Gulf spill unlikely to sour Louisiana on oil

VENICE, Louisiana Sun May 2, 2010 3:51pm EDT

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VENICE, Louisiana (Reuters) - A massive oil spill off the Louisiana coast may boost opposition to offshore drilling and spur calls for tighter federal regulation, but it is unlikely to loosen the southern state's embrace of big oil companies.

The rig explosion and sinking last month that ruptured one of BP's deepwater wells, spewing oil into the Gulf of Mexico, already has led the Obama administration to put on hold a planned limited expansion of oil and gas exploration on the eastern seaboard.

In Louisiana, a relatively poor state that is rich in oil and gas reserves, the disaster also could curb public backing for expanded offshore drilling but likely only in the short term, lawmakers, lobbyists and analysts said.

"Everybody's in shock that this can happen. But is Louisiana now turned off by this? People are irritated by what happened but ... the majority of people think that you can drill here safely," said Bernie Pinsonat of Southern Media and Opinion, a polling firm based in the capital Baton Rouge.

Fresh polls are yet to reflect public opinion in the state on the issue, but Pinsonat's views were echoed by Elliott Stonecipher, a demographer and pollster based in Shreveport.

"Public opinion has always been supportive of offshore and other drilling. We are going to wait to see how bad this is but ... (Louisiana residents) will be pretty slow to condemn the oil industry ... though we might find fault with BP," he said.

The Obama administration signaled a tougher line on oil exploration earlier this week when it announced no new areas for offshore drilling would be allowed until after a review of the Deepwater Horizon rig explosion and the resulting spill.

Greenpeace, an environmental lobbying group, said it saw an opportunity to make its case about the dangers of offshore drilling and the need to resist the planned expansion.

The group's website was "going crazy" as a result of the disaster and the American public was fully engaged in the issue, said Mark Floegel, a senior investigator for Greenpeace

U.S.

"This is cold hard proof that drilling on the continental shelf is not safe," Floegel said.

Yet in Louisiana there were few immediate signs that concern over a catastrophe that could cripple the state's $1.8 billion a year fishing industry for years was translating into widespread anger against the oil and gas sector.

U.S. officials on Sunday restricted commercial and recreational fishing for a minimum of 10 days in federal waters affected by the spill.

Many fishermen were balancing pessimism about their economic prospects with an acknowledgment of the importance of the oil industry to the state.

Louisiana ranks fourth among the U.S. states in crude oil production, behind Texas, Alaska, and California, according to the Energy Information Administration (EIA). It is also one of the nation's top natural gas producers.

CONSERVATIVE STATE

Those views reflect a conservative state where the economy has been dominated by oil and gas and the politics favored Republicans even before Hurricane Katrina in 2005 forced some of New Orleans poorest to seek refuge in other states.

"We need a balance between 'Drill, Baby Drill' and let's be more safe and cautious," said Democratic U.S. Representative Charlie Melancon, referring to the rallying cry of supporters of expanded drilling, including former Republican vice presidential candidate Sarah Palin, who popularized it.

Although his district's constituents, many of whom work in the fisheries industry, will be hurt if the spreading oil slick hits land, Melancon said he still supported expanded offshore drilling, provided it was done safely.

Melancon and U.S. Senator Mary Landrieu, another Democrat, thrive politically in part by positioning themselves as conservatives with views often in conflict with those of Democrats in more liberal parts of the nation.

But they temper their political support for expanded drilling, with demands that a greater share of oil revenue flow back to state coffers, said Robert Hogan, a political science professor at Louisiana State University.

Hogan said the spill would likely boost Landrieu's argument that a better revenue split was needed in light of the dangers oil exploration posed to the state.

COMPETING ALLEGIANCES

The energy industry's position as the largest employer in a state with a high poverty rate also makes residents more reluctant to criticize oil and gas companies.

"You are looking at a state that has struggled with education and poverty, and for many the oil and gas industry offers an opportunity to make a substantial living," said Steven Peyronnin, executive director of the Coalition to Restore Coastal Louisiana.

At the same time, the industry has deep ties to commercial fishing. Many fishermen also find work in the oil and gas industry, and almost everybody in southern Louisiana knows somebody who works in both sectors.

Suzette Tillotson, 48, who runs a roadside seafood restaurant in Belle Chase in southern Louisiana, said the spill would hurt her business but could help her husband who works in the oil cleanup field.

There are, however, areas of friction.

The vast network of oil drainage canals and pipes that criss-cross the marshlands at the mouth of the Mississippi Delta are widely thought to have worsened the storm surge that made Katrina so devastating.

John Tesvich, a fourth-generation oyster fisherman, said oil firms routinely damaged oyster beds by dragging dredging equipment up estuaries.

"Louisiana is tied into the oil infrastructure, so the state will never be against the production of oil," said Tesvich, chairman of the Louisiana Oyster Task Force.

"But the efforts to bring better regulation and more security and the prevention of accidents -- clearly that will gain headway," he said.

(Editing by Pascal Fletcher and Paul Simao)

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