Warner-Kaine bill would restore Virginia sales to 2012-17 OCS plan

Virginia’s two US senators, Democrats Mark R. Warner and Timothy M. Kaine, introduced legislation that would revise the US Bureau of Ocean Energy Management’s 2012-17 Outer Continental Shelf program by restoring to the schedule a lease sale off the state’s coast.

The bill’s OCS leasing provision includes wind, alternative, and renewable energy sales in addition to oil and gas. Tracts would not be offered if the US president, in consultation with Senate and House armed services committees, determined their leasing would interfere with military operations critical to national security.

Half of the leasing revenue would be deposited directly into the US Treasury. Another 37.5% would go to Virginia, a share similar to what Gulf Coast states receive from new Gulf of Mexico offshore leases, the senators said. The remaining 12.5% would be used, at the president’s discretion, for state land and water conservation, public transportation, and renewable and alternative energy projects.

“Our legislation includes appropriate environmental protections and an equitable formula for sharing revenues between the state and federal governments,” Warner said on May 22. “I believe that changes in the membership of the Senate after the 2012 elections have helped to produce a potentially more supportive atmosphere for our legislation.”

Kaine added, “Virginia is well positioned to be a national leader in offshore energy exploration. [Its] diverse energy portfolio is a model for the nation. This legislation will bolster our energy security, create jobs, and direct revenues to Virginia that will support important priorities across the state.”

Welcomes bill

Virginia Gov. Robert F. McDonnell (R) applauded the senators’ action. “Since taking office, I have advocated for Virginia to become the energy capital of the East Coast through an ‘all-of-the-above’ approach to domestic energy production,” he said on May 22.

“A large piece of that formula involves the responsible exploration of available oil, natural gas, and wind resources off the Virginia coast, which the federal government has blocked through its ill-conceived and illogical energy policy,” McDonnell said.

Erik Milito, the American Petroleum Institute’s upstream and industry operations director, also welcomed the bill. “Developing our offshore resources is vital to achieving the all-of-the-above energy plan President Obama has promised,” he said.

“With 87% of federal offshore acreage off-limits, unlocking key areas like the Atlantic Coast could bring enormous benefits in the form of more energy, more jobs, and more revenue to ease strained government budgets,” Milito continued.

US Rep. E. Scott Rigell (R-Va.) introduced legislation on Apr. 26 that would make the US Department of the Interior hold an oil and gas lease sale off Virginia’s coast as soon as it was practicable (OGJ Online, Apr. 29, 2013). Three other House Republicans from Virginia—H. Morgan Griffith, Robert Hurt, and Robert J. Wittman—were cosponsors.

Contact Nick Snow at nicks@pennwell.com.

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