Last week the US House of Representatives passed H.R. 4761—the Deep Ocean Energy Resources Act of 2006— by a vote of 232-187. The bill lifts a 25-year ban on oil and natural gas drilling off most of the Pacific and Atlantic coasts and the eastern part of the Gulf of Mexico.
The legislation specifically removes all leasing bans beyond 100 miles and permits leasing 50 to 100 miles offshore unless states protest. It bans all oil and gas drilling within 50 miles of state coasts unless states chose otherwise.
The legislation, which eliminates the requirement for a comprehensive inventory of Outer Continental Shelf (OCS) resources, shares the Federal leasing receipts with the coastal states off which the drilling will occur: 75% for projects out to four marine leagues (13.8 miles, 22.2 kilometers) from the coastline and 50% for projects more than four marine leagues from the coastline.
The bill also calls for the United States to use Canada’s approach to oil sands development as a model for the development of the westeren oil shale. Canadian oil sands producers pay little in royalties until several years into development.
The bill now goes to the Senate for consideration.
H.R. 4761: Deep Ocean Energy Resources Act of 2006