WATCHING WASHINGTON BACK TO WORK

Legislators face a meager agenda of energy issues when they return to Washington next week.

So far, the major energy policy question before the 103rd Congress has been not whether but how much to tax energy use.

The Clinton administration sought a $72 billion tax on the BTU content of energy to help fund its deficit reduction bill. But Congress whittled that to $23 billion--a 4.30/gal increase in the federal levy on gasoline and diesel fuel.

NAFTA ISSUE

In other action, oil lobbyists will be following congressional debate this fall over whether to approve the North American Free Trade Agreement in an up or down vote.

The treaty opens some doors in Mexico for U.S. oil service and supply firms but not for exploration companies. Meanwhile, the administration is appealing a court's ruling that it must prepare an environmental impact statement for Nafta.

The Senate may consider an amendment to the Interior Department appropriations bill that would lift the moratorium blocking sales of oil and gas leases off northern Florida and North Carolina. A bill passed by the House continues such a ban.

The Senate environment committee will hold one more hearing in September before marking up a Clean Water Act reauthorization bill. The goal is to report out a bill this fall.

The hearing will focus on a key issue for the oil industry, a bill by chairman Max Baucus (D-Mont.) and ranking Republican John Chafee (R-R.I.) governing the permitting of commercial and private developments in wetlands.

Section 404 of the Clean Water Act requires persons and companies to obtain an Army Corps of Engineers permit before filling or disturbing swamps, bogs, or marshes.

That requirement affects drilling throughout the U.S., pipeline construction along the Gulf Coast and across rivers, and siting of plants.

Three other environmental bills also are up for reauthorization: the Endangered Species Act, the Superfund Act, and the Resource Conservation and Recovery Act.

Congress faces the usual backlog of wilderness protection bills. Measures are pending to bar development on federal land in Utah, Idaho, Montana, New Mexico, and Colorado.

The Colorado bill is furthest along, having been passed by the House. It would add 600,000 acres to the 2.6 million acres designated as wilderness in Colorado in 1976 and 1980.

The Senate has passed a bill to elevate the Environmental Protection Agency to cabinet level as the Department of the Environment. House action has been delayed.

Both houses are considering legislation to insure that major oil companies do not discriminate against marketers.

Independents are asking incentives for U.S. exploration, and some majors want a royalty break for deepwater production. Prospects don't look good for either of those proposals.

NO SURPRISES

Although Congress has not passed an energy bill yet this session, that should not come as a great surprise.

Oil and gas prices are relatively low, and supplies are abundant, so energy bills have low priority.

Congress resolved most of its pending energy issues when it passed the omnibus Energy Policy Act last fall.

Copyright 1993 Oil & Gas Journal. All Rights Reserved.