24-04-01 Although the proposed sale of oil and gas leases in the Eastern Gulf of Mexico would only meet the nation's energy needs for several weeks, the auction is attracting keen industry interest and the anger of Florida politicians and environmentalists because it would be the first time the area has been opened for bidding since 1988.
"It would certainly have no impact on our dependency on foreign oil, and it represents just a fraction of 1 % of recoverable natural gas deposits in America," Mark Ferrulo, director of the Florida Public Interest Research Group, an environmental and consumer organization that is opposed to offshore drilling, said.
While the nation consumed about 19.5 mm bpd of oil last year, the six-mm-acre Sale 181 area potentially contains 396 mm barrels of oil, or about a 20-day supply. The 2.9 tcf of natural gas in the area would meet the nation's needs for about 1 1/2 months.

Offshore oil and gas rigs are a common sight in the Western and Central Gulf of Mexico, but there has never been drilling in the eastern part of the Gulf and, in fact, the 1,033 leasing blocks now scheduled to be auctioned off in December represent the first bidding opportunity the Interior Department has offered in the Eastern Gulf in 13 years. Gov. Jeb Bush, who fired off a letter to Interior Secretary Gale Norton asking for the cancellation of Sale 181, is opposed to any oil or gas drilling in the entire Eastern Gulf of Mexico and believes it is imperative to hold the line.
"Once development crosses into the Eastern Gulf and pipeline infrastructure is installed, there will be little incentive not to expand production to fully utilize the transmission capacity," Bush said in his letter to Norton. "Further encroachment towards our beaches will become inevitable." Although leases in the Eastern Gulf -- some of which are still under litigation -- were sold years ago, there is a moratorium on any new leases until 2012 -- with the exception of Sale 181, an Interior spokeswoman said.
"This is one of the most hot-button, emotionally charged issues in our state," Ferrulo said. "To date, Florida has been successful in keeping our coastline rig-free." The Interior Department has been working on the potential new leases in the Eastern Gulf for several years, and the Sale 181 area was supposed to meet the concerns of both Florida and Alabama.

Florida didn't want any leasing within 100 miles of its coast, and Alabama didn't want any leasing within 15 miles of its Baldwin County coastline. That accounts for the unusual stovepipe shape of the Sale 181 tract with a narrow finger jutting up toward the Alabama coast. But to accommodate Florida's request for a 100-mile buffer, the Interior Department drew a line 100 miles south into the Gulf from the Florida/Alabama border.
The reality, however, is the narrow strip that approaches the Alabama border is also within 25 miles of the Florida coast. "Maybe bureaucratically, technically [Sale 181] is not within 100 miles of our coasts, but from a simple geographic perspective, it's a few miles off our beaches," Ferrulo said. "The impact is that we'll have leasing in close proximity to some of the most beautiful, pristine beaches in the country."
The impact on Florida is far greater than the other Gulf states, he said, because "Florida provides recreational, retirement and tourism resources for the entire country that no other Gulf state provides." But there are several hurdles -- including a final environmental impact statement -- to cross before the auction of the six-mm-acre Eastern Gulf tract goes forward. It is possible the shape and size could be altered.
"The process has to evolve; there are still a number of steps," an Interior spokeswoman said. But the Panhandle already is under threat, Ferrulo said, because years ago Chevron acquired three offshore blocks in the Destin Dome, a natural gas field about 25 miles south of Pensacola.

The company lacks only permission from the US Secretary of Commerce to begin production and a decision is expected soon. During the Clinton administration, Chevron failed to get the green light but with the new Bush administration in office the outcome could be different.