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Monday, August 16, 2010

Drilling in the Great Lakes: Background and Issues

Pervaze A. Sheikh, Coordinator
Specialist in Natural Resources Policy

Marc Humphries
Analyst in Energy Policy

Jonathan L. Ramseur
Specialist in Environmental Policy

Adam Vann
Legislative Attorney

Drilling for oil and gas in or under the Great Lakes has generated interest among Great Lakes stakeholders, states, and Congress. Some opposed to drilling are concerned about the potential environmental, economic, and public health consequences. They contend that drilling will raise the risks of oil spills, hazardous gas leaks, and pollution that may harm lakeside residents and the Great Lakes ecosystem. Proponents of oil and gas drilling contend that drilling will increase local and regional tax revenues and employment, increase domestic energy production, and not be an environmental problem because of new technologies that lower the risks of oil spills and other accidents. 

Issuing federal or state permits for new drilling operations under the U.S. portions of the Great Lakes was banned in the Energy Policy Act of 2005 (P.L. 109-58, §386). Specifically, the provision enacts a permanent ban on the issuance of federal or state permits for new directional, slant, or offshore drilling in or under the Great Lakes. Congress had enacted a temporary ban on any new federal and state permits for drilling under the Great Lakes in 2001 (P.L. 107-66; Title V, §503) and extended it to 2007. This temporary ban was in addition to several state bans on drilling in or under the Great Lakes. In contrast to U.S. law, Canadian law permits onshore gas and oil drilling under the Great Lakes, and offshore gas drilling in the Great Lakes. 

Some contend that the decision of whether to ban drilling is a state responsibility. The states have the authority to regulate the use of Great Lakes resources within their territory and have instituted a variety of approaches for dealing with oil and gas drilling. Yet Congress has broad authority to regulate both the navigable waters and oil and gas development. Some critics of federal action to prohibit drilling say that while Congress may have the authority to regulate or ban oil and gas drilling in or under the Great Lakes, such action might also constitute a "taking" of property for which just compensation would be required. 

This report provides background information on historical and current drilling practices in the Great Lakes, and statistics on oil and natural gas production by Canada and the United States, where data are available. It describes state laws regarding drilling in the Great Lakes and analyzes the environmental, socioeconomic, and legal aspects of drilling in or under the Great Lakes.

Date of Report: July 29, 2010
Number of Pages: 22
Order Number: RL34741
Price: $29.95

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