Decisions About Great Lakes Drilling Should Be Left to the States

Two types of well paths used in directional drilling are pictured above in a diagram from a 1997 Michigan Environmental Science Board report, “Evaluation of Directional Drilling Under the Great Lakes.”

President Bush and the U.S. Congress have passed a sweeping energy bill that sets a dangerous precedent by undermining Michigan’s authority to manage its natural resources without federal interference. A little-noticed provision in the new law permanently bans all drilling for oil and gas under the Great Lakes. But Michigan and its neighboring states are far better positioned than Washington, D.C., to set lakes policy.

An interim ban on Great Lakes drilling imposed by Congress in 2001 was set to expire in 2007. Michigan, along with New York, Wisconsin, Illinois and Ohio, also had banned the practice, thereby largely negating the rationale for federal pre-emption.

A degree of federal involvement is unavoidable as long as states in the region rely on federal dollars for lakes management. Indeed, Congress appropriated more than $2.2 billion for Great Lakes restoration between 1991 and 2001, according to the Government Accountability Office.

But there also are risks in allowing Washington, D.C., to dictate Great Lakes policy. The federal government, after all, is more susceptible to a range of special interests and political pressures than are governors and legislators, who have a more direct stake in sound stewardship. To the extent that political power nationally continues to shift to thirsty Southern and Western states, federal control of the Great Lakes becomes all the more worrisome.

U.S. Rep. Bart Stupak, D-Menominee, sought the federal ban on drilling in response to concerns about potential water contamination. But numerous state regulations exist to protect the lakes, and the risk of a spill is negligible.

One safe method of extracting resources is directional drilling, which enables oil and gas deposits beneath the lakes to be tapped from a distance. As regulated in Michigan prior to the drilling ban, a rig had to be located no less than 1,500 feet from the shore, where a vertical bore could be drilled to a depth of some 1,000 feet. The hole then could be deviated at an angle toward the bedrock underlying the lake until it reached oil or gas deposits some 4,900 feet beneath the water’s surface.

The Michigan Environmental Science Board concluded in 1997, “(T)here is little to no risk of contamination to the Great Lakes bottom or waters through releases directly above the bottom hole portion of directionally drilled wells. …”  The one small risk identified by the board was contamination at the wellhead, far from the water’s edge. But wellheads, too, are regulated by the state.

Insurance data provide a dependable assessment of the risks associated with directional drilling. A 2002 study by the Mackinac Center for Public Policy found that control-of-well insurance, which covers environmental damages, was available in Michigan for as little as $33 per well per year, depending on the number of wells being covered. This low cost reflects the fact that more than 3,800 directional well bores have been drilled in Michigan without incident, including 13 beneath the Great Lakes.

Our republic was founded on the principle of federalism, whereby government power is wisely decentralized both as a check against tyranny and to foster policy competition among states. As the 10th Amendment states: “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

The territorial sovereignty granted to the states allows public policy to be crafted by those likely to have greater knowledge of both local conditions and citizens’ sentiments. Accountability is thus enhanced.

“States are closest to their constituents and problems, bringing a necessary sensitivity and perspective to local environmental issues that even the (U.S. Environmental Protection Agency’s) 10 regional offices, often many hundreds of miles away, can’t have,” said Mary Gade, former director of the Illinois Environmental Protection Agency.

It is particularly important that state sovereignty over natural resources be respected. Natural resources are principally local goods, which states historically have protected independent of dictates from Congress. Well-intentioned though Congress may be, it has subverted the principles of federalism in banning drilling beneath the Great Lakes. Congress and President Bush should repeal this ban.

Russ Harding is senior environmental policy analyst with the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich. Permission to reprint in whole or in part is hereby granted, provided that the author and the Center are properly cited.