Prompted by continuing public concern, Gov. John Engler has instituted an indefinite moratorium on
leasing Great Lakes bottomlands for oil and gas drilling. The decision, which came in mid-April, gives the
Department of Natural Resources time to review its leasing policies and brings to a temporary halt any new
energy development along the coasts of Lake Michigan and Lake Huron.

The DNR and the Department of Environmental Quality came under widespread public criticism last year
for granting offshore leases and permits for directional drilling to tap oil and gas beneath Lake Michigan and
Lake Huron. One well in Manistee County, drilled by Newstar Energy USA, a Canadian Company, turned out
to be dry. Another well, installed in Bay County by J.A.F. Properties, was productive.

In all, since May of 1979 13 oil and gas wells have been directionally drilled from Michigan's shoreline,
10 under Lake Michigan and three under Lake Huron. Seven wells have been productive.

How Many Wells Could Be Installed?
More than 200 citizens attended two public meetings in Manistee and Muskegon this summer to learn
more about the proposals from representatives of state agencies, the industry, and conservation groups. The
meetings were sponsored by the Institute, the Lake Michigan Federation, and the Michigan Environmental
Council.

William Boss, vice president of Newstar Energy USA, said his company complies with all state environmental
regulations and that concerns about potential dangers are overstated. "The thought that there are going
to be rigs showing up and whipping wells off along the Lake Michigan coast is a myth," he told citizens in
Manistee.

Harold Fitch, chief of the DEQ's Geological Survey Division concurred, adding that he did not expect
more than "20 or 30" wells along the Lake Michigan coast.

However Hans Voss, managing director of the Institute, noted that in the late 1960s Michigan leased more
than 1 million acres of public lands for developing oil and gas wells in the deep Niagaran geological
formation. State officials at the time said they expected few wells. By the mid-1980s, thousands had been
drilled in northern Michigan.

In the late 1980s state officials made similarly inaccurate judgments when they predicted the Antrim Shale
natural gas development in northern Michigan would produce a "modest" number of wells. In fact, more than
6,000 Antrim wells have been drilled to date in 10 counties. Mr. Voss said that based on the state's previous
predictions there is justification forconcern.

Don Inman, former deputy director of the Department of Natural Resources, called on industry executives
to participate immediately with state officials and citizens in a comprehensive planning effort to protect the
Great Lakes coast. Industry executives said after the meeting they did not intend to respond to the request.
"The industry tells you they are good neighbors," Mr. Inman said. "But they don't want to roll up their
sleeves and come to the table and work on this."

Plan for Drilling, or Ban the Practice?
Just such a comprehensive plan was recommended late last year by the Michigan Environmental Science
Board. The panel of scientists suggested inviting local governments and citizens to work with state officials
and the industry to draw up a plan that provides assurances to energy companies and simultaneously protects
communities and the environment. Unplanned and intensive energy development could bring hundreds of new
wells, miles of roads and pipelines, noisy processing stations, and other industrial plants to the coast, causing
disruption in communities and damage to the coastline.

The Engler Administration, however, did not act on the Science Board's finding.

Meanwhile public opinion polls show that the majority of state residents do not support drilling beneath the
Great Lakes. U.S. Rep. Bart Stupak (D-Menominee) and 15 co-sponsors from six Great Lakes states have
introduced a bill in Congress to ban the practice.

Let Rep. Stupak know what you think. Contact him at 1410 Longworth House, Office Building 20515, Washington,
D.C., 20515. Tel. 800-950-7371 or 202-225-4735.

CONTACTS: Don Inman, Michigan Resource Stewards, 517-366-6019; David Ladd, environmental advisor to the
Governor, 517-335-7824; Hans Voss at the Institute, 616-882-4723.