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House Bill Would Force Administration to Move on Oil/NatGas Lease Sales

The U.S. House of Representatives on Thursday approved a bill that its sponsor, Rep. Doc Hastings (D-WA), said would increase domestic oil and natural gas production by requiring the Obama administration to move on offshore lease sales, including off the coast of Virginia, and in areas of the National Petroleum Reserve in Alaska (NPR-A).

HR 4899 would also create an undersecretary of Energy, Land and Minerals within the Department of Interior to oversee energy projects.

The vote was 229-185, with 219 Republicans and 10 Democrats voting for the bill's passage, and 179 Democrats and six Republicans voting against. The bill now moves to the Senate for consideration.

While HR 4899 would result in more oil and natural gas exploration, it was prompted by the recent crisis in Iraq and the resulting spike in gasoline prices, said Hastings, who is chairman of the House Committee on Natural Resources.

"Right now, American families and small businesses are feeling the squeeze of high gasoline prices, which are a drain to our entire economy. Since President Obama took office, gasoline prices have doubled and our federal energy resources have been put under tight lock-and-key. The passage of this bipartisan common sense plan is a bold step forward to unlocking America's energy resources that will create over one million new American jobs, strengthen national security, improve our economy, and help ease the pain at the pump for every American," Hastings said.

The "Lowering Gasoline Prices to Fuel an America That Works Act" would require the administration "to move forward with new offshore energy production in areas containing the most oil and natural gas resources and require the administration to hold specific offshore lease sales, including off the coast of Virginia, that were delayed or canceled," and would increase onshore federal energy production by reforming and streamlining the leasing and permitting process, encouraging the development of U.S. oil shale resources," and expanding production in the NPR-A, Hastings said.

By requiring the secretary of Interior to conduct oil and natural gas lease sales that have been delayed or cancelled by the Obama administration and implementing "a fair, equitable revenue sharing program for all coastal states," the bill would generate more than $1 billion in new revenue over ten years and could create up to 1.2 million jobs, Hastings said.

The legislation comes more than four years after Obama proposed opening the South Atlantic and Mid-Atlantic coasts and parts of the eastern Gulf of Mexico to exploration and development activities (see Daily GPI, April 1, 2010). Earlier this year, the Bureau of Ocean Energy Management, which had been tasked with preparing a programmatic environmental impact statement, issued a final review of mitigation measures to protect marine life before seismic and other types of surveys are performed in the region (see Daily GPI, Feb. 27).

Last year a group of Republican governors asked for more state authority to decide the level of activity on the Outer Continental Shelf (see Daily GPI, May 9, 2013). The coalition, formed in 2011, includes the governors of Alabama, Alaska, Louisiana, Mississippi, North Carolina, South Carolina, Texas and Virginia to promote a dialogue with the federal government on responsible development of offshore energy resources.

The Interior Department last year finalized plans to lease to natural gas and oil operators nearly 12 million acres -- more than half -- of the NPR-A, which would allow, among other things, pipelines to be built to transport offshore Chukchi and Beaufort seas production (see Daily GPI, Feb. 25, 2013). Hastings said his bill would expand production in the reserve, which covers 23 million acres and holds a U.S. Geological Survey-estimated 2.7 billion bbl of oil and 114.36 Tcf of natural gas.

Rep. Peter DeFazio (D-OR), the ranking Democrat on the House Natural Resources Committee, said Hastings bill would mandate drilling in offshore areas and public lands, and was an attempt by Hastings and other House Republicans to revive legislation that previously failed to win support in the Senate. And he predicted the latest iteration would also fail in the Senate.

"The legislation passed today is the same, stale proposal they passed last year, and the year before that, and the year before that," DeFazio said. "Just like those previous years, they make the false promise that it would immediately drop prices at the pump. In reality, this bill will give oil companies the ability to put drilling rigs up and down the Atlantic and Pacific coasts. It will destroy environmental protections throughout the West, threatening our hunting and fishing grounds, our wilderness and our parks. It will make it nearly impossible for communities to fight back against drilling where they don't want it. It will line the pockets of Big Oil fat cats so they can buy another yacht, or private jet, or influence Congressional elections. The one thing this bill won't do -- lower gas prices."

It was the third energy-related bill passed by the House in as many days. On Wednesday, lawmakers passed legislation to streamline the approval of applications to export liquefied natural gas to World Trade Organization countries (see Daily GPI, June 25a). On Tuesday, the House passed a bill streamlining the approval process for oil and natural gas pipelines, and other energy infrastructure, that cross the borders with Canada and Mexico, and removing a requirement that the Department of Energy approve oil and gas imports/exports to those countries (see Daily GPI, June 25b).

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