Pallone Offers Amendment to Eliminate Offshore Drilling Provision From Budget Reconciliation

Washington, D.C. --- U.S. Rep. Frank Pallone, Jr. (D-NJ), a senior member of the House Resources Committee, gave the following statement today at a committee mark-up of the Fiscal Year (FY) 2006 Budget Reconciliation. Pallone offered an amendment to strike a provision included in the legislation that would allow states to opt-out of the current moratorium prohibiting offshore oil drilling in federal waters. The amendment was defeated in committee today by a vote of 25 to 15. The overall reconciliation bill is expected to come to the House floor for a vote in November.

"Mr. Chairman, I am offering this amendment with Congressmen Ed Markey of Massachusetts and Jay Inslee of Washington to strike all of Subtitle E, which makes dramatic and damaging changes to our current laws governing federal waters and our coastlines.

"I was first elected to Congress after floating trash and medical waste from New York wound up on New Jersey's beaches nearly twenty years ago, fouling our coasts and wreaking havoc on the tourist economy. I know from that experience how vigilant we have to be about what our coastal neighbors do. That is why I promised my constituents that I would fight to clean up New Jersey's beaches and push for further protections for our coastline.

"Subtitle E, however, undermines twenty years of consistent efforts to protect the Jersey shore environment and our coastal tourism economy. There are numerous procedural and substantive problems with this subtitle, which is why I hope my colleagues will join me in voting to strike it in its entirety.

"First of all, I strenuously object to the way this language was developed. From what I have read in press reports, the Chairman worked behind closed doors with Governor Bush to come up with this deal. Florida is only one of twenty-one states that could be affected by the offshore leasing proposal, however, and no others seemed to have had such an influence in the process of drafting this language.

"Moreover, we have not even had a single day of hearings on this proposal, which would make dramatic changes to a raft of federal resources policies and reshape the division of federal and state control over federal waters. This is no way to go about the Committee's business.

"I also have to ask what exactly this is doing in a budget bill. It is questionable whether this subtitle would actually increase federal revenues over the next five years, since projections of any such revenue are based on speculation over whether any states would decide to opt out of existing moratoria. This puts potential federal revenue at the whim of governors and state legislatures.

"From a substantive standpoint, the opt-out and opt-in provisions would seriously undermine the ability of small states like New Jersey to protect their coastlines from the actions of their neighbors. My home state may never decide to open its coastline to drilling, but one of our nearby states may find themselves in a difficult budget situation and begin leasing, imperiling New Jersey's environment and coastal economy. The 25 and 50-mile buffers will do little -- oil can easily travel that far in one day. And after 2012, anything that happens beyond 125 miles of our shore would be completely at the whim of the Secretary of the Interior. If this is passed, I can only hope we don't have a Secretary whose urge to drill is as strong as the current one's.

"Let me emphasize, as I have done in the past, that opening the OCS to drilling will do nothing for skyrocketing gasoline and natural gas prices. Even if we passed this bill today, it would be years before any product reached American markets.

"And even if we were able to drill under the OCS and get the product to market right away, there is simply no major prize of oil and gas in the areas already under moratorium. According to MMS' latest updates, there are only 2.31 billion barrels of technically recoverable oil under the entire Atlantic OCS area, compared with a full 60 billion barrels available in the portions of the continental shelf that are currently open to drilling.

"For gas, the numbers are even less impressive. The Atlantic OCS region contains only 28 trillion cubic feet of gas, compared with around 344 trillion cubic feet in the open portions of the continental shelf.

"Given the damage that just one oil spill or wrecked rig could do to shore communities that are heavily dependent on clean beach and ocean environments, it seems clear to me that undoing coastal moratoria is simply not worth it.

"Beyond this ill-advised and complex offshore drilling scheme are other parts of Subtitle E that should trouble members. Section 6524 is patently absurd to include in a revenue bill -- it actually prevents the Secretary from increasing or imposing new fees on energy leasing on or offshore. So even as we see record profits from oil and gas companies and record prices for consumers at the pump, we are actually blocking any increases in the leasing fees that they pay.

"Another provision inserted without any serious legislative consideration is Section 6521, which allows oil and gas companies to get away with not properly cleaning up offshore rigs and instead would have them be used for aquaculture or other purposes. Coming from a state with a large number of commercial and recreational fishermen, I can tell you that offshore marine aquaculture, especially at old oil rigs, is an incredibly controversial issue.

"These are yet more parts of a subtitle that truly does not belong in a budget bill and could do incredible harm to our nation's coastlines. I hope my colleagues will join me in voting to strike the entire subtitle."