House Natural Resources Committee Chairman Nick J. Rahall (D-W.Va.) may have seen the US House leadership drop practically all of the oil and gas measures his committee approved from final energy legislation in late 2007. That doesn't mean he's going to stop trying in 2008.
Rahall served notice on Dec. 20 that the committee's 2008 agenda "will continue to pursue policies in line with American expectations for conserving our Nation's precious natural resources and unique cultural heritage for this and future generations to enjoy. The committee will continue to strive to honor its commitment to serve the natural environment, wild lands, scenic vistas, fish and wildlife, and most importantly the people."
For oil and gas producers, that will mean examining inspection and management of operations on federal land and reforming royalty collection.
When the committee passed H.R. 2337 in May, the bill imposed new requirements for handling produced water, delayed oil shale leasing authorized under the 2005 energy policy act, and expanded surface land holders' rights in split estate situations involving the federal government.
It also required the US Minerals Management Service to conduct at least 550 lease audits annually and barred holders of holders of Gulf of Mexico deepwater leases erroneously issued without price thresholds in 1998 and 1999 to renegotiate terms or be barred from future lease sales.
The provisions were present when the full House passed H.R. 3221 on Aug. 4 but were absent from the bill the Senate received in early December.
Rahall's latest statement indicates that the committee will revisit at least two of these issues during 2008.
He said that the US Bureau of Land Management has identified inspection and enforcement as "inspection and enforcement is the single most critical activity that ultimately ensures protection of the natural environment and proper management of ecosystems with regard to the impacts of oil and gas activities."
Yet the Government Accountability Office has found serious backlogs in lease inspections, including those for reclamation, due to the growth in permits and budgetary constraints, he continued. "Hearings will delve into this matter in search of solutions," he said.
Rahall also said that the committee will build on hearings it held in 2007 because problems continue to plague DOI's oil and gas royalty collections. "The royalty-in-kind program, for instance, is the subject of multiple criminal investigations and merits further congressional scrutiny," he maintained.
Efforts will also continue to examine federal lands' potential to provide sites for carbon sequestration and regulatory mechanisms for future offshore development of alternative energy sources, Rahall said.
His announcement did not surprise Washington officials of oil and gas producing associations, who have said that the Natural Resources Committee chairman would try to bring back many of the ideas his committee adopted this past year. "We still don't like them," one lobbyist told me.
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