House to vote next week on offshore drilling

WASHINGTON Fri Sep 12, 2008 7:32am EDT

The Petronius oil platform is seen from the air, located 100 miles off the coast of New Orleans, June 3, 2008. REUTERS/Jessica Rinaldi

The Petronius oil platform is seen from the air, located 100 miles off the coast of New Orleans, June 3, 2008.

Credit: Reuters/Jessica Rinaldi

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WASHINGTON (Reuters) - The House of Representatives could vote next week on energy legislation that would open nearly all of the U.S. coastline to offshore drilling while repealing some tax breaks for oil companies, Democratic leaders said on Thursday.

Democrats had said they hoped to hold a vote on the energy package this week, but the House will be closed on Friday so Texas lawmakers can return to their districts to prepare as Hurricane Ike approaches.

The package proposed by Democrats would give states the option to allow drilling between 50 and 100 miles off their shores. Areas further than 100 miles from the coast would be completely open to oil exploration.

Democrats previously had opposed drilling on the outer continental shelf.

The bill also would repeal some tax breaks for oil companies to help fund investments in alternative energy.

"So we're saying: OK, you want to drill, this is how it will be. No more subsidies," House Speaker Nancy Pelosi told reporters Thursday.

Republicans, who have been pushing to lift the moratorium on drilling, criticized the proposal because it does not provide a revenue-sharing plan to coastal states as an incentive to allow drilling.

Separately, Senators Max Baucus and Chuck Grassley on Thursday unveiled energy tax legislation that would extend solar and wind energy tax credits and provide $2.5 billion in credits to clean coal facilities.

Baucus, a Democrat from Montana, and Grassley, a Republican from Iowa, said the bill would provide consumers with a tax credit of up to $7,500 for plug-in electric vehicles and also would extend credits for extend energy efficiency.

The tax bill would be funded partially by reducing tax breaks for the five largest oil and gas companies.

"This bill has the right tax policy to create thousands of jobs, jump-start alternative energy solutions and finally move America away from our dependence on foreign oil," Baucus, chairman of the Senate Finance Committee, said in a statement.

(Reporting by Ayesha Rascoe; Editing by David Gregorio)

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