Judge halts action on oil and gas seismic blasting permits due to government shutdown

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A federal judge has ruled the Trump administration’s attempt to continue processing permits to test for oil and gas deposits along the Atlantic seaboard must stop while the government remains shut down.

U.S. District Court Judge Richard Gergel handed down the ruling Friday in response to a lawsuit seeking to block seismic testing permits that would allow underwater airgun blasting off the coast that could harm or kill marine life.

Opponents of the federal seismic testing and drilling plans, including many governors along the Atlantic coast, have said the move endangers the economy. They have likened potential impacts to the widespread environmental and economic damage caused by the April 20, 2010 BP Deepwater Horizon oil well explosion.

Gergel’s decision came as a spokesman for Florida’s new attorney general said that Ashley Moody is opposed to “any form of oil drilling on either coast of Florida.”

Kylie Mason, Moody’s press secretary, told The Bond Buyer Thursday, that the Republican attorney general sworn in Jan. 8 is studying a petition filed by the state of South Carolina, another GOP-led state, to intervene in the pending suit challenging the permits.

“We are reviewing South Carolina’s complaint and considering Florida’s interest in [the state’s] options,” Mason said. No timetable was given for a decision on the matter.

President Trump’s draft 2019-2024 National Outer Continental Shelf Oil and Gas Leasing Program released in January 2018 proposes to open more than 90% of U.S. waters to oil and gas development. It’s expected to be finalized this year.

If Trump's plan is approved without any changes, it would open Florida’s Atlantic and Gulf coasts to drilling.

Known for its beaches as well as commercial and recreational fishing, Florida set a new record for tourism during the first nine months of 2018, according to the latest numbers.

Between January and September, 95.8 million visitors came to the state, a 6.7% increase over the same period in 2017, according to Visit Florida, the state’s tourism agency. They spent an estimated $112 billion and supported more than 1.4 million jobs, making tourism a top driver of the state’s economy.

Florida’s coastal counties contributed more than $584 billion in gross regional product to the state’s economy, with the Atlantic shoreline contributing $366 billion and the Gulf shoreline adding $218 billion, according to a 2010 report by the Florida Ocean Alliance.

Of the jobs created by the sector in 2011, the alliance said more than 60% were in the tourism industry and 20.5% were in ocean transportation.

In November, 69% of Florida voters approved a state constitutional amendment banning oil and gas drilling in state waters — the portion state officials can control three nautical miles from shore on the Atlantic and nine nautical miles on the Gulf.

Advocates have said the ballot measure's success also supports a general sentiment that residents don’t want oil and gas drilling anywhere off the state’s coasts.

Former Florida Gov. Rick Scott, a Republican who’s now a U.S. Senator, didn’t join other Atlantic coast governors who banded together to oppose seismic testing and drilling, nor has Florida participated in the pending litigation. Scott’s successor, Republican Ron DeSantis, has said he supports a ban on coastal drilling but gave no details on how he would pursue that policy.

After the Department of Commerce’s National Marine Fisheries Service in November announced it would issue “incidental harassment” permits that allow marine animals to be harmed in seismic testing, a bipartisan group of 10 Atlantic coast governors wrote a joint letter to the Department of Commerce and Department of the Interior addressing their opposition to testing and drilling.

“These activities pose an unacceptable and unnecessary threat to our coastal ecosystems and coastal economies,” said the letter by North Carolina Gov. Roy Cooper, South Carolina Gov. Henry McMaster, former Connecticut Gov. Dannel Malloy, New York Gov. Andrew Cuomo, Maryland Gov. Larry Hogan, Massachusetts Gov. Charlie Baker, Delaware Gov. John Carney, Virginia Gov. Ralph Northam, Rhode Island Gov. Gina Raimondo and New Jersey Gov. Phil Murphy.

The Atlantic Coast’s ocean economy generates more than $98 billion in gross domestic product, they wrote, adding that seismic surveys and drilling would jeopardize that economic impact.

The permits will allow TGS-NOPEC Geophysical Co., CGG Services Inc., GX Technology Corp., Spectrum Geo Inc., and WesternGeco LLC to conduct seismic blasting to map oil and gas deposits from the Atlantic coasts of Delaware to mid-Florida, and out about 200 nautical miles offshore.

Those permits led environmentalists and South Carolina cities and towns and the South Carolina Small Business Chamber Of Commerce to file separate lawsuits Dec. 11 in an attempt to block the permits.

On Dec. 20, nine states requested to intervene in the litigation, which has since been consolidated: Connecticut, Delaware, Massachusetts, Maine, Maryland, New Jersey, New York, North Carolina and Virginia.

The requests haven’t been granted because the court agreed to delay filings after the Justice Department requested a stay because of a lapse in appropriations during the government shutdown.

South Carolina also requested to intervene on Jan. 7, and federal attorneys once again sought a stay because they had limited staff to respond due to the shutdown.

South Carolina Attorney General Alan Wilson opposed the stay, citing the Bureau of Ocean Energy Management’s fiscal 2019 contingency plan released this month, which recalls furloughed employees to continue to work on oil and gas drilling leases, and potentially to continue processing seismic testing permits.

In a Jan. 17 response to Wilson’s opposition, attorneys for the federal defendants named in the suit, Secretary of Commerce Wilbur Ross, the National Marine Fisheries Service and its Assistant Administrator Chris Oliver, said while no final permit decisions would be made immediately the BOEM may continue to process seismic testing permit applications during the shutdown and may make decisions on them as early as March 1.

Gergel said Friday that the courts have frowned on a party who would use the stay as both a “sword and a shield,” referring to the Justice Department’s request for a stay while key agencies continue to work on permits that are being litigated.

“It requires little imagination to realize that the returning BOEM employees could act on the pending applications and seismic testing could commence during the pendency of the stay, particularly if the government shutdown should extend beyond March 1, 2019,” Gergel said.

Under those circumstances, he wrote, the states seeking to intervene in the case would be powerless to object further because their petitions haven’t been approved by the court.

“The federal defendants are seeking an extraordinary remedy: to indefinitely stay their obligation to respond to lawsuits alleging multiple violations of federal environmental laws related to the proposed seismic testing of vast amounts of ocean waters extending from Delaware to Florida,” he said.

Gergel prohibited federal agencies from taking any official action on pending permit applications in the Atlantic until the federal government has opened, and court has ruled on the state’s motions to intervene.

“The government was trying to have its cake and eat it too, and we’re pleased the court did not allow that to happen,” said Laura Cantral, executive director of the South Carolina Coastal Conservation League, one of the groups suing to stop seismic blasting in the Atlantic. “This is an issue of critical importance to the coast, and one that must be handled openly, transparently, and fairly. This ruling will allow that to happen.”

In addition to legal challenges, the Democratic majority in the newly seated House of Representatives introduced seven bills Jan. 8 aimed at preventing offshore drilling.

Doubling down on offshore drilling would be a “huge mistake,” said Natural Resources Committee Chairman Raúl M. Grijalva, D-Arizona.

“The American people don’t want oil rigs on every beach up and down our coasts, and our economy doesn’t need them,” said Natural Resources Committee Chairman Raúl M. Grijalva, D-Arizona, who announced the bills. “We can create clean energy jobs and protect our coastlines at the same time with the right policy choices.”

The American Petroleum Institute said the bills are short-sighted.

“Closing the door on offshore development could hurt local economies, as well as America’s energy security, and is a step in the wrong direction,” the industry group said in a statement.

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