[ASSURAS] Cuba -- poised to drill for oil just 60 miles off the Florida Keys. Can it be done safely?

[MANUEL MARRERO FAZ] We understand perfectly our responsibility to have clean and safe the Gulf of Mexico.

[ASSURAS] "energyNOW!" meets with Cuban officials to get answers.

[PRESIDENT OBAMA] Without a doubt, one of the biggest burdens over the last few months has been the price of gasoline.

[ASSURAS] President Obama clears the way for more offshore drilling, from the Gulf of Mexico to Alaska. Will it bring prosperity to the North Slope?

[EDWARD ITTA] The oil industry is not our enemy.

[ASSURAS] Or ruin?

[EUGENE BROWER] There goes our way of life.

[ASSURAS] A look at what drilling could mean to a centuries-old lifestyle.

And a look into the future -- a future with more carbon.

[SUITERS] Seems like there's an equal chance we could have more carbon in the atmosphere or less carbon in the atmosphere by the end of the century, right?

[PATRICK MEGONIGAL] Oh, no, we'll have more carbon in the atmosphere.

[ASSURAS] How a 5,000-year-old marsh is giving us a glimpse into our climate future. This is "energyNOW!"

Hello, everyone, I'm Thalia Assuras. Welcome to "energyNOW!", a weekly look at America's energy challenges and what we're doing about them.

Domestic oil production as part of a national effort to reduce our dependence on foreign crude is a decades' long challenge. Last year, U.S. oil production hit its highest level since 2003, but the massive spill in the Gulf of Mexico and the subsequent drilling moratorium resulted in a severe curtailment of the industry.

That's changing, though. In his weekly address last Saturday, President Obama announced steps to speed drilling for oil onshore and off, though, as he put it, only if safe and responsible. Among the steps, the president directed the Interior Department to conduct annual lease sales in Alaska's national petroleum reserve and to accelerate assessments of oil and gas resources in the Atlantic. And the president said he would extend some drilling leases.

[OBAMA] We're also taking steps to give companies time to meet higher safety standards when it comes to exploration and drilling. That's why my administration is extending drilling leases in areas of the Gulf that were impacted by the temporary moratorium, as well as certain areas off the coast of Alaska.

[ASSURAS] The White House move does not mean more American oil rigs will begin sprouting offshore immediately. But the Gulf of Mexico will sport a new, active oil rig as early as this fall, not from the United States but from Cuba. A little over a week ago, I traveled to Trinidad, site of a drilling conference, to speak directly with Cuban government and oil industry delegates about their nation's plans. They confirmed that Cuba's state oil company, Cupet, in partnership with several foreign firms, will drill off the island's northern coast just 60 miles from Florida. As you might imagine, that prospect has ignited fears of environmental disasters that could rival the BP spill.

The Cuban oil reserves are presumed to be 5,000 feet undersea, at about the same depth at BP's ill-fated Macondo site. The U.S. Geological Survey estimates there are 5 billion barrels of oil. Cuba estimates up to 20 billion barrels. Whatever the number, the wells will sit 60 miles from the Florida Keys.

With Cuba poised to launch its deepwater drilling campaign in the Gulf of Mexico, concern is rising in the United States about potential spills. After all, Cuba and its partners, because of the embargo, can't place a 911 call to the U.S., home to the closest, fastest, and biggest response teams. That challenge is not lost from the Cuban perspective either.

[FIDEL ILIZÁSTIGUI PÉREZ, CUBAN RISK MANAGEMENT OFFICIAL] ...whereas the common Gulf is a common challenge.

[ASSURAS] Cuba appeared eager to address environmental fears over its deepwater drilling plans in a recent rare appearance at the drilling conference in Trinidad. Rare because it was an American-run conference.

[PÉREZ] We need to protect people and the environment from these accidents from happening.

[ASSURAS] The concerns trump the U.S. embargo prohibiting this kind of interaction. Concerns not just about safety itself, but also about who is building the rig and who, if not the U.S., will be drilling in those waters. Cuba and its multinational partners, including Spain, Norway, and Italy, have seven wells on the drawing board, at a cost of $100 million each. This 53,000-ton rig built in China and Singapore will do the drilling off the island's north shore. If there is a spill, the U.S. cannot respond.

[JORGE PIÑÓN, FLORIDA INTERNATIONAL UNIVERSITY] During the BP Horizon incident, you had about 156 airplanes, you had 5,600 vessels, you had over a million miles of boom that were used and you had about 40,000 responders. So just think of that magnitude incident happening in Cuban waters.

[ASSURAS] Cuba, however, claims it has the know-how. After all, according to Manuel Marrero Faz -- the nation's grandfather of oil, as he's known back home -- Cuba's onshore and near-shore industry has existed for 50 years.

[FAZ, CUBAN MINISTRY OF INDUSTRY] We understand perfectly our responsibility to have clean and safe the Gulf of Mexico.

[ASSURAS] The Cuban delegation was prohibited by its own government from speaking with "energyNOW!" But in a delicate dance more common in diplomatic circles, members agreed to a few of our questions about potential accidents, directed by IADC President Lee Hunt.

[FAZ] We are very, very sure that we will do everything well.

[ASSURAS] Still, that confidence was tempered by a veiled plea for U.S. cooperation.

[PÉREZ] The only way you have to build a new approach or a better approach to set a higher standard is sharing.

[ASSURAS] For the U.S. government, Cuba's pending oil production in the Gulf of Mexico is an issue of concern. In April, Reuters reported that Interior Secretary Ken Salazar said...

[TEXT ON SCREEN] "Obviously, it's located 60 miles of the coast of Florida... it's an issue that we're monitoring carefully." --Ken Salazar, Interior Secretary, Reuters 4/20/2011

[ASSURAS] Now, the Interior Department gave "energyNOW!" a "no comment" when we asked them about Cuba's Gulf oil drilling. And we'll have more on Cuba's quest for oil a little later in the show.

Meantime, thanks to President Obama's plan to increase oil and gas production in Alaska, Shell has resubmitted plans to start drilling there next year. And the EPA says it's close to okaying three offshore permits for the company.

Alaska's untapped resources lie in the Beaufort and Chukchi seas, areas which have been hunted and fished for thousands of years by the native Inupiat tribes.

"energyNOW!"'s Dan Goldstein traveled to the state's North Slope to find out whether offshore drilling can coexist with an ancient way of life, as we see in this "energyNOW!" Spotlight.

[MASUK LANE] This is fried whale steak, breaded whale steaks.

[GOLDSTEIN] Wow.

[LANE] And this is from a whale.

[GOLDSTEIN] In the village of Point Hope, Alaska, nearly everything on your plate comes from the garden -- the bounty of sea and land. Here, just making a family dinner from this garden is an effort for Masuk Lane.

[LANE] For the bigger things, we use the saw. This cuts the fish and the caribou.

[GOLDSTEIN] Each spring, the Inupiat community hunts whales in these frigid waters. Just one 50-ton bowhead whale can feed the entire town of 700 for a year. But the Inupiat fear their days of traditional hunting could be numbered. Point Hope lies on the coast of the Chukchi Sea. Under it...

[PETE SLAIBY, SHELL ALASKA] 25 to 27 billion barrels of oil. 120 trillion cubic feet of gas.

[GOLDSTEIN] Pete Slaiby heads Shell's drilling operations in Alaska. In 2008, Shell paid the federal government more than $2 billion for the right to drill off Point Hope.

[SLAIBY] Our wells here in Alaska are shallower, relatively simple to design. And we have track records of delivering these wells.

[GOLDSTEIN] Shell wanted to start drilling this summer, but opposition from environmental groups, concerns over air quality by the EPA, and the fallout from the Gulf disaster forced it to delay its plans. Now Shell wants to start up again in 2012. Slaiby says, despite the remoteness of the Arctic, drilling there will be much safer compared to the Gulf.

[SLAIBY] Will we see a spill like we've seen in Macondo? And I think the answer to that is no. We do not have that volume. We do not have that water depth.

[GOLDSTEIN] Masuk Lane isn't so sure.

[LANE] We're way out here. How are they going to bring the equipment? The second thing is, the ocean is aggressive.

[SLAIBY] One of the large assets, actually, will spend the winter in Alaska, the Nanuq -- a 300-foot ice-classed oil spill response vessel. The most modern in the world. They can work in ice, deploy a massive amount of recovery equipment.

[GOLDSTEIN] But it's not just a potential spill that has residents uneasy. Natives fear that Shell's initial seismic mapping of the oil fields, using air guns, will create enough noise to cause the whales the Inupiats depend on to veer away, making them harder to catch. Eugene Brower is a whaling captain.

[BROWER] It will deflect the migration route. Any noise in front of it will deflect the bowhead whale out from its migration route, so it comes out, it'll start deflecting 20, 25 miles away from the source. There goes our way of life.

[GOLDSTEIN] Shell says that won't happen.

[SLAIBY] We have altered our routes so we actually travel away from coastal areas to keep the pressure off seals, walrus -- coastal animals.

[GOLDSTEIN] Just a few hundred miles from the village of Point Hope is the town of Barrow. Now, the roads are still dirt here, but as you can see, there are a few differences.

[EDWARD ITTA] The oil industry is not our enemy.

[GOLDSTEIN] Edward Itta is the mayor of Barrow, the largest town on the North Slope. Here, only 20% of the residents depend on whaling for food. That's because Barrow sits surrounded by oil fields. There are restaurants, taxicabs, banks, and tourists eager to see life at the top of the world.

[ITTA] Our standard of living has improved dramatically, as well as the health, due to our ability to have the good fortune to be able to tax the oil industry.

[GOLDSTEIN] And the final decision over new offshore drilling is mainly in the hands of the federal government. The Obama administration backed oil drilling offshore, only to put new drilling permits on hold after the Gulf disaster. Now, with oil prices close to $100 a barrel and gas prices over $4.00 a gallon, the White House is leaning toward opening the Chukchi again. At a hearing this month, the EPA appeared ready to change its tune.

[GINA McCARTHY, EPA] And now I think we're very close to an understanding between us and Shell about where their opportunity is, how they can structure their permit and how we can deliver a solid permit.

[GOLDSTEIN] Back in Point Hope, Masuk Lane is working in the city office. First up -- fixing the run-down rec center for the 200-plus children in town. It's a challenge. The city's total budget is just $200,000. Fixing the rec center will cost thousands.

[LANE] Some do want development here. They want to have swimming pools and other recreational activities, which we don't have and cannot provide.

[GOLDSTEIN] Masuk Lane says she's torn. Oil revenue could pay for a rec center, but she worries about a spill destroying her community.

[LANE] That would lose everything else they even had. Right now, they're rich with the subsistence. The freezers are full with the subsistence foods. And may not have lots of money, but lots of love and food. And the choice they're being faced with is either to choose their garden or choose the money.

[GOLDSTEIN] On the North Slope of Alaska, Dan Goldstein, "energyNOW!"

[ASSURAS] If its permits come through in 2012, Shell says it will operate two giant rigs simultaneously to drill two wells in the Beaufort Sea and up to three wells in the Chukchi. So far, Shell has shelled out $3.5 billion just gearing up to drill.

When we come back, we're going to talk about everything we just heard. Our panel mixes it up over more drilling. Should we or shouldn't we?

And we'll tackle Cuba's venture into the Gulf of Mexico. Plus, the carbon crystal ball. What the past is telling us about our climate future.

[BREAK]

[ANNOUNCER] How can we reduce our dependence on oil?

[ZEPPS] Imagine if we could harness all this kinetic energy.

[ANNOUNCER] Who is shaping our energy future?

[SUITERS] China will produce more than half the solar panels in the entire world.

[RICHARD BRANSON] If you've got good quality batteries, you could store the wind when there's no wind, store the solar when there's no solar.

[ANNOUNCER] "energyNOW!" is the only TV news magazine exploring our challenges.

[SULLIVAN] Hybrid technology saved the military $250 million.

[WOMAN] It makes sense to make this shift now.

[ANNOUNCER] "energyNOW!" on ABC-7.

[END BREAK]

[ASSURAS] Welcome back to "energyNOW!" We just took a look at President Obama's plans to speed up both onshore and offshore oil and gas drilling in the Gulf of Mexico, Alaska, and possibly in the Atlantic. And we looked at Cuba's offshore drilling plans, just 60 miles off the coast of Florida.

Well, joining us in the MIX to debate drilling is Rayola Dougher, senior economic advisor of the industry lobby, the American Petroleum Institute. Anna Aurilio, director of the environmental advocacy group Environment America. And in Raleigh, North Carolina, Daniel Whittle, the Cuba program director at the Environmental Defense Fund. Thanks, all of you, for joining us, and I'm going to begin with you, Anna. What is your reaction to the president's plan?

[AURILIO] Well, we're very disappointed that the president is so focused on expanding offshore drilling and therefore risking our pristine coastlines, particularly the Atlantic Ocean, particularly the coast of Virginia where I actually like to go to the beach, that he's so focused on that instead of focusing on the things he's doing to get us off oil.

[ASSURAS] The oil industry, in general, Rayola, seems to be saying kind of the same thing -- not so happy, just baby steps. Not so happy?

[DOUGHER] It is baby steps. It's better than nothing, but we still have a long way to go when it comes to a national energy policy. Looking at our resources that we have here in the United States, we have great opportunities to develop our oil and natural gas. We think a lot more can be done. We could bring a million jobs to the market. We could bring $194 billion into the federal treasury, if we're allowed to go ahead with a lot of this development. So there are things we can do and we'd like to do and we'd like a policy that's supportive of domestic development, and supportive, too, of energy efficiency. A policy that works for all of us.

[ASSURAS] But on oil, you are saying "a lot more."

[DOUGHER] A lot more, absolutely. We have a lot of opportunities. We're not going for them. I don't think anybody's arguing about whether you do it safely and responsibly -- that's not an option. It has to be done safely.

[ASSURAS] But are we safer?

[DOUGHER] We are safer. We are.

[ASSURAS] How can you say that? We haven't had, God forbid, another accident to put things in place.

[DOUGHER] Well, a lot has been done in this past year in terms of addressing issues from that spill a year ago. We now have an Offshore Safety Center that we're developing. We have containment systems in place. We have a lot of things. We've beefed up the offshore safety procedures. We've formed task forces to address each and every aspect of that spill to see, are there any holes, is there anything else we can do? Much as you would do in any accident -- you go back over, figure out what went wrong, and move ahead.

[ASSURAS] Anna's kind of breathing deeply. You don't agree, I gather?

[AURILIO] We woke up a year ago to the thing that some of us have worked all of our lives to try to prevent, which is a catastrophic oil spill off the U.S. coastlines, and, unfortunately, I hear what Rayola's saying about wanting to do things more safely, but the reality is that the oil industry is up there in Congress lobbying to weaken even the safety standards that have been put in place since last year's BP oil spill. So, this is a dirty and dangerous industry.

[DOUGHER] I have to disagree with that. We are working hard, developing this Offshore Safety Center. As a matter of fact, the American Petroleum Institute, our charge since 1919 is developing recommended practices, best practices, and we share this. We have offices around the world. Our focus is safety, our focus is doing things right.

[AURILIO] Did you support the bill --

[DOUGHER] So that's what we're doing.

[AURILIO] -- that got rejected in the Senate, that rolls back the safety standards. Did you support that bill?

[ASSURAS] Obviously disagreement here. Let me bring Dan Whittle in. Dan you're an environmentalist. Your view on whether the industry is ready, and I have to say, I have toured a major containment system, fast-response system in Houston. Are you comfortable that they're ready, considering, too, what may happen with Cuba getting into the mix?

[WHITTLE] I don't think anyone knows if we're ready yet. I just spent a week, last week, in Trinidad with a roomful of oil-drilling contractors from around the world, and the point made is that oil drilling in deep waters of the Gulf and along the eastern seaboard is extremely challenging. It's complex and it's risky. So, I think, in the U.S., we need to take time to get it right. We need to carefully look at the commission's recommendations, which have not been voted on yet, and just get it right before we make the same mistakes that we made last summer.

[ASSURAS] Let me move further on, because you mentioned that conference in Trinidad, and that's where you and I met because I attended the conference as well, and it was a huge deal that Cuba was there, so let's bring that into focus. And Cuba is going to be drilling very, very close to Florida. So, in terms of safety, the Cubans said, and they said to me, that they are ready and prepared. Are you comfortable with their preparedness?

[WHITTLE] No one is taking this issue more seriously than the Cubans, I'm happy to report. I've been working in Cuba for a decade on environmental law and protection, primarily on marine and coastal ecosystems, coral reefs, fisheries. And where Cuba is getting ready to drill, there are extremely sensitive environments at stake, both in Cuba and in Florida and the southeast U.S. So I'm confident they're going about it the right way. They're trying to bring American scientists and oil industry experts into their efforts.

[ASSURAS] The embargo currently restricts the United States from getting involved, for example, should there be a spill, so give us a sense, though, and you brought this up, what might happen for the American coastline should there be a major Cuban spill.

[WHITTLE] Well, if there's a major Cuban spill, oil will go through the Florida Straits. It may or may not hit the Florida keys. It more likely will come up the east coast of Florida and as far as North Carolina before shooting off to the North Atlantic. The question is, how fast could Cuba contain and respond to the spill? Under the embargo, not very fast.

[ASSURAS] Okay, so, should American companies be allowed to respond?

[WHITTLE] Absolutely. That's one thing that the administration can do right away, is to provide a license to those companies with the know-how, the capacity, and the expertise to respond quickly.

[ASSURAS] Anna, let me ask you about that. Should American companies be involved? Or should the government be thinking of a way to stop Cuba from doing this, or to penalize foreign companies that work with the United States if they're going to work with Cuba and kind of stop it in the bud?

[AURILIO] Look, all the things that Dan laid out in terms of the threats to Florida's coastline are things we're concerned about whether you drill off Cuba's coast or Florida's coast, which is what the American Petroleum Institute wants to do. So we're very concerned that, while the oil industry says they want to do things safely, they're lobbying this week in the Senate to roll back the safety standards.

[DOUGHER] We are going to need oil and natural gas for decades to come. We have opportunities here in this nation and if we don't take advantage of them, others will. So we have an opportunity to supply our own supplies and to grow those supplies. We have an opportunity to bring the best technology in the world to this job. And we have a big job to do and we're ready to do it.

[AURILIO] We should have had the best technology last summer at BP, and we did not.

[ASSURAS] A debate, obviously, that is going to continue. I hope all of you come back. Thank you very much.

[DOUGHER] Thank you.

[ASSURAS] A final note for now on deepwater drilling. Nations around the globe have been developing techniques and designing equipment for decades. More than 40 years ago, Scotland unveiled the Mercury, a drilling vessel it called "revolutionary." Take a look in this energyTHEN from 1969.

[ANNOUNCER] Scotland -- moving into position for tests at Gairloch was the new rig, the Offshore Mercury, a vessel that will revolutionize deep-sea drilling, for the Mercury is the world's first self-propelled oceangoing drilling vessel, a rig that needs neither tugs nor anchors and can sail 7,000 miles without replenishment. When in action, the derricks are jacked down to the seabed by operating this interior control panel, leaving the hull poised in the air. In the search for gas, oil, and other minerals, the rig is a big step into the future.

[ASSURAS] Today there are 326 offshore oil and gas drilling rigs in the world. 33 of those belong to U.S. companies and 32 are in the Gulf of Mexico.

When we come back, a glimpse at our climate future in a 5,000-year-old marsh.

[MEGONIGAL] The carbon dioxide concentration of the atmosphere is what the whole marsh will be growing in at the end of this century.

[BREAK]

[GIRL] We're fighting for a day when we can all breathe easier. We're fighting to make every section a smoke-free section. For a day when even vehicles quit smoking. We're fighting for clear skies over every city and healthy lungs throughout the country. The American Lung Association isn't just fighting for air, we're fighting for all the things that make it worth breathing. Join us in the fight at FightingForAir.org.

[END BREAK]

[ASSURAS] Much of what we focus on here at "energyNOW!" touches on efforts to reduce the globe's carbon footprint. The question is, what might happen if it continues to grow instead?

Well, not far from us here in Washington, D.C., a team of Smithsonian scientists is gauging what life might be like by the end of the century if nothing changes. "energyNOW!"'s Chief Correspondent Tyler Suiters had an opportunity to look into our climate future right in our own backyard, in this energyNEXT.

[SUITERS] Just outside the nation's capital, in a little corner of the Chesapeake Bay, is our planet's future. Here, the year is 2100. And for the last two decades, this has been a second home to Gary Peresta.

[PERESTA] I have a piece of tape on the pipe so I know how far down to pound it.

[SUITERS] This home is part of the Smithsonian Environmental Research Center.

How do you stay out here doing this for 20 years?

[PERESTA] Oh, I love it. This is my office. There's not a better place to work.

[SUITERS] His work involves reading the environment's tea leaves, or salt marsh leaves, to be more precise. Leaves growing in dozens of pretty low-tech time machines. These translucent tents, they are the latest twist, in the longest-running carbon dioxide experiment in the entire world. They simulate what our climate might be like 90 years into the future.

[PATRICK MEGONIGAL, SMITHSONIAN BIOGEOCHEMIST] Inside this chamber, the atmosphere, the carbon dioxide concentration of the atmosphere, is what the whole marsh will be growing in at the end of the century.

[SUITERS] You've found the level, and you just keep pumping in CO2 to maintain that level.

[MEGONIGAL] That's right.

[SUITERS] The level of CO2 Pat Megonigal's referring to is just about double the carbon dioxide we have in the air right now. That's where the world's leading climate scientists expect us to be by the year 2100. By raising carbon dioxide levels that high, the Smithsonian team can then track how our Earth will respond to change, respond to what we, humans, are doing to our planet.

Isn't that something that we all learn in our first biology class, that carbon dioxide is good for plants -- of course you're going to grow more?

[MEGONIGAL] Well, yes and no. I mean, we know that plants need carbon dioxide, but it wasn't clear at first whether giving them more carbon dioxide would do anything. And, indeed, it does -- it acts like a nutrient. It acts like fertilizer.

[SUITERS] Yes, but "it" is also a pollutant. So let's be clear about this. Doubling our current CO2 levels will help certain plants grow -- poison ivy, for one, will apparently thrive -- but that could also bring higher temperatures and longer droughts, changes for the worse. Changes that are already under way.

[PERESTA] One thing that I like about this picture is, you can see the species shift that I was talking about. You can see this is all grass. And now you see the sedges are all moved in there.

[SUITERS] That shift Peresta is showing me happened over the last 18 years. But the very same picture, it's proof that not everything here changes as quickly as the artificial climate. Do you recognize the beard? If not, well, then, the University of Tennessee hat should be a dead giveaway.

Did that kid know what he was getting into?

[PERESTA] Oh, yeah, yeah. And this is, you know, the basic kind of stuff. We've got a measuring stick, you know.

[SUITERS] Predating Peresta and his old equipment, the research material itself. These soil samples, they date back to the early 18th century.

[MEGONIGAL] So this marsh has the ability to grow upward. And as it does, you can see that it's storing carbon.

[SUITERS] It's a carbon sink, essentially.

[MEGONIGAL] Yeah, it's a carbon sink. Everything that's brown in here was gas in the atmosphere that the plants took out, and when they died, it got buried.

[SUITERS] But our current carbon pollution -- the exhaust from our cars, the emissions from most of our electricity generation -- the Earth has never seen manmade carbon emissions like this. And we're polluting our planet with a lot more than just carbon emissions, so, even if more CO2 is good for plants...

[MEGONIGAL] Nitrogen pollution, which we're worried about in the Chesapeake Bay and other estuaries around the world, tends to have the opposite effect.

[SUITERS] So, it's almost a set of scales that are balancing each other?

[MEGONIGAL] Right. If we keep the estuaries clean, then the elevated CO2 may actually help the marsh build soil. If the estuaries become polluted with nitrogen, then that benefit from carbon dioxide is cut down in half or so.

[SUITERS] Seems like there's an equal chance we could have more carbon in the atmosphere or less carbon in the atmosphere by the end of the century, right?

[MEGONIGAL] Oh, no, we'll have more carbon in the atmosphere.

[SUITERS] That's a guarantee at this point.

[MEGONIGAL] Yeah, I'll put the house on that one.

[SUITERS] Of course, Megonigal and Peresta won't be around to collect on that debt, but their hope, the reason for their research, it's that we'll all be a bit better prepared for the climate path that lies ahead.

It's a beautiful office.

[PERESTA] Yeah, and usually, it's just me. I like that.

[SUITERS] In Edgewater, Maryland, Tyler Suiters, "energyNOW!"

[ASSURAS] And that's it for this week's "energyNOW!" Want more? You can find us online at energynow.com and on YouTube and Facebook, as well as Twitter, at energyNOWnews. I'm Thalia Assuras. I'll see you next week.

[END SHOW]