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House Bill Would Force Quick Action on EPA Exploratory Permits

The House Wednesday by a wide margin passed legislation that would force the Environmental Protection Agency (EPA) to act on exploratory air permits within a six-month time frame and would limit the ability of opponents to use the EPA's Environmental Appeals Board to invalidate the permits for offshore exploration, both in offshore Alaska and in the Gulf of Mexico.

The Republican-crafted House measure (HR 2021) was voted out by 253 to 166, with 23 Democrats crossing the aisle to join the Republicans in support of the bill. The House Democratic support could bode well for the bill in the Senate.

The U.S. Chamber of Commerce applauded the House action. "Requiring the EPA to make a final decision within six months of receiving an application for oil and natural gas exploration, this bill would provide companies a predictable approval time line, rather than a costly stream of seemingly arbitrary delays," said R. Bruce Josten, executive vice president of government affairs.

The issue now turns to the Senate, where Sen. Lisa Murkowski (R-AK) introduced similar legislation last week aimed at preventing offshore Alaska oil and gas projects from being held up or killed in the EPA internal appeals process. It also would require the EPA to grant or deny a permit within six months of the filing of a completed application.

The Murkowski bill has been referred to the Senate Environmental and Public Works Committee, but it may have to wait before it gets a hearing since the panel is chaired by drilling foe Sen. Barbara Boxer (D-CA), said one Capitol Hill observer. The Senate bill is sponsored by 11 Republicans and two Democrats: Sens. Mark Begich of Alaska and Mary Landrieu of Louisiana.

"Lisa Murkowski and Mark Begich are searching for 60 votes" to block a Democratic filibuster on the floor. "The pair have a local interest in the matter, as the bill's backers repeatedly cited a five-year delay in getting EPA air permits for exploratory wells Shell wants to drill in the Beaufort and Chukchi seas off Alaska. The EPA multiple times has approved permits to drill the wells, but they have been hung up in the agency's Environmental Appeals Board," Politico said.

The White House has urged a "no" vote on the legislation, saying that the legislation would handcuff the EPA's ability to protect human health and that the limit on permit appeals could lead to more lawsuits.

Besides limiting the time for environmental reviews, the House bill also would require opponents of permits to file objections in a federal court, as opposed to a less formal appeals board that is currently available to them.

Royal Dutch Shell plc, the leading acreage holder offshore Alaska, has been working for several years to secure federal and various state approvals to drill three exploratory wells in Arctic seas. The company shelved drilling plans for this year after objections to its air quality permits were filed with the EPA appeals board (see Daily GPI, Jan. 5).

It had received the permits from the EPA to construct and operate the 514-foot Frontier Discoverer drillship and its air emission units and to conduct other air pollutant emitting activities for the purpose of exploration in the Chukchi and Beaufort seas off the North Slope of Alaska.

Shell recently filed new and expanded exploration plans with the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM), which include drilling up to four wells over two years in the Beaufort Sea and up to six wells over two years in the Chukchi Sea (see Daily GPI, May 6).

In Alaska, it is estimated that 27.9 billion bbl of oil and 122 Tcf of gas could be developed offshore, according to National Ocean Industries Association President Randall Luthi.

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