Reaction swift as Obama clears way for drilling off Va. coast

Business groups cheered. Environmentalists booed. And the governor and many Virginia lawmakers smiled, if cautiously.

Opinions abounded across the state on Wednesday after President Barack Obama endorsed oil and natural gas drilling at least 50 miles off the Outer Continental Shelf of Virginia.

While pushing for more alternative-energy development as well, the president said drilling might be allowed off the North Carolina coast and along other Southern states.

But he first called for seismic testing and other studies in the South Atlantic to see if ample energy resources are there and can be tapped safely. Such research could take several years to complete.

Later Wednesday, Interior Secretary Ken Salazar said the government, after years of public debate, was basically "teeing up" a proposed sale of drilling leases off Virginia, in an area covering 2.9 million acres of ocean bottom. Federal officials have estimated the wedge-shaped zone could contain 130 million barrels of oil and 1.3 trillion cubic feet of gas.

Still, Salazar said, obstacles remain. An environmental analysis must be conducted, he said, and prospective drilling cannot be shown to "compromise critical military training in the Atlantic."

His cautionary words were aimed at concerns voiced for years by the Navy, which has said offshore development, as currently mapped, could conflict with ship testing and training off the Virginia coast.

A Pentagon spokeswoman, Lt. Cmdr. Wendy Snyder, downplayed past opposition when asked Wednesday, saying negotiations will continue with state and federal officials.

If all hurdles can be cleared, Salazar said, he expects that private energy companies could bid on offshore leases in "late 2011 or early 2012."

After that, it would take six or seven years before any fossil-fuel products could be pumped from beneath the ocean floor - assuming companies find enough resources there to invest money and begin drilling.

The new energy policy includes no changes to federal revenue-sharing rules, Salazar said, meaning Virginia would not directly receive any funds from offshore oil and gas profits. State leaders have said they want to change this, but Congress for decades has been reluctant to do so.

Reaction to Obama's announcement came swiftly and from all angles Wednesday.

"This is a great day for Virginia," said Gov. Bob McDonnell, a Republican and vocal advocate for drilling. "Virginia will be the first state to be able to enjoy the privilege of exploring and drilling off the Atlantic coast for oil and natural gas."

The federal government had banned offshore drilling for more than 20 years before Congress and then-President George W. Bush allowed the moratorium to expire in 2008.

"Offshore drilling creates a new pollution source, one capable of significant, even devastating, environmental damage from drilling, transportation, storage and refinement," said William C. Baker, president of the Chesapeake Bay Foundation, an environmental group.

Eileen Levandoski, Hampton Roads coordinator for the Sierra Club, called it "a horrible rush to judg ment that trumps thorough environmental study with politics as usual."

By "politics as usual," she meant that Obama had compromised on offshore drilling in hope of winning Republican support for legislation aimed at combating climate change.

Sen. Mark R. Warner, D-Va., said the announcement is a "positive step forward as we work to expand our nation's domestic energy production." He cautioned that drilling is not "a silver-bullet solution to our nation's chronic energy challenges."

U.S. Rep. Glenn Nye, D-Virginia Beach, said offshore drilling will create jobs and reduce America's dependence on foreign oil. Nye and seven other Congress members from Virginia introduced a bill in March that would speed development and return at least half of sales revenues to the state.

Laurie Naismith, a spokeswoman for the Virginia Commercial Space Flight Authority, which owns a launch site at NASA's Wallops Island spaceport on the Eastern Shore, said proposed drilling would interfere with a federally required safety zone.

"That is our critical safety area," Naismith said. "So, yes, our concerns are still there. And we've expressed those concerns time and again."

In his address Wednesday, Obama said his plan strikes a balance between the desires of drilling advocates and drilling opponents, who had wanted the president to block offshore development.

"Given our energy needs, in order to sustain economic growth and produce jobs and keep our businesses competitive, we are going to need to harness traditional sources of fuel even as we ramp up production of new sources of renewable homegrown energy," he said.

On North Carolina's Outer Banks, political leaders tread lightly on an issue that has hung around the barrier islands for decades, while environmentalists expressed disappointment in the president.

The risk to tourism and fisheries along the islands nullifies any perceived economic benefit from drilling, said Michael McOwen, president of LegaSea, an anti-drilling group based on the Outer Banks.

State Sen. Marc Basnight, D-Manteo, said "those two economies" - tourism and fishing - "are about all we have, and if they were to damage those, if there was no reimbursement for those damages, I would oppose that."

North Carolina Gov. Beverly Perdue, a Democrat, said if drilling happens, she would want the state to get a share of the revenues and to continue pursuing wind energy production.

Pilot writers Catherine Kozak and Meredith Kruse contributed to this report.

Scott Harper, (757) 446-2340, scott.harper@pilotonline.com

Julian Walker, (804) 697-1564, julian.walker@pilotonline.com