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When oil and fishing industries meet Anchorage economic consulting firm updates model to assess ‘preemption impacts’ to fisheries from OCS oil and gas development Wesley Loy For Petroleum News
The ocean is only so big. So what happens when one industry sets up shop in waters potentially valuable to another industry?
That was the question before Marcus Hartley and his colleagues at Northern Economics.
The Anchorage-based economic consulting firm recently updated a model for determining “preemption impacts” to fisheries from outer continental shelf oil and gas development.
Specifically, what is the displacement cost to the fishing industry when an offshore platform goes in?
Hartley spoke about the model at a May 22 meeting of the Anchorage Association for Energy Economics.
Lots of cells The model was developed for the Bureau of Ocean Energy Management to assess impacts of five-year OCS leasing plans on fisheries along U.S. coasts.
Alaska has some of the nation’s largest and richest seafood harvests, especially in the eastern Bering Sea. Key species include pollock, Pacific cod and king crab.
The modeling involved dividing the Exclusive Economic Zone — waters extending 200 nautical miles offshore — into cells of 100 square nautical miles, and correlating the annual value of fisheries.
Millions of scenarios were run to account for an unknown — the specific cells in which platforms might be installed.
Placement of a platform is assumed to be disruptive to some fishing operations, as the platforms need a buffer zone with a half-mile radius or more.
“The buffer zones must be large enough so that as vessels move around the buffer zone, their gear which trails behind does not get tangled in the platform or its rigging,” Hartley’s presentation said.
Startling result The model indicates that the preemption impacts to commercial fisheries in terms of harvesting revenue are very small. In Alaska, the annual impact is from $0 to $260 per platform.
But this is the average cost impact across vast planning areas, large portions of which never see fishing boats.
Fishing generally occurs in “hot spots,” Hartley said, and the probability of platforms going into these hot spots is low. But if they did, the loss of fishing grounds could be far more costly to the seafood industry.
Fishermen do have ways to mitigate impacts from oil and gas operations. They can move into other areas to fish, for instance. And harvesters in some places, such as the Gulf of Mexico, have found that oil and gas installations make for fine fishing, Hartley noted.
Alaska has some oil and gas platforms in Cook Inlet, but none have been installed around the Gulf of Alaska or in the Bering Sea and Aleutian Islands. No commercial fisheries occur in the federal waters of the Arctic Ocean.
Shell has talked of potentially installing platforms to produce natural gas from the North Aleutian basin, which takes in Bristol Bay, the state’s most valuable fishing area. But the government has no immediate leasing plans for the basin.
Hartley said he believes the value of the model isn’t so much its prediction of low preemption costs to fisheries. Rather, the fishery data that went into the model can be highly informative to the Bureau of Ocean Energy Management.
Precise data can help the agency assess highly productive fishing areas and maybe preclude oil and gas lease sales in those areas, Hartley said.
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