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Oil Jobs are Estimates. Our Jobs are Real.
If offshore drilling is the solution to NC’s economic problems, then we’ve got bigger problems —
AND A FEW SERIOUS QUESTIONS:
QUESTION 1: ARE THE TEMPORARY JOBS AND REVENUES FROM OFFSHORE DRILLING REALLY WORTH TANKING THE REST OF OUR COASTAL ECONOMY?
According to a 2013 study by North Carolina State University, “Over a seven-year build up period, offshore drilling would generate $181 million in income annually, of which $11 million would be public revenues. In addition, 1,122 jobs would be created. After the seven-year build up period, offshore drilling would generate $1.9 billion in income annually, of which $116 million would be public revenue. This income and revenue generation would occur over a 30-year-period, during which 16,910 jobs would be created.”
Sounds impressive — until you compare those estimated figures to coastal tourism’s proven contribution to North Carolina’s coffers. According to the 2014 numbers in this study prepared for Visit NC by the US Travel Association, visitation to NC’s coastal counties alone directly employed nearly twice as many people (30,000 jobs) and generated 50% more money ($2.9 billion) and more than twice the public revenue — with $130 million in state taxes and $136 million in local taxes. Dare county saw a 7% increase from 2013-2014 with visitor spending exceeding 1 billion dollars. Those numbers don’t even factor in coastal home values or construction jobs, teacher salaries, and government services — or any of the other secondary revenue streams that rely on a healthy coastline. All of these jobs and revenues would be on the line due to the negative impacts of offshore oil drilling, from degraded coastal views to decimation of the coast in the event of an oil spill.
People like to say BP Horizon was a fluke, but it’s really the latest, worst example of a longer pattern of problems associated with offshore drilling. Just eight months prior to our worst environmental disaster Australia suffered a similar catastrophe using the same technology — one that dumped an estimated 132,000 gallons of oil a day into the East Timor Sea for 74 days.
And domestically, studies following BP showed that oil spills are frequent in our own waters. From 1995 to 2010, the U.S. Mineral Management Service recorded 183 spills in the Gulf of Mexico and the Pacific Ocean (including spills of toxic chemicals related to drilling). The U.S. Department of the Interior also estimated that every three to four years, a spill of at least 10,000 barrels is expected to occur.
When Hurricane Katrina whipped through the Gulf of Mexico, she destroyed over 100 platforms and caused the largest oil spill in the U.S. since the Exxon Valdez (until the Deepwater Horizon disaster). Not the most comforting news when you consider North Carolina is home to more frequent storms — both hurricanes and nor’easters.
Most recently, the Refugio oil spill on May 19, 2015 deposited 142,000 gallons of crude oil onto the most biologically diverse coastlines of the west coast. A corroded pipeline was to blame and the impacts to the county estimated as high as $74 million and overall clean up, legal expenses and settlements to be around $257 million.
ANSWER: Oil drilling is an inherently risky business. No matter how you crunch the numbers, it’s not a question of if we’ll see a spill off North Carolina, but when. And when we do have a spill, the health of our coast and economy will be on the line.
QUESTION 3: IF THE OIL INDUSTRY WANTS TO HELP COASTAL RESIDENTS’ POCKETBOOKS, WHY DO THEY ALWAYS FIGHT PAYING FOR THEIR MISTAKES?
In the wake of 1989’s Valdez accident, Exxon spent 19 years in court battling claims — ultimately getting their fines reduced from $5 billion to $500 million — meaning Alaska’s victims waited two decades to receive a paltry $30,000 in damages for suffering the nation’s second worst environmental catastrophe.
Likewise, BP spent 4.5 years after the Deepwater Horizon fighting claims before finally losing the final appeal last December, at which point BP’s lawyers already moved to limit the amount, “asking a federal judge to cap the amount of Gulf oil spill-related fines it must pay at $12 billion,” which is almost a third less than the amount U.S. prosecutors are seeking from the company.
Meanwhile, as many as 45,000 businesses may still be awaiting payment.
ANSWER: The Oil Industry is not a benevolent enterprise. It is a business and seeks to maximize its revenues and minimize its losses.
QUESTION 4: IF PETROLEUM REPRESENTS A MORE RELIABLE INDUSTRY, WHY IS OIL TANKING — AND TOURISM KEEPS BOOMING?
As of Feb. 2016, the price of oil had plummeted to less than $40 to a barrel. That may be great for consumers but it’s bad for the petroleum industry and the states that depend on the revenues. In Louisiana, “for every dollar the price of oil drops, the state loses $10 million to $12 million. In Texas, ten percent of jobs are in oil and gas. Low oil prices could mean 30,000 of those jobs could go away.”
Meanwhile, NC’s coastal tourism industry shows tank-like resilience. With the exception of 2009’s economic downtown, our coastal county’s travel expenditures have consistently grown since 1991 — with an average 5% increase between 2012 and 2013, alone. In 2014, domestic travelers spent a record $21.3 billion in North Carolina. And on a national level, a recent study conducted by the National Ocean Economics Program shows America’s “ocean economy” (specifically focusing on tourism and recreation) contributes three times the amount of money to the U.S. economy, compared to offshore oil production.
ANSWER: Oil is a finite resource and exists in a volatile market. As long as we protect our coasts, coastal tourism will continue to be a sustainable, growing industry into the future.
Perhaps — perhaps — if the potential reserves waiting offshore would make the US energy dependent, one could claim it’s a necessary sacrifice for the good of our nation.
But, they won’t.
Government estimates say only 229 days of oil and 562 days of gas lie offshore based on 2030 consumption rates, when fuel would be available to consumers. Meanwhile, a 2015 report by Oceana reveals that offshore wind power up on Atlantic coast “would produce twice the number of jobs and twice the amount of energy as offshore drilling in the Atlantic Ocean.”
Furthermore, North Carolina boasts more wind potential than any other state: “In 20 years, offshore wind would generate the equivalent of over half a billion barrels of oil more than all of North Carolina’s economically recoverable oil and gas” while creating “more than 48,000 jobs —25,000 more jobs than would be created by offshore oil and gas drilling over the project lifetime.”
And even the worst wind accident will never shut down coastal tourism.
ANSWER: If more jobs and more energy is the goal, wind makes more sense — with no risk to existing industries.
Imagine you’ve got a thriving $2.7 billion company with an 80 year history. One that stands to grow each year and employ thousands of coastal residents for generations to come — all while generating millions in tax revenue for the state as a whole.
Would you start a much riskier venture for a fraction of the revenue, knowing it could shut your existing business down at any time?
Now imagine your state government — people elected to represent your best interest — was considering risking more jobs and tax revenue to bring in an outside industry with no a track record of making mistakes and avoiding making reparations.
What would you do?