For a period of six years, there has been a moratorium in place in California to prevent oil and gas drilling leases on federal public land, following a judge ruling in 2013 that the Bureau of Land Management (BLM) had failed to consider the risks and environmental dangers associated with issuing leases for drilling, in particular hydraulic fracturing. However, as of October 2019, this moratorium ended when the Trump administration opened up 680 000 acres of federal land for surface drilling and another 42 000 acres for leasing with no surface equipment requirements. BLM has emphasised that the decision does not automatically authorise any literal drilling for exploration or development, because environmental reviews, consultation, and public involvement would need to be undertaken for any future leasing or development proposals.
Although many acres of federal land have been made available for oil and gas leasing across California, some industry experts doubt the likelihood of an oil boom in the state. Oil and gas companies generally target locations where infrastructure is present, since receiving permits for wells in undeveloped areas is much more difficult to achieve. This is already evident in the Californian counties of Monterey and Santa Cruz, where legislation has just been passed to ban the creation of new oil and gas wells.
Furthermore, the Governor of California, Gavin Newson, recently signed Assembly Bill 342, a bill intended to move the state away from fossil fuels and in opposition to President Trump's goal to undertake fraccing and drilling activities on federal lands. AB 342 will be able to block the necessary infrastructure for oil and gas development from being built (i.e. pipelines), because state jurisdiction can come into play when production from leases authorised on federal lands requires the use of the supporting facilities and transportation infrastructure that is on state lands.
Following the plan for oil and gas development on federal lands, two environmental groups have sued the Trump administration, with their lawsuit claiming that insufficient analysis was undertaken on the harm that drilling would have on climate change and the potential effects of fraccing on seismic activity. Having just returned from a visit to the Monterey coast -- where I was mesmerised by the harbour seals and sea otters, and stared transfixed at the Pacific Ocean's horizon in hope of witnessing some humpback whale migration -- concern also for the impacts of potential oil spills on marine sanctuary resources, tourism, and the coastal economy, was a thought not to be ignored.
Opposition to new federal land drilling licenses, and thus fraccing opportunities, is also mirrored in the UK. On 2 November, the UK government announced that fraccing can no longer continue in England, effective immediately, on the basis of a recent report which concluded that at present it is not possible to predict with accuracy the probability and magnitude of earthquakes associated with fraccing activities. Following this announcement, share prices in British shale gas companies were quick to fall, with the moratorium to stay in place until compelling evidence can be provided that proves fraccing can be carried out safely.
The oil and gas industries of the UK and US are non-comparable, but both are important to their respective economies. In California, the industry supports nearly 366 000 jobs and provides US$21.6 billion in state taxes, with some oilfields in the state having been in operation for more than 100 years.1 With the Trump administration gunning for energy dominancy, it is likely that the opening of federal lands in California may only be the beginning, and may easily surge beyond the hundreds of thousands of acres.
- Western States Petroleum Association, 2019, 'New economic study demonstrates oil and gas industry's significant contribution to the California economy.'
