May 5, 2011 / 7:45 PM / 8 years ago

UPDATE 2-White House slams Republican offshore drilling bill

 * White House says bill undercuts drilling safety reforms
 * Democrats blocked from ending Big Oil tax breaks
 * Pipeline safety bill more than doubles fines to $2.5 mln
 (Adds comment from environmental group)
 By Tom Doggett
 WASHINGTON, May 5 (Reuters) - The White House sharply
criticized a bill passed by the House of Representatives on
Thursday that would expand offshore drilling as part of a
broader Republican effort to stimulate domestic production in
the face of rising gasoline costs.
 The bill, which easily cleared the Republican-dominated
House, would require lease sales to proceed that were canceled
or delayed by the Obama administration offshore Virginia and in
the Gulf of Mexico following the BP oil spill.
 The White House said the bill would "undercut" new offshore
drilling safety reforms imposed after the massive oil spill
last year.
 "These reforms strengthen requirements for issues ranging
from well design to workplace safety to corporate
accountability, and they require operators to show that they
can contain a subsea oil spill like the Deepwater Horizon oil
spill," the White House said.
 The White House also said the Interior Department would
hold new lease sales in the Gulf of Mexico by mid 2012. The
administration had planned to open up drilling offshore
Virginia but backtracked on the idea after an explosion aboard
the Deepwater Horizon rig sent sent millions of barrels of oil
into the Gulf of Mexico.
 With both parties revving up for elections in 2012,
Republicans argued that increasing exploration would help lower
gasoline prices, even though it would take years to find and
develop new offshore oil.
 "This will send a strong signal to the world markets that
the U.S. is serious about producing our resources and bringing
more production online," said Republican Representative Doc
Hastings, who steered the bill through the House.
 Environmental groups said the legislation would leave the
nation's oceans more vulnerable to drilling accidents.
 "Congress is putting the interests of the oil industry over
those of the American people," Ocean conservation group Oceana
said in a statement. "Their chief priority seems to be assuring
continued profits, even if it costs us our coasts."
 Democrats were blocked from offering amendments to the bill
that would have stripped billions of dollars in federal tax
breaks from big oil companies.
 Factbox on energy bills moving through Congress:
[ID:nN03136852].
 "The Republicans say Big Oil needs these subsidies as an
incentive to drill and yet for the first quarter of this year,
the big five oil companies had profits of over $30 billion,"
said House Democratic Leader Nancy Pelosi.
 The legislation has little chance of making it into law.
The measure needs to be voted on by the Democratic-controlled
Senate, where it faces strong opposition.
 In the Senate, the commerce committee approved a bill to
toughen safety standards on oil and gas pipelines, while
imposing higher fines on violators.
 The safety bill is in response to a string of pipeline
accidents in the last year that killed more than a dozen
people, destroyed homes and polluted land and water.
 The legislation would raise fines from $100,000 per
violation to $250,000, and from $1 million for a series of
pipeline violations to $2.5 million.
 The measure must still pass the full Senate and then clear
the House before it could be signed in to law.
  As Republicans and Democrats scramble to show voters they
are trying to do something about rising gasoline prices, the
House will vote next week on legislation to set a 60-day
deadline for the Interior Department to decide on new offshore
drilling permits.
 The Senate will begin tackling tax breaks for oil companies
over the next few weeks by holding hearings on the issue and
offering Republicans the chance to vote on related bills.
 Debate is also picking up on a bill to promote natural gas.
 This week the Blue Dog coalition, a group of 25 moderate
Democrats who push for conservative budget and tax policies,
endorsed a bill that would provide incentives for manufacturers
to build heavy-duty trucks powered by natural gas and to covert
passenger cars to run on the fuel.
 The measure, which incorporates ideas from Texas
billionaire T. Boone Pickens, has bipartisan support. But
chemical makers and other industries that use large amounts of
gas are afraid that increased demand would boost prices and are
lobbying to stop the bill.
  (Additional reporting by Timothy Gardner and Richard Cowan;
Editing by Russell Blinch, Dale Hudson and Sofina Mirza-Reid)


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