1. OFFSHORE DRILLING: Bush to rescind bans, raising pressure on Congress (Greenwire, 07/14/2008)

Ben Geman, Greenwire senior reporter

President Bush will lift bans on offshore oil and gas drilling today -- an effort that escalates Republican pressure for expanded coastal production but leaves intact congressional bans that Democratic leaders want to retain.

Bush called on Congress last month to lift offshore-drilling restrictions -- which lawmakers have renewed annually since the early 1980s -- and said he would follow by removing overlapping White House moratoria put in place by President George H.W. Bush.

But now Bush is moving ahead of lawmakers, shifting the fight to Congress as public support for coastal production has grown with gasoline prices. White House spokeswoman Dana Perino told reporters that Bush will sign a memorandum today lifting the restrictions.

Overlapping White House and congressional bans essentially cover both coasts and much of the eastern Gulf of Mexico.

Congress renews the bans through the annual appropriations process, but work on those bills has been slowed by House Democrats' reluctance to allow committee votes on amendments to widen drilling and other factors.

Bush used his weekly radio address Saturday to press Congress on the issue. "Time is running out before Congress leaves for its summer recess," he said. "For the sake of our economy and American consumers, Congress must move quickly to expand exploration of the OCS [outer continental shelf] so we can tap into these vast oil resources as soon as possible."

Word of today's planned 1:30 p.m. EDT Rose Garden announcement is already drawing industry support and attacks from Democrats and environmentalists who want to maintain the restrictions.

"This would be an extremely important step toward signaling that the U.S. is absolutely serious about improving energy supply from American sources," said Bill Whitsitt, a lobbyist who heads the American Exploration and Production Council, a group that represents large independent oil and gas companies.

Athan Manuel, a lobbyist for the Sierra Club, countered, "I think President Bush even knows drilling off our coasts will not reduce the price of gas or reduce our addiction to oil, so it is a cynical political ploy, and it is hard not to think this is a gift to oil industry on his way out the door."

Bush's step highlights the intensity of a fight that is dominating Capitol Hill, as both parties try to show they are taking steps to help consumers saddled with paying more than $4 for a gallon of gasoline.

"So we are going to move forward, and hopefully, that will spur action by the Congress. The ball is squarely in their court now, and I'm sure Americans will be watching to see what Congress will do," Perino told reporters.

Democratic opposition

While some Democrats favor easing offshore restrictions, efforts to remove drilling bans face heavy opposition within their caucus and especially among party leaders.

House Democratic leaders have been increasingly emphasizing that they, too, favor domestic production. But rather than open new areas, they are trying to put the onus on industry, saying companies are failing to develop resources on tens of millions of acres of federal lands already under lease.

The push for leasing in areas that are currently off-limits has become a concern for Democratic leaders who favor the bans, especially as some Democrats who support expanded offshore leasing are seeking a compromise with Republicans on a bill that would also include greater conservation.

This week, House Democrats plan to bring a bill up that would pressure companies to use existing leases and try to accelerate leasing in the National Petroleum Reserve in Alaska, where production is allowed but not yet occurring.

But the Democratic bill will be brought up under expedited rules that prevent a GOP amendment to lift offshore bans. It also requires a two-thirds vote for passage -- which its supporters are unlikely to achieve.

The issue has also become prominent in the presidential race, with the presumptive Republican nominee, Sen. John McCain of Arizona, favoring a relaxation of the drilling bans, while the Democrats' choice, Sen. Barack Obama of Illinois, favors the protections.

Obama's campaign attacked Bush's action. "If offshore drilling would provide short-term relief at the pump or a long-term strategy for energy independence, it would be worthy of our consideration, regardless of the risks. But most experts, even within the Bush Administration, concede it would do neither," said spokesman Bill Burton.

Bush supports giving states discretion to decide whether drilling will occur in federal waters off their shores -- and to get a piece of the revenues if they support development. Several congressional proposals in recent years have contained this idea.

The president also removed a small portion of the executive ban last year when he opened up waters near Alaska's Bristol Bay, an area not covered by the annual congressional restrictions (E&ENews PM, Jan. 9, 2007).

Hurdles

The Interior Department's Minerals Management Service estimates that areas under current moratoria may contain almost 18 billion barrels, but these are broad-based projections, and many regions have not been explored in decades, if ever, especially outside the Gulf of Mexico.

While the push for more domestic production has picked up steam as oil and gasoline prices have risen, the hurdles on Capitol Hill for supporters of coastal drilling remain high due to opposition by Democratic leaders.

If the appropriations process remains stalled until the end of the fiscal year, Sept. 30, Bush's action could leave the outer continental shelf without protections if what is expected to be a continuing resolution to maintain government spending into the new administration falters.

However, even a lapse would not spur a rush to drill in currently protected areas soon, because any new development would depend on preparation of new lease sales and other time-consuming activities, as well as uncertainty about future policy.

Back to Public index page