Webb, Warner push to start offshore oil and gas exploration

WASHINGTON

U.S. Sens. Jim Webb and Mark Warner introduced legislation Wednesday that would speed up the timetable for natural gas and oil exploration off Virginia's coast and expand the state's share of offshore territory.

The bill also would require that half of future government revenues from offshore drilling be allocated directly to the state government or spent by federal officials on conservation efforts, transportation improvements and alternative energy projects in Virginia.

The two Democrats' proposal goes further in seeking a larger share for Virginia from offshore resources than a House measure co-sponsored by two Hampton Roads congressmen. However, the plan will face strong opposition from other federal lawmakers who oppose sharing federal oil and gas revenues with select states and from environmental activists who say offshore drilling is too risky.

If approved, the Webb-Warner bill would require that the sale of oil and gas leases for areas off Virginia's coast be included in a 2012-2017 federal plan. The Virginia sales were expected to begin this year but were put on hold by President Barack Obama's administration until at least 2017 in the wake of the Deepwater Horizon oil spill last year in the Gulf of Mexico.

"Opening up and expanding Virginia's offshore resources to responsible natural gas and oil exploration holds significant promise for boosting needed domestic energy production, while bolstering the commonwealth's economy," Webb said in announcingthe bill, called the Virginia Outer Continental Shelf Energy Production Act of 2011.

Warner said, "This legislation jump-starts a multiyear process that will include responsible environmental reviews, close consultations with NASA and our military partners in Hampton Roads, and this process will include multiple public hearings."

Their bill appears to more than double the size of the area off the coast that would be Virginia's share of the planning area. Under the current federal map, Virginia has a relatively small triangular area that extends about 50 miles off the Eastern Shore.

Ken Salazar, secretary of the U.S. Department of Interior, said during a visit to Norfolk last week that North Carolina's offshore planning area "seems to be a little bit big" compared with Virginia's but declined to comment on whether it was fair division.

"I don't know what it would take to change it," Salazar said.

If Congress were to approve speeding up offshore exploration and give Virginia a larger planning area, supporters could have a much tougher fight persuading lawmakers to give the state a big cut of revenues from future oil and gas.

The billions of dollars in annual federal royalties from offshore drilling are a major source of Washington's revenues. Opponents, including legislators from inland states, say the offshore resources belong to the entire country, not coastal states.

Warner acknowledged the royalty sharing will be a tough sell but said it's critical for Virginia to get a share, noting that the precedent has already been set with the Gulf states. "What's good for the goose is good for the gander," he said.

The Virginia senators' plan, if adopted, would be similar to successful 2006 legislation that approved sharing federal royalties from lucrative oil wells far out into the Gulf of Mexico. Four states - Louisiana, Alabama, Mississippi and Texas - began collecting 37.5 percent of royalties from Gulf wells in federal waters.

Webb and Warner's bill would allocate the same percentage to Virginia and direct the president to spend an additional 12.5 percent of revenues on federal projects in the commonwealth.

The proposal was praised by Gov. Bob McDonnell, a Republican, who successfully pushed for a state law last year that requires that most revenues from offshore drilling be used to fix the state's transportation system.

If approved, offshore drilling "will help move our nation closer to energy independence, while bringing much-needed jobs and revenue to the commonwealth," McDonnell said.

But Glen Besa, director of Virginia's Sierra Club chapter, contended the drilling could irreparably harm the region's environment.

"We really need Sens. Warner, Webb, and Gov. McDonnell to provide leadership in supporting an energy policy that invests in efficiency, renewable energy and clean energy jobs," Besa said. "Drilling off our coast will not reduce the price of gas and will only prolongour dependency on foreign oil."

Warner said there will be ample protection and safeguards put in place during the seven-year process before oil and gas production could begin.

The senator said offshore drilling is part of a broader approach to developing new sources of energy.

"Our economy and national security will be strengthened by an 'all-of-the-above' approach to energy, including the expanded production of our own domestic energy resources," Warner said.

Bill Bartel, (757) 446-2398, bill.bartel@pilotonline.com