Alligator Podcast: Mike Stagg – The Vermilion Monologue

This show was prompted by the lawsuit filed by 15th Judicial District Attorney Keith Stutes against 49 oil and gas companies that had received Coastal Zone Permits to conduct drilling, dredging and exploration activities in that parish. The terms of the permit required the companies to repair the land when they completed their work. They did not do so, leading to wetlands loss.

It’s a well-known, long-identified cycle on Louisiana’s coast. There is no factual dispute that oil and gas exploration, production and transport (through pipelines) has damaged our coast. It was the basis of two attempts by the state to tax oil and gas processed in the state — the First Use Tax under Edwin Edwards in 1978 and the Coastal Wetlands Environmental Levy under Dave Treen in 1982.

The persistent stance of Louisiana’s political class has been that oil and gas damaged our coast, it needs fixing, but we don’t want the oil and gas industry to share any part of that burden. It was in that context that the Vermilion Parish Police Jury’s vote to ask Stutes to drop his case should be viewed.

Mike Stagg
Mike Stagg

But, as Brenn Haase said on the show a few weeks ago, the state has committed $50 Billion (in today’s dollars) to the effort to try to save our coastal wetlands. Mark Davis of Tulane’s Center for Water Resources Law and Policy says the actual cost is closer to $90 Billion for the 2012 Coastal Master Plan and the 2017 plan is in the works.

The plain fact of the matter is that the state of Louisiana does not have the money to do this, nor does it have the prospect to get that money — unless the oil and gas industry pays up for its share of the damage to our wetlands caused by their activities.

A good bit of effort has been expended to try to get the federal government to help pay for coastal restoration here, but the question must be asked: Why would anyone else help us if we are not willing to help ourselves? That is, if we are not willing to make the oil and gas industry pay for its share of the damage to the coast, put between 30% and 70%, depending on the location.

The Vermilion Parish lawsuit, I argue in this podcast, should be viewed in the context of a negotiation dance now under way between the State of Louisiana and the oil and gas industry. A precedent exists that shows that it is in the best interests of the publicly traded oil and gas companies to reach a settlement because a properly structured settlement could relieve them of liability for coastal wetlands loss going forward.

The problem for the industry in Louisiana is that a fair number of the companies named are not just majors. Which brings up the question of who should be allowed to operate in the oil and gas business? If companies are not big enough to clean up their mess behind them, are they big enough to be allowed in the oil and gas business, particularly in, on, or around our coast?

My comments in this program are based on having worked in the oil and gas industry, having covered the oil and gas industry as a journalist and citizen, and on six years of intensive work looking at the relationship between state government and the oil and gas industry.

In the podcast only segment (the last 10 minutes or so) I talk about what drew me back to looking at the relationship of the industry and our state. I believe we are a colony of the oil and gas industry. We are Petrocolonial Louisiana.

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