energy costs skyrocketed and the economy worsened. Partisans chanted "Drill, baby drill!" at Republican political rallies, while many Democrats parsed their words to sound open to offshore drilling while promoting alternative energy.

Thursday's move was the first concrete action in Washington since President George Bush and Congress earlier this year lifted years-old bans on drilling in the Outer Continental Shelf.

Good for farmers

"We consider this to be a positive movement," said Larry Wooten, president of the N.C. Farm Bureau. He said farmers have been besieged by high fuel prices and the rising costs of fertilizer and pesticide, both of which are made with natural gas. Increasing energy sources could help, he said.

"We need to push forward with all options, and offshore drilling is just one of them," Wooten said.

Margaret Hartzell of Environment North Carolina said the state's Outer Banks could be threatened by the potential for oil spills.

"North Carolina's coasts and waters know no boundaries, and a spill in Virginia will definitely have an impact on North Carolina," Hartzell said.

The federal Minerals Management Service, which handles oil and gas lease sales, said the area being studied has been included in the federal government's five-year plan at Virginia's request.

But while the Virginia legislature passed a bill in 2006 welcoming exploration, it was only for natural gas, said Gordon Hickey, a spokesman for Virginia Gov. Timothy Kaine.

"That's the position of the governor, and that hasn't changed," Hickey said.

The federal government is considering leasing the waters as soon as 2011 for oil and natural gas exploration. The agency stressed that soliciting public comment does not mean a lease sale will go forward.

Some environmental groups hope President-elect Barack Obama will reverse course.

"Obama has said they would consider offshore drilling in the context of a comprehensive energy policy," Gravitz said. "We'd be hopeful they'd look at this and say, 'Eh, this doesn't fit.' "

Studies show offshore drilling won't lower gas prices for years, but energy companies are promoting exploration as a source for jobs.

"By opening up those areas offshore, it's going to provide our domestic companies access to getting those precious resources out of the ground and into the marketplace," said Chris Sheerman, spokesman for the Institute for Energy Research in Washington, which promotes domestic energy companies.

Still, some officials are wary.

Control to states?

Easley told North Carolina's congressional delegation in September that the federal government should give North Carolina rights to its own coastal leases outright, giving the state complete control.

And U.S. Rep. Walter Jones, a Farmville Republican whose district includes most of the state's coastline, said the Bush administration should wait and let the Obama administration develop a new energy policy.

That way, he said, states might have more control.

"This is just a states' rights issue to me," Jones said.

"You're making changes that could impact a state for years and years to come. I don't see why it cannot wait until next year."