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House Subcommittee to Vote on Domestic Crude Exports

The House Subcommittee on Energy and Power will vote Thursday on a bill that calls for lifting a ban on most domestically-produced crude oil exports, the prospect of which could be a boon to oil-heavy plays such as the Bakken and Eagle Ford shales.

The subcommittee has scheduled a markup of HR 702. The bill calls for repealing Section 103 of the Energy Policy and Conservation Act of 1975, which gives the president the authority to restrict oil and natural gas exports, as well as coal, petroleum products and petrochemical feedstocks.

The bill also calls for the secretary of the U.S. Department of Energy to conduct a study "on the appropriate size, composition and purpose of the Strategic Petroleum Reserve." The results would be presented to the House Energy and Commerce Committee, and the Senate Committee on Energy and Natural Resources.

In a joint statement, Reps. Fred Upton (R-MI) and Ed Whitfield (R-KY) called the abundance of oil and natural gas from the nation's shale plays "a game changer" and said the export ban is "obsolete." Upton serves as chairman of the full House Energy and Commerce Committee, while Whitfield chairs the Energy and Power subcommittee.

"We've flipped the script on energy," Upton and Whitfield said Tuesday, adding that lifting the ban "would boost domestic energy production, create jobs, and improve our energy security...We have taken a thoughtful approach to reconsidering oil exports, and the time to lift the ban is now."

HR 702 was introduced by Rep. Joe Barton (R-TX) last February and currently has 113 cosponsors. The subcommittee held a hearing on the measure July 9.

Last July, the Senate Energy and Natural Resources Committee passed a rival bill that also calls for lifting the ban on domestically-produced crude (see Daily GPIJuly 31). The bill, officially known as the Offshore Production and Energizing National Security (OPENS), would allow the export of any domestically-produced crude oil or condensate to countries not subject to U.S. trade sanctions. Exports would not be allowed for crude oil stored in the Strategic Petroleum Reserve.

Lifting the ban has been a long-term goal of Sen. Lisa Murkowski (R-AK), who chairs the Senate Energy and Natural Resources Committee.

Last week, analysts with the U.S. Energy Information Administration concluded that removing restrictions on U.S. crude oil exports would not cause domestic prices for petroleum products to skyrocket (see Shale DailySept. 2).

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