The economic realities of offshore drilling the Atlantic OCS


Applying reason to a rhetoric-filled debate:

Taylor, in her presentation, explored the economic and other benefits that have been touted as reasons to pursue offshore drilling off the Atlantic coast. Enhancing the nation’s energy independence, lowering energy prices and creating jobs are the big three reasons often cited, but what’s the reality?

“We cannot be independent of a globally traded commodity,” Taylor said, referring specifically to petroleum products, for which prices are set on international markets.

An indisputable reality we've been trying to convey to the "drill, baby, drill" crowd until we're blue in the face. But they're either dishonest or don't have the capacity to understand, which is why we have to keep saying it:

An American Petroleum Institute poll conducted earlier this year showed an overwhelming number of those questioned, 85 percent, agreed that increased production of domestic oil and natural gas could help strengthen America’s energy security. Also, 79 percent of respondents agreed that producing more domestic oil and natural gas could help strengthen America’s national security by lessening the negative effects of political instability occurring in other parts of the world. Eighty-six percent of those polled agreed that producing more domestic oil and natural gas could help lower energy costs for consumers, but public opinions don’t jibe with the reality of energy markets, Taylor said.

I wouldn't trust an API poll as far as I could throw Chris Christie. But even if it's accurate, that just demonstrates how poorly-informed (or intentionally mis-informed) the American public is when it comes to oil exploration and production. And as far as the argument that offshore drilling off NC's coast will increase global production, lowering prices and hurting Saudi Arabia's pocket, that's also merely a fantasy:

In terms of global crude oil reserves, which are estimated at 1.66 trillion barrels, and 2014 global production of 93 million barrels per day or 34 billion barrels per year, the most optimistic estimates of oil in the Atlantic outer continental shelf planning area amount to about one-half of 1 percent of global reserves, Taylor said. A more realistic estimate puts the Atlantic OCS reserves at less than a tenth of 1 percent of global reserves, according to figures from the Bureau of Ocean Energy Management.

Bolding mine. You'd see larger fluctuations than that when OPEC performs routine maintenance on a handful of their operations.

Lastly, the much-touted "new jobs" meme big-oil has sold to the right-wingers could end up resulting in negative numbers, especially if drilling has an adverse effect on tourism in NC's coastal areas:

Compared to current employment figures, which rank health care as the largest employer at nearly 585,000 jobs, the positions directly resulting from oil and natural gas industry growth would max out near the bottom of employment list as ranked by size. That’s fewer jobs than exist in the agriculture, forestry, fishing and hunting employment sector, which currently employs about 29,500.

In coastal North Carolina, the tourism industry is already comparable to mid-level predictions for oil and gas industry economic output 21 years from now, said Lee Nettles, director of the Outer Banks Visitors Bureau and another invited speaker at the federation’s forum. Nettles said the projected growth in the N.C. coastal tourism industry by 2035 is comparable to the highest economic benefit estimates for oil and gas industries, which top out at around the $5 billion mark by that time.

Nettles said promises of economic benefit from oil and gas come at the peril of a proven tourism industry.

“Oil and gas is a threat disguised as an opportunity,” Nettles said.

Just to give you some context of that threat, when the Deepwater Horizon (pictured above) poisoned the Gulf Coast, it cost the tourism travel industry alone some $23 billion in revenue. That does not reflect losses to satellite businesses like restaurants, privately-owned rental properties, recreational equipment rentals, souvenir shops, etc.

And the net job losses have been impossible to calculate.