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Obama wants to allow oil drilling off the East Coast — but limit it in Alaska

Jack up drilling rig.
Jack up drilling rig.
(Photo by: Education Images/UIG via Getty Images)

The Obama administration is often caught between two conflicting impulses — a desire to protect the environment, and a desire to support the ongoing US oil and gas boom.

And trying to juggle the two can lead to some awfully convoluted decisions. Case in point: On Tuesday, the Department of Interior tentatively proposed to open the federal waters off the coast of Virginia, the Carolinas, and Georgia to oil and gas drilling for the first time since the 1980s. It was a big victory for fossil-fuel companies.

Then, at the exact same time, the administration moved to block future oil and gas drilling in 9.8 million acres of ocean off the northern coast of Alaska. The White House called these areas, in the Beaufort and Chukchi Seas, "one of the last great marine wildernesses left" — with endangered whales, walruses, seals. This move came after the White House had previously barred drilling in Alaska's Bristol Bay and asked Congress for new protections for the Arctic National Wildlife Refuge, which has still-untapped oil reserves. These, by contrast, were all sweeping environmental moves.

Not surprisingly, Obama's split-the-baby decision is making lots of people unhappy. Alaska Republicans are livid about efforts to put key areas off-limits for drilling. Alaska's economy is reliant on oil production, but its existing fields are declining — so it needs new drilling to keep up. Sen. Lisa Murkowski (R-AK) has argued that Obama has "effectively declared war on Alaska."

On the other end, environmentalists are criticizing the proposal to open the Atlantic coast to new drilling, saying it's at odds with Obama's efforts to tackle global warming. "Opening these areas to dirty fuel development is incompatible with a healthy future for America's coastlines, coastal communities, or our climate," said Athan Manuel of the Sierra Club. And, while the move is popular in Virginia and the Carolinas, it's less popular with northern states worried about spills.

So here's a primer on these big new drilling proposals — and why they're likely to spark bitter, multi-sided fights for months to come.

Obama wants to open the Atlantic coast to oil drilling...

Aerial view of semi-submersible offshore drilling rig in the gulf of Mexico. (Education Images/UIG via Getty Images)

Every five years, the federal government is required to put out a plan on which oil and gas leases it will offer in federal waters. The latest five-year plan (pdf), unveiled Tuesday, would run from 2017 to 2022. This is still only a proposal, and has to go through a two-month public comment stage before being finalized. So the details could well change a lot.

(Bureau of Ocean Energy Management)

Many parts of the proposal are unsurprising — like the fact that the agency will offer leases in the Gulf of Mexico (where there's already lots of drilling) or that it won't offer leases off the Pacific coast (where states don't want drilling).

But there was one big surprise. As part of the plan, the Department of Interior is proposing to open up the Outer Continental Shelf off the coast of Virginia, the Carolinas, and Georgia to oil and gas drilling (see map). Any potential lease sale in this region wouldn't happen until 2021 or later, and it would require a 50-mile coastal buffer to minimize conflicts with other activities along the shoreline and protect wildlife.

Governors in these four states have been calling on the federal government to open up these offshore areas to drilling ever since 2008 — when Congress lifted the ban on exploration here. States would split royalties from any drilling with the federal government, which could total in the billions of dollars. (Though, again, any drilling wouldn't happen until the 2020s or 2030s.)

Notably, the plan would not open up the continental shelf off the coast of Florida, as officials there tend to look less favorably on offshore drilling, given the potential for spills that could affect beaches and tourism.

So how much oil are we talking in all? The area is estimated to contain some 4.72 billion barrels of technically recoverable oil and 37.51 trillion cubic feet of technically recoverable gas. That's a relatively small amount compared to the 122 billion barrels of undiscovered oil in federal waters and lands that were already available for leasing. Still, it's something:

(Congressional Budget Office, 2012)

The Obama administration had originally wanted to open the Atlantic coast up for drilling in its previous five-year plan that ran from 2012 to 2017. But it put the whole idea temporarily on hold after the big Deepwater Horizon oil spill in the Gulf of Mexico in 2010. Ever since, energy companies have lobbied for leases here.

Environmentalists, for their part, had been pushing against this move — citing the dangers of spills that could affect the East Coast. "This takes us in exactly the wrong direction," said Peter Lehner, executive director of the Natural Resources Defense Council, in a statement. "A Virginia blowout could readily impact New Jersey and points far north."

Meanwhile, Obama is blocking (some) drilling in Alaska

Alaska, Arctic National Wildlife Refuge, ANWR,, Bull Caribou. (Education Images/UIG via Getty Images)

But that wasn't the only surprise. On Tuesday, the White House also announced it would make 9.8 million acres in the Beaufort and Chukchi Sea, north of Alaska, off-limits to future oil and gas leasing. This is being done under an existing law — the Outer Continental Shelf Lands Act.

It's worth clarifying here: The administration isn't blocking all exploration off the coast of Alaska — the Department of Interior is still proposing lease sales in other parts of the Beaufort, Chukchi, and Cook Inlet areas between 2017 and 2022. The move today also doesn't affect Royal Dutch Shell's existing leases to drill for oil in the Chukchi Sea.

But the White House is now expanding the areas that are now off-limits to drilling — such as the Hanna Shoal off Alaska's northwestern coast:

(Bureau of Ocean Energy Management)

The White House detailed its rationale here: "Teeming with biological diversity, these areas in the Beaufort and Chukchi are part of one of the last great marine wildernesses left untouched by development. Endangered whales swim through the icy seas, walruses and bearded seals feed on the Hanna Shoal, and more than 40 species of fish like cod and herring grant fishermen their livelihoods."

Alaska politicians are furious at Obama's moves

The announcement today comes after two other Obama moves to restrict drilling in Alaska. Back in December, the White House blocked all future oil and gas exploration in the ecologically sensitive Bristol Bay along the state's southeastern coast (though that area wasn't much prized by energy companies).

Then, on January 24, Obama asked Congress to designate as "wilderness" some 12 million acres in the Arctic National Wildlife Refuge in northern Alaska. This would kill any chance of future oil exploration in an area that's currently off-limits — but has long been prized by oil companies. (It contains an estimated 10.4 billion barrels of technically recoverable oil.)

You can see the video of Obama's announcement here — he notes that ANWR is home to caribou, polar bears, marine life, but is "very fragile":

Alaska politicians, for their part, have been furious about these actions. They argue that the Obama administration is stifling resource extraction in their state.

Some context: Alaska has long relied on oil production for revenue. Yet in recent years, the state has been facing serious pressures here. Production has been declining in its existing fields since the 1980s. And the global fall in crude oil prices is putting a dent in Alaska's budget — with the state now facing a deficit of some $3.4 billion. Alaska needs new sources of oil and gas to compensate. But Obama's moves have limited future drilling in federal lands and waters.

"This administration is determined to shut down oil and gas production in Alaska's federal areas — and this offshore plan is yet another example of their short-sighted thinking," said Murkowski on Tuesday after the drilling plan came out. "The president's indefinite withdrawal of broad areas of the Beaufort and Chukchi seas is the same unilateral approach this administration is taking in placing restrictions on the vast energy resources in ANWR and the NPR-A."

Murkowski is currently the chair of the Senate Energy Committee — and she has vowed to fight Obama's proposal to grant new wilderness protections for ANWR. She also oversees the Department of Interior's budget. So it's unlikely that this will be the end of this fight.

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