Oil Platforms Near Santa Barbara Halted : Commission Vote Seen as Moratorium on All Coastal Drilling Projects

On a 2-1 vote, the State Lands Commission on Wednesday turned down an ARCO proposal to build oil platforms in the ocean off Santa Barbara and in effect declared a moratorium on platform construction within three miles of the entire California coast until a study of the impact of all offshore drilling can be completed.

Controller Gray Davis and Lt. Gov. Leo T. McCarthy, the commission’s chairman, supported a commission staff recommendation to deny ARCO’s plan to construct three massive drilling platforms in the Santa Barbara Channel because of the project’s impact on nearby residential areas and the University of California at Santa Barbara.

If approved, they would have been the first new platforms in state-controlled waters since the 1969 spill that fouled area beaches and destroyed waterfowl.

Only commission member Nancy Ordway, a deputy finance director representing the Deukmejian Administration, supported the ARCO proposal after a lengthy hearing that proved to be a classic confrontation of environmental and economic concerns. She argued that the oil company had made a “good-faith effort” to respond to commission and community concerns by offering “feasible” technological solutions to the problems of oil drilling within sight of the coast.

ARCO’s representatives went even further, challenging the commission’s authority to refuse to allow any development on tidelands leases that were issued by the state in some cases 40 years ago.

Question of Authority

“The State Lands Commission doesn’t have the authority to cancel leases,” argued attorney Edward S. Renwick. If it did, the state would have to pay ARCO compensation, he said.

But Davis, who first spoke out publicly against the ARCO plan two months ago, strongly disagreed. “It would be irresponsible of this commission to permit unrestricted development of oil on all existing leases,” he said. Davis argued that if ARCO were allowed to go ahead, it would be a signal to the holders of 50 other leases on the state’s tidelands, including 15 off the Santa Barbara shoreline.

“In relatively short order, Santa Barbara, which is today a mecca for tourism, could be turned into a heavily industrialized area,” Davis said.

Both Davis and McCarthy agreed in interviews that Wednesday’s commission vote would have the effect of delaying new construction of platforms along the coast until the completion of a study of the effects of all drilling on the state-controlled tidelands and the federally controlled outer continental shelf.

“We really need to establish a policy,” said McCarthy, who insisted it was correct to call the commission’s action a moratorium on tidelands platform construction.

It would be easy, McCarthy said, to approve projects when they are looked at one at a time. “Each application arguably has merits, but when you look at the total impact it is staggering,” he asserted.

Said Davis: “I don’t believe you can make a reasoned judgment (on any of the drilling proposals for state waters) without the benefit of a cumulative impact study. Otherwise you are flying blind, you are making decisions in a vacuum.”

Both Union and Shell oil companies currently have proposals before the commission for new platforms in the Santa Barbara Channel. Technically, each is entitled to a hearing, but Davis and McCarthy made it clear in interviews that they are unlikely to vote for any drilling proposal until the study is complete.

The State Lands Commission staff has asked for six months to put together a study plan and budget. And it is unclear where the money will come from to carry out the review.

James F. Chase, the UC Santa Barbara vice chancellor for research, told the commission that it would take three years to complete a proper study of the Santa Barbara Channel alone.

University officials opposed the ARCO project because of the potential impact of a spill on the seawater intake of the university’s marine research facilities. Along with residents of nearby communities, they also contended that the sight of drilling rigs, rising up to 250 feet above the ocean surface, represented visual pollution that would diminish the university’s appeal to students and damage the area’s tourist industry.

“You don’t go to a resort to look at oil rigs,” said Robert Klausner, a representative of a Santa Barbara community group. “The place is the attraction. The visual pollution is inconsistent with the surrounding beauty.”

But ARCO officials point out that an existing company platform on state tidelands is already visible, along with a number of others in more distant federal waters.

Jack Sloan, a vice president of the International Brotherhood of Boilermakers, complained that the decision to halt the ARCO project would cost the state 1,000 jobs and hurt another “endangered species, the California worker.”

“Without this project thousands of workers will be sitting it out on the sidelines,” agreed Kevin J. Reidy, an executive with Kaiser Steel Corp. “The fact is, that if the project proceeds many California contractors, including Kaiser Steel, and their employees will have an opportunity to participate in this work.”