Panel Votes to Open Parts of Eastern GOM to Drilling

WASHINGTON (Dow Jones Newswires), Jun. 9, 2009

A U.S. Senate panel on Tuesday voted to open up a large part of the eastern Gulf of Mexico to oil and natural gas drilling, responding to voter concern about high energy prices but setting up a fight with Florida lawmakers who have kept the area off limits.

By 13-10, the U.S. Senate Energy and Natural Resources Committee added to an energy bill a measure that would allow oil and gas development starting 45 miles from shore. A gas-rich area known as the Destin Dome, located in closer-in waters off of Pensacola, Florida, would also become open for drilling.

"We will have a bunch of Senators filibuster this if we have to," Sen. Bill Nelson, D-Fla., complained to reporters. He said that military testing and training is already conducted in the area.

The U.S. Congress has been pushing for greater access to oil and gas supplies since last year, when record-high gasoline prices prompted voter outrage. In 2008, Congress allowed a ban on most offshore leasing to expire. The only areas that remain under restriction are most of the Eastern Gulf of Mexico and some other tracts that are within 100 miles of Florida.

The vote came after the panel rejected a measure to give states along the eastern Gulf of Mexico 37.5% of revenue generated from leasing to oil and gas companies. While coastal states want the money, inland states say it isn't fair to give such a large portion of revenue associated with a national resource to just some states.

Separately, the panel voted to speed up offshore leasing. Under the amendment, from Sen. Lisa Murkowski, R-Alaska, the U.S. would have to offer leases in coastal waters within 180 days after the completion of necessary environmental reviews.  

Copyright (c) 2009 Dow Jones & Company, Inc.


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Bryan | Jun. 23, 2009
It's the oil producing states that take all of the risks and they should be compensated for those risks. If the government doesn't want the states to have the 37.5% revenue share from offshore oil, then the oil producing states should only have to pay 50 cents a gallon for gasoline. Let the rest of the country get wind of that and they'll be lining up to allow drilling in their states. If you still don't want drilling in your state or on your coast, then fine, you'll only have to pay $10/gallon for gas. That would be a fair and equitable solution to the drilling problem. The government still gets their share of the pie, the citizens in oil/gas producing states get gasoline at a reasonable rate and the rest of the country has an incentive to drill.

Milton H. Otte | Jun. 13, 2009
Many Floridians are out of work. Even in the exploratory stages drilling would get numerous support jobs in Southwestern Florida as well as in the pan handle. We have lost construction and boat building jobs.

Future Florida's vacation and resort industry business will not be enough to support the ifrastructure Florida will need in future decade. Oil and gas jobs would greatly help.

The integrated oil companies have been producing at Prudoe Bay and utilizing the seven hundred mile pipeline for over thirty years. These ares are just as pristine as they were over thirty years ago. If the sensors of the giant Mobile production platforn off Newfoundland spot an iceberg in the vicinity they can seal the many wells and disconnect in thirty minutes!

What is the real reason congressman Vern Buchanan voted against drilling in the eastern half of the Gulf of Mexico? So those who control hourly wages can keep a lid on them. Both Democrats in the state and federal office know when the oil industry comes into an area wages go up. Those officials who are into the pockets so to speak of "those who have the gold" make the rules! Milton "Mt" Otte Sarasota, Florida

Scott Pinkston | Jun. 12, 2009
It's about time! Engineers have been telling us that there is enough natural resource (oil) to support this country for several thousand more years, without relying on foreign oil and high gasoline prices.

We should pursue alternative fuels; but, use what we have at home to support US citizens and develop additional sources of fuels to replace gasoline.

James Daniels | Jun. 12, 2009
It's about time. Florida should not get a pass. It's not about pollution, it's about keeping labor cost down so the tourist industry does not have to compete with higher paying oil field related jobs. They don't want outside influence in this Urban Possum Hollow place called Pensacola. There are a number of super tankers carrying millions of barrels of Foreign Crude Oil through the Florida Straights 35 to 40 miles south of South Beach Miami, and turning Northwest into the Gulf not far from the Everglades. If something was to happen to one of those huge tankers, you would have an ecological disaster many times worst than that of the Exxon Valdez.

The Florida Pollution, & Anti Drilling Lobbyist have no problem with those tankers do they? I was a former High Pressure Gas Production Consultant. I also have experience in Drilling, Pipe Lining, Crude Oil, Underground Salt Dome Storage, metering and distribution to refineries. I try to communicate with these people over here about the safety of drilling. I get more response out of the house cat.

Craig Watson | Jun. 12, 2009
As our energy consumption grows we need to continue to explore new possibilities for oil and gas. Since natural gas is a much cleaner burning fuel, America needs to take a real look at replacing our coal fired electrical plants with the abundant natural gas that is so readily available throughout our country.

I understand why the inland states would want a larger portion of the reveune generated from offshore drilling. Free Money! However, it is the coastal states that bear the burdens of dealing with the environmental, hurricane and transportation problems that comes with offshore drilling exploration.

Louisiana is one of the largest oil producing states in the nation. Even today our coastal roads and highways are in such a state of disrepair from the continious hammering of heavy equipment.

Craig Watson Vice President of AESC, North Louisiana Chapter, PPSA CEO Impressions Advertising Specialties

Don Cole | Jun. 10, 2009
In the mid-eighties, I was Group Manager, QA for a California Offshore platform project - Federal waters - San Miguel project, Platform Julius. The Jacket and topsides were built at the Hundai yard in Ulsan. The platform was never set. Unfounded (and disproven) challenges to the permit by the California Coastal Commission caused an additional year of permit activity. The platform permit was granted. However numerous counties in coastal California passed initiatives during that year, prohibiting construction of onshore facilities to support offshore production. Nearly five hundred million (1984) dollars wasted, and nothing accomplished except to make us further dependent on imported oil.

That sort of madness must stop. I believe it is time to look into bringing eminent domain laws to bear on these drilling issues. We are dealing with National Interest issues, and cannot afford to allow states like California and Florida invoke their unfounded utopian schemes.

Tee | Jun. 10, 2009
Lorraine, I concur. I drilled the Destin Dome Block 55 (if memory serves me right) Discovery well for Chevron many years ago, and a few others off Panama City and Destin too. We had no spills then and we are much better at our business now also. It will help Florida and the rest of the country, not to mention add a few thousand jobs.

Herman | Jun. 9, 2009
I will believe it when the drilling starts. States like Fla.,Calif.,and Eastern states don't like helping our country till they get in a jam for high fuel prices. There needs to be more areas open in the waters off Fla. and the Eastern seaboard and closer to shore also.

Lorraine | Jun. 9, 2009
I live in Pensacola and I believe the drilling companies will take every precaution to protect our environment. I keep hearing this won't really help us because it will take 10 years before we reap any of the benefits. We've got to get ourselves out from under our dependence on foreign oil. At least this is a starting place. It should have been done years ago. I hope Senator Nelson and his cronies in Washington who plan to filibuster check with their constituents on how they feel about this! People are fed up with the high prices and politics as usual!


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