California Sues For Say In Fate Of Drilling Leases

California's governor, attorney general and the California Coastal Commission filed a lawsuit against the U.S. Interior Department to allow the state a say in the fate of oil drilling leases off the state's coast. California Coastal Commission Chair Sara Wan said the state was denied its mandatory right to review the leases for environmental issues. "It doesn't mean we would necessarily seek a ban on offshore drilling," Wan said. "The commission is saying (the leases) could have serious impacts on coastal resources and the state needs the right to look at the leases. It's a procedural question." The lawsuit was filed in U.S. District Court in Oakland, Calif., the state attorney general's office said. The suit was filed in response to a decision by the Interior Department earlier last week that could lift a ban on oil exploration activity on the leases offshore central California, if drillers comply with certain environmental terms. The Interior Department extended a drilling suspension on 36 oil leases in California's offshore waters and ordered a review to find out how any drilling would affect the environment. Interior Secretary Bruce Babbitt notified Wan of the suspension decision and said the environmental reviews on each lease would take 18 to 45 months. The leases were already under a 90-day suspension Babbitt had ordered back in August. California Governor Gray Davis and the state's Coastal Commission have expressed concerns about any expanded offshore drilling. "The (Interior) Department shares the Commission's and the Governor's commitment to protect California's marine and coastal environment," Babbitt said. In addition, many California residents oppose offshore drilling, remembering the 1969 oil spill off Santa Barbara that spoiled miles of beach and killed hundreds of birds. Because the oil companies holding the leases are planning new or revised oil exploration, development and production activities, no drilling can take place until the environmental impact analysis is finished, the companies' drilling plans are made public, and the drilling is deemed consistent with California law, Babbitt said. "Lease suspensions will be granted to allow sufficient time for completion of these requirements," Babbitt said. The department's decision was a mixed victory for environmental groups, who have pushed for an outright drilling ban, but instead will have to settle for a postponement of up to four years in any offshore drilling. "It's better than nothing," said Mark Whiteis-Helm, spokesman for Friends of the Earth. "Obviously, we would have preferred...a complete (drilling) moratorium," he said. "I'd have to say we're extremely disappointed," said Sierra Club lobbyist Mark Massara. "We'd hope for the federal government to take the bull by the horns and retire these things (leases)." The ruling was welcomed by the oil companies holding the leases, because development of the offshore tracts is still years away, providing hope that the next U.S. presidential administration may allow development of the leases. "Our timeline showed the earliest that we could even think about doing any additional drilling is 2003," said Conoco spokesman Carlton Adams. "At this point in the ballgame we're right where we wanted to be." he said. Karin Knapp, a spokeswoman for Nuevo Energy, which holds six of the offshore leases, said her company wanted the department's suspension. "We requested it so that we could proceed with preliminary activities that in the best of all cases would lead to exploratory drilling," she said. Other oil firms holding the offshore leases include Aera Energy, the combined California exploration and production operations of Mobil Corp. and Shell Oil Co., a unit of Royal Dutch/Shell Group, and Samedan Oil Corp. a subsidiary of Noble Affiliates. Oil firms paid more than $1 billion two decades ago for the right to drill on the leases, located off Ventura, Santa Barbara and San Luis Obispo coastal counties in Southern California. The tracts were exempt from the Clinton administration's ban last year against new oil drilling because the leases were so old, but any new projects can proceed only if cleared by the Interior Department. Vice President Al Gore said last month that, if elected president, he would ban all offshore oil drilling on the East and West coasts, including the 36 California leases. - (Tom Doggett, Reuters)