NCPA - National Center for Policy Analysis


April 3, 2006

Recently, Congress passed a sweeping energy bill that sets a dangerous precedent by undermining Michigan's authority to manage its natural resources without federal interference. The bill will permanently ban all drilling for oil and gas under the Great Lakes. And even though Michigan might be better positioned to set lakes policy, federal involvement is unavoidable as long as the state relies on federal dollars for lakes management, says Russ Harding of the Mackinac Center for Public Policy.

One reason for federal involvement is the concern about potential water contamination, but numerous state regulations -- like directional drilling, which enable oil and gas deposits beneath the lakes to be tapped from a distance -- already exist to protect the lakes, says Harding:

  • 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 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.
  • In 1997, the Michigan Environmental Science Board concluded that there was little to no risk of contamination to the Great Lakes bottom or waters because of directionally drilled wells.
  • Insurance data also represents the low risks involved in directional drilling; in 2002, control-of-well insurance -- which covers environmental damages -- was available in Michigan for as little as $33 per well per year.

Moreover, the territorial sovereignty of states allows public policy to be crafted by those who have a greater knowledge of both local conditions and citizens' sediments, says Harding.

Furthermore, it's extremely important that state sovereignty over natural resources be respected, and no matter how well-intentioned Congress may be, it has subverted the principles of federalism in banning drilling beneath the Great Lakes, says Harding.

Source: Russ Harding, "Decisions About Great Lakes Drilling Should Be Left to the States," Viewpoint on Public Issues, no. 2005-30, October 3, 2005.

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