Petro politics

Offshore oil platform
Offshore oil platform
Lukasz Z/Shutterstock
In an open letter to the federal government, Gov. Andrew Cuomo wrote, “Offshore drilling would devastate New York’s economy and environment."

Petro politics

New York criticized the federal offshore drilling plan, but does the Atlantic even have any oil reserves?
February 13, 2018

When President Donald Trump’s administration announced a plan last month to open most of the U.S. continental shelf for petroleum exploration and drilling, Albany fired off a barrage of rhetorical salvos.

“President Trump's move to allow new offshore oil and gas drilling represents yet another federal assault on our environment and our future,” tweeted Gov. Andrew Cuomo, who instead is pursuing an ambitious plan to produce 2.4 gigawatts of offshore wind energy by 2030.

In an open letter demanding New York’s waters be excluded, the governor concluded: “Offshore drilling would devastate New York’s economy and environment, cause irreparable harm to our coastal ecosystems, and could interfere with our nationally significant coastal economy.”

State Attorney General Eric Schneiderman tweeted, “We do not need another #DeepwaterHorizon off our shores.” He later announced seven state attorneys general opposed a rollback of safety protections for offshore oil and gas production.

But dire predictions aside, how much oil or gas does the Empire State have locked under its surrounding seabed anyway?

“It’s hard to say, because there just isn’t a lot of data,” said Hugh Daigle, an assistant professor at the University of Texas with expertise in drilling and petrophysics. Daigle previously worked for Chevron Corp. and Exxon Mobil Corp.

In fact, the authoritative estimate by the federal Bureau of Ocean Energy Management for how much oil and gas lies off the eastern coast of the United States is largely based on looking at what has been found in other parts of the world that have similar geology – like Africa and South America – in addition to some sparse seismic data and a few scientific boreholes from the 1970s, Daigle said.

Based on that information, the bureau’s most recent report on the area from 2016 estimates that there are 1.77 billion barrels of oil and 11.76 trillion cubic feet of natural gas that is “undiscovered” but “technically recoverable” in the North Atlantic outer continental shelf. If there’s oil and gas there or anywhere on the entire Eastern Seaboard, it appears no one has ever made money pumping it.

“To date, there has been no commercial hydrocarbon production in the U.S. Atlantic (outer continental shelf),” which is within three miles of the shoreline and stretches from Nova Scotia to the Bahamas, according to the report. There was oil and gas exploration from the late 1960s to the mid-1980s, but government-issued leases from that time “were ultimately relinquished probably due to a combination of issues,” according to the report, including the need for a “large number of wells and limited per well recovery, distance from shore (approximately 100 miles), and lack of onshore and offshore infrastructure.” A series of congressional moratoriums starting in 1982 then made the question of what oil lay off the East Coast moot for decades.

Roger Sassen, a visiting scholar at the Geochemical and Environmental Research Group at Texas A&M University whose research is cited repeatedly in the 2016 bureau report, is unimpressed with the official findings. “It was a political thing rather than a scientific thing,” he said of the report, saying that it all amounts to “a guess.”

“I know the people who did it and I’m not terribly impressed,” Sassen said. They are “trying to solve a huge problem with a vacuum of data, especially when they’re ignoring the data that exists,” he said, referring to his own research.

“In 1979, I was a geologist working for Texaco,” Sassen said. “We discovered a fairly large gas field in Hudson Canyon, which was about 100 miles south of Long Island. … There’s evidence that gas is seeping out of the seafloor. There’s huge gas seep offshore New England.”

While Sassen said he collected natural gas samples in that submarine canyon years ago, he is not aware of any significant crude oil discoveries. But given the undersea resources found off the Canadian Atlantic provinces, Sassen believes there’s petroleum to be found. Neighboring Nova Scotia estimated there are 8 billion barrels of oil and 120 trillion cubic feet of natural gas off its coast, according to a 2011 government report – that’s four times the oil and 10 times gas estimated by the U.S. federal government for the North Atlantic shelf.

Although there’s little hard evidence that there are significant oil and gas deposits off New York’s coast, it’s possible that’s because no one was looking very hard. In the oil-rich regions of the Gulf of Mexico and Southern California, Daigle said, naturally occurring ocean floor seeps bubble up and form oil slicks that long ago tipped off prospectors that there was oil below – but you won’t find such obvious signs of black gold in New England’s waters.

In response to questions sent to several state environment and energy agencies about what gas or oil wells have ever existed in state waters, the New York State Energy Research and Development Authority said it “doesn’t have that information.” It deferred to the federal Bureau of Ocean Energy Management, which also said it doesn’t track that information. Peter Warwick, chief of the U.S. Geological Survey’s Carbon Sequestration – Geologic Research and Assessments Project, said he did “not know of any reports that discuss petroleum potential for New York’s coastal waters.”

For a state that incorporated the first oil company – in Albany back in 1854 – and then had the first patent filed for an offshore drilling rig in 1869, New York has an abysmal track record of producing offshore oil and gas.

In search of any record of striking offshore oil or gas anywhere near home, there is a single mention in the report of Sassen’s natural gas discovery. “That one well off the coast of New Jersey is really the only example on the entire Eastern Seaboard,” Daigle said.

Given the absence of identified oil and gas reserves, all the hubbub surrounding the issue “is surprising,” Daigle said with a laugh.

One expert downplayed the likelihood of drilling along New York’s shore for another reason. Iraj Ershaghi, professor and director of the University of Southern California’s Petroleum Engineering Program bluntly stated in an email that “leasing will not happen in the Atlantic” because none of the states are interested in pursuing leasing in state-controlled waters immediately off the coast, considering the need for pipelines or other infrastructure in New York or other states’ waters.

Moreover, the federal report said there simply is no existing infrastructure on the East Coast that new offshore oil wells could piggyback on.

Still, the report said given improvements in technology, extracting oil and gas remains feasible. It remains an open question whether any companies are interested.

A 2013 report commissioned by industry groups American Petroleum Institute and National Ocean Industries Association predicted that New York would benefit from $1 billion in industry spending and 12,000 jobs due to offshore oil and natural gas activity in the Atlantic outer continental shelf if it was opened to petroleum exploration. While the report named New York-based companies that could drive that growth, such as offshore oil and gas operator Hess Corp. and “supply chain companies” Dover Corp. and ITT Inc., as of press time, none of those companies responded to questions about what opportunities were presented by the North Atlantic offshore drilling leases.

At any rate, no one will be pumping oil or gas anytime soon. Tracey Moriarty, a spokeswoman at the Bureau of Ocean Energy Management, said it would take five to 10 years before drilling would begin in a well-explored region, such as the Gulf of Mexico. In a largely unexplored area like the North Atlantic, “the time would likely be longer,” especially as unexpected challenges arise, she said.

Sassen, however, said his contacts in the gas industry are interested. “I think they would be overjoyed to have another crack at it,” he said.

Frank Runyeon
Frank G. Runyeon
is City & State’s senior reporter. He covers state politics and investigations.