Bill would force feds to sell drilling leases off Virginia coast

The Obama administration would be forced to sell offshore drilling leases off the coast of Virginia under a bill introduced in the House on Friday.

The measure, sponsored by Virginia Republican Scott Rigell, aims to mandate the reschedule Lease Sale 220, an auction which was first planned for 2011 under President George W. Bush but canceled in the wake of the Deepwater Horizon disaster in 2020.

Rigell’s bill also would force the Interior Department to conduct at least one auction for the region 50 miles off Virginia’s coast during each five-year lease sale program.

The government’s current five-year plan, spanning 2012 to 2017, contains no auctions for Atlantic oil and gas drilling rights, though the Interior Department is on track to allow seismic research in the region. Assistant Interior Secretary Tommy Beaudreau told Congress on Thursday that by helping to define the potential energy resources along the East Coast, those seismic surveys would inform future decisions about leasing in the area.

Scheduled sale: Western Gulf lease sale set for Aug. 28

Although some Virginia leaders have lobbied hard for the auction of nearby offshore tracts, Interior Department officials said the auction ultimately wasn’t included in the 2012-2017 plan because of opposition from other Atlantic Coast states and concerns raised by the Defense Department, which conducts exercises in the region.

Rigell’s bill would block any exploration, development or production of oil or natural gas off Virginia’s coast if it would conflict with any military operation.

The American Petroleum Institute upstream director, Erik Milito, said Rigell’s measure is an “excellent first step” toward “unlocking this oil and natural gas” that is currently off limits.

Rigell’s bill includes a sweetener for Mid-Atlantic states to go along, by allowing them to cash in on 37.5 percent of royalties paid to the federal government for oil and gas produced on the offshore leases. Similar revenue sharing agreements are already in place for Gulf Coast states, beginning in 2017. And coastal senators Mary Landrieu, D-La., and Lisa Murkowski, R-Alaska, are leading a push to expand revenue sharing even further.