Congress lets the White House decide fate of Bristol Bay drilling under new law

Nov. 11, 2003
Under new legislation signed Monday by US President George W. Bush, the US Congress lifted its objections to possible drilling in the federal waters of Alaska's Bristol Bay, although all other drilling moratoriums remain—including those that apply to the east and west coasts.

By OGJ editors

WASHINGTON, DC, Nov. 12 -- Under new legislation signed Monday by US President George W. Bush, the US Congress lifted its objections to possible drilling in the federal waters of Alaska's Bristol Bay, although all other drilling moratoriums remain—including those that apply to the east and west coasts.

The Bristol Bay language is included in a $20.2 billion Interior appropriations bill that funds the US Department of the Interior's budget as well as various fossil energy research programs at the US Department of Energy for the fiscal year that began Oct. 1.

Since 1982 Congress has included language in the Interior appropriations bill that prevents DOI from conducting leasing, preleasing, and related activities in areas under moratoria. President Bush also included moratorium language in the FY 2004 budget request earlier this year.

Industry response
The National Ocean Industries Association said that the state and federal waters of Bristol Bay have been subjected to leasing moratoria since 1995, when the federal government bought back existing leases in the region. But earlier this year, Gov. Frank Murkowski (R) and the Bristol Bay Native Coalition reached a deal in which the natives backed lifting the moratoria in Bristol Bay to further the economic development of the community. NOIA then urged Alaska lawmakers and Bush administration officials for an immediate removal of the leasing bans on federal waters as well.

"Congress agreed to remove their moratorium. Now we are asking President George W. Bush to do the same and take the steps necessary to begin leasing in this region as soon as possible," said an NOIA spokesman.

DOI officials could not be reached for comment because of the federal holiday Tuesday.

Environmentalists opposed the Bristol Bay action, saying it could open the door to drilling in areas now off limits to development. "State and federal authorities are poised and ready to push an aggressive leasing program in the area. This represents the first-ever erosion of the broadly supported Outer Continental Shelf leasing moratorium, and could serve as a first step toward eventual removal of similar protections for the East and West coasts," the Wilderness Society said.

Environmentalists noted that the US House last month voted to instruct energy bill conferees to remove a portion of their bill that required Interior to inventory potential oil and gas resources of the entire OCS, including moratorium areas. The provision, now since deleted from the draft, also required the Secretary of the Interior to report to Congress on "impediments" to the development of OCS oil and gas, including the moratoria, and the role coastal states and localities have played in stopping environmentally harmful offshore oil-related activities.

Other provisions
The new law includes a controversial provision added during final negotiations that is designed to give Interior officials another year to settle the Cobell v. Norton Indian Trust Fund case. The measure seeks to circumvent a court order that could require DOI to spend $9-12 billion on accounting of individual trust accounts.

Opponents of the measure say the provision will likely be struck down in federal court because it oversteps congressional authority. Plaintiffs in the case allege the federal government mishandled at least $13 billion in funds collected on Indian lands since 1887.

Regarding other royalty issues, the legislation directs DOI's Minerals Management Service to conduct a detailed analysis for Congress to determine whether royalty in-kind programs will generate as much or more income as comparable royalty-in-value programs that require cash payments instead of crude oil deliveries.

The legislation also earmarked $35.3 million for oil technology research at DOE, a 16% decrease from FY 2003. The natural gas technology budget for FY 2004 is $43.3 million, about $4 million below the previous year's budget, an 8% shortfall.