The GOP-controlled House last week easily passed two energy bills calling for an end to the de facto moratorium on shallow water and deepwater drilling in the Gulf of Mexico (GOM) and lifting President Obama’s ban on new offshore drilling. But the legislation faces an uncertain future in the Senate, which is controlled by Democrats.

Meanwhile producers scored a victory last Tuesday when the U.S. District Court of Eastern Louisiana ordered the federal government to act on six remaining pending permit applications to drill in the deepwater GOM within 30 days, and to file a status report on each permit application during that time period.

On Wednesday, 28 Democrats joined all 235 Republicans in passing the Putting the Gulf Back to Work Act (HR 1229), which passed by a 263-163 vote. The measure requires Interior Secretary Ken Salazar to act on a permit to drill offshore within 30 days of receiving an application, as well as 30 days to restart permits that were approved before May 27, 2010.

The House passed HR 1231 the next day by a 243-179 vote. That bill, also known as the Reversing President Obama’s Moratorium Act, would require the Department of Interior to include areas with the most known oil and gas reserves in its five-year offshore leasing plans.

Both bills weathered last-minute attempts by Democrats to attach amendments. Rep. Gerry Connolly (D-VA) wanted to add to HR 1229 a provision prohibiting Salazar from issuing a permit to any applicant with unpaid penalties or monetary damages from drilling activities on the Outer Continental Shelf. Meanwhile Rep. Rush Holt (D-NJ) wanted a requirement that offshore oil and gas leases be sold only in the U.S. tacked onto HR 1231, as well as require Salazar to reduce the number of nonproducing leases by 50% by 2017.

HR 1231 also directs Interior to set a production goal of 3 million b/d of oil for its five-year leasing plan for 2012-2017. Interior would be required to hold lease sales offshore Southern California, in Alaska’s Bristol Bay, as well as in parts of the Arctic Ocean and in the Atlantic Ocean from Maine to North Carolina.

Earlier this month the House passed HR 1230, the Restarting American Offshore Leasing Act Now, by a 266-149 vote (see NGI, May 9). All three bills are part of a legislative package introduced in late March by U.S. Rep. Doc Hastings (R-WA), who serves as chairman of the House Natural Resources Committee (see NGI, April 4).

The bills are considered unlikely to pass the Senate. That chamber heard testimony on Thursday from executives for ExxonMobil Corp., BP America, Chevron Corp., Shell Oil Co. and ConocoPhillips, who argued that stripping them of tax breaks would do nothing to bring down high oil prices (see related story).

In the courts, District Judge Martin Feldman directed the Interior Department’s Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM) to either approve or reject six permit applications filed by companies that have contracted with Broussard, LA-based Ensco Offshore Co., a provider of offshore drilling services, within 30 days.

In February, Feldman granted a preliminary injunction ordering BOEM to act within 30 days on another five pending permit applications to drill wells in the deepwater GOM. The decision granted the petition of Ensco Offshore and others regarding five permit applications in which Ensco holds a contractual stake (see NGI, Feb. 21).

However the U.S. Circuit Court of Appeals for the Fifth Circuit in March issued a stay that blocked Feldman’s ruling ordering the government to take action on pending permit applications by Ensco Offshore and ATP Oil & Gas Corp.

“In several cases in the permit applications here, the agency did hold onto the application for more than [the allotted] 30 days before returning it to the applicant for modifications. At some point this must end — with a permit, or without,” Feldman said in last Tuesday’s order.

“Although the government has begun to issue some permit applications, plainly because of this lawsuit, the future of drilling in the Gulf of Mexico remain elusive; plaintiffs’ [Ensco Offshore, et al] other long-standing permit applications speak loudly to this,” he wrote.

“The government has presented no credible assurances that the permitting process will return to one marked by predictability and certainty. Processing a scant few applications is at best a tactical ploy in a real world setting.”

©Copyright 2011Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.