VIRGINIA’S
PERSPECTIVE ON OCS
ENERGY DEVELOPMENT
Doug Domenech
Secretary of Natural Resources
Governor’s Energy Conference | Richmond, Virginia | October 15, 2013
ENERGY CAPITAL OF THE EAST COAST

A STRONG ADVOCATE FOR AN “ALL OF THE ABOVE”
ENERGY SECURITY POLICY.

CONVENTIONAL AND RENEWABLE ENERGY

ON SHORE AND OFF SHORE

INCLUDING COAL, GAS, OIL, NUCLEAR, SOLAR, WIND,
BIOMASS AND ENERGY EFFICIENCY
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SIGNED 20 PIECES OF LEGISLATION TO STRENGTHEN
AND EXPAND VIRGINIA’S ENERGY INFRASTRUCTURE
AND EXPAND ALTERNATIVE ENERGY RESOURCES.
OFFSHORE OIL & GAS OPPORTUNITIES
BROAD SUPPORT
 BIPARTISAN
 LOCAL AND STATE ELECTED OFFICIALS
 CONGRESSIONAL DELEGATION
 85% PUBLIC SUPPORT IN VIRGINIA
VIRGINIA’S OCS SAGA

November 2008:
Moratorium Lifted. DOI Call for Information to
Prepare an EIS.

March 2010:
President Obama announces Virginia sale 220
would go forward as part of the 2007-12 5-year
plan. Scheduled for March 2012.
PRESIDENT OBAMA SAID;
“This is not a decision that I’ve made lightly. It’s one that
Ken Salazar and I -- as well as Carol Browner, my energy
advisor, and others in my administration -- looked at
closely for more than a year. But the bottom line is
this: given our energy needs, in order to sustain economic
growth and produce jobs, and keep our businesses
competitive, we are going to need to harness traditional
sources of fuel…”
VIRGINIA’S OCS SAGA
 November
 March
2008:
2010:
Moratorium Lifted. DOI Call for Information to Prepare an
EIS.
President Obama announces Virginia sale 220 would go
forward as part of the 2007-12 5-year plan.
Scheduled for March 2012.

April 20, 2010:
Deepwater Horizon/Macando blowout occurs.

May 7, 2010:
Interior indefinitely postpones the comment period and
cancels the public meetings to scope the EIS for
Lease Sale 220.

May 27, 2010:
President Obama announces the cancellation of Lease
Sale 220.

December 1, 2010: Interior announces that further east coast development
would be postponed until the 2017-2022 5-year plan.
TWO NEW OBJECTIONS:

(1) A LACK OF EXISTING INFRASTRUCTURE

(2) POTENTIAL CONFLICTS WITH THE MILITARY.
THESE CONCERNS WERE NOT RAISED INITIALLY
WHEN THE SALE WAS APPROVED.
VIRGINIA’S SALE SHOULD PROCEED

SUPPORTS EFFORTS IN CONGRESS TO FORCE
INTERIOR TO OFFER A LEASE SALE OFF
VIRGINIA IN THIS 5-YEAR PLAN.

SUPPORTS AN EXPANSION OF REVENUE
SHARING

SUPPORTS EFFORTS TO REVISE THE LEASE
MAP
OFFSHORE VIRGINIA

ESTIMATED 3.3 BILLION BARRELS OF OIL AND
31.3 TRILLION CUBIC FEET OF GAS OFF
VIRGINIA.

GENERATE UP TO 31,000 DIRECT AND
INDIRECT JOBS BY 2020 AND WOULD
GENERATE MILLIONS IN REVENUE TO
BUSINESSES AND THE FEDERAL, STATE, AND
LOCAL GOVERNMENTS.
ECONOMIC BENEFITS OF ATLANTIC OCS
DEVELOPMENT
•
ATLANTIC OCS DEVELOPMENT IS PROJECTED TO
REACH OVER 1.5 MILLION BARRELS OF OIL
EQUIVALENT PER DAY .
•
ATLANTIC OCS DEVELOPMENT IS PROJECTED TO
SUPPORT OVER 160,000 JOBS 15 YEARS AFTER
INITIAL LEASE SALES.
•
LEASE SALES COULD GENERATE $8 BILLION IN
GOVERNMENT REVENUE OVER 16 YEARS.
ONE QUESTION:
WHERE DO WE GO FROM HERE?
GOAL:
•
ENCOURAGE CONGRESS AND THE OBAMA
ADMINISTRATION TO PURSUE A SENSIBLE PATH
THAT ALLOWS FOR ATLANTIC LEASING IN THE
2017-2022 FIVE-YEAR PLAN.
•
Coastal governors, legislators, and other
stakeholders should play a lead role in
delivering this message.
FIVE POINT “WAY FORWARD” PLAN
1. Continue to encourage and support federal
legislative efforts to approve Virginia OCS
leasing.
BILLS TO EXPAND OCS DEVELOPMENT
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“Offshore Energy and Jobs Act” (H.R. 2231)
“Fixing America’s Inequities with Revenues (FAIR) Act of 2013” (S. 1273)
“OCS Transboundary Hydrocarbon Agreements Authorization Act” (H.R. 1613/S. 812)
“Virginia Outer Continental Shelf Energy Production Act of 2013” (S. 1024)
“Virginia Jobs and Energy Act” (H.R. 1782)
“South Carolina Offshore Drilling Act of 2013” (H.R. 771)
“Requiring new 5-Year OCS Leasing Program” (S. 176)
“Infrastructure Jobs and Energy Independence Act” (H.R. 787)
“Energy Production and Project Delivery Act of 2013” (S. 17)
“Maximize Offshore Resource Exploration Act of 2013” (H.R. 1165)
“Energy Production and Project Delivery Act of 2013” (H.R. 1881)
“No More Excuses Energy Act of 2013” (H.R. 2081)
“More Energy More Jobs Act” (H.R. 2265)
“American-Made Energy and Infrastructure Jobs Act” (H.R. 2784)
“Deficit Reduction, Job Creation, and Energy Security Act” (H.R. 70)
“Alaska Adjacent Zone Safe Oil Transport and Revenue Sharing Act” (S. 199)
“Offshore Fairness Act” (H.R. 1430)
“Offshore Fairness Act” (S 681)
“SAFEGUARDS Act of 2013” (H.R. 1820)
“Gulf Coast Oil Recovery Zone Tax Relief and Economic Recovery Act” (S. 1506)
FIVE POINT “WAY FORWARD” PLAN
2. Continue to pressure the administration and
members of Congress to expedite the
completion of BOEM’s environmental review in
a manner that facilitates the prompt issuance
of scientifically and legally defensible seismic
permits.
EXPEDITE THE COMPLETION OF BOEM’S
ENVIRONMENTAL REVIEW.
•
The Congress called on DOI to publish a timetable for completion of
the PEIS and they produced a plan that said that a record of decision
on a final PEIS would be issued on April 13, 2012.
•
At the time, some claimed this nearly two and a half year timeframe
demonstrated that the Obama administration sought to delay drilling
in the Atlantic.
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As the agency began its scoping meetings in the spring of 2010,
BOEM officials continued to state that a record of decision on the
PEIS would be issued by “mid-2012”.
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However, in the wake of the Deepwater Horizon spill in 2010, the
agency’s deadline began to slip, significantly, even though the PEIS
concerned seismic activity, not oil and gas drilling.
SLIP SLIDING AWAY….
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PEIS Process Commenced: January 28, 2010
Draft EIS Completed: PLANNED July 15, 2011
ACTUAL March 2012 DELAY 229 Days
60-Day Comment Initiated PLANNED Oct 31, 2011
ACTUAL March 30, 2012 DELAY 151 Days
Final EIS Published PLANNED February 1, 2012
NEW PLAN January 3, 2014 DELAY 702 Days
Record of Decision Issued PLANNED April 13, 2012
NEW PLAN March 28, 2014
TOTAL DELAY: 714 Days
FIVE POINT “WAY FORWARD” PLAN
3. Include “potential” leasing in the Atlantic in
the 2017-2022 five-year plan, doing so in a
manner that allows forthcoming seismic data
(upon completion of the PEIS) to inform
specific lease sale proposals.
NEW SEISMIC BEFORE PROPOSING LEASING
ISN’T NECESSARY
•
Traditionally, the federal government proposes a lease sale
based on a proper resource assessment.
•
Statutes governing the development of a leasing program,
however, do not require new seismic data before including a
proposed lease sale in a five-year plan.
•
DOI could produce a five-year plan for 2017-2022 that includes
broad areas for potential lease sales, to be made available
contingent on seismic data that demonstrates a promising
resource base.
•
If the PEIS is competed quickly, then subsequent seismic data
acquisition could still be used to inform specific lease sales in
2017-2022 – as long as the five-year plan allows for this
possibility.
FIVE POINT “WAY FORWARD” PLAN
4. Urge DOI to commence work now on the 20172022 draft proposed plan in order to
adequately address the input of elected
officials, coastal communities, and others who
support leasing in the Atlantic and to ensure
that proposed Atlantic leasing is included in the
next five-year plan, which must be finalized by
the middle of 2017.
COMMENCE WORK NOW ON THE 2017-2022
FIVE-YEAR PROGRAM
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Under the Outer Continental Shelf Lands Act, the
Administration can commence work on a new Draft
Proposed Program (DPP) for offshore oil and gas leasing
at any time.
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DOI can justify commencing work now on the 20172022 DPP based on the need to adequately address the
input of governors, Members of Congress, and others
who support Atlantic leasing and to ensure that
proposed Atlantic leasing is included in the next FiveYear Plan, which must be finalized by the middle of
2017.
FIVE POINT “WAY FORWARD” PLAN
5. Demonstrate Virginia is ready by initiating the
Virginia OCS Readiness Project.
GOAL:
•
The project goal is to ensure that Virginia is
prepared for the development of the oil and gas
resources off of Virginia’s coast.
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Initiate and fund a study to identify the road
blocks identified by DOI, and what Virginia
needs to do to be ready.
PROJECT STUDY
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These would include;
(1) a detailed overview of the infrastructure
needed to support oil and gas exploration and
development, and
(2) a plan to work around the objections of the
military.
TOPIC: SAFETY AND ENVIRONMENT
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Review safety and environmental protection
since the gulf accident, lessons learned and
changes made.
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Review the federal standards, regulations and
requirements of lessors and operators related
to environmental protection and safety, with a
particular emphasis on new regulations and
technologies adopted in response to the
Macondo spill.
TOPIC: STATE AND LOCAL REGULATIONS
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Review the role of state and local regulations
and state and local regulators, including in
emergency response, and what a state should
have in place to be adequately prepared.
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Review Virginia’s state and local regulatory
schemes that would apply, organizations and
communications teams already in place, as
well as how same are kept current.
TOPIC: SPACE AND MANUFACTURING NEEDS
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Review what sort of onshore space the industry
needs to support its offshore activity, whether
there are federal regulations that apply.
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Review what sort of manufacturing capacity
and support services the industry makes use of
and in what degree.
TOPIC: THE MILITARY
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Continue the dialog with the military on issues
that are of concern to them.
Review operational protocols in place in other
areas where OCS development and training
activities co-exist.
Provide an opportunity for appropriate decision
makers to be briefed on the latest drilling
technologies.
VIRGINIA’S WAY FORWARD
QUESTIONS?