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House Gives Thumb's Up to Offshore Drilling After Obama Climate Push

WASHINGTON – The House is moving ahead with plans to make it easier to drill for oil and gas off the nation’s shores despite opposition from environmental groups and the specter of a pair of potential presidential vetoes.

The chamber passed two bills in recent days in an effort to remove barriers to offshore drilling. The Offshore Energy and Jobs Act, which passed 235-186, requires the Obama administration to implement a five-year plan to award leases in regions off the Atlantic and Pacific coasts that contain the largest amount of oil and natural gas resources.

Meanwhile the Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act, approved in a 256-171 vote, authorizes Interior Secretary Sally Jewell to implement the terms of an agreement between the U.S. and Mexico that arranges for the exploration, development and production of oil and natural gas in the offshore border area shared by the two nations.

Neither bill is expected to pass muster in the Democrat-controlled Senate, where they may not even come up for a vote. President Obama has already indicated he would veto the lease expansion proposal. And while he supports the agreement entered into with Mexico in 2012, he is wary of a section that waives a provision in the Dodd-Frank financial reform law requiring corporations to disclose payments made to foreign governments.

Both bills drew some bipartisan support. Twenty-eight Democrats joined most Republicans to approve the U.S.-Mexico agreement while 16 crossed over on the offshore leasing proposal.

Rep. Doc Hastings (R-Wash.), chairman of the House Committee on Natural Resources and the prime sponsor of the offshore leasing measure, said steps were necessary because “government barriers” are blocking access to vital energy resources. Development in the Atlantic and Pacific could create as many as one million new jobs, lower energy prices and generate revenues of $1.5 billion.

“Safe and responsible development of America’s energy resources is vital to American energy security,” Hastings said.

In 2011 the Obama administration announced a plan to close most of the outer continental shelf from new energy production through 2017. The administration’s five-year plan prohibited new offshore drilling and allowed lease sales to occur only in areas that were already open. The plan included lease sales in the Gulf of Mexico and the Arctic but excluded portions of Alaska and the entire Atlantic and Pacific coasts.

The president’s actions came primarily in response to the Deepwater Horizon oil spill in the Gulf of Mexico in April 2010, the largest marine oil spill in the petroleum industry’s history, with total discharge reaching 4.9 million barrels.

Hastings said Obama had an opportunity upon taking office in 2008 to expand the nation’s offshore oil and natural gas production

“Instead, he said no to new American jobs and no to new American energy by canceling lease sales, placing more offshore areas off-limits and effectively re-imposing an offshore drilling moratorium,” Hastings said. “It’s no surprise that offshore energy production has declined since President Obama took office.”

Rep. Rush Holt (D-N.J.) accused Republicans of rushing forward with ill-conceived legislation to open up beaches and coastlines on the Atlantic and Pacific coasts to unsafe drilling.

The bill, Holt said, would permit “big oil to put drilling rigs off the Atlantic, Pacific and Alaskan coasts without enacting key drilling safety reforms that we know should be there following the BP Deepwater Horizon disaster. This is bad policy through a bad process, all so this bill can enjoy the same fate that so many irresponsible drilling bills that the majority has rammed through have experienced.”

“Oil and gas doesn’t need more acreage to drill on,” Holt said. “They need to drill on the leases they currently hold.”

Rep. Alan Lowenthal (D-Calif.) characterized the drilling bill as “a mess of ‘drill-baby-drill’ slogan-over-substance dead ends.”

“Americans have a right to weigh in on government actions in their backyard,” Lowenthal said. “This bill eliminates that opportunity by mandating lease sales and gagging the National Environmental Policy Act. Americans should all be able to share in the value of their public lands. This bill, however, takes the sale of a public asset and sends much of the revenue to only a few states, instead of either paying down the deficit or spending it on programs of national benefit to all Americans.”

But Rep. Markwayne Mullin (R-Okla.) predicted the measure “will lower energy prices through the increased production of offshore resources.”

“This is not only a jobs bill but a path to energy independence and relief to the American consumer’s pocketbook — a concept this administration claims they support, but fails to follow through with,” he said.

On the U.S.-Mexico legislation, Hastings noted that then-Secretary of State Hillary Clinton and Mexican Foreign Secretary Patricia Espinosa signed the agreement in February 2012 but the Committee on Natural Resources didn’t receive the implementing legislation from the White House until March 19.

“Despite the Obama administration sitting on this agreement for over a year, that should not in any way downplay the importance of getting this agreement approved,” Hastings said. “This agreement is good for our economy and it’s good for our American workers. Opening new acreage for energy exploration and development creates jobs, it creates more American-made energy and it helps reduce our dependence on foreign countries for our energy needs.”

The Bureau of Ocean Energy Management and the State Department estimate the agreement will open nearly 1.5 million acres in the Gulf of Mexico. These areas are estimated to contain as much as 172 million barrels of oil and 304 billion cubic feet of natural gas.

Democrats generally expressed support for the agreement and indicated the bill likely would pass were it not for the dispute over the Dodd-Frank language. Hastings and the Republicans said it was necessary to waive the provision disclosing payments made to foreign governments because Mexico hasn’t determined decided how it will collect its royalties from energy development.

Rep. Peter DeFazio (D-Ore.) said deleting the Dodd-Frank language would “allow big oil companies to make secret deals with the Government of Mexico.”