Posts Tagged ‘Senate Energy and Natural Resources’

An internal memo from the U.S. Interior Department suggesting that the agency set the highest possible royalty fee on potential oil and gas development before last year’s Cook Inlet lease sale is drawing blowback from the Democratic chair of the Senate Energy and Natural Resources Committee.

West Virginia Sen. Joe Manchin said in a statement he was “appalled” by the memo, which he said was leaked and prioritized a “radical climate agenda” over the energy needs of Alaskans and the U.S.

Anchorage Daily News

From the decision memo:

While a 16 ⅔ percent royalty may be more likely to facilitate expeditious and orderly development of OCS resources and potentially offer greater energy security to residents of the State of Alaska, a reasonable balancing of the environmental and economic factors for the American public favors the maximum 18 ¾ percent royalty for Cook Inlet leases.

Sale 258 Decision Memo

The lower royalty rate probably would not have made much difference in the outcome of this sale, which only drew one bid, but the attitude expressed in the decision memo is rather disappointing given the Department’s mission, as expressed in the OCS Lands Act, to make resources available for expeditious and orderly development.

What might have made the sale more attractive was royalty suspensions, Option D.5.b (below). This would have been the best means of supporting the objectives of Senator Manchin, the other authors of the congressional leasing mandate, and the State of Alaska.

Option D.5.b: Offer Royalty Suspensions
BOEM could offer royalty suspensions with the goal of making resources available for expeditious and orderly development. However, BOEM does not recommend royalty suspensions as the recommended lease term options are expected to balance the goals outlined earlier in this memo

Sale 258 Decision Memo

Those who are concerned by the Sale 258 Decision Memo should be more troubled by the Proposed 5 Year Leasing Plan, most notably this stunning sentence which justifies the minimalist plan and signals a phasing out of offshore oil and gas leasing:

The long-term nature of OCS oil and gas development, such that production on a lease can continue for decades makes consideration of future climate pathways relevant to the Secretary’s determinations with respect to how the OCS leasing program best meets the Nation’s energy needs.

5 Year Leasing Program, p.3

Read Full Post »

Secretary Salazar will appear before the Senate Energy and Natural Resources Committee on Wednesday (2 March) at 10:00 am ET and the House Natural Resources on Thursday (3 March) at 10:00 am ET. Expect deepwater drilling and other offshore energy questions.  Both hearings will be streamed live at the respective websites.

Read Full Post »

From the State of the Union address:

The Interior Department is in charge of salmon while they’re in fresh water, but the Commerce Department handles them when they’re in saltwater. I hear it gets even more complicated once they’re smoked. President Obama

While this comment drew laughs from the audience, the regulation of salmon is rather straightforward compared to the extraordinarily complex regulatory regime for offshore facilities and pipelines. The first and most important recommendation in my testimony before the Senate Energy and Natural Resources Committee last May was as follows:

Streamline the OCS regulatory regime to minimize the potential for gaps, overlap, and confusion.  Because of the complexity of the OCS regime, regulatory and industry personnel spend too much time resolving and coordinating administrative and procedural matters.  This time would be better spent focusing on mission critical safety issues.   A single agency should be responsible and accountable for safety and pollution prevention at offshore facilities, and should draw on the expertise of other agencies and organizations as necessary to achieve performance objectives.

If we are to achieve our safety, pollution prevention, efficiency, and energy production objectives, the OCS regulatory regime must be consolidated and simplified.

Read Full Post »


Read Full Post »

I haven’t posted recently for a variety of reasons, but I see that folks are still visiting the blog.  Thanks for checking-in.  For those who are formulating their own views about what really happened and why, the documents at the House Energy and Commerce Committee site are mandatory reading.

Also, many thanks to those who have asked about my testimony before the Senate Committee on Energy and Natural Resources.  My statement is here. Kudos to Chairman Bingaman and the very capable committee staff for their thoughtful and professional approach to these hearings.

Read Full Post »