Florida Draws a Line in the Sand

The feds want offshore drilling--but opposition is fierce

For more than a decade, to be a Floridian has meant opposing offshore drilling. Nearly everyone in the state, from environmentalists and the tourism industry to successive inhabitants of the governor's office, fought off attempts to drill in the nearby oil and gas fields under the Gulf of Mexico. Now, however, the oil industry, backed by a friendly White House, has finally won a round. On Dec. 5, the Interior Dept. auctioned off the rights to drill on 1.5 million acres about 100 miles off Florida's west coast.

That's not all. ChevronTexaco Corp. (CVX ) is on the verge of winning federal approval to drill 25 miles off the pristine beaches of Pensacola. "We've been peering over the fence for the past 13 years, and at last we're being allowed inside," says Robert J. Allison Jr., chairman of Anadarko Petroleum Corp. (APC ), which won the biggest share of the recently auctioned rights.

But don't count on drilling beginning any time soon. Granting leasing rights is only the most recent salvo in this decades-old battle, which is largely being fought between oil interests and Florida's huge tourism industry, who have received a helping hand from environmentalists. It has already pitted two prominent political brothers against one another. President Bush wants more domestic exploration, while his brother Jeb, Florida's governor, opposes it in his state. And even oil executives concede that opponents--who are gearing up to fight the oil companies through lawsuits and challenges to the permitting process--could halt drilling for up to five years, if not kill it altogether.

Until now, there has never been a commercial well drilled off the state's coast. But hundreds of rigs dot the horizons of other Gulf states' shorelines. The difference: Florida's $50 billion tourism industry. "Any perceived threat to the Panhandle's clear waters and world-renowned beaches injures our tourist industry, the backbone of Florida's economy," says Governor Bush.

Some in Washington are less convinced by that argument. Governor Bush became the target of an intense yet quiet Administration campaign to open up the offshore fields. With the heat on from his brother, Jeb has had to publicly agree to accept drilling outside a 100-mile perimeter of the Florida coast. A total of 17 oil companies bid $340 million on a small number of the 6 million tracts.

Now drilling foes plan to challenge the oil companies over every one of the dozens of state and federal permits needed to begin work. This is no idle threat. The companies can't start without scores of permits from the Environmental Protection Agency and other federal agencies. Each permit must go through a series of hearings where opponents can voice objections. The loss of any permit can stop the drilling. "We always get an overwhelming show of force against the industry," says Mark Ferrulo, director of the Florida Public Interest Research Group, which opposes exploration.

Lawsuits are also likely. If permits are granted, environmentalists plan to sue to stop exploration under the Endangered Species Act, arguing that sperm whales in the Gulf would be threatened. Others may also sue the Commerce Dept. in federal court if it grants ChevronTexaco the drilling rights it won back in 1988.

Florida's officials are making themselves heard in Washington, too. Governor Bush has written to Commerce Secretary Donald L. Evans asking the federal government to deny ChevronTexaco drilling rights. Meanwhile, Senator Bill Nelson (D-Fla.) is lobbying Congress to let Florida repurchase any of the recently leased rights and retire them. "We sell Florida on its clean and pristine beaches," says Lenne Nicklaus-Ball, vice-president of the Nicklaus Group, which owns the plush Sirata Beach Resort in Tampa. "A spill would devastate Florida's tourism industry." True enough. But that's a risk that the White House appears willing to take.

By Charles Haddad in Atlanta, with Laura Cohn in Washington

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