Senate Majority Leader Harry Reid (D-NV) has pulled the plug on plans to consider the competing Democratic and Republican energy/oil spill bills before Congress leaves for the August recess, pushing action to September.

"Neither bill is going to win the 60 votes that's needed to move forward," said Martin Edwards, legislative vice president for the Interstate Natural Gas Association of America. "So it's a pointless exercise at this point" to hold a cloture vote.

Although Reid has formally punted the dueling bills until after the month-long recess, Edwards questioned whether the Senate will act then. "They may not do anything in September," he said, adding that the Senate has a lot on its plate when it returns then -- spending bills, tax measures and funding for the wars in Iraq and Afghanistan.

"It's a sad day when you can't find a handful of Republicans to support a bill … that would hold BP accountable for the worst oil spill in history,” Reid told reporters, according to Politico. "We tried jujitsu, we tried yoga, we tried everything we could to get Republicans to come along," he noted.

"You can't blame Republicans [for blocking his proposal] when you refuse to even have a vote," said Robert Dillon, a spokesman for Sen. Lisa Murkowski (R-AK).

"In the wake of the Gulf oil spill, the American people expected Congress to act to ensure proper oversight of offshore exploration. Instead, what they got from House and Senate leadership was legislation that essentially shut down America's oil and gas industry," said Karen Harbert, president of the U.S. Chamber of Commerce's Institute for 21st Century Energy.

"It is not surprising then that ultimately the Senate proposal collapsed and the bill was pulled from consideration, Coupled with the administration's blanket moratorium on oil and gas production, it is clear that America is not getting the leadership it needs on energy," she said.

Passing the slimmed-down energy bill at first seemed like a sure bet for Democrats before leaving for the recess. But the odds of gaining the 60 votes to ward off a Republican filibuster became bleaker over the past few days.

Republicans and even some Democrats from oil states -- Sens. Mary Landrieu of Louisiana and Mark Begich of Alaska -- are opposed to the Democrat oil spill bill (S. 3663), which would lift the existing $75 million cap on liability damages for oil spills and overhaul oversight of offshore regulation, require the disclosure of chemicals used in hydraulic fracturing and promote natural gas and plug-in electric drive vehicles, as well as provide $5 million in incentives for the Home Start energy efficiency program (see Daily GPI, July 23). The Chamber attacked many of these proposals in a letter to the Senate Tuesday.

Likewise Democrats have attacked the Republicans' version of the bill, which would increase the $75 million liability cap (but not totally remove it), lift the Obama administration's moratorium for producers who comply with the Interior Department's new safety standards, and would advance revenue sharing between the federal government and coastal states who permit drilling off their shores.

Most energy experts and Capitol Hill observers agreed that if a compromise on the Senate bills was not reached by midweek, the debate over energy legislation would have to wait until September (see Daily GPI, Aug. 3).

If a "broad compromise does not emerge by then [Wednesday], we expect the Senate bill to be set aside until after the...recess and the Senate to turn to the debate on Supreme Court nominee Elena Kagan," FBR Capital Markets analysts said.

The House passed its oil spill package (HR 3534) by 209-193 last Friday. The measure includes a provision to lift the existing $75 million cap to cover the liability for the BP oil spill and future spills.

It also would bar an operator with a checkered safety record from obtaining leases/permits from the federal government. And it would dismantle the "dysfunctional" Minerals Management Service; set minimum requirements for blowout preventers (BOP); require third-party safety certification of BOPs, well designs and cementing programs; stiffen penalties for violators; and establish a new training academy for offshore inspectors.

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