GULF SPILL:

API, Pew square off in ad battle

An environmental group wanting reforms to offshore drilling and the petroleum industry's biggest trade group launched dueling ads yesterday tied to the Gulf of Mexico oil spill.

Pew Environment Group is running an ad that shows an oil-soaked pelican with the message "Help stop this from happening again. Change the law."

The ad -- which appeared in Politico, Roll Call and CongressDaily -- says, "The oil spill disaster in the Gulf of Mexico could easily happen again unless we change the laws that allowed it to occur in the first place."

The American Petroleum Institute's ad will blanket the country for two weeks in papers that include The Washington Post, The New York Times, USA Today, The Wall Street Journal, Los Angeles Times, Chicago Tribune, Gulf Coast newspapers and Beltway publications. There is a radio ad as well.

"The people of America's oil and natural gas industry are working to help BP and the authorities respond to the spill," the API print ad says. "Clearly, there will be lessons to be learned, and we are fully committed to doing everything humanly possible to understand what happened and prevent it from ever happening again."

It also describes oil and natural gas as "vital domestic resources that power our way of life."

Both ads come as the Obama administration and some in Congress consider policy changes because of the oil spill.

"We're seeing the president grandstand on the spill. We're seeing politicians push for [climate measures] because of the spill," said Ken Green, resident scholar at the American Enterprise Institute, a think tank that favors free market policies. "It's become now more of a thing to lever in legislation."

The campaigns also arrive as polls show declining support for increased offshore drilling. About one-quarter of Americans now back added offshore drilling, while 31 percent want fewer offshore wells and 41 percent want the number of wells to remain at current levels, according to a poll conducted June 3-6 by The Washington Post and ABC News.

Overall support for drilling fell from 64 percent last August to 52 percent now, with 49 percent of respondents describing the Gulf spill as a symbol of broader problems. A quarter of Americans now support increased offshore drilling, while 31 percent want fewer offshore wells and 41 percent want the number of wells to remain at current levels, according to the poll.

Because of the magnitude of the spill, the timing is right for Congress to make regulatory changes, said Chris Mann, senior officer at the Pew Environment Group.

"A lot of people we're talking to on the Hill feel that Congress has to act on this, including committee and chamber leadership," Mann said. "It's a major challenge to the Obama administration. Politically it seems to have become a huge liability. They need to demonstrate that they are hitting this head-on."

API supports and is assisting the ongoing investigations into the causes of the spill, said Linda Rozett, API's vice president of communications. But any reforms now could have negative unintended consequences, she said.

"To decide what to change in order to prevent something from happening before we know what caused it" could lead to the wrong solutions being enacted, Rozett said.

Seeking changes

Pew's ad kicks off a new campaign calling for changes to the law governing offshore oil and natural gas exploration, as well as the rules covering oil spills that were enacted after the 1989 Exxon Valdez incident.

"In the early weeks of the spill, the concern was about the loss of life, the environmental impact," Mann said. "More and more people are turning to what can we do to address not just the symptoms of this but the root causes."

While human error and technological failures were probably factors, "the ultimate cause of the spill, ultimately we believe is a failure of governance."

The Pew print spot asks Congress to take four measures in response to the spill. The first is a more thorough review of environmental impacts "at every stage of offshore oil and gas leasing and development."

Environmental analyses done before as part of leasing for offshore drilling are insufficient, Mann said. The pre-lease reviews of the well involved in the current spill "didn't seriously consider the possibility of a blowout," or "how to deal with a blowout."

Congress is likely to approve additional environmental reviews, Green said.

Pew wants a separation of government offices that collect revenues from offshore drilling from those that enforce safety regulations. Interior Secretary Ken Salazar in May split the Minerals Management Agency into three divisions: energy development, enforcement and revenue collecting (E&ENews PM, May 19).

Mann said that if Salazar's revision is the correct overhaul, it should be made law so a future administration does not reverse it.

Pew wants an end to the current $75 million liability cap for economic damages connected to an oil spill. Two Democratic senators are pushing legislation that would eliminate that limit (E&E Daily, June 9). Companies should pay all of the costs associated with spills, Mann said.

Congress probably will lift that $75 million limit, Green said, although it might consider language to protect the smallest companies.

Pew also is looking for a national ocean policy that would coordinate with regional plans in helping guide places for offshore drilling. It wants to "identify which areas are appropriate for energy development and which are too ecologically sensitive."

Identifying which areas are too ecologically sensitive for drilling could be difficult, Green said.

API response

API's ad strives to highlight the rarity of a spill like the one in the Gulf.

"Nothing like the Deepwater Horizon spill has ever occurred in more than 60 years of oil and natural gas exploration in U.S. waters of the Gulf of Mexico," the ad says. "We have already assembled the world's leading experts to conduct a top-to-bottom review of offshore drilling procedures, from routine operations to emergency response."

The API ad "is just part of the conversation," about the spill and what to do next, Rozett said.

"It's important for the industry to stay involved in the conversation as it moves forward," about the spill, she added.

Any regulatory changes passed because of the BP spill could affect all oil and natural gas companies, AEI's Green said.

"They're just trying to in some way salvage some of their reputation," Green said of the API ad. "They don't want to be tarred with BP's brush."

The oil industry likely will succeed in "fending off what they consider particularly onerous," changes, Green said, especially because offshore drilling plays a major role in the economies of Gulf states.

Click here to see the API ad.

Click here to see the Pew ad.