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Senate Dems' Energy Bill Ducks Issue of Offshore Access

The oil and natural gas title unveiled by Democrats on the Senate Energy and Natural Resources Committee last Thursday ignores the controversial issue of increasing access to offshore resources, said a major producer group.

"This bill does little to provide new access to bring on additional supplies of domestic oil and natural gas, despite the clear desire of the American people for additional development," said Jack Gerard, president of the American Petroleum Institute. "We hope this bill is amended to allow greater development of our domestic oil and gas resources."

The oil and gas title is part of a broader energy bill, the American Clean Energy Leadership Act of 2009, which the committee said it will consider reporting out Tuesday to the Senate floor. But "we may have so many amendments that we may not be able to do it tomorrow [Tuesday]," said Bill Wicker, a spokesman for Sen. Jeff Bingaman (D-NM), chairman of the Senate energy panel. If that turns out to be the case, the committee will meet Thursday to complete the bill, he said.

Wicker anticipates a vigorous debate on the oil and gas title Tuesday. "I would expect there would be a healthy number of amendments that will be filed. But not all of them will be brought up" during mark-up, he said. Republicans on the committee are expected to offer amendments to expand offshore access.

The oil and gas portion of the Democrat-sponsored energy bill would authorize $100 million for each fiscal year from 2010 through 2015, and $50 million for each fiscal year from 2016 through 2020 for the Interior Department to carry out an inventory and analysis of the Outer Continental Shelf (OCS) planning areas estimated to have the greatest potential for energy development in barrel of oil equivalent.

The inventory also would include OCS areas that are outside of any leased area or area scheduled for leasing prior to 2011 under the OCS five-year leasing program, according to the proposed bill. Two years after enactment of the legislation, Interior would be required to submit to Congress a report on the results of the first phase of the inventory and analysis. The results of the second and third phases would be reported two years later.

The legislation further would earmark an additional $20 million for each fiscal year from 2016 through 2020 for the coordination and processing of oil and gas permits, as well as for oil and gas inspection and enforcement on onshore federal lands.

In addition, the measure would require the director of Interior's Minerals Management Service (MMS) to be appointed by the president and confirmed by the Senate. The MMS director currently is appointed by the Interior secretary.

The legislation also would allocate $2 million each fiscal year from 2009 through 2019 for the Interior secretary to establish a regional joint OCS lease and permit processing office for the Alaska OCS region. The new office would be staffed by regulatory experts from the Department of Commerce, U.S. Army Corps of Engineers, Environmental Protection Agency and other federal agencies that have a role in permitting activities.

And the bill would increase the amount of the federal loan guarantees for the Alaska natural gas pipeline to $30 million from $18 million. It also would give the Interior secretary the authority to issue right-of-way permits for a high-pressure natural gas transmission pipeline in nonwilderness areas within the boundary of Alaska's Denali National Park within, along or near the approximately seven-mile segment of the George Parks Highway that runs though the park.

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