Drilling for Oil: Throwing Caution to the Wind

by Bill Chameides | June 21st, 2010
posted by Erica Rowell (Editor)

Permalink | 3 comments

To drill or not to drill, that is today’s question. (U.S. Coast Guard)

The Wall Street Journal still wants to drill, baby, drill.

The oil industry and the WSJ are hopping mad. And the object of their anger is — big surprise — the Obama administration. Their beef this time: Obama’s six-month moratorium on drilling new deepwater oil and gas wells in the Outer Continental Shelf, including the Gulf of Mexico.

Leading the pack is Hornbeck Offshore Services, described on its Web site as “a leading provider of technologically advanced, new generation OSVs [Offshore Supply Vehicles] serving the offshore oil and gas industry.” Hornbeck is suing the Department of the Interior, asking a federal judge to lift the moratorium.

Hornbeck’s argument, according to The Associated Press, is that “the government arbitrarily imposed the moratorium and suspended drilling at 33 existing exploratory wells without any proof that the operations posed a threat.” To back up such claims, Hornbeck is citing irreparable financial losses for itself and ultimately the entire oil industry. (Louisiana’s governor, Bobby Jindal, citing a “severe impact on the economy” from the moratorium, joined this side of the argument with a friend-of-the-court brief [pdf] filed today.)

The government’s counter-argument holds that the moratorium is indeed needed to prevent another blow-out from occurring and that Hornbeck et al’s predictions of economic catastrophe are “alarmist and speculative.” Talk about turning the tables — when’s the last time you heard someone defending a step designed to protect the environment call the other guy “alarmist and speculative”?

Arguments on the merits of the case are being heard today in federal court in Louisiana.

Here Come Da WSJ

Just in time for those court arguments (as well as news that internal BP documents put worst-case estimates of the daily dump of oil into the gulf at as much as 100,000 barrels), the WSJ published an editorial entitled “The ‘Paralyzing’ Principle,” lamenting the array of “nasty consequences” from the expanding oil spill. But for the WSJ those consequences are not limited to the human and environmental tragedies, but include the “political panic” that has led to rehabilitating “the thoroughly discredited theory of regulation known as the precautionary principle.” Exhibit #1 in the WSJ’s case: Obama’s six-month moratorium.

For the folks at the journal, this is an example of regulatory fervor gone mad, an approach that demonstrates a “government … attempt to prevent any risk — regardless of the costs involved, however minor the benefits and even without understanding what those risks really are.” The bankruptcy of this approach, they argue, can been seen in “the intellectual architecture for the Environmental Protection Agency, which is still required to eliminate certain environmental risks no matter how expensive.”

So let’s examine this statement. What exactly is meant by “minor benefits” here? Could it be that the folks on the WSJ’s editorial board find the damage done by the Deepwater Horizon spill to be minor and therefore the benefits of preventing another would also be minor? Or perhaps they feel that now that the Gulf Coast has been totally despoiled, there is no longer any significant benefit to preventing another spill? Or is it that the imperative to drill for more oil must override all else?

And by “intellectual architecture,” I assume the WSJ means the Clean Air and Clean Water Acts that have allowed EPA to bring about historic and unprecedented improvements in our nation’s water and air quality. Improvements, by the way, that have saved countless lives and billions of dollars. Not exactly bankrupt in my book.

The Precautionary Principle

The precautionary principle [pdf] comes in various flavors — there’s the strong form and the weak form and lots of in-betweens. I favor the construction that came out of the 1992 U.N. Environmental Programme meeting in Rio de Janeiro. Principle 15 of the declaration endorsed the precautionary principle as the basis for states to undertake environmental protection:

“Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.”

While Hornbeck and the WSJ maintain that Obama’s moratorium is uncalled for because of the lack of “proof that operations posed a threat” and too little “understanding [of] what those risks really are,” the precautionary principle holds that steps like the moratorium are appropriate when there is a clear and present danger of “serious or irreversible damage” (emphasis mine), even if there is not complete understanding or iron-clad proof of the threat. Note that the principle requires not extraordinary measures but reasonable (i.e., cost-effective) actions.

Folks, this is a no-brainer, common sense. Imagine you’re walking down the street on a cold January day and see a patch of ice in front of you. Now, you don’t know that you’ll slip on it and you don’t know that if you slip you’ll break your arm, but you might decide to adopt the precautionary principle and walk around it. Hardly an unreasonable decision.

Precautionary Approach to Deepwater Drilling

Seems to me that Obama’s moratorium is a pretty reasonable application of the precautionary principle — some hold that a little more precaution some months ago might have prevented the current disaster. (See here and here or consider the math: some 5060 federal inspectors overseeing “more than 3,850 producing and 200 drilling facilities”
 that involve some 35,000 to 55,000 petroleum-related workers.)

It had been thought that “oil rigs generally don’t cause spills.” (See video of Obama’s speech in North Carolina from April 2, 2010.) Well, that turned out to be wrong, and the consequences of that
wrong call have been serious and quite likely irreversible.

While it’s pretty clear the Deepwater Horizon disaster was caused by some combination of mechanical and human failures, a complete accounting has yet to be developed. Many of the same mechanical and human systems are being used on other oil rigs in the gulf. Is it so unreasonable to halt new drilling for some period of time while we figure out what went wrong and make sure it won’t happen again?

In the end we could choose to throw caution to the wind or follow the advice of that wise old philosopher who said: ‘The better part of valour is discretion; in the which better part I have saved my life.” He may have been laughed at, but my vote in this case goes with the discretion guy.

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  1. rockingham
    Jun 23, 2010

    Putting 30-50 thousand people out of work is pretty serious to me. A one month moratorium is all you need. Get the Fed inspectors in there working overtime with no vacations and bring back in some retired personnel for the duration. All rigs can be checked out and vetted on an expedited basis. Get all the drillers on their best behavior. The Feds are so bloated…Send some more Fed office workers to that department. Assign them to help with the paperwork such as inspection reports. Sideline a rig or two (or more) for further vetting. Why should the innocents and the good guys be out of jobs because of BP’s very bad practices? Six month ban on drilling is absurd. You seem like a nice guy GGrok but it is easy to philosophize from 1000 miles away at Duke University. People in Louisiana want to work and off shore rigs pay well.

    • Jamie Friedland
      Jun 28, 2010

      Rockingham, I’m sorry, but the drilling ban is not absurd: -Fact: We do not yet know what caused the blowout that sank the Deepwater Horizon rig. -Fact: We do not have adequate prevention or containment methods for a deepwater blowout, so a massive oil spill is guaranteed if a blowout occurs. -Fact: A massive oil spill is unacceptably destructive. -Conclusion: Deepwater drilling must be halted AT LEAST until we know how to prevent and/or recover from deepwater blowouts. That logic is unimpeachable. People who talk about the severity of temporarily losing those jobs on deepwater rigs are neglecting the rest of the job loss picture. There is only so much oil in the Gulf. Oil drilling is an extractive operation, and those jobs are not permanent. Assuming it takes a certain amount of time to get that oil out and we are going to extract a given amount of oil when all is said and done, those oil rig jobs will still be there for the Gulf economy for as long as they were going to be anyways, just bumped back a few months or perhaps years. If you want to talk about job loss, let’s look at how many hundreds of thousands of SUSTAINABLE Gulf Coast jobs are driven by a healthy Gulf via tourism and fishing. Right now, hopefully, that massive job threat will be temporary. If enough oil gushes and wreaks enough havoc on the fisheries, wetlands and reefs in the Gulf, those jobs will all be lost.

  2. Anne Davis
    Jun 21, 2010

    I totally agree. I feel discretion is certainly the answer for more than one reason. If people are confused by all the media attention to this oil spill, let’s join hands because I have some good advice–listen to one of the best scientists I’ve met! (Bill, I had to write to say I was so proud of this document and your viewpoint that I had to send my cheers!!!! After all, water, air, earth should be cherished with little risks taken! What do we have to lose?!….only everything.

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