Senate turns back GOP oil, gas bill similar to House bill

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, May 19 -- One day after refusing to consider the Democrats’ bill to increase taxes for the five biggest US oil companies, the US Senate similarly rejected on May 17 a Republican measure patterned after legislation that the US House approved last week by a 57-42 vote.

S. 953 would have set a deadline for the US Bureau of Ocean Energy Management, Regulation, and Enforcement to issue decisions on certain permit applications under existing leases within 60 days; instructed the US Interior secretary to hold lease sales which were postponed after the Macondo well accident and crude oil spill; and directed the secretary to extend by 1 year leases affected by last year’s moratorium.

It also would have amended the Outer Continental Shelf Lands Act to require lessees to develop spill response and containment plans, established a public-private oil spill response and mitigation taskforce, and order the US Comptroller General to conduct a study of federal oil spill responses that examined capabilities and legal authorities to clarify appropriate federal roles, according to Minority Leader Mitch McConnell (R-Ky.), its main sponsor.

“We need to work hard to produce more American jobs,” said Roy Blunt (R-Mo.) as he spoke in support of McConnell’s bill. “I can’t think of a better way than producing more American energy.”

But Robert Menendez (D-NJ), who was the main sponsor of the bill that the Senate rejected a day earlier, said S. 953 would expand offshore oil and gas activity without providing the necessary safeguards. “This reckless bill would allow drilling in sensitive areas even though current safety and environmental regulations have been found to be inadequate,” he warned.

GOP dissenters
Five Republicans—James W. DeMint (SC), Mike Lee (Utah), Richard C. Shelby (Ala.), Olympia J. Snowe (Me.), and David Vitter (La.)—voted with 51 Democrats and Independent Bernard Sanders (Vt.) against the bill. Senate Finance Committee Chairman Max Baucus (D-Mont.) did not vote.

Vitter said he opposed the bill because it would add a new layer of bureaucracy that would slow down instead of accelerate permit processing. He and Louisiana’s other US senator, Democrat Mary L. Landrieu, said in a joint statement on May 17 that they were voting against both the Democrats and Republicans’ bills because the measures were too partisan.

“As the two senators most familiar with the Gulf of Mexico energy shutdown, we are eager to pass strong energy legislation that includes an emphasis on increased domestic production with revenue sharing between the federal government and offshore oil producing states,” they said. “Unfortunately, these two bills are a disappointing start.”

American Petroleum Institute Executive Vice-Pres. Marty Durbin said following the vote that while the motion to proceed failed, McConnell’s bill pushed the congressional energy debate in the right direction. “Even some senators who opposed the motion did so out of concern that it didn’t go far enough in encouraging more domestic energy development, which could produce as many as 1 million jobs and trillions in additional government revenues,” he said. “We hope the discussion leads to realistic policies for a stronger and more secure energy future.”

But Karen A. Harbert, president of the Institute for 21st Century Energy at the US Chamber of Commerce, said the Senate missed an opportunity to stimulate a stagnant US economy with a bill that would have produce more domestic energy and created thousands of new jobs. “One would hope that the high gasoline prices currently burdening families and businesses would serve as a call to action, as it did in the House, but unfortunately the Senate is off to a disappointing start,” she maintained.

Contact Nick Snow at nicks@pennwell.com.

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