By OGJ editors
HOUSTON, Apr. 11 -- Sens. Lamar Alexander (R-Tenn.) and Tim Johnson (D-SD) have introduced legislation that would give governors the power to override federal drilling bans and approve exploration and production off their states.
"This is not a question of tweaking our natural gas policy. It is time to aggressively revamp it," Alexander said in an Apr. 6 news release explaining the bill. "It is no mystery why we have high natural gas prices. We have contradictory energy policies. We're restricting the supply of natural gas, but we're encouraging its use."
The 250-page bill targets reducing US petroleum demand by 1.75 million b/d by 2015.
"We need aggressive conservation, aggressive use of alternative fuels, aggressive research and development, aggressive production, and for the time being, aggressive imports of liquefied natural gas," Alexander said.
The bill comes the month after the Senate voted to leave in a budget bill funding for oil and gas leasing of the Arctic National Wildlife Refuge Coastal Plain in Alaska (OGJ Online, Mar. 16, 2005).
Also last week, the House Energy and Commerce Committee finished marking up two titles of a comprehensive energy bill similar to legislation Congress considered but failed to pass last year. The committee expected to finish marking up the new legislation this week.
Drilling, production
The bill introduced by Alexander and Johnson authorizes the Department of Interior to issue gas-only leases for offshore drilling.
It also instructs Interior officials to draw the state boundary between Alabama and Florida regarding Lease Sale 181 area and to lease portions off Alabama that do not conflict with military training or operations. The bill sets Dec. 31, 2007, as the deadline for amending the leasing program.
"A moratorium on gas, or oil and gas, leasing on the Outer Continental Shelf shall be effective with respect to the area off the coast of a state only if the governor of the state consents to the moratorium," the bill said. The drilling moratoriums for the East and West coasts have existed since 1982.
LNG
The bill calls for a streamlined permitting process for LNG receiving terminals, giving the US Federal Energy Regulatory Commission "exclusive authority" for siting and regulating the terminals.
It also clarifies the permitting process for pipelines and gas storage facilities, Alexander said. The bill requires that FERC grant or deny a terminal or pipeline application within 1 year of the application's filing.
Meanwhile, the bill recognizes the authority of state governments under the Coastal Zone Management Act and other acts.
"Nothing in this section grants the commission any right of eminent domain with respect to the siting, construction, expansion, or operation of a natural gas import or export facility," the bill said.
Conservation, alternate fuels
The bill calls for a 4-year consumer education program aimed at reducing energy demand.
It also would establish higher appliance and equipment standards for natural gas efficiency.
The bill calls for construction of six coal gasification plants by 2013 and requires streamlined permitting for coal gasification facilities.
In addition, it outlines tax incentives for investment in solar power, the use of hydrogen for fuel cell vehicles, gas hydrates, biofuels, and biomass. Alexander introduced President George W. Bush's hydrogen initiative in the Senate in 2003.
