In a partisan House Resources Committee hearing on President Bush’s proposed National Energy Policy last Wednesday, Republican House members played up the energy crisis and called for more exploration and production, Democrats called for more conservation and research, and Interior Secretary Gale Norton attempted to stay above the fray, offering insights into the proposed North Slope pipeline and controversial Eastern Gulf Lease Sale 181, among other things.
Norton affirmed that the Interior, Energy and State departments have been directed by President Bush to be ready to work with Canada, the State of Alaska and other “interested parties” to expedite the permitting process to construct a pipeline to deliver natural gas to the Lower 48 “once an application is filed.” Interior also would participate in interagency efforts to “improve pipeline safety and expedite permitting in an environmentally sound manner.”
Norton also answered a rumor that some of the tracts in the proposed Minerals Management Service’s Lease Sale 181 in the Eastern Gulf of Mexico scheduled this December could be eliminated — a move advocated by Florida Gov. Jeb Bush and up to now opposed by the president. The proposed leases provide a 15-mile buffer zone off Baldwin County, AL, but most are more than 100 miles from Florida — a region where drilling is opposed by Gov. Bush. The proposed sale, which is in the public comment stage now, would be the first in the eastern Gulf since 1988.
The Interior Department is completing an environmental impact statement on the proposal, which is expected to be released in July. However, Norton hinted that some of the proposed leases could be dropped from the final sale, but she did not say which ones could be on the short list.
“In any review, mitigation measures are always a consideration,” Norton said. She added, “none of those things have been foreclosed.” In statements that appeased some of the members of the committee, Norton said that Interior would not attempt to lease any regions now covered under moratoriums, but in her pitch for the proposed National Energy Policy, she reminded members that the department should still “consider where the resources are.”
Norton, who said the “need for a national energy policy becomes clear when you look at the numbers,” told the full committee that “a large portion of the United States’ energy reserves are contained in the lands and offshore areas managed by federal agencies…Estimates suggest that these lands contain approximately 68% of all undiscovered U.S. oil reserves and 74% of undiscovered natural gas resources.”
Saying that “more than half of the domestic recommendations” in the policy report are “targeted to conservation, environmental protection, renewable and alternative energy,” Norton called on Congress to streamline several regulations to expedite energy development. “This may be especially applicable when projects, such as transmission lines and pipelines, cross jurisdictional boundaries and require approvals from more than one federal agency, state or tribe.”
Norton said that the “nation’s energy infrastructure has not kept up with the changing requirements of our energy system. The demand for additional energy and electricity is expected to increase the need for rights-of-way across federal lands. To help with this process, we have identified a number of opportunities to expedite the processing of energy rights-of-way applications by streamlining the application process.”
Among other things, Norton called for improvements to the National Environmental Policy Act, expedited permitting and improving the Endangered Species Act consultation process.
Although not yet completed, Interior also is reviewing policies to encourage and allow more exploration of federal onshore lands, the Outer Continental Shelf, the Alaskan National Petroleum Reserve and the story getting most of the news play, the Arctic National Wildlife Refuge.
Of exploration in the OCS, Norton said the Interior and Commerce departments now are re-examining the current federal policies surrounding energy-related activities in the coastal zone and will then determine if changes are needed, including new incentives to encourage energy development projects.
“The Deep Water Royalty Relief Act of 1995…contributed much to the increase in deepwater leasing in the central and western Gulf of Mexico over the last five years,” Norton said. “Similar incentives could help spur development in other technological frontiers, such as deep natural gas, or make possible continued production from both offshore and onshore fields near the end of their economic life. The President has directed us to continue to explore opportunities for royalty reductions, consistent with a fair return to the public, in areas where production might not otherwise occur.”
She said opening up ANWR is a “prime example of the department’s dual commitment to energy development and environmental conservation,” and said “if this exploration discovers as much oil and gas as we hope, we will proceed cautiously with development and production.”
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