Congress can do more to advance offshore drilling in the Gulf of Mexico and Atlantic Ocean while boosting the economies of coastal states, eight governors said Friday.
Options rage from giving states a greater share of federal drilling royalties to passing legislation that would force the Interior Department to make more coastal tracts available for oil and gas development, the group of coastal governors said.
The governors, including Texas’ Rick Perry, made their pleas in a letter to their congressional delegations in the nation’s capital.
“During this congress, legislators will consider several matters that directly and indirectly affect the future of offshore energy development,” said the governors, who all represent coastal states. “As our federal representatives, we strongly urge you to act in concert to champion outer continental shelf energy and, by effect, the vitality of our coastal and state economies.”
The group — banded together as the OCS Governors Coalition — offered five recommendations.
At the top of their list: expanding an existing program for sharing offshore drilling revenue with states near the activity.
“Currently, the Atlantic coast states and Alaska are generally not eligible to share in revenues generated by oil, gas and renewable energy development in the outer continental shelf,” the group said. “These states should be treated equitably with all states.”
The governors may be preaching to the choir, since several of the recipients already have sponsored legislation that would open up the revenue-sharing program — which is set to begin for the Gulf Coast in 2017 — to all coastal states.
The Senate Energy and Natural Resources Committee is set next week to hold a hearing on one of those proposals, a measure by Sens. Lisa Murkowski, R-Alaska, and Mary Landrieu, D-La., that would also move up the timeline for the Gulf revenue sharing program so it starts sooner. Their measure also would do away with a $500 million annual cap on what Gulf states can collect.
Under their bill, every state with ocean views would be able to participate and collect up to 37.5 percent of the royalties from any offshore energy production, whether it comes from oil and gas or wind and solar.
But the proposal is controversial — particular among offshore drilling foes, who believe the lure of revenue could encourage cash-strapped states to support oil and gas development in nearby waters.
In a March letter to Wyden and Murkowski, eight senators insisted they would “vigorously oppose any effort that expands or provides further incentive for offshore oil and gas drilling in areas where drilling is currently prohibited.”
The coastal governors also endorse plans to expand access to new outer continental shelf areas. The Obama administration’s five-year plan for selling offshore oil and gas leases through June 2017 contains a dozen auctions of territory in the Gulf of Mexico and three of tracts near Alaska.
But regulators at the Interior Department’s Bureau of Ocean Energy Management opted not to plan an auction of leases near Virginia, where a sale had previously been scheduled (and canceled after the 2010 Gulf spill). Some Alaskan areas and southern California acreage, near existing development, also were left out of the plan.
The coastal governors say the administration should have opened access to new frontiers and should finish its ongoing review of the environmental effects of seismic research along the Atlantic that could help pinpoint possible oil and gas reserves.