US House Panel OKs Bill That Slows Oil, Gas Devt Permitting

WASHINGTON Jun 13, 2007 (Dow Jones Newswires)

The U.S. House of Representatives Natural Resources Committee Wednesday passed a broad energy bill that includes provisions that repeal laws designed to accelerate the oil and gas permitting process.

Industry groups, including the U.S. Chamber of Commerce and the American Petroleum Institute, say they fear the bill could stunt domestic oil and gas production.

The committee passed the Energy Policy Reform and Revitalization Act of 2007 by a 26-22 vote, but rejected a slew of amendments submitted by Republicans that sought to strike the first two major measures in the bill that dealt with petroleum production and electricity transmission.

The bill also set wildlife and environmental guidelines for the federal government for siting of wind turbines that were more lenient than previously proposed following tough lobbying from the wind energy industry.

The panel voted against striking Titles I and II of the legislation, H.R. 2337, which roll back key provisions in the Energy Policy Act of 2005 that were designed specifically to expand U.S. production of oil and natural gas, while also strengthening the U.S. electric power transmission grid.

"The bill provides balance, transparency and accountability," said Chairman Nick Rahall, D-W.Va., who rejected Republican and industry claims that it would stunt petroleum output. "They're unfounded, and I believe that we have provided a process that does not stop any production, but provides a more balanced approach taking into consideration concerns of all the American people, including hunters and ranchers on public lands," he said.

The chairman said his legislation provides "a framework to reinstate public accountability and integrity in the Interior Department's energy programs," as well as advance alternative fuels and efficient energy strategies.

Rahall said the legislation will likely be merged with a package of energy proposals House Speaker Nancy Pelosi, D-Calif., wants to have completed by July 4.

Besides repealing 2005 energy laws that streamline the drilling permitting process in the Intermountain West, Rahall's bill requires any oil or gas the government receives as payment for energy development on federal lands to go towards the Strategic Petroleum Reserve and promote clean coal technologies.

It would impose a $1-per-acre fee on non-producing federal onshore oil, gas and coal leases, with the money going towards repairing land damage caused by drilling.

It would also push back the federal government's plans to lease public lands for oil shale development.

"Democrats voted today to keep production low, prices high, and deprive consumers of needed domestic energy resources," said Rep. Steve Pearce, R-N.M., who led the drive to strike several of the provisions.

"We have the potential for producing 2 trillion barrels of oil from oil shale - more than the known reserves in Saudi Arabia - but the amendments passed today in the Rahall Energy Bill would prevent us from obtaining any of it," he said.

"Instead of doing the things necessary to increase production to meet demand, the Rahall Energy bill locks up our resources, guarantees high prices, and makes us even more dependent on foreign energy," Pearce told Dow Jones Newswires.

Copyright (c) 2007 Dow Jones & Company, Inc.

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