Oil War II : California Won the First Round. But Interior Secretary Donald Hodel Believes That Next Time the Ending Will Be Quite Different.

FROM INSIDE, AN offshore oil-drilling platform looks like a combination aircraft carrier and moon base. The crew walks around on catwalks high over the water and moves among the five main levels on steep, vertiginous stairs. Below the twin drilling towers and helicopter pad, the platform is a Mad Max landscape of pipes, valves, tanks, drums, condensers, scrubbers, separators and pumps. Unlike the Art Deco contours of hydroelectric turbines, there’s nothing aesthetically pleasing about the arrangement of piping and machinery on an oil platform, and even with a guided tour, one despairs of making sense of its random, Erector Set design. Everywhere there is the whine, throb and whir of motors, generators, turbines and fans, intermingled with the shipboard smells of diesel exhaust and lubricating oil. Overhead, one hears the rhythmic thub-thub-thub of arriving helicopters. And just beneath the bottommost catwalk, one can see gentle westerly swells swirling and eddying around a thick, black crust of mussels on the platform’s massive legs.

This is Texaco’s Platform Harvest, a just-completed offshore drilling platform at the north end of the Santa Barbara Channel, seven miles southwest of Point Arguello. It goes into operation this December and has an anticipated life span of 30 years. At full production, it will yield 40,000 barrels a day. In the crew rec room, the color TV runs around the clock. And across the passageway, in the platform’s warm and crowded crew mess, production supervisor Vern Rockhold sits quietly behind a fearsome row of bottles of Tabasco, Pickapeppa and Red Rooster hot sauce, methodically attacking a small roast chicken.

Rockhold is a genial, bulky, basset-jowled man who alternates between a week on the platform and a week at his Big Sur home, where he raises fruit trees and worries about his water supply. When a visitor wonders if Rockhold’s neighbors ever ask why he’s drilling for oil off the California coast, Rockhold says that, generally, the subject never comes up. But when it does, he says, he simply tells the truth: “That’s where the oil is.”

The Coming Storm

IT HASN’T HIT most Americans yet, U.S. Interior Secretary Donald P. Hodel told Jane Pauley on the “Today” show last February, but another oil crisis is “almost a certainty.” It’s not readily apparent now because supplies are abundant and gas is cheap but, by Hodel’s estimate, Americans will be sitting in gas lines again “within two to five years.” This is because, says Hodel, the United States is importing 44% of its oil, more than in 1973, when the OPEC embargo was imposed. At the rate we’re going, Hodel says, “in two to five years this nation will be 50% or more dependent on imported oil, (whereupon) the hawkish members of OPEC will conclude that they’ve got us where they want us, and they will seek to raise the price. Then our Congress will almost inevitably decide to fix the price to hold prices down.” And the result will be shortages and gas lines.

The only way to prevent another energy crisis, says Hodel, is full exploration and development of the only two places in the United States with large oil reserves--Alaska and offshore California. The problem, says Hodel, is that in California, many people “don’t want any drilling at all.” Ever since the beginning of the Reagan Administration, they’ve stymied the Interior Department with one moratorium after another. And the result is that most leasing off the California coast has been shut down cold.

After Hodel took office in February, 1985, he and members of California’s congressional delegation negotiated a tentative compromise agreement to protect the coast while still allowing limited oil drilling. But in September, 1985, Hodel rejected the plan as “not in the national interest.” Neither side was able to agree on a new drilling plan. And a year ago last summer, Congress passed a bill putting off further lease sales until the next Administration.

Although Hodel tried to put the best face on all of this, environmentalists maintain that he suffered a stinging personal defeat: He had come into office planning to drill up and down the coastline, they say. Now he is going out of office, at the end of the Reagan Administration, without having leased so much as a single drilling tract off the California coast.

But Hodel says it is the opponents of offshore drilling who are swimming against a historic tide. California’s outer continental shelf holds an estimated 2 million to 5 million barrels. Another oil crisis is coming, he says, and when it arrives the rest of the country is going to turn on California. “The biggest mistake my opponents are making, in my estimation--and it’s unfortunate because they aren’t the ones who are going to suffer--is creating an atmosphere in which there is a perception that vast resources are being locked away,” Hodel says. “The real risk is that in a crisis, if these areas are blocked off, Americans will demand that we proceed in some kind of mad rush to go see what is there. I keep pointing out that any society that will take the Japanese like we did in World War II and incarcerate them simply because they were Japanese is not above throwing its environmental concerns out the window when it thinks its interests are being jeopardized.”

Already, he says, many people tend to regard Californians as rich, arrogant and more worried about ocean views than about the fact that in the Persian Gulf “we have soldiers under the gun trying to protect their oil supply. The risk the (opponents) run, of course, is that by the time they’ve got a sufficient oil-supply problem or price problem, the new secretary, no matter which party is in power and no matter what promises the Democratic presidential candidate may make, will say, ‘My gosh. We have 200 million people in jeopardy and a million people or 500,000 people who will be outraged if we do this. That isn’t even close.’ ”

Hodel on Environmentalists

IT’S A HOT, humid afternoon last July, and Don Hodel is taking a two-day vacation and inspec tion trip down the Colorado River in eastern Utah. He has an appealingly informal manner, and as he bobs along in his faded blue shorts and sopping-wet sneakers at the head of a five-raft flotilla, the river guides quickly drop the “Mr. Secretary” stuff and begin to call him Don. It’s appropriate. There’s an aspect of Eagle Scout to his personality anyway. He sprinkles his conversation with words like super, gosh, nifty and neat . He has what one newspaper called “dark and mobile eyebrows” and a lean and wiry frame. It’s easy to see how he progressed from being an obscure Oregon lawyer to being secretary of Interior: He brings an almost alarming energy to everything he does. The first time the raft encounters white water, he slips overboard and rides the rapids in his life vest. Through other rapids, he stands in the front of the raft like Washington crossing the Delaware. At the end of the day, while most members of his party are content to sit quietly around while the crew prepares dinner, he climbs the base of a nearby ridge to get a closer look at a vertical slab of sheared rock. Later, he flags down some passing kayakers and spends the better part of an hour practicing capsizing recovery techniques. During quiet stretches on the river he marvels at flocks of Canada geese on the banks, golden eagles soaring along the canyon rim, cliff swallows and the grandeur of the river canyon’s 500-foot-high red sandstone walls. “Look at those cliffs,” he says. “I’m glad we came. Can’t you just feel everything drop away?”

Actually, not quite everything drops away. Every so often he sees something that reminds him of his chief adversaries these days--those environmentalists (he calls them “preservationists”) who, in his view, want to freeze nature for all time exactly as it is now. When the raft passes ancient tar seepages high up the face of the cliff, he jokes about including a line item in his next budget for sandblasting the cliffs clean and installing steel pins to restrain loose rock, lest sometime in the next eon or two it fall into the river without prior authorization.

Off the river, two days later, Hodel is riding through a broad, wide valley in a muddy passenger van toward the Grand Junction Airport in Colorado. In between pointing out prairie dogs to his wife, Barbara--”There’s one. See the little gray animal? See them? See them?”--he continues to criticize the “single-interest” environmentalists whose world view, he says, “has the aspects of a theological method.”

“In their view there are two classes of people in the world, the righteous and the unrighteous--and classification is done by the righteous.” And what is frustrating about that attitude, Hodel says, is that it destroys the very dialogue that environmentalists claim they want.

“People say, ‘You didn’t listen to me.’ And if you probe, you find that what they really mean is ‘because you didn’t do what I advocated.’ ”

As Hodel sees it, you can’t please some environmentalists no matter what you do. President Carter’s Interior secretary, Cecil D. Andrus, practically stood on his head “to curry favor with the preservationist constituency,” Hodel says, and in the end, they sued him anyway.

To Drill or Not to Drill

FOR SOMEONE who has devoted the last eight years to helping local govern ments fight offshore oil drilling, Richard Charter lives in an ideal location--a high, sandy bluff overlooking the Pacific Ocean five miles south of the Russian River. On a clear day, he says, he can see a 50-mile sweep of coast from Fort Ross to the north to Point Reyes in the south and, except for the crashing surf below, not a great deal else.

Charter is the knowledgeable director of the California Outer Continental Shelf Local Government Coordination Program, an agency located near Bodega Bay and financed by 30 coastal cities and counties from Oregon to the Mexican border to help them deal with offshore oil drilling. He’s a tall man with a neat black beard and an abiding resentment of Hodel’s contention that environmentalists are using moratoriums to block all drilling. On the contrary, he says, sitting on a cold, windy beach below his house and wriggling his bare feet in the coarse sand, the first moratorium only came about after James G. Watt reneged on a limited drilling plan proposed by his predecessor, Andrus. “It wasn’t just that (Congress) got mad one day and put a moratorium on California.”

As soon as Watt took office in 1981, says Charter, he reinstated four offshore drilling areas that Andrus had previously deleted from the Interior Department’s five-year offshore oil plan--”whereupon all hell broke loose.” By the time the dust had settled, a group of California congressional representatives led by Rep. Leon Panetta (D-Monterey) had managed to persuade Congress to attach an emergency rider to a House appropriations bill to prevent Watt from spending any money to conduct lease sales in the four northern offshore oil-bearing geologic basins. At the urging of the California delegation, Congress expanded that moratorium to other areas the following year, and by the time Hodel took office in February, 1985, the opponents of drilling in the congressional delegation had extended their string of moratoriums to four in a row.

HODEL AGREES that he was never fond of oil-leasing moratoriums. The problem, he says, was that when he took office he quickly concluded that “it was not realistic to expect without some kind of miracle taking place that we were going to be able to carry out a (lease) sale off the California coast. Congress had said that they would not put another moratorium in the appropriations bill unless the Department of the Interior failed adequately to consult with the California delegation. I said, ‘It appears to me then that we have to sit down with those people and see if we can work something out.’ ”

As Hodel saw it, the facts in favor of oil drilling, if not the votes, were on his side. Over the last 16 years, he says, outer continental shelf operations off California’s 1,000-mile coastline have lost a total of only 21,000 barrels of oil to the ocean while producing more than 330 million barrels. In contrast, he says, natural seeps have leaked more than 2 million barrels during the same period. And, according to Hodel, street runoff into storm drains puts far more oil in the ocean than offshore drilling.

Not only did the Santa Barbara oil spill, estimated at 50,000 to 70,000 barrels, do no permanent damage to the coast, Hodel said in testimony before the Senate Committee on Energy and Natural Resources in September, 1985, but also “animal populations were back to normal in little over a year. Santa Barbara channel platforms . . . are covered up to four feet thick with corals, sponges, anemones, scallops, mussels and other marine life. One small company alone harvests over 5,000 pounds of mussels a week from production platforms in the Santa Barbara Channel. A single platform can harbor 20 to 50 times more fish than do nearby areas with soft mud or sand bottoms. I personally have seen large colonies of sea lions, attracted by the abundant fish, actually scrambling on the floating pipeline at Exxon’s Hondo facility in Southern California.”

Critics are forever asking, Hodel said in a recent speech, “Why sacrifice the wildlife and environmental values of this area for the sake of only a few days’ worth of oil?” What these critics ignore, he says, is that “the vast majority of all the oil fields ever discovered in the United States have been small fields,” each containing only a few days’ worth of petroleum. But together they add up to significant reserves. “The energy discovered to date in the California and Gulf OCS (outer continental shelf ), for example, is enough to replace all our oil imports for 16 years at 1986 rates,” he says. Furthermore, “oil fields cannot be found just anywhere, nor can they be picked up and moved to an area where fewer objections might be raised about developing them.” After a lease is issued, it takes an average of five to 15 years to get the oil to the consumers. “If we wait until we really need the oil to begin looking for it,” Hodel says, “we will (have) a cold, dark decade.

“Development opponents regularly apply a maddening double standard. They insist that every conceivable impact of every existing and planned project be considered together to determine the cumulative effects on a river, a wildlife population or an area’s air quality. In the next breath, they demand that America close its eyes to the cumulative impact of numerous no-development decisions. One has to wonder what would happen to America’s energy picture if we had ever developed all those resources that, by the critics’ logic, were not worth drilling”--such as, for instance, Prudhoe Bay, “which now provides 20% of all the oil produced in the entire United States.”

Although critics of oil drilling are fond of asserting that the Interior Department intends to line the coast of California with a “picket fence” of oil platforms, says Hodel, in two decades federal leasing programs have led to the construction of only 21 drilling platforms in the federal waters three miles off the California coast. And, Hodel says, even the largest of these, when seen from the shore, appears no bigger than “a dime held at arm’s length.” Such a harmless “intrusion” on a few people’s ocean view, he says, is a small price for energy security.

TO RICHARD Charter, Hodel’s at titude toward environmental issues borders on the “mischievous.” Last summer, says Charter, he came up with the notion of tearing down the dam at Hetch Hetchy. “All of a sudden,” says Charter, “Hodel is another environmentalist. He is going to create another Yosemite. You’ve got (San Francisco) Mayor (Dianne) Feinstein up here riding around in a motor boat she is so afraid they are going to drain Hetch Hetchy.” But this is the way Hodel operates, says Charter. He’s the kind of guy who, when he was a kid, “probably used to drop cherry bombs down anthills to watch them run.” He didn’t like moratoriums. So he made an agreement with the California delegation. Everyone was happy, says Charter. All of a sudden there’s no offshore drilling controversy anymore. And then he repudiates the entire agreement. “He lit a cherry bomb and ran away.”

Charter believes that Hodel’s dime-at-arm’s-length argument is both offensive and false. If true energy security could be obtained for the cost of a small blip on the horizon, then no reasonable person could possibly object, he says. It’s not the platforms themselves that people object to, says Charter, but what they represent and what they produce--air pollution from the diesel generators, toxins from the drilling muds, disruptions to wildlife, tourism, the fishing industry and the rural character of the central and northern coasts, and most of all, the danger of oil spills.

Charter doesn’t think much of Hodel’s contention that the Santa Barbara spill of 1969 caused no permanent damage. The fact is, he says, no one really knows. There weren’t any base-line studies before the spill for comparison. And besides, he says, there’s a vast difference between cleaning up an oil spill on a flat sandy beach in Santa Barbara and trying to cope with one on the rocky cliffs of the northern coast.

Charter considers it grossly unfair for Hodel to throw in Texas and Louisiana as examples of states which are doing their fair share of offshore drilling. “The coast (here) is fragile. It is not the Gulf of Mexico, where you have drilling rigs 90 miles from shore. We got blessed or cursed with a narrow continental shelf. (And) drilling is going to be as close to shore as they can get it.” That’s why there’s so much controversy. The best tracts, says Charter, are in many instances directly opposite the most sensitive areas of the coast, such as the state elephant seal reserve at Ano Nuevo, a spot so popular with Californians, he says, that they “line up (to buy tickets) at Bass-Ticketron.”

The Battle: A Brief Honeymoon

HAL GROSS, A former aide to Sen. Alan Cranston, says that when Hodel came along, those in the environmental lobby had hopes that at last they might have an Interior secretary they could work with. He was low-key and non-confrontational. His staff returned environmentalists’ phone calls. Shortly after taking office he reversed two Watt decisions that had compressed the leasing timetable and eliminated environmental-impact statements for offshore drilling. “This was taken as an indication,” says Gross, “that maybe, just maybe, he might be different.”

The de facto leader of the fight against offshore oil drilling was Rep. Leon Panetta. Although he had led the fight against oil drilling during the Watt years, by 1985 it was getting harder and harder to find support for the moratoriums in Congress.

“We were running out of judicial tactics,” says Gross. “We didn’t know how long we could keep getting moratoriums. Everyone was damn tired. The appropriations committee was tired of having riders put on its appropriations bill. Local governments were tired of fighting this. Every six months you had to file a new set of objections. There was fighting every year, every time there (was) a lease sale. Everyone was saying, ‘Can’t you get this thing settled? Can’t we get a permanent solution?’ ”

In the hopes that some compromise agreement might be possible, in the spring of 1985, Panetta sent Hodel a letter, also signed by Rep. Bill Lowery (R-San Diego) and Rep. Mel Levine (D-Santa Monica), asking for a meeting.

Hodel was agreeable, and negotiations for an oil-drilling agreement soon began with a small group of representatives led by Panetta. Although the plan was to give the oil companies a few promising tracts in which to drill in return for leaving the rest of the coast alone, says Charter, all the high-interest tracts tended to be near shore. “A lot of them (were) in Santa Monica Bay, Orange County, Newport Beach, Oceanside, San Diego, Santa Cruz, Bodega, Mendocino and the Eel River basin. You cross a lot of congressional districts. Barbara Boxer (D-Greenbrae) was saying, ‘Gee, I can’t really have any leasing off my coast.’ Doug Bosco (D-Occidental) said, ‘Well, I can accept some.’ Leon (Panetta) was saying, ‘Well, I don’t think I want any at all.’ Hodel was engaged in geopolitical polling to see what members of Congress might be amenable to leasing off their district. To the members, it was a question of, ‘How much leasing can I agree to and still go home and get elected?’ ‘Hey, my district elected me to protect the coast. It was one of the things I ran on.’ So there was a very strong reluctance on the part of the members to accept leasing off their districts. And it was not an easy process.”

According to Bob Hattoy, Southern California director for the Sierra Club, the politicking got so bad at times that the members were simply suggesting the sale of tracts in the districts of any representative who wasn’t there. “It was ridiculous,” Hattoy recalls. “For a while they were saying, ‘Well, who’s not here?’ We were saying, ‘No, no, no, no. There are specific areas that need to be protected. There are fishing issues and air issues.’ ”

Driving the negotiating process, says Panetta, was the fact that no one knew which way the upcoming vote on a fifth moratorium would go. The House appropriations subcommittee on Interior was chaired by Sidney R. Yates, a Chicago Democrat and a good friend to California environmentalists (“We ought to name a couple of beaches after him,” says Charter). In the summer of 1985, he had once more sent moratorium legislation out of his subcommittee to the full appropriations committee. But this time, says Charter, its chances in full committee were a lot more dicey. “Oil-patch members from Texas were offering an amendment to strike (the moratorium). The entire coast of California is on the table. Do you try to sustain against an amendment to strike? Or negotiate? The number of tracts were (up) to 150. The members were nervous: ‘I don’t know if I can get away with this and still go home.’ ”

Early on a Friday evening in July, with the moratorium vote imminent, Panetta decided to give the negotiations one last shot. He called Hodel, he says, and asked if he, Sen. Pete Wilson, Mel Levine and Bill Lowery could meet with Hodel in his office. “I had asked that we be able to meet with him alone,” Panetta says. “I had found that his staff interfered. The meeting began on the tone that ‘we really ought to try and resolve this.’ It was really important for us not to fail. There was a sense that we’d come so far and to have to walk out and tell the press there was no agreement would be a defeat for both sides. Pete Wilson stressed that point. Hodel had that same reaction. Four of us were saying the same thing: ‘Can we at least come up with a tentative agreement?’ ”

From his point of view, Hodel says now, the group’s offer was marginal at best. In return for 150 nine-acre tracts of unknown value, he would have to promise to mothball another 6,310 tracts until the year 2000. On the other hand, he says, Watt hadn’t leased anything in the moratorium area for four years. Although 150 tracts weren’t very many, Hodel says, Wilson, Lowery, Levine and Panetta “were not about to make further concessions.” And it was at least “a foot in the door.”

A Deal Is Struck

RICHARD CHARTER was waiting back in Panetta’s office when Panetta returned from the meeting with Hodel. “He was elated,” says Charter. “ ‘We did it,’ (Panetta said). ‘We have a deal.’

“I about fell over. ‘Which configuration?’ ”

“ ‘Our final offer. The secretary is coming over (next Tuesday), and we’re going to have a press conference.’ ”

Despite the general enthusiasm, says Charter, he was still suspicious. The congressional delegation had agreed not to press for a moratorium, and all they had to show for it was a little piece of paper. “I said, ‘Don’t trust this guy.’ I argued vehemently. I wanted to have a moratorium in effect until the deal was signed into law by the President.” But Panetta said no. If the delegation were now to ask for a moratorium it would look as if it wasn’t keeping its part of the deal. “We had to take the deal or not,” says Charter. “And part of the deal was that we trust Hodel.”

The public announcement of the agreement took place on July 16, 1985, in the Caucus Room on the third floor of the House’s Cannon Building. “Hodel came over,” says Charter. “Most of the California delegation was there. It was full of media people--a major news story. It was heralded as a landmark agreement. It was a top-of-the-news, front-page story all over California. It was a real coup for Panetta.”

Coastal environmental activists were so delighted, says Charter, that they held spur-of-the-moment parties in Santa Cruz and Mendocino. And Barbara Boxer, who had managed to keep all leasing out of her district, called the agreement a “dream come true.”

The oil industry, on the other hand, was, in the words of the industry publication Oil Daily, “appalled and astounded.” Daniel E. Lungren, a mild-mannered Republican congressman from Long Beach who claimed his aides had been purposely excluded from the negotations, said the agreement made no sense. “It allows drilling where there is no oil and no drilling where there is.” Furthermore, he asked, why were there drilling tracts in his district but hardly any in the districts of the members who negotiated the agreement? He says he called up Hodel and asked, “What in God’s name are you doing?”

Hodel was shocked at Lungren’s call, the congressman says. Hodel would later say that it was his understanding that the Panetta group was speaking for the entire delegation. A few months later, Hodel told reporters that the whole agreement might have been a “setup.”

“It was a Friday evening in July,” he recently explained. “Congress was headed back home. Four congressmen came in and said the best they could do was make available 150 tracts. I said I didn’t know how good they were. ‘We need public input.’ They said, ‘Can we call this an agreement?’ I said, ‘No.’ ‘OK, can we call this a preliminary agreement?’ I said, ‘OK.’ Then they went out and said a ‘landmark agreement’ had been reached.”

In an effort to get public input on the leasing plan, in mid-August Hodel began a series of meetings in 11 California towns, starting in Eureka and ending in Oceanside. For the first three stops, Hodel was upbeat and positive. “He had a computer-generated slide show,” says Charter. “He would show the high-interest tracts, the (drilling) basins and the agreement. And Hodel did this little spiel.”

Hodel’s fourth stop was Bakersfield, a blue-collar town in which support for drilling was strong. “It was the same spiel, the same projector, but now,” says Charter, Hodel was telling “a totally different story: ‘We maybe have the wrong tracts. We maybe have had some bad data in making the agreement.’ It was like he had a brain transplant on the plane. He was saying, ‘I’ve heard there are problems with the agreement.’ Of course he was hearing it. The oil industry was paying people to come and say it. In the meantime, all the delegation had was a piece of paper.”

Hodel was equally surprised by the results of the town meeting. The Panetta group had assured him, he now says, that “they were speaking for Californians, and most Californians don’t want the drilling.” But everywhere he went now, people were denouncing the plan. Hodel began to see unanticipated problems with it as well. In Ventura, speaking in shirt sleeves to oil-industry workers from a flatbed truck, he declared that not once had the anti-drilling members of the delegation shown concern about the agreement’s impact on jobs.

The farther south Hodel traveled, he says, the more opposition he found. Oil company representatives were calling the tracts “dogs” and the agreement “a sick cow.” In Los Angeles, the Western Oil and Gas Assn. promised to take Hodel to federal court rather than accept a plan that it said “ties our hands for 15 years.” Santa Monica Mayor Christine Reed threatened a lawsuit to stop any drilling in Santa Monica Bay.

Los Angeles County Supervisor Deane Dana said he’d go to court to stop drilling off Malibu, Newport Beach and Oceanside. Newspaper reports of Hodel’s tour said that by the time he reached Oceanside he was so tired and frustrated he threw up his hands.

Back in Washington, Hodel called in the state’s congressional delegation and announced that the “150 tracts only contained 5% of the oil that was out there.” Numerous people had promised to sue him if he went ahead. There was no way he could sign the plan.

A Dead Deal

ALTHOUGH HODEL still held out hope of coming to a new agreement with better tracts, says Charter, by October it was clear the plan was dead. “He never heard of it. The press conference never happened.”

Environmentalists were furious. The national president of the Sierra Club, who had criticized the plan when she thought Hodel was for it, now joined a coalition of environmental groups to demand another moratorium unless Hodel honored the compromise.

The Sierra Club’s Hattoy says he doesn’t usually get emotionally involved in his work, but when Hodel repudiated the preliminary agreement he was “devastated.” It wasn’t bad enough, he says, that just for supporting an agreement in the first place he had to endure all sorts of abuse from “lefty environmentalists,” claiming that the Sierra Club had sold out to the oil companies. But then Hodel simply walked away from the whole agreement, saying it didn’t go far enough and that the environmentalists were stopping progress.

Hodel was equally upset. The members of the California delegation with whom he negotiated, he says, “knew the plan was preliminary. And the transcript of the press conference made it plain they knew it was preliminary.”

How could it have been anything else, Hodel argues. “They came in and said they had a very limited proposal and pleaded with me to let them call it an agreement, which I couldn’t. So we called it a preliminary agreement, and then they chose to later treat it as a breach of faith that I couldn’t go forward with it after the facts were in.”

When Congress chose to forgo the fifth moratorium in 1985, it mandated further consultations between the Interior Department and the California delegation. But for the second round of negotiations, says Hodel, he was not about to fall into the “trap” of bargaining only with opponents of oil drilling. The new 18-member committee, which started negotiations in early 1986, included both proponents and opponents of drilling.

To the anti-drilling members of the California delegation, this was a deliberate attempt at sabotage. “The composition of the group meant there was no way to get an agreement,” says Hal Gross. And in any case, says Gross, it wasn’t clear that the secretary wanted one. “He came to one meeting, made a brief address and then left. The rest of the time the delegation was negotiating with the ideologues on the secretary’s staff.” And they, says Richard Charter, must have had standing orders not to compromise, for they rejected out of hand everything the delegation proposed.

FOR SIX MONTHS, the negotiations struggled on. Then, in the summer of 1986, talks collapsed after Hodel declined to delay a North ern California lease sale tentatively scheduled for fall, 1987, in the new five-year plan. At this point, says Bob Hattoy, Rep. Ralph Regula (R-Ohio) announced in closed committee that the Interior Department was impossible to work with: “Let’s put on a moratorium till 1989.” And in late July, the Democratic-run House Appropriations Committee added language to an Interior Department spending bill to delay any California lease sales in the current five-year plan until February, 1989, when Reagan and Hodel will both be gone.

“The experience with that first agreement had really poisoned the water,” says Panetta. “(Hodel) felt burned by it. The members felt burned by it. It didn’t increase his credibility with the committee in any way. We didn’t feel that anything we negotiated would stick.” It’s not that Hodel doesn’t mean well. “The problem is the backbone isn’t there. You can’t depend on a position that he has taken as one that he is going to fight for all the way.”

Finger-Pointing

TO HATTOY, responsibility for the failure to reach a solution to protect the California coast is entirely Hodel’s. By his “stri dent policies and his determination not to compromise,” Hodel has “rendered himself irrelevant for the rest of the Reagan Administration. We’re just waiting for him to leave.”

In the meantime, as a way of nailing down the coffin lid, Barbara Boxer and Mel Levine have joined forces to sponsor a bill to make most of the coast of California an “ocean sanctuary” from the three-mile limit out to 200 miles. A Laguna Beach councilman has proposed a “national ocean park” between the coast of Orange County and Catalina Island. Levine has announced plans to try to force all the Democratic presidential candidates to take stands against the Hodel five-year leasing plan as the price of California’s support for the Democratic nomination. In last November’s general elections, voters in cities and counties up and down the California coast passed ballot measures to deny building permits for coastal facilities to support offshore oil drilling.

In addition, drilling opponents have, as promised, taken Hodel to court over the Interior Department’s five-year plan, which became final last spring. In August, Atty. Gen. John K. Van de Kamp filed a lawsuit on behalf of the state of California, the State Lands Commission and the Coastal Commission to stop Hodel’s leasing program. Other suits against the plan were filed by the National Resources Defense Council, the Sierra Club and the states of Florida, Oregon, Massachusetts and Washington.

Richard Charter says he is glad that things worked out the way they did. If it hadn’t been for Hodel’s “bait-and-switch techniques,” there would have been one more moratorium in 1986, then Hodel could have “leased the entire Humboldt and Mendocino coast without constraints” under the existing five-year plan. But by trying to lease it all, says Charter, Hodel “gave us the great gift” of the entire Central and Northern California coastline. “We couldn’t have saved it through the Reagan years any other way.”

As to why Hodel made an agreement whose oil-producing potential was so bad that he had to repudiate it six weeks later, even today opinions vary. Doug Henderson, president of the Western Oil and Gas Assn., says Hodel didn’t realize what he was getting into until “he saw the public posturing of the people he had negotiated with. And I think at that point he began to realize it was much more serious and volatile than he had appreciated earlier.”

Rep. Mel Levine agrees. “I don’t think Donald Hodel had any concept of how volatile the issue was here, on the one hand, and how intensely the oil industry felt about it, on the other.”

“It was an honest error of judgment on his part,” says Rep. Bill Dannemeyer (R-Fullerton). “I don’t blame him. He was looking at a California delegation of 45 members. Only 15 supported outer continental shelf drilling. He saw that both senators were opposed (to offshore drilling). And under the circumstances, he thought that was the mood of the people.”

Charter says he doesn’t know why Hodel made the agreement unless it was a trick to avoid another moratorium. But, he says, it certainly isn’t for the reason Hodel seems to want to give now: “These guys got me in an alley and beat me up.”

Hodel Looks Back to the Future

TODAY, HODEL readily admits that he made a mistake. He never should have negotiated, he says, with people who take “near delight in portraying themselves as total opponents of drilling.” He only did it, he says, to accommodate the concerns of the delegation and “to meet congressional requests that we confer.” But, says Hodel, all the brief agreement did was “reduce the area over which the battle goes” without bringing “any peace or certainty for the program.”

On the other hand, he says, if he had not gone through the time-consuming process of demonstrating beyond any doubt that offshore drilling critics were “not willing to accept any exploration in the moratorium areas,” he would have been accused of jumping to a conclusion. But now, he says, even Leon Panetta recognizes that drilling off California is necessary.

In regard to the contention by Charter and Panetta that he has been defeated because Congress took the lease sale away from the Reagan Administration, Hodel says that it is nothing new to have a lease sale delayed, and just because the California delegation was intransigent doesn’t mean he’s lost the game. In fact, he says, such a process probably “had to take place to unmask the fact that some people are probably going to put their local interests ahead of the national interest. And (someday) honest historians may look back and say the worst mistake ever made environmentally on the California coast was the non-negotiating posture basically taken by the . . . anti-drilling forces in the California delegation. Only time will tell whose view of history is right, but I would bet on mine.”

Aftermath

IT’S A BRIGHT August, 1987, morning at a resort-hotel complex at Lake Tahoe. Don Hod el, cool and crisp in a blue sports coat, is giving a breakfast speech over scrambled eggs and chipped beef to Republican Eagles--people who have contributed $10,000 or more to the Republican National Committee. Down the hall, gamblers are playing blackjack and feeding slot machines. But here the mood is calm, confident and partisan. After complimenting the audience about their faith in American values, Hodel gives an old-fashioned stem-winder of a speech urging Oliver North to run for the Senate, confirmation of Judge Robert H. Bork and adoption of a plank in the Republican platform to give “Americans who do not have AIDS” as much protection “as Americans who do.” The audience is friendly, laughing at his jokes and applauding when, referring to Nicaragua, he says, “we cannot afford another Cuba south of our borders.”

Watching Hodel in action it is hard to imagine that he considers himself defeated in any way. He comes across as a man at ease with himself, without rancor and without regrets. There is no way to tell whether this is because, as Panetta maintains, Hodel doesn’t have the political sense to realize that he’s suffered a defeat, or whether it’s because Hodel now understands that the California delegation would never have allowed drilling no matter what. So he accepts with equanimity what he couldn’t have changed and goes on to more promising pursuits such as leasing the Arctic National Wildlife Refuge and draining Hetch Hetchy.

“Sometimes people say, ‘What are your biggest disappointments?’ ” says Hodel. “And I say, ‘I have no disappointments. Disappointments are a function of expectations.’ ” And, he says, he’s been in public life far too long to harbor any of those.