State treasurer says oil may not be the energy investment of the future


To Janet Cowell, the issue of oil and gas exploration in North Carolina boils down to economics as much as environmentalism. And the people she has talked to aren’t counting on oil and gas as long-term, high-yield investments, she told a group of environmental advocates in Carolina Beach.

The Democratic state treasurer controls billions of dollars in pension funds and other state investments, and she is looking 30 years down the road. That means a fund must be stable, safe and also offer the taxpayers the best possible rate of return.

“I ask every investor I meet, are you investing in coal? … Nuclear? … Fracking?” The answer is always the same, she said: “No.” That goes for offshore oil as well, she said. Oil and gas operations have expanded in recent years, and the supply is ample, Cowell said, and many investors don’t see a long-term profit in oil.

“I don’t see in the immediate term a lot of prospects for offshore (exploration),” she said May 6 during the gathering organized by the N.C. League of Conservation Voters.

The purpose of the event was to bring together the various groups working to prevent seismic testing and potential oil drilling off the North Carolina coast. As a state senator Cowell received the league’s Green Tie award for legislators with a strong environmental record.

The mood was decidedly anti-drilling, but, like Cowell, some of those in attendance questioned not just the environmental dangers of offshore drilling, but the economic sense of it.

Lawmakers need to consider the impact drilling could have on tourism, fishing and other coastal industries, said Kevin Piacenza of the Surfrider Foundation, which advocates for the protection of coastal waters and beaches.

In a May 6 announcement, Gov. Pat McCrory touted record tourism spending of $21.3 billion in 2014, an increase of 5.4 percent over the previous year. Fifty million visitors took in the sights, and the industry employed 200,000 people.

Much of that economic benefit was generated in the state’s 20 coastal counties.

“Risking all that … it makes you wonder,” Piacenza said. “It certainly doesn’t make any sense.”

Oil industry representatives remain optimistic about the market, however. American Petroleum Institute spokesman Carlton Carroll said in an email the industry trade group cannot speculate about future markets or prices. But the U.S. Energy Information Administration projected in 2013 global consumption of petroleum and biofuels will increase 30 percent by 2040, he said.

“U.S. oil and natural gas producers make investment decisions based on long-term expectations, not short-term prices, and our government should do the same to support energy security,” he said.

Groups represented at the league’s event included the N.C. Sierra Club, the N.C. Coastal Federation, the Surfrider Foundation and Oceana, as well as several local elected officials and residents concerned about preserving the state’s coastline.

Carolina Beach Mayor Dan Wilcox attended to express his support of the groups’ focus on seismic testing and offshore drilling. Carolina Beach is one of many coastal communities that has passed resolutions opposing the Obama administration’s plan to allow seismic tests off the North Carolina coast. Critics fear the deafening sound blasts will harm marine life.

Wilcox said the environment is an issue not restricted to political boundaries.

“To me, this issue is kind of simple,” he said. “I am a sailor. I grew up on the coast. I care about our coast and our natural resources. To me, it’s not a Republican or Democratic issue.”

Organizers of the event, held at Michael’s Seafood, said they hope a cooperative effort will help them persuade lawmakers that coastal residents care about the potential risks from offshore energy exploration.


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