By the OGJ Online Staff
WASHINGTON, DC, July 2 -- US Sec. of the Interior Gale Norton said Monday she would pare back a proposed lease sale in the Eastern Gulf of Mexico this December in deference to concerns by Florida officials.
"We have listened and worked carefully with officials and affected citizens around the 181 lease area. The outcome is a balanced and common sense proposal," said Norton. "Our modified 181 area has been adjusted from 5.9 million acres to 1.5 million. The adjusted area is at least 100 miles from any portion of the Florida coast. For example, its northern border is more than 100 miles from Pensacola and the eastern edge is 285 miles from the shores of Tampa Bay.
"The 181 Area proposed today will help our nation reduce our dependence on foreign oil, including unstable nations such as Iran and Iraq. The proposal also works to meet the President's commitment to develop our nation's energy needs in an environmentally safe way.
"The Department projects the adjusted area contains 1.25 tcf of natural gas -- enough to serve 1 million US families for 15 years. The area also contains 185 million bbl of oil -- enough to fuel the automobiles of a million families for nearly 6 years," she said.
Industry officials, however, maintained that the lease properties dropped from consideration could contain up to 90% of the area's total production potential.
"We are very disappointed in this decision," said Tom Fry of the National Ocean Industries Association. "You of course never know for sure until you drill, but this was an area that was negotiated between two Democrats, then President Clinton and then Gov. Chiles, with years of public comment. It comes at a time when we need new supplies, and this is one of the few areas in the lower 48 where we can drill without a moratorium in place."
"It's like waiting for Christmas all year and being told by the US House of Representatives that Christmas is canceled." said R. Skip Horvath, president of the Natural Gas Supply Association.
Last week, the House voted to disallow any drilling in the proposed lease area.
"What Interior Sec. Norton has done is said that 1 million US families can have natural gas for 15 years," Horvath said. "We hope that some day an additional 1.5 million families, or the total 2.5 million families originally expected to be served with natural gas from this area, will enjoy Christmas, too."
He said, "In fact, industry actually believes that the amount of natural gas is closer to 6.5 million families for 15 years."
Although not entirely unexpected, Congressional sources said, Norton's move comes only a week after the White House sent a letter to GOP House leaders saying the administration supported Lease Sale 181 in its original form.
In a letter from the Office of Management and Budget to House Appropriations Chairman Bill Young (R-Fla), the White House said it opposed a floor amendment agreed to by the House to postpone the sale.
Young preserved the sale in an earlier version of the spending bill, but later voted for the amendment when members of his delegation offered the legislative rider to indefinitely delay the sale. Proponents of the sale later retaliated by pushing though their own amendment that symbolically blocked the Florida-bound Gulfstream Pipeline from being completed (OGJ Online, June 28, 2001).
Soon after the dust had settled, Congressional sources said they expected a compromise to occur by the time the legislation reached the Senate in midsummer. But few expected the White House to make the decision for them this quickly.
The motivation behind the decision may have come from several fronts, congressional sources said.
First, Jeb Bush, the current governor of Florida (R), recently kicked off a reelection campaign and has aggressively sought to block the entire sale since his brother, President George W. Bush, took office in January.
A White House spokesman said Monday the two brothers discussed the sale today before Norton's decision was announced.
Another factor coloring today's action is that Norton is eager to get her own team in place and offering the compromise early may help motivate the Democratically controlled Senate to move forward with stalled nominations. The absence of top levels officials within Interior and other government agencies is hampering the White House's ability to pursue major regulatory initiatives.
"Either way, we appreciate the administration's desire to work out a compromise with all concerned parties; however, this industry has proved repeatedly that we can supply natural gas while at the same protecting the environment," Horvath said.
