A BILL TO BE ENTITLED
AN ACT to prohibit the exploration, development, and production of offshore oil and gas in north carolina coastal waters in order to protect military operations, commercial and recreational fishing, and tourism, and the billions of dollars they contribute annually to the coastal economy, and the state as a whole, from the profound risks of offshore oil and gas exploration, development, and production.
Whereas, the Department of the Interior (DOI) is currently processing permit applications for offshore oil and gas seismic permits to allow private sector entities to perform seismic airgun testing off North Carolina's coast, and the DOI has proposed a 5‑year leasing program that would allow oil and gas exploration, development, and production off the Mid‑Atlantic region of the Outer Continental Shelf (OCS), which includes North Carolina's coast; and
Whereas, the National Oceanic and Atmospheric Administration (NOAA) recently issued final Incidental Harassment Authorization (IHA) permits allowing five private sector companies to begin the practice of seismic airgun testing for oil and gas reserves in the Mid‑Atlantic, including vast areas off the North Carolina coast; and
Whereas, seismic airgun testing is used to determine what oil and natural gas reserves lie beneath the ocean floor; and
Whereas, seismic airguns essentially shoot blasts of compressed air into the ocean floor, and such blasts are known to be one of the loudest man‑made sounds in the ocean, and sounds from these intense blasts can travel over 2,000 miles; and
Whereas, if seismic airgun testing is approved, vessels would tow as many as 30 airguns, which would be fired every 10 seconds continuously 24 hours a day and seven days a week for the duration of the mapping exercise, which could last for several weeks; and
Whereas, offshore oil and gas development activities pose profound risks to a state's natural resources and economy as evidenced by the 2010 release of an estimated 170 million gallons of oil into ocean waters from a single rig, BP's Deepwater Horizon, which severely impacted more than 600 miles of shoreline, and resulted in numerous beach closings, harmed countless numbers of marine mammals, fish, shellfish, marine birds, and other wildlife, and caused an estimated loss of more than a billion dollars to the commercial fishing industry and an estimated loss of more than 22 billion dollars to the tourism industry in the Gulf States; and
Whereas, a study submitted to the Joint Legislative Commission on Energy Policy in 2013 reported the spillage rates for offshore oil development during the period 1964‑2010 for the United States OCS shelf platform and pipeline operations with losses greater than 1,000 barrels was 0.6 spills per billion barrels of oil produced, and the average loss per spill was 547,163 barrels. Thus, if offshore drilling is allowed to occur, applying the average rate of spills per billion barrels of oil to the estimated average of 20 million barrels of North Carolina offshore oil to be pumped annually would yield 0.012 spills per year with an average annual spill loss of 6,566 barrels. The report further went on to find that using a cleanup cost of $12,600 per barrel, the expected annual loss from oil spillage related to offshore development in North Carolina would be $83 million; and
Whereas, North Carolina has a uniquely dynamic yet fragile coast, with over 300 miles of coastline, 2.5 million acres of estuarine waters, and 10,000 miles of estuarine shoreline; and
Whereas, maintaining a healthy coast is vital to the economic well‑being of North Carolina's 20 coastal counties, and the State as a whole; and
Whereas, in 2013 the coastal counties represented 6.8 percent of the State's total gross domestic product (GDP) at $32 billion, and 8.2 percent of total employment with 336,522 employees; and
Whereas, from military operations, seafood and fishing activities, tourism and recreation, and access to global markets through shipping and transport at coastal ports, hundreds of thousands of jobs and many billions in annual revenue for the State depend on our ocean and coast; and
Whereas, seismic airgun testing and offshore drilling endanger military operations within the State, and the natural resources that serve as the foundation of our fishing and tourism industry and our thriving coastal economy; and
Whereas, an October 2015 study released by the Department of Defense designated portions of the North Carolina coast as areas where no offshore drilling activity at all could occur without impeding military operations, designated portions of the North Carolina coast as areas where permanent surface oil and gas structures should be prohibited, and designated the remainder of the State's coast as an area where offshore drilling could occur only with site‑specific stipulations to avoid impacts on military operations; and
Whereas, a study by the State's Department of Commerce in 2015 estimated that military installations in North Carolina supported 578,000 jobs, $34 billion in personal income, and $66 billion in GDP, which amounted to roughly 10 percent of the State's overall economy; and
Whereas, research suggests that seismic airgun testing risks diminish essential fish stocks for commercial and recreational fishing communities in our State by imposing significant harmful impacts on marine mammals and fisheries, including acute, cumulative, and chronic negative impacts on the ability of marine mammals to send and receive signals that are essential for feeding, reproduction, raising offspring, and navigation; and
Whereas, seismic testing has also been correlated with body malformations in certain marine life, development delays and death of shellfish, increased mortality in larval fish, as well as declines in catch rates near seismic blasting that range from 40‑60 percent, depending upon the fishery and gear type; and
Whereas, commercial and recreational fishing in North Carolina continues to be an important economic activity, as well as a cultural tradition along the North Carolina coast, and contributes an estimated $2 billion annually to the State's economy, and represents thousands of  jobs; and
Whereas, coastal tourism generates $3.4 billion annually in North Carolina and supports more than 35,000 jobs in the eastern part of the State; and
Whereas, more than 200 local governments have passed resolutions opposing seismic airgun surveying and/or offshore drilling in the Atlantic Ocean, including over 30 North Carolina coastal communities; and
Whereas, there is widespread bipartisan opposition to seismic airgun surveys and offshore drilling from business and trade groups, tourism associations, chambers of commerce, and convention and visitors bureaus; and
Whereas, opposition to seismic testing and oil and gas exploration, development, and production in the Mid‑Atlantic has also been expressed by the Department of Defense due to impacts to military testing, readiness, and national security; and
Whereas, according to BOEM, the entire Atlantic OCS contains approximately 5% of the undiscovered, technically recoverable resources of oil in all regions of the nation's OCS, and approximately 8% of the undiscovered, technically recoverable resources of gas in all regions of the nation's OCS, and the Mid‑Atlantic region of the OCS is just a fraction of those percentages, and North Carolina's share yet a further fraction of the small percentages in the Mid‑Atlantic region; and
Whereas, based on government estimates, if all of the economically recoverable offshore oil and gas in the Atlantic OCS were extracted and used, oil demand would only be met for 132 days and gas demand would only be met for 283 days, at current consumption rates; and
Whereas, the risks posed by offshore exploration, development, and production of oil and gas to military operations within the State, and the State's natural resources and the fishing and tourist economies on which they depend, are too grave, and those risks vastly outweigh any benefits from drilling for the amount of oil and gas estimated to be economically recoverable off the North Carolina Coast; Now, therefore,
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 113A‑119.2 reads as rewritten:
"§ 113A‑119.2.  Review of offshore fossil fuel facilities in federal waters; prohibition on such facilities in State coastal waters.
(a)	In addition to the definitions set out in G.S. 113A‑103, as used in this section, the following definitions shall apply:
(1)	"Coastal fishing waters" has the same meaning as in G.S. 113‑129.
(1a)	"Development" means those activities taking place following the discovery of oil and natural gas, including geophysical activity, drilling, platform construction, pipeline construction, and operation of all onshore support facilities that are performed for the purposes of ultimately producing the resources discovered.
(2)	"Discharge" has the same meaning as in G.S. 143‑215.77.
(2a)	"Exploration" means the process of searching for oil and natural gas, including any drilling.
(3)	"Offshore fossil fuel facility" means those facilities for the exploration, development, or production of oil or natural gas that have the potential to affect any land or water use or natural resource of the coastal area. For purposes of this definition, offshore fossil fuel facilities shall include, but are not limited to:
a.	Structures, including drill ships and floating platforms and structures relocated from other states or countries, located in coastal fishing waters.
b.	Any equipment associated with a structure described in sub‑subdivision a. of this subdivision, including, but not limited to, gathering systems, processing and storage facilities, and pipelines that are used to carry, transport, or transfer oil, natural gas, liquid natural gas, liquid propane gas, or synthetic gas.
c.	Onshore support or staging facilities associated with a structure described in sub‑subdivision a. of this subdivision.
(4)	"Oil" has the same meaning as in G.S. 143‑215.77.
(5)	"Production" means those activities that take place after the successful completion of any means for the removal of oil and natural gas, including that removal, field operations, transfer or resources to shore, operation, monitoring, maintenance, and workover drilling.
(b)	In addition to any other information necessary to determine consistency with State guidelines adopted pursuant to G.S. 113A‑107, the following information is required for the review of an offshore fossil fuel facility located more than three geographical miles offshore:
(1)	All information required to be included in an Exploration Plan required pursuant to Subpart B of Part 250 of 30 C.F.R. (July 1, 2009 edition).
(2)	All information required to be included in an Oil‑Spill Response Plan required pursuant to Subpart B of Part 254 of 30 C.F.R. (July 1, 2009 edition).
(3)	An assessment of alternatives to the proposed offshore fossil fuel facility that would minimize the likelihood of an unauthorized discharge.
(4)	An assessment of the potential for an unauthorized discharge to cause temporary or permanent violations of the federal and State water quality standards, including the antidegradation policy adopted pursuant to section 303(d) of the federal Clean Water Act (33 U.S.C. § 1313(d)).
(5)	Any other information that the Commission determines necessary for consistency review of an offshore fossil fuel facility located more than 3 geographical miles offshore.
(c)	Notwithstanding any other provision of law, the exploration, development, or production of oil or natural gas within the estuarine and ocean waters of the State, which includes those ocean waters extending offshore to the limits of State jurisdiction, is prohibited. In addition, the construction or operation of offshore fossil fuel facilities is prohibited in such waters."
SECTION 2.  G.S. 146‑8 reads as rewritten:
"§ 146‑8.  Disposition of mineral deposits in State lands under water.
(a)	The State, acting at the request of the Department of Environmental Quality, is fully authorized and empowered to sell, lease, or otherwise dispose of any and all mineral deposits belonging to the State which may be found in the bottoms of any sounds, rivers, creeks, or other waters of the State. The State, acting at the request of the Department of Environmental Quality, is authorized and empowered to convey or lease to such person or persons as it may, in its discretion, determine, the right to take, dig, and remove from such bottoms such mineral deposits found therein belonging to the State as may be sold, leased, or otherwise disposed of to them by the State. The State, acting at the request of the Department of Environmental Quality, is authorized to grant to any person, firm, or corporation, within designated boundaries for definite periods of time, the right to such mineral deposits, or to sell, lease, or otherwise dispose of same upon such other terms and conditions as may be deemed wise and expedient by the State and to the best interest of the State. Before any such sale, lease, or contract is made, it shall be approved by the Department of Administration and by the Governor and Council of State.
(b)	Any sale, lease, or other disposition of such mineral deposits shall be made subject to all rights of navigation and subject to such other terms and conditions as may be imposed by the State.
(c)	The net proceeds derived from the sale, lease, or other disposition of such mineral deposits shall be paid into the treasury of the State, but the same shall be used exclusively by the Department of Environmental Quality in paying the costs of administration of this section and for the development and conservation of the natural resources of the State, including any advertising program which may be adopted for such purpose, all of which shall be subject to the approval of the Governor, acting by and with the advice of the Council of State.
(d)	Notwithstanding any other provision of law, the sale, lease, or other disposition of any submerged lands in the estuarine and ocean waters of the State for the exploration, development, or production of oil or natural gas, and the construction or operation of offshore fossil fuel facilities, is prohibited. The definitions in G.S. 113A‑119.2 apply to this subsection."
SECTION 3.(a)  G.S. 143‑215.94CC reads as rewritten:
"§ 143‑215.94CC.  Liability under this section; exceptions.
(a)	Any responsible person shall be strictly liable, notwithstanding any language of limitation found in G.S. 143‑215.89, for all cleanup and removal costs and all direct or indirect damages incurred within the territorial jurisdiction of the State by any injured party that arise out of, or are caused by any of the following:
(1)	The discharge, as defined in G.S. 143‑215.77, of natural gas, oil, or drilling waste into or onto coastal fishing waters or offshore waters, from any of the following sources wherever located:
a.	Any well or undersea site at which there is exploration for or extraction or recovery of natural gas or oil.
b.	Any facility, oil rig, or oil platform at which there is exploration for, or extraction, recovery, processing, or storage of, natural gas or oil.
c.	Any vessel in which natural gas, oil, or drilling waste is transported, processed or stored other than for purposes of fuel for the vessel carrying it.
d.	Any pipeline in which natural gas, oil, or drilling waste is transported.
(2)	Any exploration, development, or production, as those terms are defined under G.S. 113A‑119.2, occurring in waters beyond the jurisdiction of the State.
(3)	Any technique or method used for cleanup and removal of any discharge of natural gas, oil, or drilling waste from any source listed in subdivision (1) of this subsection into or onto coastal fishing waters, including, but not limited to, chemical dispersants.
(b)	A responsible person is not liable to an injured party under this section for any of the following:
(1)	Damages, other than costs of removal incurred by the State or a local government, caused solely by any act of war, hostilities, civil war, or insurrection or by an unanticipated grave natural disaster or other act of God of an exceptional, inevitable, and irresistible character, which could not have been prevented or avoided by the exercise of due care or foresight.
(2)	Damages caused solely by the negligence or intentional malfeasance of that injured party.
(3)	Damages caused solely by the criminal act of a third party other than the defendant or an agent or employee of the defendant. In any action arising under the provisions of this Article wherein this exception is raised as a defense to liability, the burden of proving that the alleged third‑party intervention occurred in such a manner as to limit the liability of the person sought to be held liable shall be upon the person charged.
(4)	Natural seepage not caused by a responsible person.
(5)	Discharge of oil or natural gas from a private pleasure boat or commercial fishing vessel having a fuel capacity of less than 500 gallons.
(6)	Damages which arise out of, or are caused by, a discharge that is authorized by and in compliance with a State permit.
(7)	Damages that could have been reasonably mitigated by the injured party in accordance with common law.
(c)	A court of suitable jurisdiction in any action under this Part may award reasonable costs of the suit and attorneys' fees, and the costs of any necessary expert witnesses, to any prevailing plaintiff. The court may award reasonable costs of the suit and attorneys' fees to any prevailing defendant only if the court finds that the plaintiff commenced or prosecuted the suit under this Part in bad faith or solely for purposes of harassing the defendant."
SECTION 3.(b)  G.S. 143‑215.94GG reads as rewritten:
"§ 143‑215.94GG.  Notification by persons responsible for discharge.
(a)	Any person responsible for an offshore discharge under this Part shall immediately notify the Division of Emergency Management and the Department of Environmental Quality pursuant to rules established by the Secretary of Environmental Quality and the Secretary of Public Safety, if any, but in no case later than two hours after the discharge. Failure to so notify the Division of Emergency Management and the Department of Environmental Quality shall make the responsible person liable to the penalties set out in subsection (b) of this section.
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SECTION 3.(c)  G.S. 143‑215.94HH reads as rewritten:
"§ 143‑215.94HH.  Oil spill contingency plan.
(a)	The State Emergency Response Commission, in consultation with the Secretary of Administration and the Secretary of Environmental Quality or their designees, shall develop a State oil spill contingency plan relating solely to the undersea exploration, extraction, production and transport of oil or natural gas in the marine environment off the North Carolina coast for any such development on the Outer Continental Shelf seaward of the State's jurisdiction over its territorial waters.
(b)	The Secretary of Public Safety or his designee shall establish, pursuant to such a plan, an emergency oil spill control network which shall be comprised of available equipment from appropriate State, county, and municipal governmental agencies. Such network shall be employed to provide an immediate response to an oil discharge into the offshore marine environment which is reasonably likely to affect the State's coastal waters. Furthermore, such network shall be employed in conjunction with the cleanup operations under this Article or any applicable federal law, required of the owner or operator of the discharging operation, vessel, or facility, the Department of Environmental Quality, and any federal agency.
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SECTION 4.  If any section or provision of this act is declared unconstitutional or invalid by the courts, it does not affect the validity of this act as a whole or any part other than the part declared to be unconstitutional or invalid.
SECTION 5.  This act is effective when it becomes law.