US appeals court blocks Calif. offshore drilling
Date: 04-Dec-02
Country: USA
Author: Michael Kahn
The decision by a three-judge panel of the 9th Circuit Court of Appeals does not cover existing offshore production in state and federal tracts but is a blow to the administration of President George W. Bush which had sought to open up 36 offshore leases to exploration.
Environmental groups, which had joined California in lawsuits to stop any renewed exploration, hailed the decision involving tracts that could hold an estimated one billion barrels of oil off the state's central coast.
The move to extend the 36 leases was widely seen by environmental groups as a prelude to renewed oil prospecting in California, which has been halted since 1989.
"After losing twice in federal court it is time for the Bush administration to stop fighting for more oil drilling and to start protecting California's coast," said Drew Caputo, a lawyer with the Natural Resources Defense Council.
A spokesman for the U.S. Department of Interior, which is named in the lawsuit, said lawyers were still reviewing whether to appeal the decision to the full court. The spokesman emphasized the case was about the government's right to extend the leases, and not about allowing drilling.
California sued to block the new exploration soon after President Bill Clinton's Interior Secretary Bruce Babbitt extended the offshore leases in 1999 as they were set to expire while ordering a review of their impact on the environment.
These tracts were exempt from the Clinton administration's 1998 ban on new oil drilling because the leases were so old.
The state, however, argued against the department, saying California had been illegally denied the right to review the leases for environmental issues before any action at the federal level.
U.S. District Court Judge Claudia Wilken agreed and in June 2001 halted exploration and drilling in the 36 offshore tracts, pending environmental review and approval by the California Coastal Commission.
While the state's suit did not explicitly seek cancellation of the leases, Davis has expressed reservations about offshore oil drilling and environmental groups have loudly condemned any move which could threaten the state's famous coastline.
Environmentalists have also argued that the Interior Department should scrap the leases, which cost oil companies more than $1 billion when they were granted 25 to 30 years ago.
Companies holding the leases include Aera Energy, the combined California exploration and production operations of Exxon Mobil Corp. and Shell Oil Co., a unit of Royal Dutch/Shell Group, ConocoPhillips, Nuevo Energy and Samedan Oil Corp. a subsidiary of Noble Affiliates.
