South Florida’s Dirty Secret Is Oil

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Courtesy of NRDC
By Alison Kelly, Senior Attorney, Environmental and Energy Law

“Paradise Coast” is how the tourism industry often refers to the Everglades, Naples, and Marco Island parts of south Florida. As many city dwellers flee states with cold winters and expensive costs of living looking to quarantine in this paradise, there is a dirty little secret lurking in the Florida swamp — impending oil development.

Many new residents and tourists come to Florida to experience the state’s natural wonders, like Everglades National Park, Big Cypress National Preserve, Ten Thousand Islands National Wildlife Refuge, and Florida Panther National Wildlife Refuge. They come to hike, view wildlife, kayak, boat, and fish. What they don’t know is that beneath many of these public lands in Florida, including Big Cypress, there is oil — and it’s privately owned.

Much (but not all) of this oil is owned by corporations run by the politically powerful Collier family, after whom Collier County is named. Collier-related corporations also engage in real estate development, including a new 45,000-acre town, in endangered Florida panther habitat. The Intercept recently reported on the Collier entities’ development of endangered species’ habitats. And the Colliers have also set their sights on accessing Florida panther habitat in Big Cypress in a continued quest for oil.

Although there are two legacy oil drilling sites in Big Cypress National Preserve — Bear Island and Raccoon Point — the Colliers’ lessee, Burnett Oil Company, wants to expand oil drilling at Raccoon Point and develop another entirely new area of the Preserve, consisting of wetlands and namesake cypress trees.

The U.S. Government Tried to Buy Out the Colliers’ Mineral Rights Under Big Cypress

Big Cypress National Preserve is a “split estate” where the federal government owns the surface of the preserve and private entities, including Collier entities, own the oil and gas beneath the surface. In the early 2000s, under President George W. Bush and his brother, Florida Governor Jeb Bush, there was an attempt to strike a deal to buy mineral rights from the Collier entities for Big Cypress, Ten Thousand Islands National Wildlife Refuge, and Florida Panther National Wildlife Refuge. The deal fell through after a Department of Interior whistleblower raised concerns that the agency overvalued the mineral rights and did not follow applicable agency rules. The complaint was referred to the Interior’s Office of Inspector General, which produced a report raising several claims.

Interior’s Inspector General found Collier entities only own around two-thirds of the private mineral rights, yet the deal contemplated compensation for 100%. Even more concerning is the report’s finding that Collier entities may have already been compensated in previous transactions for some or all of the mineral interests that they sought compensation for in the early 2000s. Given all the uncertainties in valuing the oil and gas rights, the Inspector General recommended that, should Interior consider acquiring Big Cypress’s private mineral interests again, the Department consider condemnation. That’s what the enabling legislation, establishing the Preserve as a National Park Unit, contemplated.

Since the federal government failed to buy out private oil and gas rights beneath Big Cypress, there has been no action on the Inspector General’s claims. This is a big deal because, generally, when oil companies want to extract oil and gas from public lands and waters, they enter into lease agreements with the federal government and pay certain fees and royalties on the fossil fuels they extract. In the case of federally owned oil and gas, the U.S. taxpayers collect a share of the profits based on the value or volume of the oil and gas extracted.

But in the case of Big Cypress, the Collier entities’ lessee, Burnett Oil Company, only had to obtain an access permit from the National Park Service (in addition to state-issued permits) to hunt for oil in the Preserve, which it did in 2017 and 2018, as we previously reported. In order to drill, Burnett Oil Company must apply for an operations permit from the National Park Service, but since the mineral rights are privately held and below the surface, it needs no lease with the federal government. In short: because Collier’s mineral rights are private, neither the federal government nor the taxpayer will receive any royalties from oil extracted in Big Cypress.

And Collier entities have begun a lobbying effort to try to make sure they are compensated if state or local governments try to impact their efforts to drill for oil. As recently reported, a registered lobbyist for certain Collier companies drafted proposed bill language and sent it to Florida Senator Ray Rodrigues, for what became proposed Senate Bill 1380, “Relief From Burdens on Real Property Rights.” If this bill passes, it will amend the “Bert J. Harris, Jr., Private Property Rights Protection Act” in Section 70.001 of the Florida Statutes. The existing law created “a separate and distinct cause of action from the law of takings, the Legislature herein provides for relief, or payment of compensation, when a new law, rule, regulation, or ordinance of the state or a political entity in the state, as applied, unfairly affects real property.” Senator Rodrigues’ proposed amendment would ensure that the law applies to privately held oil and gas.

There are other bills pending in the 2021 Florida Legislative Session, such as Senate Bill 722, which would prohibit the Florida Department of Environmental Protection from granting permits for the drilling of wells for oil or gas within the Everglades Protection Area. But this area does not include Big Cypress National Preserve. Florida minority Democratic Leader Senator Gary Farmer has introduced Senate Bill 546 — “Stop Fracking Act” — that would prohibit “extreme well stimulation,” including certain types of fracking and acidizing. The senator also opposes oil drilling in Big Cypress.

Burnett Oil Company Seeks Federal Water Permits to Facilitate Oil Drilling

Burnett Oil Company must have liked the results of its damaging oil exploration activities in the Preserve because it has applied for permits to fill in wetlands to build new oil drilling well pads and access roads. It is seeking these permits under Florida’s Section 404 Clean Water Act permitting program. Note that in the eleventh hour of the Trump Administration, the Environmental Protection Agency approved the state of Florida’s application to assume this permitting program. There is federal court litigation challenging that move, and the Miccosukee Tribe of Indians of Florida has raised serious concerns about the state’s takeover of this permitting program. The tribe indicated that it also plans to submit comments on Burnett Oil’s new development proposal. There are hundreds of known cultural and archaeological resources located in the Preserve and one of Burnett Oil’s proposed new well pads is located adjacent to a Miccosukee reservation.

According to Collier Resources Company, the National Park Service allows oil exploration and development “as long as the activities comply with strict environmental protection measures.” However, state and federal government permitting requirements for the oil exploration so far have failed to prevent extensive damage and these permits are not being “strictly” enforced.

Here’s an example: other permittees in Florida proposing to impact wetlands must provide compensatory mitigation. They have to assess ecological functions provided by wetlands and other surface waters using a standard procedure called the Uniform Mitigation Assessment Method (UMAM), calculate the amount those functions are reduced by a proposed impact, and the amount of mitigation they would need to do to offset that loss. State regulators usually require mitigation plans in advance of any impacts to wetlands. But when Burnett Oil conducted seismic testing in Big Cypress, it was not required to provide compensatory mitigation before driving 33-ton vehicles off-road through Preserve wetlands to hunt for oil. Indeed, four years after Burnett began exploring for oil in big Cypress, the company has not completed compensatory mitigation for its wetland damage in Big Cypress using Florida’s Uniform Mitigation Assessment Method.

Now Burnett Oil Company is proposing the same mitigation approach for oil development in its state Section 404 Clean Water Act application. And why not? Wetland mitigation requires time and money, and, thus far, the oil company is not being required to prove it can compensate for the loss of wetland functions under UMAM.

The Biden-Harris Administration Should Review, and if Necessary, Halt, Burnett Oil’s Drilling Plans

Despite the damage Burnett Oil caused in its first phase of exploration and its failure to complete mitigation for that harm to wetlands, the National Park Service Big Cypress National Preserve Superintendent said we can anticipate public release of Burnett Oil’s operations permit application to drill for oil in Big Cypress in late April or early May 2021.

This rush to process permit applications to accommodate oil drilling in the early days of the Biden-Harris Administration could jeopardize its comprehensive review and reconsideration of federal oil and gas permitting and leasing practices, including potential climate and other impacts associated with oil and gas activities. The Administration is also working on strengthening Tribal consultation and Nation-to-Nation relationships, and, therefore, the concerns expressed by the Miccosukee Tribe of Indians of Florida and the Seminole Tribe of Florida must be heard and addressed. NRDC submitted Freedom of Information Act (FOIA) requests to the National Park Service during the Trump Administration, seeking information on Burnett Oil’s first phase of exploration and legacy oil drilling in the Preserve to better understand the impacts. The National Park Service should fulfill those requests.

The National Park Service should not permit new oil drilling in Big Cypress National Preserve  “[i]n order to assure the preservation, conservation, and protection of the natural, scenic, hydrologic, floral and faunal, and recreational values of the Big Cypress Watershed … and to provide for the enhancement and public enjoyment thereof” as contemplated by Congress in the Preserve’s enabling act. At a minimum, it should pause decisions until after:

1. The Biden-Harris Administration completes a comprehensive review of the federal oil and gas program;
2. The Department of the Interior initiates an investigation to follow up on the claims made by its Office of Inspector General regarding the possible prior purchase of private mineral rights beneath Big Cypress;
3. The National Park Service fulfills outstanding FOIA requests regarding past and present oil exploration and development in Big Cypress;
4. The National Park Service engages in meaningful government-to-government Tribal consultation;
5. The National Park Service prepares a detailed Environmental Impact Statement (EIS) under the National Environmental Protection Act (NEPA) to analyze the impacts of oil drilling and to consider alternatives to drilling, such as purchasing private mineral rights; and
6. The National Park Service initiates formal consultation with the U.S. Fish and Wildlife Service on impacts from oil drilling on endangered species and their critical habitats, such as the Florida panther, Florida bonneted bat, and the Everglade snail kite.

Further, the Florida Department of Environmental Protection should not authorize additional wetland impacts or oil drilling in Big Cypress, particularly in light of the damage Burnett Oil Company caused during its first exploratory phase. After all, state and federal agencies are already spending billions of dollars to restore the Everglades and Big Cypress provides over 40 percent of water to Everglades National Park. So, is it wise to industrialize this region to accommodate more oil extraction?

The Florida Department of Agriculture and Consumer Services’ Secretary, Nikki Fried, who is a member of Florida Governor DeSantis’ cabinet, opposes oil drilling in Big Cypress. It is unclear why the Florida Department of Environmental Protection would permit new drilling in Big Cypress in light of Governor DeSantis’ prior efforts to protect other parts of the Everglades from oil development.

New oil development will jeopardize Floridians way of life and tourism dollars — adverse impacts could include truck traffic, pipelines and compressor stations, risks of leaks and spills and related surface and ground water contamination, air emissions and related impacts to human health and the climate, noise, lighting, compromised viewsheds, and impacts to cultural and natural resources and wildlife habitats.

We need state and federal agencies to help preserve what’s left of Florida’s paradise.

You can take action here.