Washington – Oil drilling would be expanded in the eastern Gulf of Mexico and more offshore revenue would flow to Louisiana and other Gulf states under a proposal by U.S. Sen. Bill Cassidy, R-La., that won approval by a Senate committee Thursday.
Cassidy’s Offshore Energy and Jobs Act was incorporated into legislation that also would open areas off the Atlantic and Alaska coasts to drilling. The overall bill cleared the Energy & Natural Resources on a party-line 12-10 vote, advancing the measure for consideration by the full Senate.
The bill also includes an end to the 40-year-old ban on exportation of crude oil, a change widely supported in the Louisiana congressional delegation.
The Cassidy proposal would increase energy production in the Gulf by ending in 2017 the moratorium on drilling within 125 miles of the Florida Panhandle (and within 235 miles of Tampa Bay), now scheduled to expire in 2022. Cassidy’s bill would shrink the drilling-free zone to 50 miles off the Florida coast.
The measure also would raise the $500 million annual cap on sharing of federal offshore revenues with Louisiana, Texas, Mississippi and Alabama that is set to take effect in 2018. The $500 million limitation, which represents a significant increase over current revenue-sharing levels as central Gulf fields are to be incorporated in the program, would rise to $700 million in 2018-2025 and to $1 billion in 2026-2055 under the proposal, which also adds Florida to the revenue-sharing pool.
The proposal to extend drilling in the Eastern Gulf has drawn opposition from members of Congress from Florida, both Republican and Democratic. Environmentalists also are against expanding offshore energy development.
But Cassidy says more drilling in the Eastern Gulf would provide oil, jobs, billions in government revenue and billions more in economic benefits.
In its budget proposal early this year, the Obama Administration called for scrapping the revenue-sharing program altogether.
The committee also approved a broad, bipartisan energy proposal in a separate bill.
Cassidy, a former congressman from Baton Rouge elected to the Senate in 2014, is a member of the energy committee. His original Senate version of the legislation included David Vitter, R-La., as a co-sponsor.