Jackson Free Press

JACKSON, Miss. (AP) — Opponents say Mississippi officials stacked the deck in favor of offshore natural gas drilling when they wrote rules to allow it.

Sierra Club attorney Robert Wiygul questioned employees of the Mississippi Development Authority at a hearing Wednesday. He argued the state was biased in favor of allowing drilling, when the law only said the state could offer such leases.

The legal action centers not on whether drilling would be good for the state's environment and economy but on whether MDA properly drew up the rules to allow seismic testing and leasing of parts of the Mississippi Sound by oil and gas companies

Drilling would be limited to areas seaward of the barrier islands, but closer to shore in the eastern edge of Mississippi waters near the Alabama state line. Experts say there's natural gas under the sound but little oil.

The administrative hearing will continue Thursday with more testimony from opponents' witnesses. An appeal to Hinds County Chancery Court could follow.

The Sierra Club and the Gulf Restoration Network, which challenged the rules in March, say MDA erred by failing to prepare an economic impact statement that encompassed all the risks and benefits of oil and gas drilling. The agency limited its analysis to only the costs and benefits of seismic exploration and leasing, not to the actual drilling.

"They're committing the public resources before they do the analysis," Wiygul said in an interview after the hearing.

An analysis by opponents argues that visible oil and gas rigs could drive away visitors and that a serious spill could do great harm to the coast's $1.8 billion tourism industry, outweighing any gains from lease fees and royalties.

MDA argues that it's not required to do an analysis of the whole issue. State economist Bob Neal said such a study would likely be prepared when the Mississippi State Oil and Gas Board prepares rules for the actual drilling and recovery of gas.

The opponents also say MDA didn't adequately respond to and analyze all the public comments it received during the rule-making.

"To my knowledge, every comment was looked at," said Manning McPhillips, MDA's chief administrative officer. Officials said they responded to some comments, but that responses to all were not required.

Jack Moody, a geologist for MDA, said some comments resulted in changes.

"I wasn't just marking time," Moody said. "I was looking for issues we could deal with."

For example, the state agreed to put environmental monitors on seismic boats, charge enough for permits to pay them properly, and allow them to shut down seismic testing if they detected problems.

Moody said that the sound is roughly estimated to have 1 trillion cubic feet of natural gas beneath it. That's less than Alabama, which he said has roughly 5 trillion feet in Mobile Bay and offshore areas.

Wiygul noted that the 2004 law that reassigned leasing to MDA says the agency "may" lease parts of the sound. However, MDA officials said they work for the governor's office and that officials from former Gov. Haley Barbour's administration told them to proceed.

"I believe that's mandatory," Moody said. "They told us what they wanted to do."

Wiygul also questioned whether MDA's website was inappropriately pro-drilling.

"MDA had already decided it was going to promote this and it was going to go forward with leasing the Mississippi Sound for oil and gas development, hadn't it?" Wiygul asked McPhillips. Dan Turner, marketing and communications director for MDA, denied that the publicity effort was a "slick marketing campaign."

"It was an educational campaign," Turner said.