Should Virginia allow offshore drilling for natural gas?

by Stuart V. Price
for Virginia Business
July 2005

Higher energy prices, demand for a more secure domestic energy infrastructure, and new national energy priorities may provide the impetus to harvest plentiful natural gas resources from Virginia. But wait. Virginia’s southwestern counties — famous for their rich coal seams — generate some natural gas, but the Old Dominion has never been recognized as a major natural gas supplier. Right?

Not so fast. Several businesses and political leaders contend that we can access economical reserves of clean-burning natural gas from Virginia. But we have to go out into the Atlantic Ocean to reach them along the Outer Continental Shelf (OCS).

Earlier this year, a coalition including Columbia Gas of Virginia, Virginia Natural Gas, Dominion Resources and the Virginia Manufacturers Association advocated developing offshore gas reserves. “To support economic growth, protect consumers from rising energy prices, and improve the environment, we must have a comprehensive discussion about energy, and part of that discussion should include exploring available options for increasing natural gas supplies to Virginia,” says Kathleen O’Leary, president of Columbia Gas of Virginia.

From a financial angle, Prudential Financial is on board. Led by Charles Gabriel, Jr., Prudential reported last March that coastal states should be given the chance to harvest offshore resources. (According to preliminary U.S. Interior Department studies, the Atlantic Ocean’s OCS may contain 33.3 trillion cubic feet of natural gas.)

For the past 20 years, however, harvesting offshore energy resources has not been popular. A federal moratorium, in place from 1982-2012, restricts fossil fuel surveying, exploration, development and production along the nation’s OCS. This moratorium remains in place today even though Canada encourages companies like Exxon Mobil (headquartered in Fairfax) to harvest fossil fuels off of its Atlantic Coast.

New offshore production technologies
Joe Leimkuhler, with the American Association of Drilling Engineers, says drilling advances now allow environmentally friendly operations not possible 20 years ago. “Misinformed public perception is a key problem facing the drilling industry,” observes Leimkuhler. “The exploration and production industry has improved substantially since the 1980s. When operators drill into offshore natural gas reserves today, we can safely contain that product — using wellheads, casing, and risers — and pipeline it directly to onshore receiving facilities.”

Speaking before the Senate Energy and Natural Resources Committee last year, Charles Davidson, vice chairman of another industry voice, the Domestic Petroleum Council, highlighted technologies such as:
• Supercomputers, 3-D seismic and visualization systems that provide superior images of ocean geology and resources.
• Advanced drilling systems that allow customized well bores.
• Sub-sea tiebacks that can cover 30 miles and allow operators to produce natural gas from a single production platform, thereby reducing the most common public complaint — visibility of offshore platforms.

Energy legislation
During the 2005 Virginia General Assembly, state Sen. Frank Wagner (R-Virginia Beach) introduced legislation promoting offshore natural gas exploration. The Hampton Roads Chamber of Commerce supported the move. “We believe the time is right to lift the OCS moratorium,” says Ira Agricola, the chamber’s senior vice president for governmental affairs. “If we let operators look for offshore natural gas reserves, the market will decide if there are enough resources to warrant drilling. If there are, our communities will benefit economically. Today’s technology will minimize environmental risks.”

Even though the state Senate and House passed this bill, Gov. Mark R. Warner used his veto pen. While the governor advocates growing Virginia businesses, he contended this legislation directed the state to pursue offshore exploration before Congress had passed energy policy directions. But a national energy roadmap may now be close at hand.

The U.S. House of Representatives emphasized fossil fuel production when it passed its energy bill last April. The Senate Committee on Energy and Natural Resources passed its own energy bill last May. While deliberations continue, observers firmly believe that Congress will present a final energy policy bill to the president that gives coastal states the right to harvest offshore gas reserves.

If so, are we ready to begin harvesting natural gas reserves off Virginia? Today’s advanced drilling technologies, greater environmental controls, and a steady eye for safety will let operators harvest offshore natural resources, strengthen America’s energy posture, bolster national security, and improve Virginia’s economy.

Stuart V. Price, a principal with RSVP Communications in Alexandria, has written about energy, engineering, and environmental operations for 20 years.