    [From the U.S. Government Printing Office, www.gpo.gov]

                             Zone
              coastal
                Injormab6n                                                                                   COASTAL ZONE                                                               FE8 6
                       Center                                                                                INFORMATION CENTER
                                                                         76'                                          75'                                          74P                                           73,

                                                            A
                                     39                                                                                                                                                                                                                39'

                                                                                                                                                                            -ND
                                                                                                                        V-1 R GI N I A A'
                                                                                                                                                                                                            E
                                                                                                                        R, C 9@4 TI
                                                                                                                                                                          E.'.'.N'T                  L SHELF

                                                                                                                                                                                                                                                       30
                                                                                                                                                                                                J

                                                                                                                                                                                     . .... .......

                                                                                                                                                                            ...... . . ...

                                                                   Xt

                                                                                                                                                                                                                                                        5r
                                                                       55.
                                                                                                                       PfiQBLEIVIS, POSSIBILITIES
                                                                                                 V
                                                                                                                                           AND POSTURE

                                                                                                                           JI

                                    36q
                                                                                                  IX

                                                                                                                                       /*

                                             GC
                                             85.2
                                             N8
                                             V57                                                                     75*                                           7de                                           73*
                                             1974

                                            VIRGINIA

                                            AND THE

                                   OUTER CONTINENTAL SHELF:

                                   PROBLEMS, POSSIBILITIES,

                                              AND

                                            POSTURE

                                               A

                                              Report

                                             of the

                               Outer Continental Shelf  Advisory
            04
            C-1                            Committee
            C-17
                                            (Ad Hoc)

                                        November, 1974

                               COMMCINWEALTH OF VIRGINIA

                                     OFFICE OF THE GOVERNOR

                                   COUNCIL ON THE ENVIRONMENT

        GERALD P. MCCARTHY
           ADMINISTRATOR                        November 7. 1974
            P0. Box 790
           RICHMOND 23206

           Honorable Earl J. Shiflet
           Secretary of Commerce and Resources
           Commonwealth of Virginia
           910 Capitol Street
           Richmond, Virginia   23212

           Dear Secretary Shiflet:

                I forward herewith the report of the Outer Continental Shelf Advisory
           Committee prepared in response to your request for a proposed State policy
           for the Commonwealth related to the development of the Outer Continental
           Shelf (OCS).

                The report states that damage to the offshore environment is not
           likely to be great, but warns of gaps in our knowledge of the inhabitants
           and environment of the area, as well as the effects of oil spills upon them.
           Thq possibility of a catastrophic spill, with its attendant effects upon
           wetlands and beaches, must be considered. Permanent structures on the OCS
           will interfere with navigation, and constrain commercial fishing in the
           area, although they may act as artificial reefs, enhancing sport fisheries.

                The entire OCS area of study, understandably, poses many legal and
           governmental problems that could not be addressed within the time con-
           @traints of this project, especially in view of yet to be determined rights
           in all the lands and natural resources of the bed of the Atlantic Ocean
           beyond three geographical miles from the coastline; nevertheless, these
           problems-impinge upon the area of state and local concern. Our control of
           the OCS lands is not assured. The Committee, therefore, believes that our
           opportunity to control potential development from the discovery of oil and
           gas on the OCS of Virginia is dependent, in part, upon the outcome of the
           Commonwealth's offshore litigation now pending in the United States Sup-
           reme Court. Accordingly, alternative recommendations are proposed by I the
           Committee, recommendations that are based upon the degree of Virginia s
           control of the waters and lands adjacent to the onshore areas.
                The report recommends that measures to control development should in-
           sure preservation of the traditional lifestyles and values of Virginia's
           coastal citizenry. In this regard, the Committee believes that the state
           should develop criteria for the siting of facilities with greater than
           local impact.

           Earl J. Shiflet
           November 7, 1974
           Page two

                The Committee is cognizant of the complexities of our subject, and
           offers this report in the hope that its recommendations will catalyze
           the necessary action to fulfill the expectations initiated by your re-
           quest. It is the hope of the Committee that this report can be useful
           to you, the Governor and interested members of the General Assembly in
           order that the entire spectrum of OCS problems and proposals can be
           given early consideration.@

                On behalf of the Committee I thank you for the opportunity to c6n-
           tribute to Virginials preIparation for meeting the challenges posed by
           the development of the Outer Continental Shelf resources.

                                                 incerel

                                                              L

                                                Gerald P. McCarthy
                                                Chairman

           GPM:dja
           Enclosure

                                             PREFACE

                         The Outer Continental Shelf Advisory Committee was

               established by the Secretary of Commerce and Resources, Earl J.

               Shiflet,, in July, 1974. This action was taken based upon the

               realization that the Atlantic Outer Continental Shelf (OCS) was

               a likely area for the development of offshore Pil and gas re-

               sources, and that such development could have profound and far

               reaching impacts upon the Commonwealth. Such impacts could

               either be beneficial or detrimental or both, depending greatly

               upon the preparations made by the Commonwealth beforehand. Accor-

               dingly, Secretary Shiflet charged the OCS Advisory Committee to

               consider all facets of the situation., and to prepare a report

               recommending a posture for the Commonwealth.

                         The following report represents a first step in an

               effort to engender debate and discussion of the issues involved

               in the question of OCS development. It is the feeling of the.

               committee that, while further discussion is necessary, and en-

               couraged, on some particulars, there is general consensus on the

               content, conclusions,, and recommendations presented herein.

                                      OUTER CONTINENTAL SHELF

                                         ADVISORY COMMITTEE

                                        Mr. Gerald McCarthy

                                    Council on the Environment

                                             Chairman

              Mr. J. Frank Alspaugh              Mr. Douglas B. Fugate
              Director                           Commissioner
              Division of Industrial             Department of Highways
              Development

              Mr. Gerald L. Baliles              Dr. William J. Har gis, Jr.
              Deputy Attorney General'           Director
              Office of the Attorney             Virginia Institute of Marine
              General                            Science

              Mr. Rob R. Blackmore               Admiral E. P. Holmes
              Director                           Executive Director
              Commission of Outdoor              Virginia Port Authority
              Recreation

              Dr. James L. Calver                Mr. Eugene T. Jensen
              Commissioner                       Executive Secretary
              Division of Mineral                State Water Control Board
              Resources

              Mr. Charles A. Christophersen      Mr. William R. Meyer
              Director                           Executive Director
              Division of State Planning         State Air Pollution Control
              and Community Affairs              Board

              Mr. James Douglas                  Dr. M. I. Shanholtz
              Commissioner                       Commissioner
              Virginia Marine Resources          Department of Health
              Commission

                                        Mr. John Pleasants

                               Virginia Institute of Marine Science

                                          Project Leader

                                        ACKNOWLEDGEMENTS

                     This report is the result of the joint efforts of the agencies
             of the Outer Continental Shelf Advisory Committee. All made valuable
             contributions. Worthy of special note was the work of the personnel
             of the agencies designated as "core" agencies in the preparation of
             this report. These were:

                     Mr. Julian Alexander
                     State Water Control Board

                     Mr. Donald LeVan
                     Division of Mineral Resources

                     Mr. Gerald L. Baliles
                     Office of the.Attorney General

                     Mr. Edward Holm
                     Division of Industrial Development

                     Mr. James Douglas
                     Marine Resources Commission

                     Mr. B. C. Leynes
                     Division of State Planning and Commiinity Affairs

                     Mr. John Pleasants
                     Virginia Institute of Marine Science
                     (Lead Agency)

                     The core agencies furnished the authors for the individual
             sections,, and to these people is due a large share of the credit
             for this report. They, and the sections they wrote, are as follows:

                     Dr. Donald Boesch - VIMS
                     III - Offshore Area

                     Mr. Thomas Bernard - VIMS
                     IV - Interface Area

                     Mr. Daniel Jones - DSPCA
                     Mr. Keith Buttleman - DSPCA
                     V - Onshore Area

                     Mr. Gerald Baliles - Attorney General's Office
                     Appendiz A - U.S. v. Maine, et al

                     Section I - Executive Summary, and Section II - Background,
              were written by the project leader, who also served as editor. The
              remaining section, VI - Recommendations,, was.a group effort.
                     In addition to these "core" agency personnel valuable assis-
              tance was made by the following individuals:

                     Mr. Bill Craft
                     Virginia Port Authority

                     Mr. 0. H. Adams
                     State Health Department

                     Mr. James F. McInteer
                     Commission of Game and Inland
                     Fisheries

                     Mr. Henry J. Hughes
                     State Air Pollution Control
                     Board

                     Mr. Carl Schreiber
                     Commission of Outdoor Recreation

                     Input from the petroleum industry was provided by Dr. Wilson
              Laird of the American Petroleum Institute, who not only provided
              voluminous amounts of literature,, but also traveled to Gloucester
              Point to discuss the situation with members of the core agencies.
              His assistance is gratefully acknowledged.

                     Mrs. Virginia Camechis patiently typed and retyped the many
              drafts and the final copy.

                     Mr. W. S. G. Britton and the Virginia Department of Highways
              are responsible for reproduction of the document.

                     To all these people goes the sincere thanks of the project
              leader. Lady and gentlemen, it has been my pleasure.

                                                John B. Pleasants
                                                Virginia Institute of
                                                  Marine Science
                                                Project Leader

                                               iv

                                          TABLE OF CONTENTS

                 Preface  . . . . . . . . . . . . . . . . . . . . . . . . .

                 Outer Continental Shelf Advisory Committee     . . . . . . .

                 Acknowledgements   . . . . . . . . . . . . . . . . . . . .

                 I.   Executive Summary    . . . . . . . . . . . . . . . . .

                 Ii.   Background   . . . . . . . . . . . . . . . . . . . .       7

                 III.   Offshore Area    . . . . . . . . . . . . . . . . . .    29

                 IV. . Interface Area    . . . . . . . . . . . . . . . . . .    40

                 V.   Onshore Area  . . . . . . . . . . . . . . . . . . . .     61

                 VI.   Recommendations  . . . . . . . . . . . . . . . . . .     86

                 Appendix A    U.S. v. Maine, et al  . . . . . . . . . . . .   A-1

                                                  v

                                       Executive Summary

                            The possibility exists for the discovery of both

                 oil and gas off the coastline of Virginia. The area of

                 interest is called the Baltimore Canyon Trough, which is

                 near the edge of the continental shelf in our.waters. This

                 report attempts to evaluate the impact of such a discov5@ky

                 on Virginia and to make plausible recommendations for action

                 by the Commonwealth to control any resulting development,

                 both offshore and on.

                            The area of our concern for purposes of this report

                 has been divided into three sections as follows:

                            offshore   - from the edge of the shelf to the

                                         three mile limit of the marginal sea

                            Interface -  from the three mile limit to the upper

                                         of the limit of the wetlands, and

                            onshore    - from the upper limit of the wetlands

                                         inland

                            The quantity of oil and gas on the Outer Continen-

                 tal Shelf (OCS) - or even its existence - is unknown. We

                 have assumed a major find on the assumption that if our

                 posture is adequate for a large find, it will also prove

                 sufficient for anything less. Other necessary assumptions

                 are also made, including:

                            (1) Development of related industry onshore will

                                take place on the Eastern Shore, in Hampton

                                Roads, or in the York River entrance.

                           (2)  Leasing by the Federal government could begin

                                as early as late 1975.

                           One of the primary facets of the problem of OCS

                 development is in the yet unanswered question of ownership.

                 Virginia is party to a suit against the Federal government

                 (U.S. v. Maine, et al.) for title to the continental shelf

                 to a distance of one hundred miles. Should the Supreme Court

                 rule in favor of the states, all royalties, rents, and bonuses

                 from the leasing of OCS oil lands would accrue to the common-

                 wealth, but a mechanism within the state government would have

                 to be established to handle these complex affairs.

                           The United States has become increasingly dependent

                 on foreign petroleum. This dependence will continue, but the

                 development of OCS oil and gas could serve to reduce the rate

                 of growth of these imports. This would have a favorable

                 effect on our balance of payments. If petroleum is brought

                 ashore from the OCS by pipeline, it would likely be environ-

                 mentally less damaging than if an increasing number of tankers

                 were used.

                           Currently, about one eighth of our domestic oil and

                 gas production,is from offshore wells, largely in Louisiana

                 -and California. Many foreign countries also exploit their

                 OCS areas. There have been only four spills of greater than

                 5,000 barrels from the more than 17,000 wells drilled at sea.

                 A recent study by the federal Council on Environmental Quality

                                                2

                  (CEQ) estimates very little probability of oil from a spill

                  in Virginia's OCS area impinging on the coast. The most

                  likely month for such an occurrence is August, and the prob-

                  ability then is five percent. This has been questioned by

                 .some scientists.

                            Further, oil was spilled in great amounts on Vir-

                  ginia's coast during World War II and has had no readily

                  apparent long-term effects.

                            Also to be considered, however, are the effects

                  of chronic hydrocarbon pollution in minute amounts on the

                  biota of the OCS area. These effects are largely unknown.

                  By-products of drilling may also have localized effects.

                            The possibility for financial benefits of consider-

                  able importance accruing to the state is excellent if oil or

                  gas are found off our coast. Jobs will be created not only

                  in the oil industry itself, but in supporting industries, as

                  well as secondary development such as restaurants, shopping

                  centers, and housing.

                            Against these benefits must be weighed the possi-

                  bility of environmental damage, which could affect such

                  established industries as tourism and commercial fishing.

                  Other costs would be incurred in the area of public services.

                            The major concerns by area are as follows:

                  Offshore Area

                            (1) The incorporation of oil,in sediments either

                                through the catastrophic or chronic discharge

                                of petroleum to the environment.

                                               3

                           (2) Sub-lethal effects of chronic discharges of

                                petroleum.

                           (3) The effects of oil spills on sea birds.

                 Interface Area

                           (1)  The effects of large scale dredging if new

                                port facilities are developed. The disposal

                                of spoil is also of concern.

                           (2)  Effluents, wetlands destruction, water usage

                                and the increased chance of spills of refined

                                products due to location of satellite indus-

                                tries in the Interface area.

                           (3)  The effects of a spill of refined products in

                                Chesapeake Bay. This could seriously affect

                                the estuary for up to five years. A spill of

                                refined or crude oil could severely affect

                                tourism at Virginia Beach if it reached shore,

                                and could have serious effects on the water

                                bird population.

                           (4)  Present techniques for cleaning up oil spills
                onshore Area    are not satisfactory, especially in rough seas.

                           (1)  Uncontrolled development, particularly on the

                                Eastern Shore.

                           (2)  Air and water pollution from industrial and

                                secondary development.

                           (3)  Water demand to support the projected develop-

                                ment.

                                               4

                         (4)  The requirements for increased public services.

                         In order to control the situation, recommendations

               are made as follows:

               Overall Recommendations

                         (1)  Insure compatibility between any OCS actions

                              and the currently evolving Coastal Zone Manage-

                              ment Plan.

                         (2)  Oppose any drilling on OCS lands until an ef-

                              fective oil spill cleanup association similar

                              to those in other areas has been formed.

                         (3)  Support research designed to fill the gaps in

                              our knowledge of the marine environment and

                              the effects of hydrocarbons on the biota, par-

                              ticularly in the offshore area.

                         (4)  Formalize and continue the present OCS Advisory

                              Committee (ad hoc).

               Recommendations for the Offshore Area

                         If Virginia is awarded control:

                         (1) Establish leasing, production, and inspection

                              regulations similar to those of the Federal

                              government.

                         (2)  Assign responsibility for all OCS lands to a

                              state agency. The Virginia Marine Resource

                              Commission, if greatly expanded and properly

                              equipped and funded, might be a logical choice.

                              Alternatively, a new agency could be created.

                                                5

                        Should the federal government be awarded control:

                        (1) Create an office to coordinate all contacts

                             between state and Federal agencies and industry

                             in regards to the OCS area.

                        (2)  Support federal legislation requiring sharing

                             of monies received by the Federal government

                             from OCS lands.

              Recommendations for the Interface Area

                        (1) Restructure the Wetlands Act to encourage plan-

                             ning instead of reaction on a case-by-case basis.

                        (2)  Develop criteria for approval of permits for the

                             placing of structures, including pipelines, in

                             the marine environment.

                        (3) Control pipeline access   through the Interface

                             area to keep the number  of corridors to a mini-

                             MUM.

              Recommendations for the Onshore Area

                        (1)  Encourage and assist local governments to plan

                             for and regulate projected growth in their

                             areas.

                        (2)  Conduct a study as to the use of any funds

                             derived from the OCS lands.

                        (3)  Frame and enact legislation requiring the

                             state to increase its role in planning for

                             and controlling siting of developments, such

                             as refineries, of regional as opposed to local

                             impact.

                                          Background

                 Scope of the Study

                           This report concerns itself with the impacts upon

                 Virginia and Virginians of the possible exploration for, and

                 exploitation of petroleum resources on the Outer Continental

                 Shelf (OCS) lying to the east of our state. It further rec-

                 ommends courses of action to control the development of these

                 resources as well as that of the possible supporting indus-

                 tries which may be based in our state. -

                           In order to address these problems, this report

                 will discuss our current coastal environment, the effects

                 of drilling, the laying of pipelines, and air and water pol-

                 lution that could be caused by industrial and secondary

                 development on shore. The possible effects of catastrophic

                 and chronic oil spills will also be considered.

                           The social effects will be addressed. As an exam-

                 ple, should a predominantly rural area become the setting

                 for a refinery or a large logistical support operation, the

                 social implications--the changing lifestyles, patterns of

                 employment, the arrival of large numbers of outsiders--might

                 create problems with which the local area is ill equipped to

                 cope.

                           Legal problems will be discussed., These include

                 consideration of the outcome of the court case (U.S. v.

                 Maine, et al) to which Virginia is party, as well as the

                                               7

                 possibility of future decisions by the upcoming Law of the

                 Sea Conference to be held in 1975, which may increase the

                 breadth of the territorial sea.

                           The economic effects of the development of the OCS

                 will also be considered.

                           To facilitate this study, we have divided the area

                 of concern into three geographic areas as follows:

                           Offshore Area - This is defined as extending from

                                the outer limits of exploitation up to the

                                three mile limit of the marginal sea.

                           Interface Area - This area covers the three mile

                                marginal sea and extends inland to the upper

                                limits of the wetlands as defined by Virginia's

                                Wetlands Act of 1972 (one and one half times the

                                tidal range above mean low water).

                           Onshore Area - This includes everything landward of

                                the upper limit of the wetlands.

                           Each area will be discussed in detail in separate

                 sections of this report.

                 Assumptions

                           There are many factors involved in the development

                 of the OCS which are at this point in time completely inde-

                 terminant. Basic to the entire study, of course, is the

                 question "Is there oil off Virginia's Coast and, if so, how

                 much?" Since there has been no known exploratory drilling

                 to date, this question cannot be positively answered at pre-

                 sent. This and other presently unquantifiable factors led

                                               8

               to the necessity of making certain assumptions. Since the

               entire report is based on these assumptions, it seems logical

               to state them here.

                         For the purpose of this report, it is assumed that:

                         (1) The area of the petroleum discovery considered

                              will be somewhere off the coast of the middle

                              Atlantic States, most importantly between
                              latitudes 36 32'N and 38 05'N, and will be on

                              the continental shelf or slope.

                         (2)  The volume of production will be in the high

                              range of possibility, on the order of .75

                              million barrels per day by the year 1985, and

                              1.5 million barrels per day by 2000. Gas dis-

                              coveries will produce on the order of .9 billion

                              cubic feet per day by 1985, and 3.6 billion

                              cubic feet per day by 2000.(1)

                         (3)  Development or related industry will take place

                              on the Eastern Shore, in the Hampton Roads area,

                              and possibly to some degree in the York River

                              entrance area. The year 1985 is the target year

                              for which impacts are assessed.

                         (4)  If the State should be granted title to 100

                              miles of the OCS., leasing for exploratory

                              drilling would likely begin sometime in late

                              1976 or early 1977. If the federal govern-

                              ment is assigned control, leasing might begin

                                                 9

                               as early as January 1976. Based on these

                               sta rting dates, the following schedule is

                               assumed.

                                                             OCS Title Holder
                                                         Virginia     Federal Govt.
                               Action

                               Leasing                      1977            1976

                               Exploratory Drilling         1978            1977

                               First Production             1981            1980
                                 Platforms

                          (5)  The years of 1986 and 1987 are    assumed  to cover

                               the period of peak construction effort.

                          (6)  The period of production will be on the order

                               of 30 to 40 years.

               Discussion

                         During its industrial era, our contry has always

               had access to abundant, inexpensive energy. Consequently,,      we

               have developed a society that is centered upon this abundance.
               We are the world's most mobile people. Our automobiles are

               more numerous and larger than those of other countries. We,
               constituting about 1/17th of the population of the earth,
               utilize nearly 1/3rd of the world's energy. Of this, approx-

               imately 78 percent comes from oil and gas. (1)        Energy

               consumption in the U.S. has doubled in the past thirty years

               on a per capita basis. By 1985, total consumption may be

               twice what it is today.

                         With this in mind,, it is unfortunate that we have

               become increasingly dependent on imported petroleum. This

                                                10

                 fact was brought sharply home to us during the winter of

                 1973-74, when the Arab Oil Embargo lowered speed limits,

                 thermostats, rate of production and morale.

                           The end of the embargo, however, did not mean the

                 end of the supply problem. The petroleum was there, all

                 right, but the price had quadrupled. Even without price

                 increases, economists had predicted problems with our bal-

                 ance of payments vis-a-vis the Arab world due; to our soaring

                 demand for oil. With the increases, these problems become

                 even more acute.

                           All predictions indicate that continued petroleum

                 imports will be required, whether or not the OCS resources

                 are developed, at least until 2000. This will be despite

                 any savings that may result from even very stringent con-

                 servation measures. Our best approach to closing the gap

                 between supply and demand therefore consists of reducing

                 dependence upon imports to the maximum extent practicable

                 by increasing domestic production to complement present or

                 potential sources of energy such as coal, shale oil, geo-

                 thermal, and nuclear fission. Nuclear fusion, which pro-

                 mises clean, nearly inexhaustible energy, may be the long

                 term solution.

                           In our current situation, however, the environ-

                 mental trade-off appears,to be:

                           (1   Increase imports of foreign crude oil.

                                This implies either a much greater number

                               of standard tankers, or the establishment

                               of deepwater ports to handle VLCC (Very'

                               Large Crude Carriers). If standard tankers

                               are chosen, transportation costs will be

                               much higher than for VLCC, and the risk of

                               spills in inshore estuarine waters is much

                               more severe. If VLCC are chosen, the fuel

                               must either be transshipped at a deepwater

                               port to smaller tankers that can enter our

                               ports, or pipelines from single point mooring

                               systems or islands must be laid. Dredging

                               channels for VLCC is considered impracticable

                               due to the depths (on the order of 100 feet)

                               required.

                          (2)  Develop our OCS petroleum resources. This

                               involves certain environmental risks, includ-

                               ing the laying of pipelines, but reduces the

                               number of tankers entering port, as well as

                               promoting our national independence of foreign

                               oil and having a beneficial effect upon our

                               balance of payment. Some increase in importa-

                               tions may still be required, however.

                          Against this background, the United States under

                Presidential direction has embarked'on a program to develop

                independence of outside energy sources by 1985. As an im-

                portant part of this drive for independence, it has been

                decided by the federal government to increase drastically

                                           - 12

                  the acreage of the continental shelf available for leasing

                  to ten million acres in 1975. At the time of the Presiden-

                  tial energy message (23 January 1974) in which the tripling

                  of the original OCS leasing was directed, a commitment was
                  made to conduct an environmental study by the federal Council

                  on Environmental Quality (CEQ) prior to any leasing. This

                  study has been completed, and forms a very valuable source

                  book for this report.(l)

                            It is important to understand at this point that
                  there is nothing new or untried about offshore"drilling.

                  In 1972, some 12% of our domestic petroleum production and

                  13% of our natural gas production was from offshore wells,

                  and many foreign countries as well depend upon American

                  developed equipment and expertise in the exploitation of

                  the petroleum resources of their continental shelves.(l)

                  According to Mr. Charles D. Mathews, President of the

                  National Ocean Industries Association, over 17,000 wells

                  have been drilled at sea. Of these, only four have had

                  spills in excess of 5,000 barrels. He feels, to be fair,

                  this very small percentage should be considered when one

                  contemplates the possibility of an oil spill affecting the

                  coast. As an example, the CEQ study gives as the greatest

                  possibility of oil from the southern end of the Baltimore

                  Canyon Trough reaching shore as five percent in the month

                  of August.(l) If we follow Mr. Mathews' argument, this five

                  percent should be multiplied by the chance of the spill oc-

                                               13

                 curring in the first place, which would give a nearly negli-

                 gible chance of oil impingi ng upon the coast.

                           oil spills upon o"ur coast are not unknown. During

                 World War II, about four million barrels of oil were released

                 by torpedoed tankers and other ships off our A@lantic and

                 Gulf Coasts. No clean-up effort was made due to the press

                 of wartime activities. Although no baseline data are avail-

                 able, and sub-lethal effects are unknown, there was no readily

                 apparent long term damage from this massive pollution.(4)

                           Estimates of resources available on the Atlantic

                 Continental Shelf vary widely, but are in the range of 5 to

                 20 billion barrels of economically recoverable crude oil,

                 and 55 to 110 trillion cubic feet of natural gas.(l)

                           The most likely portion of the continental shelf

                 off the middle Atlailtic States for the discovery of petro-

                 leum is known as the Baltimore Canyon Trough. The trough,

                 which is a depression in the basement rock in which a thick

                 layer of sediment has been deposited, commences at about 401

                 north latitude (roughly the latitude of Philadelphia). It

                 parallels the edge of the continental shelf with a.bulge

                 towards the mouth of Delaware Bay. At about the Virginia-

                 Maryland boundary it crosses the edge of the shelf going sea-

                 ward to the south.

                           The trough, then, is in somewhat the shape of the

                 cross section of a shallow bowl, with the base of the bowl

                 off Delaware Bay. Here the trough seems to reach its

                                              14

                 greatest depth and consequently here the area of the thick-

                 est sediments is found.   According to Dr. Wilson Laird of

                 the American Petroleum Institute, this is the area of predom-

                 inate interest.(5) The trough continues down into our waters

                 and though the sediments are not as thick here, considerable

                 interest remains.

                           As previously stated, there has been to date no

                 reported exploratory drilling on the'Atlantic OCS of the

                 United States. However, off the coast of Canada, in similar

                 sedimentary deposits on the Nova Scotia Shelf, 89 exploratory

                 wells have been drilled. These indicate the presence of

                 hydrocarbons, particularly natural gas and natural gas liq-

                 uids. At the time of the preparation of the CEQ report, four

                 wells had indicated commercial quantities.(l)

                           The prospective resources of the Atlantic OCS must

                 be viewed against the national supply of, and demand for

                 petroleum. During 1973 the situation was as follows:

                                              15

                               1973 CRUDE OIL AND NATURAL GAS DATA

                                               Crude Oil          Natural Gas
                                           (Thousand Barrels) (Million Cubic Feet)

                 Domestic Production             3,360,903           22,647,559

                 Total Consumption             *4,549,734            22,965,914

                 Imports:

                      Crude Oil                *1,183,996             1,032,901
                      Unfinished Oils               50,161    (Canada accounted for
                      Plant Condensate              37,475     99.5% of the total
                      Refined Products             991,891     imports above.)

                 *Preliminary Figure - Subject to Change - Final Figures will
                  not be available until January 1975.

                  Source: U.S. Bureau of mines

                           Transportation of petroleum or natural gas resources

                 from the area of their discovery to shore will of course be

                 of crucial importance to any study of the impact of the develop-

                 ment of the OCS. The means employed for such transportation

                 depend greatly upon the size of the resource to be transported.

                 In the case of oil, a large discovery would dictate the use of

                 pipelines; in line with our basic assumption, this is the prog-

                 nosis for our shelf. Tankers or barges are utilized for small-

                 er amounts and, as well, may be used in the early stages. it

                 is not clear at what level of resource recovery pipelines be-

                 come economically viable, but the savings accruing through the

                 use of a pipeline must amortize the line within a reasonable

                 period of time (on the order of twenty years).(5) Natural gas

                 will in any case require pipelines, since no technology cur-

                 rently exists for liquifaction at sea for transport by tankers.

                                             - 16 -                                        I

                           Pipelines have much to recommend them from an envi-

                 ronmental  standpoint once they are in place. Their record as

                 regards spillage is generally excellent as compared to tankers.

                 Burial of pipelines which are laid in less than two hundred

                 feet of water is now required by the regulations of the U.S.

                 Geological Survey. Of course, the area affected by dredging

                 for pipelines is miniscule when compared to the total area

                 of the shelf. On shore, it is most common to lay pipelines

                 in wetlands in dredged canals. This can obviously cause

                 serious local environmental damage by disrupting drainage

                 patterns and burying the biota as well as physically remov-

                 ing it. Turbidity, variations in salinity and changes in

                 current flows can also result.

                           A further possibility to be considered is that of

                 temporarily storing petroleum at sea in the area where it is

                 produced. This may be done in elevated, floating, or bottom

                 standing depots. The first is quite limited in size. The

                 floating storage barges currently in use may hold as much as

                 one million barrels, and be secured to a single point mooring

                 system (SPM), which also serves as a loading/unloading fa-

                 cility.(l)

                           The bottom standing systems may be completely sub-

                 merged, as in the Persian Gulf, or a surface-piercing type

                 similar to Ekofisk in the North Sea, which also has a capa-

                 city of one million barrels. Both of the above systems employ

                 single point mooring for loading and discharging their contents.

                           As a final thought, the problem of transportation of

                                               17 -

                 refined products from Virginia must be weighed. These re-

                 fined products (such as number 2 fuel oil) are far more

                 hazardous to the marine environment than crude oil or gas,

                 and consideration must be given to the method of their re-

                 moval from areas in the Commonwealth where they may be pro-

                 duced. Barges, tankers, trucks, tank cars and pipelines are

                 all possibilities.

                 Description of the Area

                           The area of our primary concern is,between Cape Cod

                 and Cape Hatteras, named "The Virginian Sea" by Captain John

                 Smith circa 1607.  Particularly, of course, we are interested

                 in that portion that lies off the ocean coastline of Virginia.

                 When one contemplates the possibility of the use of barges or

                 tankers to transport petroleum, plus the possibility of

                 effluents from supporting construction, it becomes apparent

                 that some consideration must also be given to Chesapeake Bay,

                 and at least the lower James and York rivers. The description

                 in this section is intended to be general,  with more detailed

                 discussions contained in succeeding sections of the report.

                           Essentially, the continental shelf off our coast

                 is gently sloping and relatively smooth. There are some sand

                 ridges separating troughs wherein the sediment tends to be

                 finer. These systems are usually oriented parallel to the

                 coast, and are the result of the actions of waves and cur-

                 rents. There are patches of shell, sand, gravel and mud.

                           The slope is much steeper as it descends to the

                 abyssal floor, and rocky projections are frequent.

                                              18

                           The biota is varied, and many sport and commercial

                 species are represented, including the American lobster in

                 the rocky cover of the slope. The shelf itself produces surf

                 clams, several species of flounder, sea bass, scup, hake, and

                 other commercial species. The superjacent waters produce tuna,

                 dolphin, bluefish and mackerel, as well as menhaden. Much of

                 the area is used as a spawning grounds for several marine

                 species, with a great fan shaped deep current acting as a

                 transport system to carry the larval forms into the Chesapeake

                 Bay. Although exact parameters for this inward flowing cur-

                 rent are not known, the overall concept must be kept clearly

                 in mind, since the implications for the eventual transport

                 of deep offshore pollutants into the bay are clear.

                           Additionally there are many varied species of plank-

                 ton, seasonally dense, which are the base of the food web, and

                 great numbers of benthic organisms which, while not commercially

                 exploitable, are of vital importance in the overall scheme.

                           The oceanic coast of Virginia is divided into two

                 parts by the entrance to Chesapeake Bay. The northern part is

                 characterized by a chain of barrier islands protecting exten-

                 sive salt marshes from the Atlantic Ocean, with associated

                 lagoons and winding creeks. Since there is relatively little

                 fresh water inflow to the system, the salinities are usually

                 fairly high, ranging upwards from about 18 parts per thousand

                 to normal sea salinity of 35 parts per thousand. The area is

                 in a nearly natural state, and most of the barrier islands are

                 in the hands of the federal government,-The Nature Conservancy

                 or the state.

                                              19 -

                           The beach front south of the bay entrance is a long

                 continuous beach, the greater portion of which is devoted to

                 the tourist industry, and well developed for that purpose.

                           Chesapeake Bay is an estuary, which implies the

                 mixing of fresh water from rivers with the heavier saltier

                 water from the ocean. The bay follows the classic pattern

                 of estuaries, with fresher water flowing seaward on the sur-

                 face, and saltier water moving upstream along the bottom.

                 Due to the effects of the earth's rotation, one finds saltier

                 water along the eastern shore as opposed to the western bank.

                 The entire system moves in and out with the ebb and flow of

                 the tide. Virginia's three great rivers--the James, the York,

                 and the Rappahannock--enter the bay from the west, as does

                 the Potomac, which lies largely within the state of Maryland.

                 The rivers are estuaries themselves and grow less saline as

                 one proceeds upstream. They also follow in general the

                 classic estuarine pattern described above.

                           The bay floor is relatively smooth and flat, with

                 its deepest portion following the river bed of the ancient

                 Susquehanna. The bay is actually the drowned valley of this

                 river and in fact, the Susquehanna still provides about 50

                 percent of the annual freshwater input to the bay.

                           The bay is extremely shallow for its width. As a

                 comparison, if the width of the paper upon which this is

                 written is taken as the width of the bay, the thickness of

                 the sheet is relatively greater than the bay's depth. All

                 along the bay shore there are extensive areas of shallows

                                            - 20

                 and wetlands upon which the productivity of the bay depends

                 to a great degree. This is particularly true of the western

                 shore.

                           There are many commercial species dependent upon

                 the bay and its wetlands at,some point in their life cycle.

                 Rockfish, shad, herring, croaker, spot, flounder, bluefish,

                 menhaden, blue crabs, oysters, clams, scallops--the list is

                 very extensive. All are important to Virginia's economy,

                 and all could be affected by the chronic or catastrophic

                 release of hydrocarbons.

                           The oyster industry, one of the most valuable of

                 Virginia's commercial fisheries, is particularly vulnerable

                 to any disruptions in the James River, since the seedbeds

                 there produce the majority of the seed oysters upon which

                 the industry depends.

                           The land environment in the area of our concern

                 is also of importance, since it is here that development to

                 support the exploitation of OCS resources will occur.

                           The Eastern Shore is a peninsula flanked on the

                 west by Chesapeake Bay, and on the east by the Atlantic.

                 It is flat, with a maximum elevation in the area of 20 feet.

                 The sea side is bounded by a chain of sandy barrier islands,

                 largely unspoiled, to which the only access is by boat. Be-

                 hind these islands are extensive areas of shallows and salt

                 marsh, drained and divided by nearly numberless winding

                 creeks and channels.

                           The bay side of the shore has long beaches and low

                                              21

                 headlands, with many small inlets and creeks, which contain

                 wetlands of varying salinity regimes. These, as previously

                 mentioned, are important in the food web, but are not nearly

                 as extensive as those on the other side of the peninsula.

                           Fishing and agriculture are the traditional employ-

                 ments of residents of the Eastern Shore, and such manufac-

                 turing and trade as occurs is related primarily to natural

                 resources such as fruit and vegetable canning, and seafood

                 and fowl processing. Tourism is also important to the area.

                           The Hampton Roads area (which is considered here

                 to consist of the cities of Hampton, Newport News, Virginia

                 Beach, Norfolk,, Portsmouth,, Chesapeake, and Suffolk) is basi-

                 cally a large urban center surrounded by rural areas contain-

                 ing smaller urban centers. Considerable port-r   elated activity

                 is based upon the famous port of Hampton Roads at the con-

                 fluence of the James River and Chesapeake Bay. The federal

                 government is also heavily involved here, with the Norfolk

                 naval complex the largest in the world. Manufacturing, tour-

                 ism, seafood, wholesale and retail trade, and agriculture also

                 play important parts.

                           The Lower York River area (here considered to encom-

                 pass parts of York County and Gloucester County) is a curious

                 mixture of both preceding areas. It is rural in nature, but

                 with some industry. There is an extensive area under the con-

                 trol of the Federal Government, but little manufacturing. Sea-

                 food is harvested here, and tourism is very important. Here,

                 too, is Virginia's only refinery (AMOCO, at Yorktown), with a

                                             - 22

              current capacity of 50,000 barrels per day.

              Legal Aspects

                         In 1969, the state of Maine assigned certain explo-
              ratory rights to a privat e corporation beyond the three mile

              limit. A suit was thereupon brought against the state by the

              United States, to which the twelve other Atlantic Coastal
              States became party, to determine rights on the Continental

              Shelf beyond the three mile territorial limit. Virginia, re-
              presented by the Attorney General's Office, has taken a lead-

              ing role in these proceedings. The matter is still in dispute;

              the Special Master appointed by the Supreme Court of the United

              States has recently fileda report recommending that the posi-

              tion of the federal government be sustained. The Court has

              called for briefs from the states and from the federal govern-

              ment,, all of which are to be filed before December 31, 1974.

              The case is expected to be argued in January or February, 1975,

              with a decision to be announced by June. For a full explana-

              tion of the legal issues involved, see Appendix A.

                        As a secondary consideration, a series of inter-

              national conferences on the Law of the Sea are currently

              underway, the first (at Caracas, Venezuela) having recently

              been completed. While there were no concrete results, one

              of the items under consideration involved the possible

              establishment of an internationally recognized limit of

              twelve miles for territorial waters. It is felt that this

              will again be put forward (probably as some part of a pack-

              age proposal) when the Law of the Sea Conference reconvenes

                                               23

              in Geneva in 1975. Although there is a possibility that this

              limit will become a recognized part of International Law,. it

              is not considered likely for purposes of this study. As a
              matter of interest, however,!, it should be noted that there is

              no indication of any petroleum resources within twelve miles

              of the coast of Virginia, and according to Dr. Wilson Laird

              of the American Petroleum Institute, there is nopresent in-

              terest in drilling there.(5) There are of course other

              mineral resources between the current limit of three miles

              and twelve miles, with sand and gravel being an example.
                        As to the first consideration, should Virginia's

              claim to one hundred miles of subaqueous lands be upheld,

              all the bonuses, rents and royalties which would normally

              accrue to the federal government from the leasing of drill-

              ing sites would instead belong to the state. On the debit

              side, the extensive leasing, regulating and monitoring pro-

              cedures currently conducted by the Federal Government with

              all the difficulties attendant thereto would become Vir-

              ginia's responsibility. There is currently under study by
              the Attorney General's Office a legal analysis of mechanisms

              for these procedures in our state government, and the time

              required for the development of such mechanisms is the reason

              for differences in dates given in the assumed schedule (as-

              sumption #4) between Virginia and the federal government.

                        In view of the above discussion,, legal

                                               24

               considerations at this junction preclude an analysis of

               related legal problems involved with OCS development un-

               til the matter of United States v. Maine et al., is re-

               solved.

               Meteorological Conditions

                        An obviously important aspect of the environmental

               safety of OCS development is the meteorological conditions in

               the area of our consideration. It should be stated here that

               we believe the CEQ Study is misleading in regard to our area

               since it apparently considers meteorological conditions on the

               Middle Atlantic OCS to be more severe than those in the North

               Sea.(l) While it may be true that our offshore area is sub-

               ject to hurricanes, whereas the North Sea is not, the whether

               conditions in general, particularly in the winter months, are

               believed more severe there. Only two spills from offshore

               structures of over one thousant barrels have been ascribed to

               hurricanes.(1)

                        Bad weather has a greater controlling effect on

               poloratory drilling than any other phase of the petroleum re-

               covery operation, since mobile rigs are involved. Of course,

               the threat of extreme weather would cause the temporary aban-

               donment of any sort of OCS operation.

                        Prevailing winds in the Virginian Sea are generally

               from the northwest during the fall and winter, and'from the

               southwest in spring and summer. Wind speeds during summer

               average six to eight knots and during winter eight to ten

               knots. In summer., winds blow onshore in the daytime, and off-

               shore at night.(2)

                                                25 -

                          Temperatures are generally moderate in our area,

                with the mean annual temperature at Norfolk being 53.50F.

                At sea, temperatures usually are somewhat warmer in the

                winter and cooler in the summer, due to the moderating

                effect of the ocean. Temperatures seldom are in excess of

                100'F, and_freezing is probable about one day in three from

                November through March. Icing in mid Atlantic offshore areas

                should not interfere with operations.(2)

                          Precipitation in the area of concern averages about

                43 inches per year, and can be in the form of snow or freez-

                ing rain in the winter months.

                          Fog occurs the year around, but is most frequent

                during the autumn and winter months. Visibility can also be

                severely restricted during periods of intense precipitation

                such as summer thunderstorms or gales, and snow in the winter.

                Days with less than five miles visibility occur from five to

                fifteen percent of the time.(l)

                         .Seismic activity is considered moderate in the

                Atlantic OCS, with the northern portion the most vulnerable.

                According to the CEQ study, earthquakes of a magnitude of 7

                on the Richter scale can be expected on an average of once

                every 100 years in the Atlantic OCS area. Such a shock

                could cause damage to or the failure of OCS structues in

                the near vicinity.(l)

                          Tsunamis, which are long period waves caused by

                seismic activity, have not to date been recorded in our area.

                Such waves travel at enormous speeds (up to about 600 mph)

                                            - 26

                 and are not noticeable in the open sea due to their low

                 amplitude there. They become very high in shallow water,

                 however, and can cause considerable damage onshore. There

                 is no record of tsunamis in the Virginian Sea, and they are

                 not expected to affect OCS operations there.(2)

                           Clearly, it is important that any plans for con-

                 struction and operation of OCS facilities include provisioii

                 for these and other environmental factors which would effect

                 safety and security of the facilities themselves, the per-

                 sonnel on them and the environments and resources within

                 their range of influence.

                 Introduction to the Report

                           The foregoing has been a general discussion of the

                 area that would be involved in the development of Virginia's

                 Outer Continental Shelf, and some of the prospects and prob-

                 lems that must be considered by those who hope to approach

                 the very real issues in a logical fashion. The three succeed-

                 ing sections will discuss in detail the geographic divisions--

                 Offshore, Interface, and Onshore--that have been previously

                 laid out. The last section in the report w  ill make recom-

                 mendations for action to control the situation in order to

                 assure that Virginians, their property, and their environ-

                 ment are protected, and that resources are reasonably

                 managed.

                                              27

                                    LITERATURE CITED

               1. council on Environmental Quality. 1974. OCS Oil and

                        and Gas - An Environmental Assessment. A report

                        to the President.

               2. U. S. Department of the Interior, Bureau of Land Manage-

                        ment. N. D. Proposed Outer Continental Shelf Hard

                        Mineral Mining Operating and Leasing Regulations.

                        Draft Environmental Statement.

               3. Statement of Charles D. Mathews, President, National

                        Ocean Industries Association. 1974. Hearing

                        before the Committee on Commerce, United States

                        Senate, Washington, D.C. Pursuant to S. Res. 222,

                        National Ocean Policy Study.

               4. State of Dr. Maurice Ewing. 1973. Hearing on Offshore

                        Exploration.  Council on Environmental Quality,

                        Washington, D.C.

               5. Dr. Wilson Laird, American Petroleum Institute. Personal

                        Communication.

                                          28

                                          Offshore Area

                             A thorough consideration of the environmental

                  effects of development of OCS oil and gas resources should

                  take into account the existing environmental conditions of

                  the offshore area, the activities which may potentially irr.-

                  pact this environment, and the susceptibility and response

                  of the environment to these activities. Assessments of the

                  effects of OCS development on the offshore areas must nec-

                  essarily be imp recise and vague because of both the lack of

                  detailed knowledge of the continental shelf environment and

                  the inadequacy of knowledge of the effects of the contem-

                  plated developmental activities on this environment.

                  The Continental Shelf Environment off Virginia

                             The continental shelf environment off Virginia is

                  distinctly different from the coastal environments of the

                  Chesapeake Bay and Eastern Shore, in terms of physical,

                  chemical, geological and biological processes, yet the en-

                  vironments interact intimately--one affecting the other.

                             The offshore water masses in the Virginian Sea

                  affect the movement and characteristics of shelf waters.

                  The Gulf Stream, flowing well off our coast, affects the

                  direction and velocity of shelf currents, causing predom-

                  inantly southerly flows. Yet the tidal flux of water

                  through the Virginia Capes and into the Chesapeake Bay

                  also affects the flow of water--particularly bottom cur-

                                                29 -

                 rents--over a wide expanse of shelf.

                           The temperature of shelf waters varies less than

                 the waters inshore. The salinity is of course higher and

                 more stable, but it too is influenced by Bay discharges.

                 Nutrients in shelf waters, which are necessary for phyto-

                 plankton growth, are in concentrations intermediate between

                 those in the rich coastal waters and those in the surface

                 waters of the open Atlantic. Nutrients are injected into

                 the shelf waters both from coastal discharges and "upwelling"

                 from nutrient rich deep sea waters.

                           The continental shelf is broadly covered by sand,

                 some of which is from relict beach deposits and some from

                 recent contributions from rivers. Much of this sand is in

                 frequent motion and is generally arranged in dynamic ridges

                 parallel to the shore. only near the edge of the shelf are

                 appreciable amounts of fine sediments--silts and clays--found.

                           Many of the fishes of the shelf also show a consid-

                 erable dependence on coastal waters and estuaries. Most are

                 migratory, moving inshore and offshore depending on the sea-

                 son. many have long north-south movement, also in season.

                 Some species move into the Bay and other estuaries to spawn,

                 and the young of others move inshore to grow up in the es-

                 tuarine nursery areas. The plankton is composed of oceanic

                 and estuarine forms as well as those types more or less con-

                 fined to shelf waters. The bottom-dwelling (benthic) orga-

                 nisms include not only some characteristic of the lower

                 Chesapeake Bay but also many northern species unable to

                                            - 30

                 tolerate the summer temperatures of the Bay. There are also

                 specialized forms adapted to live in the dynamic sediments

                 of the shelf such as the commercially fished surf clams.

                 Activities in OCS Development Having Potential Environmental
                   Impact

                           This portion contains a discussion of activities in

                 the exploitation of offshore oil field which may impact the

                 environment adversely. The effects of some of these activities

                 are likely to be insignificant. on the other hand, the effects

                 of seemingly innocuous practices may be insidious, with cur-

                 rently unknown but far-reaching consequences. Thus, for com-

                 pleteness, all of those activities potentially affecting the

                 environment will be discussed without p,resumption of the re-

                 lative serious ness of their impact.

                           Not only must the effects of producing oil and gas

                 on the DCS of Virginia be considered, but also the more im-

                 minent effects of exploration, exploratory drilling, and

                 developmental drilling should be evaluated.

                           Exploration

                           Early in the exploratory phase of oil field devel-

                 opment  extensive seismic surveys must be conducted to in-

                 vestigate the subsurface geological structure of the area.

                 From these surveys petroleum geologists determine if the

                 sedimentary environments represented in subsurface deposits

                 are conducive to the formation of petroleum and if faults,

                 domes and other features which trap and concentrate oil and

                 gas are present. In the past, seismic surveys involved

                 detonating explosive charges in the water resulting in

                                               31

                 localized mortalities to fish and other marine organisms.

                 Nowadays, substitute energy sources, such as the propane-

                 oxygen 11guns" or high powered oscillators, are used. These

                 are far less damaging to the environment. Apparently, little

                 or no long term environmental damage was done by the   seismic

                 techniques employed in our area, and much of the exploratory

                 seismic work has already been accomplished.

                           There is presently no method of positively iden-

                 tifying oil and gas deposits without actually drilling into

                 them. Drilling is not allowed by federal regulatory agencies

                 until after lease sales, and even coring requires a permit

                 from the U.S. Geological Survey. Exploratory drilling is

                 now generally carried out from drilling ships, jackup rigs,

                 or semisubmersable rigs. Drill cuttings and drilling mud

                 are usually disposed of overboard. These may smother bottom-

                 dwelling organisms and otherwise alter benthic habitats in

                 the vicinity of the drilling operations. Also, drilling mud

                 sometimes contains oil and various toxic components, notably

                 barium compounds. Such overboard discharge can presumably

                 be controlled by regulation if need be. Further, since ex-

                 ploratory drilling probes unknown geological structures, the

                 risk of blowouts is substantially higher during this phase

                 of oil field development than in the production stage, though

                 still a very small percentage. Debris from drilling opera-

                 tions may find its way overboard, either through accident or

                 carelessness, as it can from any maritime operation. Al-

                 though exploratory drilling in deep water need not result

                                            - 32

                 in permanent obstructions, the operations themselves may

                 impair other uses of the OCS, such as commercial trawling

                 and transportation during the period of active exploration.

                           Development and Production

                           once significant discoveries are made by explora-

                 tory drilling, development and production activities may

                 proceed in the oil or gas field. Again, drill cuttings and

                 drilling mud disposal may have local environmental impacts.

                           Once the oil well is in production, "bleedwater"

                 brought up with and separated from the oil by "oil-water

                 separators" is usually disposed of overboard. Bleedwater

                 is usually of very high salinity and contains substantial

                 amounts of oil--on the order of 50 ppm. (parts per million).

                 Sand is also often brought up with the petroleum and it

                 must be separated and discharged overboard where it may

                 impact benthic communities. As previously stated, the risk

                 of blowouts is substantially less during production than in

                 the exploratory drilling and development stages. Nonethe-

                 less, production blowouts can occur if pressure in the well

                 suddenly increases. Production and development rigs are

                 usually built resting on the bottom, or sub-sea well heads

                 are employed. Too often the incentives to remove unused

                 or obsolete platforms and sea bed structures do not out

                 weigh the costs of removal, resulting in semi-permanent

                 obstructions to other uses of the OCS. Again, the acciden-

                 tal or careless loss of debris and refuse from production

                 rigs may impact the environment.

                                               33

                           Transportation

                           If it is decided to transport oil and gas from

                 offshore production by pipeline, the emplacement of these

                 large diameter objects would,require considerable dredg-

                 ing with the accompanying disruption of local benthic habi-

                 tat. Further,@the risk always exists, particuarly on a high

                 energy coastline such as ours,for rupture of the lines. How-

                 ever, the record of offshore pipelines has been very good and

                 on past experience the ptobability of accidental breakage

                 seems small. Pipelines require maintenance which may involve

                 disruptions to bottom life and the long-term environmental

                 effects of abandoned pipelines should be considered. Section

                 IV- Interface Area contains a fuller discussion of pipelines

                 and their effects.

                           In the event that tankers or barges were used to

                 transport oil from the OCS to shore, oil spills from trans-

                 ferrals and accidental spills resulting from collisions and

                 groundings may pose a problem. Routine discharges of bilge

                 and ballast waters may also introduce oil into the offshore

                 environment. The use of deep draft tankers to transship oil

                 would necessitate deepening navigation channels extending

                 well past the three mile boundary, with the attendant prob-

                 lems associated with dredging. This, however, is considered

                 unlikely in our area as previously stated.

                           Shipment by vessel would also require offshore

                 storage facilities which could rupture, or might result in

                 more frequent small spills associated with handling oil.

                                              34

                 They would also be an obstruction to other uses of the con-

                 tinental shelf.

                 Environmental Effects of OCS Development

                           Solid Wastes

                           Overboard discharge of drill cuttings, drilling mud

                 and sand from wells may cause smothering of the benthic orga-

                 nisms or benthic habitat alterations localized in scope.

                 This is not a necessary practice and can be,controlled by

                 regulation.

                           Potentially more serious is the introduction of

                 compounds which may be harmful in trace amounts. Drilling

                 muds can contain substantial quantities of refined oil--

                 similar to number 2 fuel oil--which is us ed to achieve pro-

                 per viscosity and lubrication. Because this oil is thor-

                 oughly mixed with the mud itself, much of it will be deposit-

                 ed on the bottom. It is well known that petroleum hydrocar-

                 bons can persist for long periods of time in bottom sediments

                 where they may affect benthic organisms, leach into bottom

                 waters, or be resuspended by currents. Chemical additives

                 in drilling muds include barium compounds which are toxic

                 to marine organisms. Widespread deposition of trace amounts

                 of these and other toxic compounds may result from drilling

                 activities.

                           Chronically Discharged Effluents

                           Discharges of bleedwater and other liquid wastes

                 from offshore production platforms would probably be diluted

                 so rapidly that any toxic effects on marine life would be

                                              35

                quite local. It is possible, however, that petroleum hydro-

                carbons, trace metals, and other materials may be adsorbed

                to suspended sediments and eventually deposited on the bot-

                tom where they may concentrate and persist. Further, very

                low concentrations (in the parts per billion range) may cause

                sublethal effects on marine organisms. Particular concern

                has been voiced over the possible effects of small concen-

                trations of hydrocarbons on the ability of organisms to sense

                low concentrations of other compounds which are important in

                their feeding, mating and migration.

                          Oil Spills

                          Most concern and virtually all research about the

                effects of spilled oil has centered on the intertidal or

                coastal environment. For example, the Council on Environmen-

                tal Quality based their assessment of the relative risks of

                OCS drilling sites on the probability of spilled oil reach-

                ing the shore. Whenever oil has been looked for in subtidal

                sediments following a spill it has been found. There is

                therefore no reason to preclude possible effects on offshore

                benthic organisms resulting from blowouts, tanker spills,

                pipeline leaks or other episodic inputs of oil. oil was

                found in relatively deep water sediments following  both the

                Santa Barbara and Gulf of Mexico blowouts. The lack of ade-

                quate consideration of effects of oil spills on offshore

                organisms as well as of the effects of chronic discharges

                are two deficiences of the CEQ's offshore impact analysis.

                          Further, it should be noted in passing that some

                                               36

                 skepticism has been voiced by the National Academy of Sciences

                 regarding the validity of the mathematical models which allow-

                 ed CEQ to predict that the chance'of floating oil reaching the

                 shore of Virginia from OCS drilling sites is virtually nil.

                 The oceanographic and meterological data base on which these

                 predictions are based is inadequate   and the model itself is

                 at variance with some of these data.

                           Those offshore organisms potentially most suscep-

                 tible to the effects of spilled oil are seabirds, which may

                 be coated with floating oil, organisms which live at the

                 air-sea interface (the neuston), and benthic organisms, be-

                 cause sedimental oil may concentrate and persist in the bot-

                 tom. Reliable predictions of effects, except perhaps on

                 birds, are not possible because of inadequate knowledge of

                 the offshore effects of previous oil spills.

                           Dredging

                           Dredging activities attendant to navigational

                 channels and pipeline placement may impact offshore orga-

                 nisms primarily through the removal of benthic habitats and

                 the suspension of sediment and associated compounds. Gene-

                 rally speaking these effects are not considered as serious

                 as they may be in inshore waters because bottom sediments

                 over much of the shelf are naturally dynamic and thus the

                 ability of most of the biota to recover from damage is

                 good. Further, shelf sediments are mostly sands, whereas

                 it is typically the finer particles which have adverse effects

                 if resuspended.

                           Extension of navigation channels onto the shelf

                                               37

                would, however, involve alteration of local benthic habi-

                tats and would probably require frequent maintenance dre  dg-

                ing due to the dynamic nature of the bottom. As previously

                mentioned, such dredging seems unlikely.

                          Obstructions and Debris

                          Habitat changes may occur where construction debris

                and other material is jettisoned. The environmental effects

                resulting would be localized and of unknown, but probably

                minor, overall importance. Perhaps more important is the

                obstruction to other uses of the shelf such as fishing and

                transportation caused by semi-permanent or abandoned struc-

                tures such as platforms, subsea well heads and pipelines.

                          It must also be mentioned that oil and gas rigs

                have the capability of acting as artificial reefs and

                attracting game fish. In Louisiana, "rig fishing" has

                proved to be extremely productive, and charter boat opera-

                tors as well as private vessels fish these rigs frequently.

                In the case of Virginia.however, the area of interest is on

                the order of seventy five miles offshore, which may pre-

                clude or reduce such fishing.

                Major Concerns

                         .The effects which are probably or potentially the

                most serious include:

                          (1) The incorporation of oil in sediments, either

                               through the catastrophic or chronic discharge

                               of petroleum to the environment.

                          (2) Sub-lethal effects of chronic discharges of

                                             38

                                petroleum.

                           (3)  The effects of oil spills on sea birds.

                 Conclusions

                           The threats posed by OCS development to the environ-

                 ment and organisms of the offshore area of the Virginian Sea

                 are unknown. Assessments of impact such as that by the Coun-

                 cil on Environmental Quality have, in general, not given prop-

                 er consideration to effects on offshore environments. This

                 has probably been due to pressures to develop predictive

                 models and make definitive statements about impacts on little

                 known environments.  It is not sufficient to base impact as-

                 sessments largely on the basis of the probability of spilled

                 oil reaching shore.

                           If exploitation is to proceed, strict regulation

                 to ensure environmental protection should be developed and

                 enforced. Specifically, spill prevention devices and regu-

                 lations need to be adequately policed, since some blowouts

                 in offshore oilfields elsewhere have followed inadequate

                 enforcement of the regulations by federal and industrial
                 author'ities. Standards must be set to regulate chronic

                 discharges from production platforms. To this end, ef-

                 fluent limitations are currently being developed by the

                 Environmental Protection Agency. However, these effluent

                 limitations are based exclusively on technological con-

                 siderations. Research is needed on the effects of these

                 discharges so that environmentally relevant discharge

                 standards may be implemented.

                                              39

                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I
                    I

                                               IV

                                        Interface Area

                 General Description

                           Although the Inte rface Area includes the subaqueous

                 lands out to the three mile limit, the impacts of offshore

                 oil activities will be felt primarily in the relatively shal-

                 low inshore areas and in the intertidal and wetlands habitats.

                 Major discussion in this section will therefore center on the

                 three above-mentioned subareas within the larger Interface

                 Area.

                           Virginia's shoreline, of which there is almost 5,000
                 miles, is best characterized by its variety.''This variety ex-

                 tends from the serene fragility of the barrier islands of the

                 Eastern Shore to the glittering strip of Virginia Beach, and

                 from the industrial activities of Hampton Roads to the quiet

                 productivity of Chesapeake Bay marshes. In its shoreline,

                 Virginia has a natural resource of inestimable value.

                           The Eastern Shore of Virginia is-a low-lying pen-

                 insula bounded on the east by a barrier island - marsh-bay

                 complex and on the west by a marsh-tidal creek complex.

                 Extensive and highly productive shallows occur on both

                 coasts and in the tributaries. The Eastern Shore contains

                 about 70% of Virginia's ocean front shoreline, and from

                 Wallops Island south it is the only portion of the eastern

                 barrier island chain (from Cape Cod to Cape Hatteras) which

                 remains in its natural state. The Eastern Shore also con-

                                               40 -

                tains approximately 84,000 acres of wetlands, one-half of

                the Commonwealth's total.(l) The entire complex fringing

                the Eastern Shore must be considered a unique resource by

                the Commonwealth. At the present time the barrier islands

                are marked for conservation. The marshes, because of their

                value to the seafood industries of the Commonwealth, are pro-
                tected by the Virginia Wetlands Act of i972. The relativeiy

                clean waters, complexed with the islands and marshes, are

                used primarily by commercial and sport fishermen.(2)

                          In contrast to the Eastern Shore oceanfront, that

                of Virginia Beach is quite commercialized. From Cape Henry

                to Sandbridge, the beach is a highly active resort area with

                only three exceptions, where military bases are present.

                Despite a sometimes severe erosion problem, Virginia Beach

                development has continued to mount. From Sandbridge to the

                North Carolina line, however, the beach area and the lagoons

                behind it are presently marked for conservation. The Back

                Bay Wildlife Refuge and the planned False Cape State Park

                are extremely valuable areas from this viewpoint.

                          The Back Bay area is approximately 45 sq. miles of

                primarily marsh and shallow lagoons. Both this area and the

                barrier island - marsh bay complex on the Eastern Shore are

                invaluable to birdlife since they are integral parts of the

                Eastern flyway, used each year by thousands of migrating

                waterfowl.

                          The port of Hampton Roads includes the most highly

                developed portion of Virginia's shoreline. Very little of

                                           - 41

                  the shoreline of the Elizabeth River is unaltered and the

                  sediments in the river are highly contaminated from one

                  source or another. The northern side of the James River

                  is also highly developed in the Hampton Roads area but the

                  river itself is still important as a seed oyster and clam

                  producing area. Except for the Nansemond River, which

                  also appears to be headed towards heavy industrial develop-

                  ment, a few small tidal creeks, and the Ragged Island Marshf

                  most of the natural shoreline of the lower river has been

                  developed. Because of the rapid population growth of the
                  Hampton Road's area, the rivers are highly stressed by sewage

                  and other effluents. It is also important to note that the

                  channels of both Hampton Roads and the Elizabeth River are

                  scheduled for expansion or deepening, or both, in the near

                  future.

                            Except for its lower southern bank, which has

                  several industries and military establishments, the York

                  River retains its natural character with residential areas

                  spotted between large marsh areas and small tidal creeks.

                  Water quality is relatively good and the river supports

                  a considerable commercial seafood industry.

                            North of the York River the shoreline is char-

                  acterized by small fringing marshes and tidal creeks.

                  The natural character of the shoreline remains since

                  coastal development has taken the form of residential hous-

                  ing small commercial seafood operations, and small marinas.

                            In summary, the oil industry will have to compete

                                               42 -

                with a variety of other interests which are already estab-

                lished on Virginia's shoreline. Because of the dependence

                of the seafood industry on marshes, the Virginia Wetlands

                Act controls wetland development. Most of the barrier is-

                lands are owned by the federal government, the Commonwealth

                or The Nature Conservancy. The tourist industry, primarily

                centered around Virginia Beach, will take a very close look

                at offshore oil development. Further, a large portion of

                the citizens living along the shoreline will likely be opposed

                to oil development because of the possibility of associated

                pollution, real or imagined.

                Discussion of Problems

                          A discussion of the problems of the interface zone

                may best be accomplished by dividing the subject into six

                lesser subjects and covering them individually. For this

                purpose the following problems are considered as major:

                          Port Development

                          Effluent Effects

                          Tanker Traffic

                          Catastrophic Oil Spills

                          Oil Cleanup, and

                          Pipeline Effects

                          Each will be discussed in turn.

                          Port Development

                          It does not appear likely at present that OCS re-

                lated offshore port development will take place within the

                three mile limit because of the extensive dredging which

                                              43

                 would be required, and because  the preferred method of trans-

                 porting crude oil from offshore fields is by pipeline. As

                 previously stated, vessel transport will be employed only

                 if the fields are small. Port development will be needed,

                 however, for the staging of materials and men during explo.-

                 ration and construction periods and this is most likely to

                 occur on the Eastern Shore or the Hampton Roads area.

                           Most of the existing channels in the Hampton

                 Roads are adequate to handle the vessels necessary, but if

                 the Eastern Shore or undeveloped portions of Hampton Roads

                 are utilized, new channels will have to be dredged. In

                 this case, dredging and disposal of the dredged soil will

                 have a major impact.

                           Depending on the amount of dredging necessaryl

                 impacts may be in the form of destruction of benthos (bottom)

                 communities and fish feeding and spawning grounds, altered

                 salinity regimes and current patterns, destruction of marshes,

                 and interference with water column productivity and fish mi-

                 gration routes through increases in turbidity. Large amounts

                 of spoil from such dredging will have to be disposed of, and

                 this may well place more stress on wetlands a nd benthic habi-

                 tats, since these are the most economical disposal areas in

                 the short term.

                           Most of the impacts described above may be avoid-

                 ed if the state takes strong measures to insure that the oil

                 industry utilizes the existing port facilities and channels

                 of Hampton Roads and the Eastern Shore. With the planned

                                               44

                 deepening of Hampton Roads to 55 feet and the facilities

                 which already exist, the adverse impact of port develop-

                 ment derived from OCS activities should be held to a mini-

                 MUM.

                           Effluent Effects

                           A large OCS oil or gas find will almost certainly

                 precipitate the establishment of various industries directly

                 and indirectly related to the oil industry. One can expect

                 such industries as oil refining, gas processing and petro-

                 chemical production as well as secondary development includ-

                 ing sewage treatment plants to locate as close as possible

                 to the oil fields. The primary impacts of these industries

                 on the interface will be in the areas of effluents, water use

                 and possible wetlands destruction.

                           The effluents from various refining industries

                 potentially could pose as great a threat to water quality

                 in the Commonwealth as the drilling and transportation of

                 crude oil, since it is generally recognized that refined

                 hydrocarbon products are more toxic than crude oils and that

                 petroleum processors are chronic pollutant contributors.(2)

                 Strict control of effluents will be required.

                           Very little research has been done in the area of

                 chronic hydrocarbon contamination and sublethal effects,

                 but it is known that chronic inputs can have significant

                 impacts in confined estuarine areas.(3) A large area of

                 saltmarsh vegetation was killed by refinery effluent at

                 Southhampton, England.(4) Another researcher reported bottom

                                             - 45 -                                      I

                 organisms in Los Angeles Harbor have been reduced to one

                 tolerant species of oil industry wastes.(5) In more open

                 areas where there is greater dispersion of the effluent,

                 the biological effects,where known, do not appear to be as

                 serious. Where chronic effects have appeared, such as in

                 Los Angeles Harbor and the Houston Ship Channel, not only

                 direct toxicity is involved but also depleted oxygen levels

                 due to high oxygen demand by contaminated sediments and

                 other oxygen consumers.

                           On the Eastern Shore, receiving waters are naturally

                 somewhat organically loaded and the interactions of other

                 variables such as stream morphology, freshwater inflows, ti-

                 dal forces and salinity make these streams less than satis-

                 factory as receiving waters.(6) Numerous shellfish beds are

                 found in waters surrounding the Eastern Shore and stringent

                 water quality standards and criteria have been set to protect

                 both general water quality and the quality of water required

                 to support shellfish and finfish. Any development by the oil

                 processing industry on the Eastern Shore, unless closely

                 controlled, could adversely affect the survival and quality

                 of fish and shellfish there because of the poor suitability

                 of the surface waters to receive effluents. This would have

                 substantial impact upon the seafood and recreational fisheries

                 of the area.

                           The fact remains, however, that the proximity of

                 the Eastern Shore to the continental shelf and the undevelop-

                 ed and therefore relatively inexpensive land available make

                                              46

                 the area a prime development site for the oil industry.

                 This could drastically increase pressures to drain and fill

                 the marshes, and thus adversely affect the seafood and re-

                 creational fishing industries since marshes are directly

                 linked to seafood productivity and water quality.(7)

                 Lyle St. Amant has stated before the National Advisory

                 Committee on Oceans and Atmosphere that the greatest im-

                 pact of oil development on the Gulf coast was in the area

                 of filling and draining wetlands.

                           Satellite industry development in the Hampton

                 Roads area, if property sited, constructed, and operated,

                 might not have the adverse impact that it would on the

                 Eastern Shore because of the better flushing character-

                 istics of the James River estuary. It is apparent, how-

                 ever, that with approximately 50% of the shellfish grounds

                 in Hampton Roads presently condemned, additio n of further

                 improperly treated effluent could severely affect the James

                 River seed oyster beds and the seafood industry in Hampton

                 Roads. Tourism may also be affected, since spills might

                 reach beach areas such as Buckroe and Ocean View.

                           The Nansemond, Elizabeth and Pagan rivers, because

                 of low freshwater inputs, are either highly stressed at pre-

                 sent or unsuitable for large effluent loading. The Nansemond

                 and Pagan rivers have large marsh areas which are very impor-

                 tant to the lower James River system. It is possible that

                 these marshes along with others, such as the Ragged Island-

                 Candy Island complex, could be looked on as desirable develop-

                                            - 47 -                                     I

                  ment areas for housing or industry. Hopefully, the Wetlands

                  Act will control such development so that essential natural

                  habitat will be preserved.

                            The lower York River has experienced some water

                  quality problems associated with domestic and industrial

                  waste discharges. A new sewage treatment plant is planned

                  in the area, but water quality at this time is generally

                  good. This area does contain large wetlands, which may be

                  threatened by development because of a lack of suitable up-

                  land industrial sites.

                            In addition to increasing pressures on the environ-

                  ment in the form of wetlands destruction and effluent re-

                  leases, development of petroleum related industry will in-

                  crease the chances for spills of refined products. The

                  ef f ects of such spills are discussed more f ully below.

                            Tanker Traffic

                            It is difficult to project the effects of an off-

                  shore oil discovery on the number of tankers utilizing Vir-

                  ginia waters. As previously stated, however, it appears

                  that if a pipeline is used to transport the oil, the number

                  of tankers entering Hampton Roads might be smaller than if

                  no oil were discovered at all. Further, the transport of

                  refined products from refineries must be considered.

                            According to Porricelli(9), tanker and barge trans-

                  port of oil and oil products amounts for 30% of the oil re-

                  leased into the marine environment. The same study estimates

                  that 75% of.the spills from tankers are caused by human error

                  and 25% by mechanical failure. This record points to the

                  need for improved design of handling systems to prevent such

                                                48 -

                occurrences. The spills charged to mechanical failure account-

                ed for a much larger volume of oil spilled even though there

                were fewer of them. The newer pipelines which are better con-

                structed than older ones and have built-in safety devices, have

                an excellent record.

                          From a crude oil transportation point of view only,

                an offshore discovery with pipeline transport of oil might

                prove to be a lesser environmental risk than the increase in

                tanker traffic which might occur if the oil, needed to meet

                now planned refining capacity increases, had to be brought

                in from other areas.

                          Catastro2hic Oil Spills

                          Even though the'literature on oil pollution is

                voluminous, very few conclusions as to the effects of oil

                in the marine environment are agreed upon by everyone in-

                volved. Most of the work done to date has been concentrated

                in the intertidal area; hence, very little is known of the

                effects of oil on subaqueous organisms.. It is generally

                conceded that different oils, both crude and refined, have

                different effects but few researchers agree on what these

                effects might be.

                          All are agreed, however, that refined products

                are more damaging to biota than crude petroleum. It is

                instructive in this regard to review what many consider

                a "worst case" episode, the West Falmouth (Massachusetts)

                spill, which released refined petroleum into a confined

                area on the Atlantic seaboard.

                                              49

                            The West Falmouth spill was relatively small by

                 volume. Between 171,000 and 184,000 gallons of #2 fuel oil

                 were released into Buzzards Bay when an oil barge grounded.

                 The immediate effect was a massive kill of marine life in-

                 cluding fish, shellfish, crustaceans, and worms and other

                 invertebrates. Sampling showed a 95% mortality of organisms

                 in the spill area. It is important to note.that although all

                 visual effects of this refined product were gone within a few

                 days, scientific sampling techniques demonstrated that after

                 eight months the oil was still spreading along the bottom and

                 killing the organisms there. Bottom sediment.was contaminated

                 in 42 feet of water at the deepest point in that part of Buz-

                 zards Bay. Very little bacterial breakdown of the oil had

                 occurred eight months after the spill. Commercial shell-

                 fishing was prohibited for two years in the area, and it

                 appears that shellfish productivity will be affected for a

                 much longer period. Destruction of the Buzzards Bay biota

                 reduced the stability of sediments and this has resulted in

                 increased erosion. Damage to shellfish for the first year

                 alone has been estimated at $118,000 by the town of Falmouth.

                 Another $200,000 was paid to the Commonwealth of Massachusetts

                 for resource losses. The.actual ecological damage is estimated

                 to be much greater.(10,11)

                           As for crude oil, one of the primary impacts of a

                 spill in the Interface Area would be its effects on the

                 coastal birds. The Torrey Canyon, Santa Barbara and San

                 Francisco Bay spills have all demonstrated that oil releases

                                               50 -

                can kill significant proportions of local sea bird popula-

                tions. During the Santa Barbara blowout, for instance, over

                half of the local populations of loons and grebes were killed.

                Since many sea bird's-have relatively low reproductive rates,

                population recovery may be a very slow process. All of this

                has particular importance to the Commonwealth because of the

                large numbers of sea birds which utilize the Eastern Shore

                and Back Bay areas each year.

                          The treatment of oiled birds has received consid-

                erable publicity, but thus far surviva 1 of treated birds has

                been very low. Less than 1% of the birds treated during the

                Torrey Canyon disaster survived(12), and even under the best

                conditions survival has been 20% or less.(2)

                          Most of the research conducted after previous spills

                has concentrated on the intertidal zone, and thus the long

                term effects of the oil which reaches the subtidal area are

                virtually unknown. Intertidal organisms suffer primarily

                from smothering when crude oil comes ashore, but may also be

                affected by direct toxicity and fouling. The differences in

                effects noticed seem to be related to the type of oil spilled

                as well as the type of shoreline which receives it. Very

                little is known of the effects of oil on beach communities.

                          Marshes can be adversely affected by single oil

                spills, but generally their recovery is good. Experimental

                studies have shown that marsh flora are highly vulnerable

                to a series of oil dosages and that under these circumstances

                recovery is poor. Marsh fauna appear to be more susceptible

                                           - 51

                 to the effects of oil, but little research has been con-

                 ducted in this area.

                           Forecasting the economic impact of a catastrophic

                 oil spill on the Tidewater area is difficult, but it can be

                 said that the impact may be considerable under the proper

                 circumstances. Direct effects of the Santa Barbara spill

                 on commercial fish species have not been demonstrated, but

                 the presence of the oil prevented fishermen from trawling,

                 and thus affected their incomes. Other studies such as

                 that of the West Falmouth spill have shown tainting of shell-

                 fish to be a problem which can last for years, with the exact

                 duration still unknown. Many oil pollution scientists are

                 also concerned about the possible retention of carcinogenic

                 hydrocarbons by shellfish and other species well after any

                 noticeable taint has disappeared.

                          A large oil spill in the vicinity of or reaching

                 the Virginia Beach resort area would have a significant im-

                 pact on tourism in the area. Even if the spill did not occur

                 during the summer season, the adverse publicity would have

                 some impact on tourism even though the beach might well be

                 cleaned beforehand. In addition to aesthetic considerations,

                 the present erosion problem at Virginia Beach could be ex-

                 acerbated by the removal of beach sand during cleanup opera-

                 tions as well as by changes in the normal beach processes

                 brought about by the mixing of oil and sand and the destruc-

                 tion of normal biota.

                                              52 -

                          Oil Cleanup

                          There are presently a wide variety of oil spill

                containment and cleanup procedures available which attempt,

                with varying success, and sometimes an environmental impact

                of their own, to reduce the effects of spills. These methods

                include the use of floating booms, sorbent materials, burning

                agents, dispersants, sinking agents, biodegradants, and

                others. In general, none of these methods has yet proved

                satisfactory under natural conditions.

                          The National Petroleum Council, an oil-industry

                advisory group to the Department of Interior,says of booms,

                "Containment devices that will restrict the movement of oil

                in the open sea are not available. There have been no de-

                monstrations of oil recovery devices with the ability to

                pick up oil from large spills in rough waters at the needed

                rates and efficiencies."

                          Milgram(2) regards sorbents as having the greatest

                potential use in the cleanup process, but Ahern(8) states

                that the state of the art cannot handle waves in excess of

                five feet and is thus unsatisfactory. Most dispersants are

                so toxic to marine life that they cause more damage than the

                oil they are used to disperse. New formulations may be able

                to lessen this problem in the future. Sinking agents appear

                to work well with weathered crude'oil spills but the danger

                here is that the effects and the persistence of the oil once

                it is on the bottom are virtually unknown. Burning agents

                have met with little success and can cause temporary air

                                              53

                pollution. Although no quantitative data exists on the use

                of biodegradation, indications are that there is a potential

                for enhancing the natural activity of oil-degrading bacteria

                and yeasts.(2)

                          Since environmental awareness in the oil industry

                is relatively new, there is a great deal of research needed

                to improve all of the above cleanup and containment techni-

                ques. New methods and materials will be forthcoming in the

                near future since considerable research is already underway.

                For the present, however, natural processes will generally

                have to be counted on to do much of the cleaning up after

                a spill.

                          Pipeline Effects

                          Both from an industrial and environmental viewpoint,

                the transport of crude oil from offshore fields by pipeline

                is preferred to transport by tanker and barge. This is not

                to say, however, that there are no problems associated with

                pipeline use. Pipelines generally have a better record as

                regards spills than tankers simply because there are fewer

                opportunities for a spill to occur. The major impact of a

                pipeline on the environment occurs during installation.

                          All pipelines placed in less than 200 feet of water

                must be buried according to federal regulations. This in-

                volves large amounts of dredge spoil and temporary disrup-

                tion of the benthic area. Wetlands in Louisiana have ex-

                perienced significant temporary and permanent damage since

                the two methods developed there for laying pipelines in

                                              54

                marshes involve the excavation of canals. The canals may

                cause disruption of natural drainage and water current

                patterns as well as accelerated erosion. Biologically pro-

                ductive areas are lost and disturbances such as changes in

                turbidity, salinity, acidity, hydrogen sulfide levels and

                biological oxygen demand may occur.(13)

                          The ocean coast of Virginia may be compartmented

                into three zones on a north-sotth basis for the sake of

                discussion of pipeline effects in the Commonwealth. These

                zones are the Eastern Shore barrier island-marsh complex,

                the Chesapeake Bay entrance, and the headland coast and

                barrier between Cape Henry and the North Carolina-Virginia

                boundary.

                          Since the pipeline must be buried in transiting

                nearly all subaqueous lands the impact question relates

                primarily to the method for crossing the shoreface and area

                behind it.

                          In the case of a pipeline coming ashore on the

                Eastern Shore or south of Cape Henry in an unburied or sur-

                face mode, the pipeline and its armoring will interact with

                the littoral drift system with inevitable adverse impact.

                More importantly, the pipeline is exposed to severe wave

                attack. The likely result would be local scour caused by

                the concentration of wave energy and the resulting current

                with the possibility of inlet formation and pipeline failure

                at the shoreface. Therefore, even if the pipeline is elevated

                after passing the shoreface, the risk of failure is high.

                                            - 55

                            If the pipeline crossing the shoreface is buried

                  there is less environmental risk involved and the excavation

                  impact may be temporary in nature, provided that trenches

                  are backfilled and marsh species replanted. It is very

                  important, however, that the location of the crossing point

                  be given careful consideration. For example, the location

                  chosen should not be one which has had a history of tempo-

                  rary inlet formation since the pipeline could be scoured

                  out by a reoccurrence(14)

                            A pipeline through the Chesapeake Bay entrance

                  would have a temporary impact due to dredging. There would

                  be, however, the advantage of less wetlands destruction as

                  well as that of ultimately coming ashore on a lower energy

                  coast than than found on the ocean front.

                  Major Concerns

                            The following are the major concerns in the Inter-

                  face Area which are occasioned by OCS development:

                            (1) If new port facilities are developed major

                                 impacts will be caused by the dredging of

                                 channels. Care mus  t be taken that spoil from

                                 such dredging is disposed of in accordance

                                 with accepted standards.

                            (2)  Satellite industries may be expected to

                                 locate on the Virginia coast and these may

                                 cause impacts in the form of effluents, wet-

                                 lands destruction, water usage, and increased

                                 chance of spills of refined products. The

                                                56

                                requirements of the National Pollutant Dis-

                                charge Elimination System (NPDES) should re-

                                duce these problems.

                           (3)  OCS development may, if a pipeline is used

                                to transport the oil from the fields, reduce

                                the number of tankers antering Hampton Roads

                                from what it would be were OCS oil not de-

                                veloped. This could be significant, since

                                tanker transport accounts for 30% of the oil

                                which reaches the oceans and offshore rigs

                                only about 2% by some estimates.

                           (4)  An oil spill involving a refined product in-

                                side Chesapeake Bay could severely affect the

                                estuary for a period of perhaps five years.

                                A crude oil spill, whether in ocean waters
                                or in the bay, might be less damaging due to

                                the general lower toxicity of the crude.

                                Virtually nothing is known of the effects of

                                the oil which is deposited below the inter-

                                tidal area. Adverse effects of sea bird

                                populations can be expected from almost any

                                spill. Oil reaching Virginia Beach could

                                severely impact the resort primarily through

                                the effects of adverse publicity.

                           (5)  Although much research is underway to develop

                                and improve oil spill cleanup methods and

                                materials, the present state of the art does

                                              57

                                 not allow satisfactory recovery of spilled

                                 oil, especially in rough seas. It appears

                                 that more adequate  techniques will be forth-

                                 coming in the near  future.

                  Conclusions

                            Virginia's shoreline, measuring some 5,000 miles,

                  is a natural resource of an estimable value to its citizens

                  and the hundreds of thousands of tourists which visit the

                  area annually., Already stressed by population pressures,

                  this coastline would undoubtedly face further stress from

                  OCS oil and gas development. The commonwealth must.take

                  the necessary steps to learn the impacts associated with all

                  ramifications of OCS development. Little is known of the

                  sublethal effects of hydrocarbon compounds on estuarine

                  organisms. A much greater knowledge of such characteristics

                  as carcinogenicity, persistence  and toxicity must be acquired

                  to properly assess the impacts of development of a petroleum

                  industry in Virginia. Spill prevention and cleanup m    ethods

                  are as yet inadequate and must be refined.

                            The unknown adverse factors mentioned above as

                  well as the known adverse factors such as wetlands destruc-

                  tion, benthic community disruption and the effects of efflu-

                  ents could all have an undesirable impact on the state and

                  its citizenry. Firm control backed by adequate knowledge of

                  all impacts associated with OCS development is necessary if

                  the seafood and tourist industries as well as the present

                  quality of life in Virginia is to be m4intained.

                                                58

                                     LITERATURE CITED

                1. Athearn, W. D., G. L. Anderson, R. J. Byrne, C. H. Hobbs

                          III, and J. M. Zeigler. 1973. Shoreline Situation

                          Report, Northhampton County, Virginia. SRAMSOE No.

                          50. Prepublico-:.tion. VIMS, Gloucester Point, Vir-

                          ginia.

                2. Boesch, D. F., C. H. Hershner and  J. H. Milgram. 1974.

                          Oil Spills and the Marine Environment. Ballinger

                          Publishing Company. Cambridge, Massachusetts.

                3. Baker, J. M. Biological effects of refinery effluents.

                          In: American Petroleum Institute. Proceedings of

                          a Joint Conference on Prevention and Control of Oil

                          Spills, Washington, D.C., March 13-15, 1973. pp.

                          715-724. Washington, American Petroleum Institute,

                          1973.

                4. Baker, J. M. Refinery Effluent. In: Cowell, E. B., editor.

                          Proceedings of the Symposium on the Ecological Effects

                          of oil Pollution on Littoral Communities, London, 30

                          November - 1 December 1970. London, Institute of

                          Petroleum, 1971.

                5. Reish, D. J. The effect of oil refinery wastes on benthic

                          marine animals in Los Angeles Harbor, California.

                          Symposium Commission internationale exploration

                          scientifique Mer Mediterranee, Monaco, 1964, 355-

                          361F 1965.

                6. Virginia State Water Control Board data.

                                           - 59

                 7. Wass, M. L. and T. D. Wright. 1969. Coastal Wetlands

                           of Virginia.. Interim Report. SRAMSOE No. 10.

                           Gloucester Point, Virginia.

                 8. Ahern, W. R., Jr. 1973. Oil and the Outer Coastal Shelf.

                           Ballinger Publishing Company. Cambridge, Massa-

                           chusetts. 133 pp.

                 9. Porricelli, J. D., V. F. Keith and R. L. Storch. 1971.

                           Tankers and Ecology. Transactions.of the Society

                           of Naval Architects and Marine Engineers, 79:169-

                           221.

                10. Blumer, M., H. L. Sanders, J.- F. Grassle and G. R.

                           Hampson. 1971. A Small Oil Spill. Environment,

                           13(2):1-12.

                11. Blumer, M., J. Sass, G. Souza, H. Sanders, F. Grassle

                           and G. Hampson. 1970. The West Falmouth Oil

                           Spill. Technical Report 70-44 WHOI. Woods Hole,

                           Massachusetts.

                12. Potter, J. 1973. Disaster by Oil. The Macmillan

                           Company. New York, New York.

                13. Council on Environmental Quality. 1974. OCS Oil and

                           Gas - An Environmental Assessment. A Report to

                           the President.

                14. Dr. Robert Byrne (VIMS) Personal Communication.

                                              60

                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I
                                                     I

                                                V

                                           onshore Area

                            The area that must support any development of the

                  OCS off our shores is the land itself. Here could be located

                  not only the refineries, the tank farms, and the petrochemi-

                  cal complexes, but also the housing, schools, restaurants

                  and shopping'centers required to support the workers. The

                  land and its people would reap the benefits of such develop-

                  ment, but would also be required to bear the burden of costs

                  for the added public services required, including police

                  protection, firemen, local administration and hospitals.

                  There are the further considerations of increased water

                  requirements (both domestic and industrial), solid waste,

                  and sewage, plus the attendant potentials for air and water

                  pollution. All are discussed below.

                  General Approach

                            The impacts of high level OCS oil and gas develop-

                  ment upon the onshore portion of the Commonwealth have been

                  projected for 1985 by means of a three step process. First,

                  an industrial development scenario was drawn based on the

                  production level assumptions of Section II and a number of

                  known or reasonably projected product demand and plant loca-

                  tion constraints. This scenario resulted in a description

                  of statewide impacts which can be applied to either of two

                  primary impact areas (Eastern Shore or Hampton Roads/York

                  River entrance) or to the remainder of the state. The

                                                61

                second step was to project employment and population figures

                attributable to OCS development for each area. The third

                step in this process was to assess the social and physical

                effects of this development on each area.

                          These social and physical impacts, as well as the

                economic impact discussed in step two, would be the results

                of two basic types and levels of development. The most direct

                and obvious changes will result from the construction and

                operation of those facilities and industries involved in

                actual oil-and gas-related activities. These will include

                exploration related facilities such as onshore bases and

                supply yards, production related facilities, a major plat-

                form fabrication facility, processing plants for natural gas,

                refineries for oil, and associated petrochemical plants, as

                well as storage and transmission facilities such as tank

                farms and pipelines. These impacts are relatively easily

                quantified and assigned to specific areas. Less direct and

                less obvious, but of greater overall importance in many

                respects, are the impacts which will result from the domestic

                and other development generated by the direct oil and gas

                related activities. These impacts will include other in-

                duced manufacturing plants, service employment generated

                to support the basic industries, and the total population

                increase associated with this overall increase in the labor

                force. These impacts may be quantified and attributed to

                geographic impact areas by inference from projections of the

                primary impacts.

                                           - 62

                           Finally, mention must be made of the impact of new

                 air pollution control regulations and federal court rulings

                 upon both industrial and secondary developments. Indirect

                 sources, for instance, such as facilities which attract more

                 than a certain number of vehicles, will be controlled by per-

                 mit after 1 January 1975. New industrial sources must also

                 be permitted. Further, new industrial sources to be located

                 within a standard metropolitan statistical area (SMSA) must

                 nut prevent maintenance in that area of National Ambient Air

                 Quality Standards. Outside the SMSA's, EPA non-degradation

                 requirements may pose problems.

                 Assumptions

                           Major assumptions of the onshore section of this

                 report, which are in addition to the overall assumptions of

                 Section II, are discussed below. Many of these assumptions

                 are based on the findings of an earlier report entitled

                 "Off-Shore Port Facilities" which was completed in February

                 of this year by the Virginia off-Shore Port Facilities Task

                 Force. The assumptions are as follows:

                            (1) Base case I assumes that capacity of the York-

                                town refinery will increase by 60 percent to

                                80,000 barrels per day and that the Suffolk

                                refinery will be built with production of

                                184,000 barrels per day. Under the base case

                                I assumption, Virginia would have total re-

                                finery capacity of 264,000 barrels per day

                                by 1985.

                                              63

                           (2) Base case II assumes that capacity of the

                               Yorktown refinery will increase by 100 per-

                               cent to 100,000 barrels per day and that the

                               Suffolk refinery will be built as outlined in

                               base case I. In addition, the Transco re-

                               finery is assumed to be operational with a

                               200,000 barrel capacity. In base case II an

                               off-shore port facility would be built off

                               the coast of Virginia. bnder the base case

                               II assumption, Virginia would have total

                               refinery capacity of 484,000 barrels per day

                               by 1985.

                           (3) With development of the outer continental

                               shelf (OCS), Virginia's total refinery capa-

                               city would reach 750,000 barrels per day. In

                               addition to the assumptions made in base case

                               I and base case II, it is assumed that the

                               Yorktown refinery will increase capacity to

                               150,000 barrels per day, that the Suffolk re-

                               finery will increase capacity to 300,000 barrels

                               per day, and that the Motor Gas, Oil, and Re-

                               fining Corporation will build its facility with

                               a 100,000 barrel per day capacity.

                           (4) For each 50,000 barrels per day refinery capa-

                               city, 135 employees are needed.

                           (5) Each refinery, gas processing, and petrochemical

                               worker is expected to create employment for one

                                              64

                                 additional construction worker, one addi-

                                 tional utility worker, and two additional

                                 manufacturing workers. Also, each additional

                                 "basic industry" type worker is expected to

                                 create an additional service or "supporting"

                                 type worker.

                            (6)  All of Virginia's present and future (through

                                 1985) refinery capacity growth will be in the

                                 Hampton Roads/York River area.

                            (7)  Two gas processing facilities will be built

                                 on Virginia's Eastern Shore by 1985, employ-

                                 ing a total of approximately 100 persons.

                            (8)  Two petrochemical facilities will be built in

                                 the Hampton Roads/York River area by 1985,

                                 employing a total of 2,275 persons.

                            (9)  Brown and Root, a major metal fabricator, is

                                 assumed to employ about 1,700 persons on the

                                 Eastern Shore by 1985 with OCS production.

                            (10) Of the 7,520 persons estimated by Resource

                                 Planning Associates to be employed in east

                                 coast oil and gas recovery by 1985, one half

                                 is assumed to be employed in Virginia. Of

                                 the Virginia total (3,760), one half or 1,880

                                 would be employed on the Eastern Shore and

                                 one half in the Hampton Roads/York River area.

                            (11) Ratios used to generate figures for the ten

                                 social and physical system indicators from

                                               65

                                     1985 population figures are in some cases the

                                     averages of similar determinations made for

                                     four east coast hypothetical case studies

                                     done by Resource Planning Associates for the

                                     Council on Environmental Quality. These case

                                     study locations are Bristol County, Massa-

                                     chusetts; Cumberland/Cape May Counties, New

                                     Jersey; Charleston, South Carolina; and Jack-

                                     sonville, Florida. Other quantitative values

                                     are commonly accepted for Virginia where dif-

                                     ferent from those presented by RPA. Specific

                                     ratios used are:

                         School enrollment                     262.5 per thousand popula-
                                                                 tion (RPA)

                         Hospital beds                         3.64 per thousand population
                                                                 (RPA)

                         Police manpower                       1.54 per thousand population
                                                                 (RPA)

                         Government overhead                   $7.53 per person (RPA)

                         Government employees                  30 per thousand population
                                                                 (VA.)

                         Water demand - domestic               100 gallons per person per day
                                                                 (VA.)

                         Water demand - Industrial             (petroleum industry figures
                                                                 based on RPA report)

                                                               Refineries - 40 gallons per
                                                                 barrel

                                                               Gas processing      15,000 gallons
                                                                 per plant

                                                               Petrochemical      24 million
                                                                 gallons per day per plant

                                                      66

                       Sewage - domestic               100 gallons per person
                                                         per day

                       Solid waste                     3 tons per thousand pop-
                                                         ulation per day (VA.)

                       Residential structures          3.0 persons per household
                                                         (VA.)

                       Commercial structures           24.5 sq. ft. per person
                                                         (RPA)

                            Finally, it is well to reiterate here that this

                  section of the report is based on a major discovery of gas

                  and oil on the Virginia OCS. This assumption is made so

                  that the greatest conceivable impact will be considered on

                  the theory that if Virginia's posture is adequate to handle

                  such impact, it will also prove sufficient for anything

                  less.

                  Potential Impact Areas

                            Possible economic impacts of the assumed high OCS

                  development are indicated in Tables 1 through 3. The major

                  factors analyzed include population, employment, and the

                  labor force participation rate. Within total employment,

                  specific areas of analysis include construction, mining,

                  agriculture, manufacturing, utilities, and services.

                            For historical reference 1972 population and em-

                  ployment figures were used. Projections were then made to

                  1985 using three different sets of assumptions in reference

                  to refinery capacity in Virginia and OCS development. The

                  absolute change in population and employment resulting from

                  each of the three 1985 development levels is also shown.

                            The impacts of a high level of OCS oil and gas

                                               67

                production on social and Physical systems are projected and

                illustrated (Table 4) in terms of a set of ten systems fac-

                tors, five for each overall system. Each of these factors

                represents a valid component of the respective system to

                which it belongs, but in addition, the five in each category

                can serve as a set of indicators of trends within the overall

                system brought about by stress being applied to that system.

                In this case, the stress is the hypothetical impact of a

                large oil find off the coast and-the trends are those of

                increases in the overall level of performance required of

                the social and physical systems of the state and each re-

                spective impact area. It should be noted that the systems

                components used here for.indicators are only samples of the

                total set of many similar components that make up each system.

                They are hopefully a representative sample, but are by no

                means exclusive. Projections for each of these indicators

                are dependent upon the overall population increase figures

                projected for the OCS production assumption case. Each is

                linked to the population figure in a direct positive corre-

                lation based on current ratios of level of each indicator's

                performance to population. The figures shown thus represent

                increases in each category over what that same category level

                would be under 1985 base case II assumptions.

                          The social systems changes for the state and the

                two impact areas are indicated by changes in school enroll-

                ment, required hospital beds, police manpower, government

                overhead, and government employees. Physical systems changes

                                           - 68 -                                     I

                  are shown as changes in water demand (domestic and industrial),

                  domestic sewage discharge, solid waste generation, numbers of

                  residential structures, and required square footage of commer-

                  cial facilities. The division between social and physical sys-

                  tems used here is admittedly tenuous. Several indicators have

                  aspects which could fall into either category. Solid waste,

                  for example,. impacts upon the physical system by being a phy-

                  sical commodity which requires land for disposal or for an

                  incineration system. At the same time, however, it impacts

                  upon the social system by requiring an effort by local govern-

                  ment for its collection and disposal. In general, the physi-

                  cal systems components involve the use or commitment of phy-

                  sical resources such as water and land, while the social in-

                  dicators involve services.

                            Eastern Shore

                            As of July, 1972, the Eastern Shore of Virginia

                  had an estimated population of 43,500. Total employment for

                  the same year was approximately 16,600 persons with the single

                  most important employment sector being agriculture. However,

                  agriculture, traditionally the most important employer in

                  the area, is yielding its dominance to manufacturing activity.

                  Other traditionally large "basic" activities in the area in-

                  clude fishing and the tourist industries. The   labor force

                  participation rate as a percent of population on the Eastern

                  Shore currently stands at 43.2 percent.

                  1
                  Consists of Accomack and Northampton Counties.

                                                69 -

                           In base case I, which assumes the building of no

                 off-shore port facilities and no development of the outer

                 continental shelf (OCS), the Eastern Shore population is ex-

                 pected to reach 47,200 by 1985. With considerable growth

                 anticipated in manufacturing activity (primarily Brown and

                 Root) and continued employment declines in agriculture,
                 manufacturing by 1985 will be the Eastern Shore's most impor-

                 tant employer in place of agriculture. In base case I total

                 employment is projected to reach 17,800 and the labor force

                 participation rate is expected to fall slightly to 41.3

                 percent.

                           In base case II the Eastern Shore population and

                 employment figures would remain unchanged because refinery

                 capacity increases built into this case would affect the

                 Hampton Roads/York River area only.

                           With OCS development the Eastern Shore population

                 is projected to increase by 5,700 persons, while employment

                 will expand by approximately 7,400 by 1985. The largest

                 11primary" or "basic" industry employment gain would be in

                 mining (oil and gas extraction). For purposes of simplifi-

                 cation, employment ass ociated with exploration, platform

                 development and oil and gas production are all grouped into

                 the oil and gas recovery  or extraction category. The

                 2
                  Resource Planning Associates, Inc. estimates that a total
                  of 7,520 persons would be employed in oil and gas recovery
                  on the east coast by 1985. Of this total 1,550 would be
                  employed in exploration, 3,720 in platform development and
                  2,250 in oil and gas production.

                                               70

                   Eastern Shore mining employment total for 1985 is projected

                   to be 1,880 with 390 persons in exploration, 930 in plat-

                   form development, and 560 in oil and gas production. It is

                   assumed that one quarter of total east coast oil'and gas re-

                   covery employment for 1985 will   itinpact on Virginia's Eastern

                   Shore.

                             An employment gain of 1,500 is anticipated in

                   "other" manufacturing, specifically fabricated metal products

                   with expansion of Brown and Root. Approximately 100 persons

                   would be employed in the two gas processing plants assumed to

                   be located on the Eastern'Shore by 1985. Secondary employ-

                   ment gains totaling approximately 3,900 persons would occur

                   in the construction, utilities, and service categories.

                             Thus, with OCS development the Eastern Shore will

                   have a 1985 population total of 52,900 and total employment

                   of 25,260. The area's labor force participation rate is

                   projected to increase to 50 percent.

                             Social system impacts on the Eastern Shore associ-

                   ated with the projected population increase of 5,700 include

                   almost 1,500 new school children, 21 new hospital beds, a

                   manpower increase in the local police of nine men, and a

                   rise in state and local g overnment employment of 171. In

                   addition, local government overhead costs would rise by

                   nearly $43,000.

                             The physical system would see a rise of 0.6

                   million gallons per day (mgd) in total water demand and 0.57

                   mgd of domestic sewage for the 1,900 new households gene-

                                                  71 -

                 rated. To serve these, almost 140,000 square feet of new

                 commercial floor spacewould be required. Solid waste gene-

                 ration would rise by 17.1 tons per day.
                                                    3
                           Hampton Roads/York River

                           Virginia's Hampton Roads/York River area was esti-
                 mated to have a 1972 population of 1,04'4,400. Total employ-

                 ment including military was approximately 503,400 with the

                 federal government (both military and civilian) being the

                 largest single employer. As shown in Table II, federal

                 employment totaled approximately 170,500 persons. Nearly

                 60,000 persons are currently employed in manufacturing jobs,

                 with approximately one half of these working in Newport News

                 with the Newport News Shipbuilding and Dry Dock Company.

                 Also included in the manufacturing sector are 225 persons

                 employed by American Oil Company at its Yorktown refinery.

                 As previously stated, this is the only refinery in Virginia.

                 Its daily production is about 50,000 barrels of refined pro-

                 ducts. The entire area represents the most populated and

                 one of the most highly industrialized regions within the

                 state. Currently the area has a labor force participation

                 rate of 49.3 percent.

                           Base case I assumes that refinery production in

                 Virginia and the Hampton Roads/York River area will increase

                 3
                  Consists of the cities of Norfolk, Portsmouth, Chesapeake,
                  Suffolk, Virginia Beach, Hampton, Newport News, and
                  Williamsburg, and the counties of James City and York.

                                               72

                  to 264,000 barrels per day. By 1985, the Yorktown refinery

                  in base case I will have acapacity of 80,000 barrels per

                  day and a newly-built Suffolk refinery will have daily pro-

                  duction of 184,000 barrels. The population of the Hampton

                  Roads area is expected to reach 1,244,600 by 1985 without

                  off-shore port and OCS development. Total employment is

                  expected to increase to approximately 600,800 persons with

                  the largest gains coming in manufacturing employment. With-

                  in the manufacturing sector, more than 700 persons are pro-

                  jected to be employed in petroleum refining. The area's

                  labor force participation rate is expected to increase

                  slightly to 49.6 percent.

                            As indicated in the assumptions for this section,

                  in base case II an off-shore port facility is built, and

                  refinery capacity increases to 484,000 barrels per day. It

                  is further assumed that all refinery capacity gains would

                  occur in the Hampton Roads/York River area. In base case

                  II the area's population would increas e by 4,000 persons

                  over the base case I population for 1985. Total employment

                  would increase by approximately 6,400 persons with a gain

                  of nearly 1,800 in manufacturing. Refinery employment

                  would be up by nearly 600 to 1,300 persons. In base case

                  II the area's labor force participation rate is projected to

                  reach 50.0 percent.

                            The population of the Hampton Roads area with OCS

                  development is projected to increase by nearly 67,000, reach-

                  ing a 1985 population total of 1,315,500. Total employment

                                               73

                 is expected to grow by nearly 46,800 with a nearly 13,000

                 person gain in manufacturing. Employment in petroleum re-

                 fining, gas processing and petrochemicals would increase by

                 4,300 thus reaching a 5,600 person total. Included in the

                 figure of 4,300 would be 2,025 persons actually employed in

                 refineries. The remaining 2,275 persons are estimated to

                 be employed in two major petrochemical operations. A signi-

                 ficant gain (1,880 persons) is also anticipated in  oil and

                 gas extraction (mining). As on the Eastern Shore, one

                 quarter of total east coast oil and gas recovery employment

                 for 1985 is expected in the Hampton Roads/York River area.

                 As indicated earlier, all refinery capacity associated with

                 the 750,000 barrel per day OCS production assumption would

                 be refined in Virginia's Hampton Roads/York River area.

                 With OCS development, the Yorktown refinery would produce

                 150,000 barrels per day, the Suffolk refinery 300,000 bar-

                 rels per day, and the two Portsmouth refineries 200,000 and

                 100,000 barrels per day.

                           The area's relatively high labor force participa-

                 tion rate is expected to increase slightly from 50.0 per-

                 cent to 51.0 percent with OCS development.

                           In the Hampton Roads/York River area, a population

                 increase of 66,900 would result in over 17,000 new school

                 enrollments, new hospital capacity of 244 beds, 103 new

                 police positions, and 2,007 new state and local governmental

                 employees. Local government overhead would rise by more

                 than $500,000.

                                               74

                              Large increases would be felt in water demand with

                   78 mgd required  for new industry and 6.7 mgd for domestic

                   supply. Domestic sewage discharge would rise by 6.7 mgd

                   as well. An increase of two hundred one tons per day of

                   solid waste would accompany the 22,000 new households and

                   1.6 million square feet of   new commercial space.

                              Commonwealth of Virginia

                              Virginia's 1972 population was estimated to be

                   4,764,000. Total employment was estimated at 1,860,000.

                   Only ten persons were employed in oil and gas extraction--

                   primarily in southwest Virginia. As previously mentioned,

                   only 225 persons were employed statewide in refinery pro-

                   duction, all of whom were employed on one Hampton Roads/

                   York River facility. Statewide in 1972, the labor force

                   participation rate was 40.2 percent.

                              In base case I the state's total population is

                   anticipated to reach 5,650,000, and total employment is

                   projected to reach 2,376,000. Refinery employment for

                   the state would be the same as for the Hampton Roads/York

                   River area--approximately 700 persons. The state's labor

                   force participation rate is projected to reach 43.2 per-
                   cent.      In base case III the changes in Virginia's popu-

                   lation and employment totals resulting from refinery em-

                   ployment gains are exactly the same as for the Hampton

                   Roads/York River area in that all changes are anticipated

                   there.

                                                   75

                           In the case of OCS development, the impact figures

                 for the Eastern Shore and Hampton Roads/York River were

                 aggregated to arrive at the total for Virginia. Virginia's

                 total population would increase by 72,600, and total employ-

                 ment would be increased by 54,120. For the entire state in

                 1985, approximately 5,700 persons w6uld be empl oyed in petro-

                 leum refining, gas processing and petrochemicals, and an

                 additional 3,785 in oil and gas extraction. Secondary em-

                 ployment gains resulting from OCS development include an

                 additional 4,400 persons in both construction and utility

                 activity and an additional 70,100 persons in other manu-

                 facturing jobs. Service employment would be increased by

                 approximately 27,000. With OCS development, the state's

                 labor force participation rate would be expected to go up

                 slightly to 43.7 percent.

                          The social and physical system impacts on Virginia

                 as a whole are also treated here as simple aggregates of the

                 impacts on the two specific areas. The 72,600 additional

                 persons attributable to OCS development would result in

                 19,058 new school enrollees, 264 additional hospital beds,

                 112 additional police personnel, and a rise in state and

                 local governmental employment of 2,178. Local government

                 overhead would increase by $546,678.

                          Water requirements would be up by over 85 million

                 gallons per day and domestic sewage up by over 7 mgd. A

                 solid waste increase of 218 tons per day would accompany

                 more than 24,000 new housing units and almost 1.8 million

                                            - 76

                  square feet of new commercial space.

                  Major Concerns

                            major concerns associated with OCS development in

                  the Onshore Area are:

                             (1) The possibility of rapid, uncontrolled growth,

                                 particularly in the relatively rural Eastern

                                 Shore.

                             (2) Air and water pollution resulting from both

                                 directly and indirectly OCS-related industrial

                                 development, as well as secondary development.

                             (3) The demand for large amounts of water which

                                 will be required to support any development.

                                 Problems in this regard are already projected

                                 for the Hampton Roads/York River area, and the

                                 Eastern Shore has only limited supplies.

                             (4) The requirements for increased public ser-

                                 vices and for increased overhead of local

                                 government.

                  Conclusions

                            In general, the results of this analytical

                  procedure have some significant impacts likely to occur

                  under these assumptions with the possibility for even

                  greater impacts under different working assumptions. The

                  Eastern Shore, for example, would experience modest popula-

                  tion increases and concurrent demands upon social and physi-

                  cal systems. Of possibly greater impact would be the signi-

                  ficant shift that could occur from an economy, lifestyle,

                                                77 -

                and landscape pattern based primarily upon agriculture, fish-

                ing and food-related industry to one based more upon general

                and oil-related industry.

                          The Hampton Roads/York River area would-experience

                much greater increases in both population and industrial

                development. These increases could severely tax not only

                the social and physical support systems of the area but also

                something as basic as available space as well. Both water

                supply and air quality considerations could conceivably act

                as limiting physical factors. Supplying sufficient water to

                the Hampton Roads/York River area is a problem today, and de-

                mand increases of over 80 million gallons per day by 1985 may

                prove impossible without reclamation of treated domestic

                wastewater, the importation of water from other river basins,

                or the desalinization of seawater. Air pollutant discharges

                of over 30,000 tons per year (particulates) could likewise

                prove to be intolerable in an area with "air space" for less
                                  4
                than 2,000 tons.

                          Along with impacts upon the above geographic areas,

                the state as a whole could feel major effects of OCS develop-

                ment. The nature of these impacts, though not as easily pro-

                jected, could be one of healthy progress and financial bene-

                fit if properly directed by sound planning and judicious regu-

                lation.

                 Air Pollution Control Board, Estimate of the Effect of
                 Outer Continental Shelf Development on Air Pollution
                 Control.

                                              78

                                    TABLE I.--POSSIBLE HIGH DEVELOPMENT IMPACT OF THE ATLANTIC OUTER CONTINENTAL SHELF ON VIRGINIA'S EASTERN SHORE

                                                                         1972                                                        1985
                                                                                                      a/      Absolute                                Absolute                           c/
                                                                        Actual            Base Case   r         Change            Base Case 111Y         Change         OCS Development-
             Population                                                 43,500                47,200                                 47,200              5,700                  52,900

             Labor force (including military)                           18,810                19,500                                 19,500              6,960                  26,460

               Unemployment                                              2,175                 1,600                                  1,600                -400                  1,200

               Total employment (including military)                    16,635                 17,900                                17,900              7,360                  25,260
                 Construct .ion                                             361                   420                                    420 h/             100                     520h/

                 Mining
                   Oil and gas extraction                                                                                                                1,880                   1,880.1/
                   Otherd7

                 Agriculture                                             3,360                 2,500                                  2,500                                      2,500

                 Manufacturing
                   Petroleum refining, gas processing
                       and/petrochemical
                   Othere                                                3,353                 5,400                                  5,400i/            1,500                   6,900.i/
                 Utilitie,f/                                                509                   630                                    630                100                      730 i/
                 Servicesfa/                                             9,052                 8  950                                 8,950h/            3,680                  12,630!S/

             Labor force as a percent of population                        43.2                  41.3                                   41.3                                       50.0

                  a/ Base case one assumes that refinery capacity at the Yorktown refinery will increase by 60 percent to 80,000 barrels per day and that the
             SuffoTk refinery will be built with production of 184,000 barrels per day.              Under the base case I assumption, Virginia would have total refinery
             capacity of 264,000 barrels per day by 1985.

                  b/ Base case two assumes that refinery capacity at the Yorktown refinery will increase by 100 percent to 100,000 barrels per day and that
             the S_uffolk refinery will be built as outlined in base case I. In addition the Transco refinery in Portsmouth is assumed to be operational with a
             200,000 barrel refinery capacity. In base case 11 an off-shore port facility would be built off the coast of Virginia. Under the base case Il
             assumption, Virginia would have totalrefinery capacity of 484,000 barrels per day by 1985.
                  c/ Under the third option, development of Virginia outer continental shelf is assumed. Total refinery production would reach 750,000 barrels
             per day. In addition to the assumptions made in base case I and base case II, it is assumed that the Yorktown refinery will increase capacity to
             150,000 barrels per day, the Suffolk refinery will increase capacity to 300,000 barrels per day and that the Motor Gas, Oil and Refining Corporation
             will build its Portsmouth facility with a 100,000 barrel per day capacity.

                  d/ Includes all mining except oil and gas extraction, which is SIC group 13.

                  e/ includes all manufacturing except petroleum refining and related industries which is SIC group 29.

                  f/ includes all public utilities, transportation, and communications. Presented are SIC categories 40 through 49.

                                TABLE I.--POSSIBLE HIGH DEVELOPMENT IMPACT OF THE ATLANTIC OUTER CONTINENTAL SHELF ON VIRGINIA'S EASTERN SHORE (Cont'd)

                     Includes all employment not mentioned in the above categories. SIC categories 50 through 99 are included here.

                 h/  Each refinery, gas processing, and petrochemical worker is expected to create employment for one additional construction worker.

                 i/  Each refinery, gas processing, and petrochemical worker is expected to create employment for one additional utility worker.

                     Each refinery, gas processing, and petrochemical worker is expected to create two additional other manufacturing jobs.

                 k/  Each additional "basic industry" type worker is expected to create an additional service or "supporting" type worker.

                 l/  Represents one half of the east coast exploration, platform development and oil and gas production total estimated to be needed by Resource
            Planning Associates in order to produce 750,000 barrels of crude oil per day.

                 Sources: Resource Planning Associates, Inc. "Potential Onshore Effects of Oil and Gas Production on the Atlantic and Gulf of Alaska outer
            Continental Shelf," December 1973; Arthur D. Little, Inc., "Potential Onshore Effects of Deepwater oil Terminal-wRelated Industrial Development -
            Report to the Council on Environmental Quality;" United States Department of the Interior,"Environmental Impact Statement: Deepwater Ports,"
            April, 1974; Commonwealth of Virginia, "Off-Shore Port Facilities: Commonwealth of Virginia," February, 1974; and Tetra Tech, Inc., "The Effect of
            Natural Phenomena on OCS Gas and Oil Development," December, 1973.

       00
       0

                                                                                                                                                    Ep

                              TABLE 2.--POSSIBLE HIGH DEVELOPMENT IMPACT OF THE ATLANTIC OUTER CONTINENTAL SHELF ON VIRGiNIA'S HAMPTON ROADS AREA
                                                                1972                                                      1985
                                                                                                   Absolute                              Absolute
                                                              Actual              Base Case I!/       Change         Base Case II         Change         OCS Development -

          Population                                           1,044,400           1,244,600          4,000            1,248,600          66,900              1,315,500

          Labor force (including military)                      514,755             617,693           6,435             624,128           46,760                670,888

            Unemployment                                         11,346              16,953                              16,953                                  16,953

            Total employment (including military)               503,409             600,740           6,435             607,175           46,760                653,935
               Construction                                      21,466              27,600              585             28,770il          4,300                 33,070i/

               Mining
                 Oil an gas extraction                                 -                   -                                               1,880                   1,88CP-/
                 OtheZ                                                57                  60                                  60                                      60

               Agriculture                                         3,898               2,868                               2,686                                   2,868

               Manufacturing
                 Petroleum refining, gas processing,                                                                           h/
                   and   trochemicals                                225                 715             585              1 300.-          4,300                  5 600
                 Other 97                                        59,914              83,926           1,170              85:  09;k/        8,600                 93:69;@/
     00
               UtilitieT f/                                      20,749              25,200              585             25,785/           4,300                 30,085j-/

               Federal government                               170,520             154,000                             154,000                                 154,000
               ServicesA/                                       226,580             306,371           2,925             309,2961/         23,380                332,6761/

          Labor force as a p  ercent of population                  49.3                49.6                                50.0                                    51.0

               at Base case one assumes that refinery capacity at the Yorktown refinery will increase by 60 percent to 80,000 barrels per day and that the
          Suffolk refinery will be built with production of 184,000 barrels per day. Under the base case I assumption, Virginia would have total refinery
          capacity of 264,000 barrels per day by 1985.

               b/ Base case two aE@sumes that refinery capacity Ett the Yorktown refinery will increase by 100 percent to 100,000 barrels per day and that
          the Suffolk refinery will be built as outlined in base case I. In addition the Transco refinery in Portsmouth is assumed to be operational with a
          200,000 barrel refinery capacity. In base case II an off-shore port facility would be built off the coast of Virginia. Under the base case II
          assumption, Virginia would have total refinery capacity of 484,000 barrels per day by 1985.
               cl Under the third option, development of Virginia outer continental shelf is assumed. Total refinery production would reach 750,000 barrels
          per d;iy. In addition to the assumptions made in base case I and base case II, it is assumed that the Yorktown refinery will increast capacity to
          150,000 barrels per day, the Suffolk refinery will increase capacity to 300,000 barrels per day and that the motor Gas, oil and Refining Corporation
          will build@ its Portsmouth facility with a 100,000 barrel per day capacity.

               d/ Includes all mining except oil and gas extraction, which is SIC group 13.

               e/ Includes all manufacturing except petroleum refining and related industries which is SIC group 29.

               f/ Includes all public utilities, transportation, and communications. Presented are SIC categories 40 through 49.

                             TABLE 2.--POSSIBLE HIGH DEVELOPNENT IMPACT OF THE ATLANTIC OUTER CONTINENTAL SHELF ON VIRGINIA'S HAMPTON ROADS AREA (Cont'd)

                    includes all employment not mentioned in the above categories. SIC categories 50 through 99 are included here.

                h/ It is assumed that 135 refinery workers are required for each 50,000 barrels per day refinery capacity. Thus, with refinery capacity of
           484,000 barrels, 1,300 workers would be needed.

                i/  Each refinery, gas processing, and petrochemical worker is expected to create employment for one     additional construction worker.

                i/  Each refinery, gas processing, and petrochemical worker is expected to create employment for one     additional utility worker.

                k/  Each refinery, gas processing, and petrochemical worker is expected to create two additional other manufacturing jobs.

                I/  Each additional "basic industry" type worker is expected to create an additional service or "supporting" type worker.

                m/  Represents one fourth of the east coast exploration, platform development and oil and gas production total estimated to be needed by
           Resource Planning Associates in order to produce 750,000 barrels of crude oil per day.

                Sources: Resource Planning Associates, Inc. "Potential onshore Effects of Oil and Gas Production on the Atlantic and Gulf of Alaska outer
           Continental Shelf," December 1973; Arthur D. Little, Inc., "Potential Onshore Effects of Deepwater Oil Terminal-Related Industrial Development
           Report to the Council on Environmental Quality;11 United States Department of the Interior, "Environmental Impact Statement:     Deepwater Ports,"
           April, 1974; Commonwealth of Virginia, "Off-Shore Port Facilities: Commonwealth of Virginia," February, 1974; and Tetra Tech, Inc., "The Effect of
           Natural Phenomena on OCS Gas and Oil Development," December, 1973.

      00

                                                                                                                                                                      up

                                          TABLE 3.--POSSIBLE HIGH DEVELOPMENT IMPACT OF THE ATLANTIC OUTER CONTINENTAL SHELF ON ONSHORE VIRGINIA

                                                                   -1972                                                                      1985

                                                                                                                 Absolute                                   Absolute
                                                                        Actual               Base Case            -Change           Base Case II             Change         OCS Dev@@---tm@

             Population                                               4,764,000              5,650,000             4,000             5,654,000              72,600

             Labor force (including military)                         1,913,300              2,440,000             6,435             2,446,435              54,120                2,500,555

               Unemployment                                               51,700                 64,000                                   64,000                                      63,600

               Total employment (including military)                  1,860,000              2,376,000             6,435             2,382,435              54,120                2,436,555
                   Construction                                           99,400                126,000            1,170                 127,170-L/          4,400                   131,5701/
                   Mining                                                                                                                                                              3,785-@-/
                     Oil an
                          d@ gas extraction                                    10                     25                                       25            3,760
                     Other-                                               15,690                 19,975                                   19,975                                      19,975

                   Agriculture                                            73,300                 40,000                                   40,000                                      4.0,000

                   Manufacturing
                     Petroleum refining, gas processing                                                                                         h/
                       and/petrochemicals                                     225                    715                                  1 30O:-_'          4,400                    5 700
       00            Othere                                              375,175                514,285            1,170                 515'45@k/          10,100                  525:55.;@
                   Utilities f/                                           98,900                125,000                585               125,585             4,400                   129,985-i/
                   ServicesZ/                                         1,197,300              1,550,000             2,925             1,552,925-1/           27,060                1,579,985P

             Labor force as a percent of population                          40.2                   43.2                                    43.3                                        43.7

                   a/ Base case one assumes that refinery capacity at the Yorktown refinery will increase by 60 percent to 80,000 barrels per day and that the
             Suffolk refinery will be built with production of 184,000 barrels per day. Under the base case I assumption, Virginia would have total refinery
             capacity of 264,000 barrels per day by 1985.

                   b/ Base case two assumes that refinery capacity at the Yorktown refinery will increase by 100 percent to 100,000 barrels per day and that
             the Suffolk refinery wil:l be built as outlined in base case I. In addition the Transco refinery in Portsmouth is assumed to be operational with a
             200,000 barrel refinery capacity. In base case II an off-shore port facility would be built off the coast of Virginia. Under the base case II
             assumption, Virginia would have total refinery capacity of 484,000 barrels per day by 1985.

                   c/ Under,the third option, development of Virginia outer continental shelf is assumed. Total refinery production would reach 750,000 barrels
             per day.    In addition to the assumptions made in base case I and base case II, it is assumed that the Yorktown refinery will increase capacity to
             150,000 barrels per day, the Suffolk refinery will increase capacity to 300,000 barrels per day and that the Motor Gas, Oil and Refining Corporation
             -will build its Portsmouth facility with a 100,000 barrel per day capacity.

                   d/ Includes all mining except oil and gas extraction, which is SIC group 13.

                   e/  Includes all manufacturing except petroleum refining and related industries which is SIC group 29.

                   f/ Includes all public utilities, transportation, and communications. Presented are SIC categories 40 through 49.

                                 TABLE 3.--POSSIBLE HIGH DEVELOPMENT INPACT OF TEE ATLANTIC OUTER CONTINENTAL SHELF ON ONSHORE VIRGINIA (Con'd)

                    Includes all employment not mentioned in the above categories. SIC categories 50 through 99 are included here.

                h/  It is assumed that 135 refinery workers are required.for each 50,000 barrels per day refinery capacity.      Thus, with refinery capacity of
           484,COO barrels, 1,300 workers would be needed.

                i/  Each refinery, gas processing, and petrochemical worker is expected to create employment for one additional construction worker..

                J/  Each refinery, gas processing, and petrochemical worker is expected to create employment for one additional utility worker.

                k/  Each refinery, gas processing, and petrochemical worker is expected to create two additional other manufacturing jobs.

                l/  Each additional "basic industry" type worker is expected to create an additional service or "supporting" type worker.

                m/  Represents one half of the east coast exploration, platform development and oil and gas production total estimated to be needed by Resource
           Planning Associates in order to produce 750,000 barrels of crude oil per day.

                Sources: Resource Planning Associates, Inc. "Potential onshore Effects of Oil and Gas Production on the Atlantic and Gulf of Alaska Outer
           Continental Shelf," December 1973; Arthur D. Little, Inc., "Potential onshore Effects of Deepwater Oil Terminal-Related Industrial Development -
           Report to the Council on Environmental Quality;" United States Department of the Interior, "Environmental Impact Statement: Deepwater Ports,"
           April, 1974; Commonwealth of Virginia, "Off-Shore Port Facilities: Commonwealth of Virginia," February, 1974; and Tetra Tech, Inc., "The Effect of
           Natural Phenomena on OCS Gas and oil Development," December, 1973.

     CD
     4'

                                                 TABLE 4.--POSSIBLE 1985 HIGH OCS DEVELOPMENT IMPACTS ON SOCIAL AND PHYSICAL SYSTEMS:
                                                                          VIRGINIA, HAMPTON ROADS, AND EASTERN SHORE

                                                                                                 Virginia                Hampton Roads                    Eastern Shore

                      Population (absolute change over Base Case 11)                               72,600                       66,900                           5,700
                      Social Systems a/
                        School enrollment b/                                                       19,058                       17,561                           1,496
                        Hospital beds cl                                                               265                         244                               21
                        Police manpower d/                                                             112                         103                                9
                        Government overhead, e/                                                  $546,678                     $503,757                         $42,921
                        Government employees  f/                                                    2,178                        2,007                             171

                      Physical Systems
                        Water demands (million gallons per day)ya/
                          domestic                                                                   7.26                         6.69                             .57
                          petroleum related industry   h/                                              78+                           78                            .03
                        Sewage - domestic (million gallons per day)                                  7.26                         6.69                             .57
                        Solid waste (tons per day)   i/                                               218+                         201                               17
                        Residential structures  i/                                                 24,200                       22,300                           1,900
                        Commercial structures (square feet)ls/                                  1,778,700                    1,639,050                         139,650
      Go

                          a/ Ratios used to generate figures for the ten social and physical system          indicators from 1985 population figures are      in some
                      cases the averages of similar ratios for four east coast hypothetical case studies done by Resource Planning Associates for the
                      Council on Environmental Quality. These case study locations are Bristol County, Massachusetts, Cumberland/Cape May Counties, New                Jersey,
                      Charleston, South Caroline, and Jacksonville, Florida. Other ratios are commonly accepted ones for Virginia supplied by the State                Water
                      Control Board and the Division of State Planning and Community Affaits where significantly different from RPA figures.
                          b/  School enrollment is assumed to be .2625 the total population, based on RPA figures.
                          c/  Demand for hospital beds is assumed to be 3.64 per thousand population based on RPA figures.
                          d/  It is assumed that 1.54 additional police persons will be required for each 1,000 persons based on RPA figures.
                          e/  Local government overhead cost is estimated at $7.53 per person based on RPA figures.
                          f/  A ratio of 30 government employees per thousand population is assumed based on DSPCA figures for Virginia.
                          fl/ A domestic water demand and sewage discharge of 100 gallons per person per day is assumed based on SWCB estimates for Virginia.
                          h/  Petroleum industry water demand figures are based on assumptions of 40 gallons per barrel for refineries, 15,000 gpd per gas
                      processing plant, and 24 mgd per major petrochemical complex from RPA sources.
                          i/ Solid waste is assumed to be generated at 3 tons per thousand persons per day based on SWCB Virginia estimates.
                          j./ Residential structure figures are calculated at a ratio of 3.0 persons per household based on DSPCA-Virginia figures.
                          k/ Commercial structure requirements are assumed to be 24.5 square feet per person based on RPA figures.

                          Sources: Resource Planning Associates, Inc."Potential Onshore Effects of-Oil and Gas Production on the Atlantic and Gulf of Alaska Outer
                      Continental Shelf," December, 1973; Arthur D. Little, Inc., "Potential Onshore Effects of Deepwater Oil Terminal-Related Industrial Develop-
                      ment - Report to the Council on Environmental Quality;" United States Department of the Interior, "Environmental Impact Statement:
                      Deepwater Ports," April, 1974; Commonwealth of Virginia, "Off-Shore Port Vacilities: Commonwealth of Virginia," February, 1974; and
                      Tetra Tech, Inc., "The Effect of Natural Phenomena on OCS Gas and Oil Development," December, 1973.

                                               VI

                                        Recommendations

                         This section will set forth recommendations based

               .Upon the preceeding portions of this report. Their ultimate

               aim is to enable Virginia to derive maximum benefit from

               whatever resources may be discovered on the OCS, while pre-

               serving to the greatest possible extent the environment which
               so enhances our daily lives. In fact, given the energy re-

               quirements of the United States, we feel they will likely b e

               developed whether or not we as Virginians desire it,, regard-

               less of the decision of the Supreme Court with respect to

               ownership of the offshore lands. It therefore behooves us to

               make arrangements to anticipate the effects of OCS development

               and its associated problems.

                         In order, therefore, to prepare for the possibility

               of the development of the OCS off the coast of our state, we

               make the following recommendations:

               Overall Recommendations

                         (1) Virginia is currently involved in the develop-

                              ment of a Coastal Zone Management Plan. It

                              is recommended that this planning effort con-

                              sider the possibility of OCS oil and gas ex-

                              ploration and exploitation, including the

                              findings of this and any subsequent reports.

                                               86

                             Other related reports, such as that recently

                             completed on Offshore Port Facil ities should

                             also be considered.

                                  It is further recommended that any planning

                             for and regulation of OCS development be con-

                             ducted consistently with and as a part of the

                             Coastal Zone planning effort.

                        (2)  In case the Supreme Court rules against the states

                             federal legislation to require sharing of

                             federal rents, bonuses and royalties received

                             from the leasing of OCS lands should be sup-

                             ported. Some arrangements to pass funds from

                             this source to the localities seems only simple

                             justice, since it is they who bear the brunt of

                             the onshore impacts. These impacts include not

                             only the public services which must be furnish-

                             ed to the industries and people related to OCS

                             development, but also those less easily quanti-

                             fied financially, such as the threat of oil

                             spills, modifications to coastal ecology and

                             shifts in population. Further, such legisla-

                             tion should consider the fact that onshore de-

                             velopment in one state could well be related to

                             OCS development off the coast of a neighboring

                             state5 and provisions made therefor. A joint

                             declaration to this effect by all coastal

                             states would be a useful means of supporting

                             such legislation.

                                              87

                             (3) The Atlantic Coast al States should oppose

                                  drilling on OCS lands until an oil spill

                                  cleanup association organized in the fashion

                                  of "Clean Gulf Associates" has been formed

                                  for the Atlantic area by the oil companies

                                  who desire to.exploit the Atlantic OCS. This

                                  association should be capable of employing

                                  "state of the art" technology in its clean-

                                  up activities.

                             (4)  Research problems concerning hydrocarbons and

                                  the marine environment should be jointly

                                  attacked by the Atlantic Coastal States and

                                  the Federal Government in order to prevent

                                  needless duplication. Virginia should develop

                                  an adequate offshore research and monitoring

                                  capability to support thi@_lse studies. Though

                                  it is impossible to list here all of the pro-

                                  grams which should be scientifically pursued

                                  in this regard, the following general topics

                                  are considered to be the most important:

                                  (a)  Baseline studies to establish current con-

                                       ditions among the biota, particularly those

                                       of the offshore area.

                                  (b)  Response of the various organisms to chron-

                                       ic long term releases of small amounts of

                                       petroleum.

                                  (c)  Surface and bottom current patterns in the

                                                88

                                     Virginian Sea under various meteorolo-

                                     qical conditions, including the develop-

                                     ment of a reliable predictive model.

                                (d)  The effects of various natural phenomena

                                     on the weathering of petroleum, including

                                     rates of degradation.

                                (e)  Effects of the various constituents of

                                     petroleum on organisms, particularly the

                                     larval stages.

                                (f)  The physical-chemical interrelationships

                                     between sediments and the various constit-

                                     uents of petroleum, including the persis-

                                     tance of hydrocarbons in sediments.

                                (g)  The effects of the incidental products of

                                     the exploration for and exploitation of

                                     petroleum resources upon the marine environ-

                                     ment and biota. Included among these pro-

                                     ducts are drilling mud, bleedwater, and

                                     drill cuttings.

                           (5) The present Outer Continental Shelf Advisory

                                Committee, organized on an ad hoc basis by the

                                Secretary of Commerce and Resources, should be

                                continued. This committee now represents

                                agencies of the Commonwealth with interests

                                in OCS development. It should be formalized,

                                and charged with the responsibility to act in

                                an advisory capacity in matters relating to

                                            - 89

                                   the development of the OCS.

                   Recommendations for the Offshore Area

                              If Virginia should be awarded control of the off-

                   shore area, the following recommendations apply:

                              (1) Regulations similar to those in current use

                                   by the Federal Government should be adopted

                                   by Virginia to cover all phases of leasing,

                                   exploration, production, and inspection of

                                   the OCS lands and operations. These should

                                   include the control of,.,  drilling.by-products

                                   such as bleedwater drill cuttings and drilling

                                   mud.

                                   A state agency should be assigned responsi-

                                   bility for the OCS lands in the offshore

                                   area. The Virginia Marine Resources Commis-

                                   sion would be a logical choice; however, VMRC

                                   would have to be very greatly expanded, since

                                   the magnitude of OCS activities it would oversee

                                   would be enormous. Alternatively, a new agency,

                                   properly funded, staffed and equipped could be

                                   formed and assigned the responsibility, together

                                   with the broad powers required.

                                         In either case, close liaison should be

                                   established with other state agencies having

                                   an interest in the marine environment and its

                                   resources, notably the Virginia Institute of

                                   Marine Science, the State Water Control Board,

                                                  90

                                the Division of Mineral Resources, and,

                                should responsibility be assigned elsewhere,

                                the Virginia Marine Resources Commission.

                           Should the federal government be awarded control of

                 the offshore area, the following recommendations apply:

                           (1) A state office having responsibility for

                                coordinating all contacts between the state

                                and the federal government and industrial

                                organizations should be created. It would fur-

                                ther serve as a focal point for Virginia in

                                matters concerning the development of the OCS.

                                close liaison should be maintained with state

                                agencies having an interest in the marine

                                environment and its resources, including the

                                Virginia Institute of Marine Science, the

                                State Water Control Board, the Virginia Marine

                                Resources Commission and the Division of Mineral

                                Resources.

                 Recommendations for the Interface Area

                           (1) The Virginia Wetlands Act of 1972 should be

                                reviewed and modified to encourage local plan-

                                ning for wetlands alterations as opposed to

                                the case-by-case method currently in use.

                                Experience in Louisiana indicates the major

                                damage to the marine environment related to

                                offshore oil and gas activity was the result

                                of modifications to wetlands. Technical ad-

                                            - 91

                                 vice regarding massive wetlands alterations

                                 as well as surveillance of such activities

                                 should be provided local governments by appro-

                                 priate state agencies such as the Virginia

                                 Institute of Marine Science and the Virginia

                                 Marine Resources Commission.

                             (2) Detailed criteria should be developed to be
                                 utiliz'ed in the approval of permits for the

                                 placing of structures (including pipelines)

                                 in the marine environment. Methods of con-

                                 struction, route selection, operational moni-

                                 toring and requirements for removal upon ob-

                                 solescence should be included. A detailed

                                 study should be made of problems encountered

                                 in states where offshore activity has been

                                 going on (such as Louisiana and California)

                                 and the procedures developed to handle them.

                             (3  Pipeline access through the Interface area

                                 should be so controlled that the numbers of

                                 pipeline corridors will be kept to a minimum.

                  Recommendations for the Onshore Area

                             (1) Local governments who are expected to bear

                                 the impact of onshore development should be

                                 encouraged with state assistance to plan for

                                 and regulate projected growth in their areas,

                                 in order that they may derive maximum benefit

                                 from such growth at the least possible expense

                                                92

                                to their traditional values and lifestyles.

                                Minimum state standards should be developed

                                to guide this process.

                           (2)  A study should be conducted by the state as

                                to the most appropriate use of any revenues

                                received as a result of the development of

                                the OCS. One alternative to be considered

                                by such a.study would be the use of a portion

                                of the funds received to assist the localities

                                most heavily impacted in providing public

                                services.

                           (3)  Recognizing that production of oil and gas

                                from the OCS can result in development on-

                                shore of large industrial complexes such as

                                refineries, tank farms and petrochemical

                                plants--all of which can be considered as

                                having an impact of regional as opposed to

                                local scale--it is recommended that the

                                Commonwealth act to increase its role in the

                                planning and control of these developments.

                                It appears appropriate to frame and enact

                                legislation requiring the state to develop

                                criteria and minimum standards to be used in

                                the review and processing of the siting of

                                these developments of greater than local im-

                                pact, thus contributing to orderly development.

                                              93

                                          Appendix A

                                     U.S. v. Maine, et al
                           in 1969 the State o@ Maine granted exclus ive explo-

                 ratory rights in certain tracts of offshore lands beyond the

                 three-mile limit to King Resources. The United States there-

                 upon brought suit aga inst the 13 Atlantic Coastal States for

                 a determination of rights in all the lands and natural re-

                 sources of the bed of the Atlantic Ocean more than three geo-

                 graphical miles from the coastline. The federal action, in a

                 word, is in the nature of a suit to quiet title.

                           The coastal states, in response to the  complaint of

                 the United States, denied the allegations and, by way of af-

                 firmative defense, alleged that they as successors in title

                 to certain grantees of the Crown of England are now and -

                 ever since the formation of the Union - have been e ntitled to

                 exercise exclusive dominion and control over the exploration

                 and development of such natural resources as may be found in,

                 on or about the seabed and subsoil underlying the Atlantic

                 Ocean adjacent to their coastlines. The States also asserted

                 that such power of control i.s not prohibited by the Consti-

                 tution, has never been delegated by the States to the federal

                 governme nt and that any attempt by the government to assert

                 such power violates the provisions of the Tenth Amendment to

                 the Constitution.

                           After the initial pleadings had been filed, the

                 United States moved for judgment on the pleadings; the States,

                                                A-1

                led by Virginia, countered with a motion for reference to a

                Special Master, the States contending that, unlike other

                states in the nation, the Atlantic States preceded the nation,

                formed the government and, consequently, were possessed of

                historical documents and other forms of evidence and claims,

                all of which should be carefully reviewed prior to any deci-

                sion by the High Court. In June, 1970, the Supreme Court

                granted the motion of the States and referred the case to a

                Special Master, a Senior United States Circuit Court Judge.

                          Hearings were held in Philadelphia for almost three

                years, during which time thousands of documents, some in me-

                dieval French, were submitted by both sides. Scholars from

                the country's top universities and a retired judge from the

                World Court were among the witnesses to the Court. Archives

                from Virginia to London were scoured for relevant evidence.

                old maps were discovered and offered to the Court. In addi-

                tion to the evidence collectively submitted by the States,

                Virginia offered comprehensive testimony with respect to the

                assertion of authority, the exercise of authority and juris-

                diction and the exploitation of Virginia's natural resources

                by the Colony and State and its citizens.

                          The basic contention of the United States is that

                the original colonies did not separately acquire ownership

                of the three-mile belt in the adjacent sea or the soil under

                it. Such ownership was acquired by the national government

                after the formation of the Union and, consequently, by act

                of Congress in 1953, the United States confirmed to all

                                              A-2

                 coastal states' ownership of the bed of the three-mile ter-

                 ritorial sea adjacent to their coastal lines while at the

                 same time reasserting the federal claim to resources seaward

                 of the three-mile limit, subject to coastal states proving

                 claims to limits beyond the three-mile limit.

                            The basic contentions of the defendant states are

                 several:

                            (1) That under the law and practice of England

                                prior to and during the 17th and 18th cen-

                                turies, the seabed comprising the continen-

                                tal sh elf of England and of English posses-

                                sions was subject to an exclusive right of

                                exploitation in favor of the English Crown.

                            (2) In that period no generally recognized prin-

                                ciple of international law prohibited or

                                denied that  exclusive right to the English

                                Crown.

                            (3) During the period 1492 to 1776, England ac-

                                quired by right of discovery or conquest and

                                the performance of symbolic acts of sover-

                                eignty over the territories now comprising

                                the defendant states and the adjacent con-

                                tinental shelf. During that period the Crown

                                granted its right of exploitation over part

                                or all of that continental shelf to Colonial

                                proprietorships and governments. For example,

                                the States assert that the 1607 and 1609

                                                A-3

                              Virginia charters to the London Company

                              by King James I, in addition to grants of

                              land to the North, South and West, included

                              the sea, seabed, all islands and minerals

                              for a distance of 100 miles, the distance

                              Virginia and other states are claiming today.

                          (4) To continue, the States assert that at Ameri-

                              can Independence those rights passed individ-

                              ually to the successor independent states.

                              If any portion of the continental shelf was

                              not granted to the Colonial proprietorships and

                              governments by the Crown prior to 1776, such

                              portion passed individually to the independent

                              states at independence or, at the latest, by

                              the Peace of Paris in 1783. Virginia asserts,

                              for example, that the 1776 Constitution of

                              Virginia, and even the Code of Virginia today,

                              specifically incorporate the 100 mile boundary

                              first delineated by King James as the eastern

                              boundary of the Commonwealth.

                          (5) The states contend, too, that nothing has

                              occurred since 1783 which effectively divested

                              the defendant states.of the ownership of the

                              continental shelf. The states preserved their

                              respective rights when they entered into the

                              Articles of Confederation and into the Consti-

                              tution of the United States.

                                             A-4

                          Thus, the legal lines are drawn in the latest and,

                perhaps, the last of the big offshore lands cases. Much is

                at stake; the case is expected to be argued in February,

                1975, with a decision to be announced by June.

                                              A-5

                                                                                                                                        N AA COASTAL SERVICES CTR LIBRARY

                                                                                                                                                 38 14110845 8

                                                                        COUTAL ;ONE                                         FEB 3 :@,@1975
                                                                       MF               TION CENTER