Bush Curbs Oil Drilling in Florida Coast Tract

WASHINGTON —  WASHINGTON -- President Bush, whose administration has emphasized increasing domestic energy production, moved Wednesday to prevent oil and gas drilling in a large tract off the Florida coast and in parts of the Everglades.

The federal government will pay $115 million to oil companies to drop their fight to drill about 30 miles off the Florida Panhandle. The companies bought drilling rights in the 1980s but faced obstacles put up by Republican and Democratic state officials who objected that drilling could wreak havoc on the white-sand beaches in the Panhandle and on the state’s vital tourism industry.

The federal government will spend an additional $120 million to buy oil and gas drilling rights held by private individuals in three sensitive areas of the Everglades.

Bush’s decision to preserve what he termed “some of our nation’s most beautiful natural treasures” should bolster his environmental credentials in Florida, as well as help his brother Jeb, who is seeking reelection there as governor.

Jeb Bush, who visited the White House on Wednesday, conceded that he stands to benefit from his brother’s move. “But more importantly,” he added, “it is good public policy, and when there’s a convergence of good politics and good public policy, I don’t think we should be ashamed about it.”

The White House denied that politics played a role in the decision.

The president’s action also triggered calls from California officials for his administration to take similar steps to end a fight over undeveloped offshore oil and gas leases off the West Coast.

“What’s good for Florida certainly is good for California,” said Steve Maviglio, Gov. Gray Davis’ spokesman.

It was the second time that Bush, a former West Texas oil man who has pushed for oil and gas exploration in Alaska’s Arctic National Wildlife Refuge, has scaled back potential drilling off the Florida coast. In July, the administration reduced by 75% the size of a new offshore tract in another part of the Gulf of Mexico in response to objections from Gov. Bush.

Wednesday’s decision drew rare praise for the president from environmentalists, and criticism from his usual allies in the energy industry.

The reaction also underscored the difficulty the administration and Congress have experienced in developing a national energy policy in the wake of California’s power crisis last year.

“National energy supply has certainly been handed a setback today,” said R. Skip Horvath, president of the Natural Gas Supply Assn. He noted that the now-abandoned offshore drilling tract in Florida potentially contained large natural gas reserves--as much as 2.6 trillion cubic feet. The nation consumes almost 22 trillion cubic feet of natural gas annually.

“We cannot continue to chisel away at America’s own resources and expect to continue to be self-sufficient in filling future demand,” Horvath said.

Sen. John B. Breaux (D-La.), who has supported the president’s efforts to open the Arctic refuge to drilling, said: “Once again politics is deciding energy policy.... Surely the administration that supports drilling in the Arctic National Wildlife Refuge should find a way to drill in the Gulf of Mexico, where we have been successfully drilling for the past 60 years.”

Mark Ferrulo, director of the Florida Public Interest Research Group, a pro-environment group based in Tallahassee, called the White House announcement “one of the most significant victories in the 20-year battle to keep Florida’s coast rig-free.”

But some environmentalists were skeptical of the administration’s motives.

Referring to the total cost of the decision, Phil Clapp, president of the National Environmental Trust, called it a “$235-million campaign contribution to the Reelect Jeb Bush Committee, courtesy of U.S. taxpayers. It’s a great move for Florida, and clearly any state that wants to protect its environment ought to follow suit and elect a Bush.”

The president’s aides sought to downplay the impact of the decision on energy supplies.

Interior Secretary Gale A. Norton said the deal resolves a “long-standing stalemate” between the oil companies and Florida officials.

“The money paid to the companies under the settlement can be used to make investments elsewhere to help meet the nation’s energy needs,” she said.

The Everglades land is estimated to contain only about 40 million barrels of oil, a two-day supply for the nation, Norton said--far less than what is thought to exist in the Arctic refuge.

Congressional approval is not required for the administration to buy back the Gulf leases from Chevron, Conoco and Murphy Oil in the area known as Destin Dome. But Congress will need to approve the purchase of the drilling rights in three sensitive areas of the Everglades ecosystem--the Big Cypress National Preserve, the Florida Panther National Wildlife Refuge and the Ten Thousand Islands National Wildlife Refuge. All are in southwestern Florida.

Some members of Congress were already talking about additional actions they plan to seek from the administration.

Sen. Barbara Boxer (D-Calif.) sent a letter to Bush saying his announcement is welcome news for Floridians, but it “ignores the fight that Californians have been waging since a devastating oil spill off the coast of Santa Barbara in 1969.”

Although state and federal moratoriums prohibit new offshore oil leases in California, those bans do not apply to 36 undeveloped leases issued from 1968 to 1984. They lie more than three miles off the coasts of Ventura, Santa Barbara and San Luis Obispo counties.

“Californians do not want these leases developed, and the oil companies that hold the leases want out of a protracted legal battle,” Boxer wrote Bush.

Oil companies holding the undeveloped California leases have filed a breach of contract lawsuit against the federal government because of procedural hurdles that have prevented drilling from proceeding. It was a similar lawsuit that led to settling the drilling dispute off the Florida coast.

The administration has yet to take a position on whether the government should buy back the California leases.

At the White House, deputy press secretary Scott McClellan insisted there is no inconsistency in the president’s policies toward the leases in Florida and California.

“The president believes it’s important to consult with local and state communities to address local concerns, whether in Florida or in California,” McClellan said.

Congressional sources said that the purchase of the California leases could be far costlier--in excess of $1 billion.

While the president’s actions Wednesday clearly could enhance his own reelection chances in Florida--which determined the outcome of the 2000 race--the chief short-term beneficiary is likely to be his brother.

Jeb Bush said that, while some might believe that politics were a consideration in the decision, “I don’t really care.”

The governor insisted it is not hypocritical to support energy exploration in Alaska while opposing such action in Florida.

The president has labored to get an energy bill out of Congress that would allow drilling in the refuge.

While the Republican-controlled House passed a bill that would authorize Arctic drilling, the Senate, controlled by Democrats, approved legislation that did not and instead was geared more toward promoting conservation.

As a result, one year after the president unveiled his national energy policy, energy legislation remains in doubt.