House votes to allow limited offshore drilling

Wednesday, September 17, 2008


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(09-17) 04:00 PDT Washington --

The House voted Tuesday to lift the federal moratorium that has blocked drilling along most of the U.S. coastline for three decades and give states a greater role in choosing whether to have oil rigs off their shores.

The energy bill, passed with the support of most Democrats, would let states decide whether to drill between 50 and 100 miles off their coasts while allowing the federal government to open areas beyond 100 miles. Republicans opposed the bill, calling it a sham because it would not give the states any financial rewards for drilling and would ban exploration within 50 miles of shore.

The bill "is nothing more than hoax on the American people and they will not buy it," said House Minority Leader John Boehner, R-Ohio.

The vote marked a tactical retreat by Democrats, who have fought each year since 1982 to renew the ban. But House Speaker Nancy Pelosi, fearing a backlash for her party in November with polls showing growing support for new drilling, agreed to lift the moratorium as part of a broader energy bill.

Pelosi hails vote

Pelosi hailed the 236-189 vote as a victory because the bill also included Democratic priorities such as stripping oil companies of $18 billion in tax breaks, renewing expiring tax credits for wind and solar, and requiring electric utilities to get 15 percent of their power from renewable sources by 2020.

The measure "will put us on the path toward energy independence" and make "Big Oil pay for its fair share of our transition to a clean, renewable energy future," Pelosi said.

The bill faces a very uncertain future. The Senate is set to take up three separate energy bills, which differ sharply from the House measure. The White House issued a veto threat Tuesday, saying the House bill "purports to open access to American energy sources while in reality taking actions to stifle development."

Senate Republicans may choose to block action on any energy bill and allow the moratorium to expire on Sept. 30. If the drilling ban lapses, the Bush administration could begin the process of preparing oil and gas lease sales in new areas as close as 3 miles offshore.

Even if it became law, the House bill probably would have little immediate impact in California. Gov. Arnold Schwarzenegger and the state Legislature adamantly oppose drilling. The Interior Department estimates that of California's estimated 9.75 billion barrels of recoverable oil offshore, 95 percent is located within 50 miles of the coast, which would be off-limits under the bill.

But Richard Charter, a longtime coastal advocate who works with Defenders of Wildlife, warned that a future governor or state Legislature could view drilling differently - especially if offered a share of oil royalties. "Governors change periodically. Florida elected a governor in (Republican) Charlie Crist who opposed offshore drilling and he changed his mind," he said.

The bill provoked a fierce debate on the House floor Tuesday, underscoring the huge political stakes for both parties. Republicans, who have seen their political fortunes improve by focusing on their support of drilling, said the bill was designed mostly to give election-year cover to Democrats, who fear being seen as anti-drilling.

GOP lawmakers noted that the bill would not offer states a share of the multibillion-dollar oil royalties, even though current oil-producing states such as Louisiana benefit from revenue-sharing. Governors and state legislatures are seen as unlikely to take the risk of opening up their coasts without an enticement.

"It's the equivalent of the government opening a Starbucks or a McDonald's franchise in the garage of your family home, but paying you nothing," said Rep. Doc Hastings, R-Wash.

Democrats countered that they could not offer states revenue-sharing without adding $40 billion to the deficit over the next decade. They also pointed out that by opening all areas beyond 100 miles to development, the bill would add more than 300 million acres that could potentially be leased to oil companies.

Democrats argued that Republicans were opposing the bill because it would revoke billions of dollars in subsidies to oil companies and devote the money instead to renewable energy.

"America needs an oil change, said Rep. Ed Markey, D-Mass., who chairs the House Select Committee for Energy Independence and Global Warming. "They keep saying on the Republican side, 'Drill, baby, drill!' What we're saying is 'Change, baby, change!' and they can't change."

Bill's other elements

The bill includes other elements opposed by the White House, including a requirement that the administration release 10 percent of the oil in the Strategic Petroleum Reserve and replace it with heavier, cheaper oil. It also would lift the federal ban on oil shale development, which expires Sept. 30, but allow the states of Utah, Colorado and Wyoming to decide whether to extract the energy in oil shale.

The House bill disappointed many environmentalists and some Democrats, who said it bolstered the GOP's claim that drilling could help bring down gas prices. The U.S. Energy Information Administration has concluded that lifting the moratorium would have no short-term impact on gas prices and an "insignificant" effect by 2030.

Rep. Lynn Woolsey, D-Petaluma, one of only 13 Democrats to vote against the bill, said, "By advocating coastal drilling as part of the solution to our nation's energy woes, this proposal continues the myth championed by President Bush and Sen. McCain for months now - the belief that we can drill our way out of our nation's energy crisis."

In Bay Area: Half of voters in California, Oregon and Washington would agree to more offshore oil drilling but only accompanied by plans to protect the environment and develop renewable energy sources. B1

E-mail Zachary Coile at zcoile@sfchronicle.com.

This article appeared on page A - 5 of the San Francisco Chronicle

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