INSIGHT: Polar bears, politics and petroleum

29 May 2008 15:47  [Source: ICIS news]

US polar bear ruling may chill energy developmentBy Joe Kamalick


WASHINGTON (ICIS news)--The recent decision by the US Department of the Interior (DOI) declaring the polar bear a “threatened” species may well stand as a watershed event that ultimately could shut down further development of US oil and gas reserves.


Both sides of this heated environmental dispute agree that the department’s 14 May decision to list the arctic polar bear as threatened marks a major turning point in US environmental and energy policy.


The future of domestic oil and especially natural gas production is of crucial interest to the country’s petrochemicals sector and derivative industries because they are heavily dependent on natural gas as both a feedstock and energy source.


Those industries and the broader US manufacturing sector are already facing domestic energy access restrictions and the related four-fold price increases for natural gas that have spurred migration of production capacity and jobs to other countries. Anything that further restricts energy resources is a critical concern.


The Interior Department’s action marks the first time that US regulators have determined that an animal species is threatened or endangered because of current and potential impact of global warming on the creature’s habitat.


In the polar bear’s case, environmentalists successfully argued in federal court that global warming has drastically reduced the amount of arctic sea ice and proportionately diminished the bear’s habitat.


But according to many who oppose the department’s action, the ruling has implications that reach far beyond the polar bear's habitat in Alaska and eventually could block indefinitely access to vast US oil and gas reserves in outer continental shelf (OCS) regions, in the Rocky Mountains and oil shale and tar sands development in the US west.


“This decision will have far-reaching consequences,” said Senator James Inhofe, the Oklahoma Republican and long-time opponent of anthropogenic global warming theories.


“This decision to list the polar bear as ‘threatened’ is based more on politics than science,” Inhofe said, challenging a fundamental part of the Interior Department’s ruling, namely that the arctic polar bear is currently threatened by global warming.


Inhofe, the ranking Republican on the Senate Environment Committee, noted that the arctic polar bear population is now estimated at 20,000 to 25,000 animals, up considerably since the 1950s and 1960s when the creature’s numbers were as few as 5,000.


As the polar bear cannot reasonably be said to be under current threat, given their population growth, Inhofe argued that the department also had no basis to classify the bear as threatened because of what might happen under global warming.


“With the number of polar bears substantially up over the past 40 years, the [department’s] decision appears to be based entirely on unproven computer models,” he said, referring to projections of global warming impacts 40 and 50 years out.


“The implications of the department’s decision,” Inhofe added, “will undoubtedly lead to a drastic increase in litigation and eager lawyers ready to use this listing to do exactly what they have intended to do all along - shut down energy production.”


The State of Alaska agrees with Inhofe. In notifying the Interior Department that it intends to file a civil suit to block and reverse the department’s polar bear ruling, Alaska Attorney General Talis Colberg argued that basing the ruling on what might happen under global warming was beyond the department’s listing authority, which was supposed to be based on the best available scientific data.


“Forecasting events out 40 to 50 years as the ‘foreseeable future’ cannot be considered to be based on the best available scientific and commercial data and are no more than guesses,” Colberg said, “because reliable forecasts of climate change are not possible beyond about 10 years.”


Alaska is worried that the polar bear ruling could jeopardise further production of its oil and gas reserves and perhaps torpedo the massive Alaska pipeline project that is finally beginning to move forward. Oil and gas royalties account for the bulk of Alaska’s state revenues.


However the legal battle turns out, in the meantime the polar bear decision is likely to put a further chill on hopes among some in Congress of reviving oil and gas exploration and development in OCS regions on the US Atlantic and Pacific coasts that have been closed to drilling for 26 years under congressional moratoria.


Don Norman, a top energy economist at the Manufacturers Alliance, says the Interior Department ruling “represents a foot in the door for environmentalists and opens huge potential for attempts to block development of further oil and natgas production, especially in Alaska but elsewhere as well”.


“For those, like me, who favour further development of domestic energy resources, we are concerned about what can happen with this ruling, and rightly so,” he said.


Although the Interior Department’s polar bear ruling included a special provision that would allow energy development to continue in polar bear habitat, Norman was worried that that caveat could easily and quickly be set aside when a new US presidential administration came to power in January next year.


In addition, said Norman, by establishing, however precariously, the distant potential for global warming as grounds for listing a species as threatened or endangered, the department had opened the door for a rash of similar lawsuits.


“It will be easy for environmentalists to find other species in the Rockies or in offshore areas that are ‘threatened’ by global warming,” Norman warned. 


“Once you establish the principle that this is a legitimate concern and basis for the ruling,” he said, referring to the global warming element of the department’s decision, “there’s no telling where this can go.”


Indeed, the Center for Biological Diversity, one of the principal plaintiffs in the federal court case that forced the Interior Department to make its ruling, is already taking steps to broaden it.


Kassie Siegel, climate programme director for the centre, said the ruling ultimately would mean any activity within the US that contributes to global warming could be said to be further threatening polar bear habitat.


Even though the department’s ruling specifically held that activity outside of Alaska could not be deemed to have an effect on the bear’s habitat, Siegel said that aspect of the ruling would fall and was already being challenged in court.


“That is illegal because under the Endangered Species Act, you cannot exempt from regulation the very thing - in this case, global warming - that is threatening the species,” she said.


“What we are saying in our litigation is that activities that impact polar bear habitat are not just those in the habitat area itself in Alaska but any activities anywhere in US jurisdiction that cause global warming, including for example oil shale and tar sands development in Utah, Wyoming and New Mexico,” Siegel added.


The centre has already filed a new suit seeking to force the Interior Department to make a similar global warming threat listing for walruses and other Pacific coastal marine life.


“The Bush administration is still trying to avoid regulating greenhouse gas emissions,” Siegel said, “but this Interior Department ruling is the beginning of the end of that failed policy.”


“This is a watershed moment,” she said.


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By: Joe Kamalick
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