House approves oil spill legislation

In its most sweeping response to the gulf oil spill, the House on Friday approved legislation that would impose new environmental safeguards for offshore drilling, remove a liability cap for spill damages, and slap industry with a new tax to fund conservation projects nationwide.

The Democratic-drafted legislation passed on a largely party-line 209-193 vote but faces trouble in the deeply divided Senate.

“The Deepwater Horizon explosion and the subsequent damage that has occurred over the past 102 days is indeed a game-changer,� said Nick J. Rahall II (D-W.Va.), chairman of the House Natural Resources Committee.

The measure, which follows dozens of Capitol Hill hearings into the worst offshore oil spill in U.S. history, would remove a $75-million liability cap on oil firms for economic damages caused by spills. It would also hit energy producers with a new $2 per barrel tax to fund land purchases for national parks, forests and wildlife refuges.

The House bill would set new standards for blowout preventers, the safety device that apparently failed on BP’s blown-out well in the Gulf of Mexico. And it would repeal an 1851 law that rig owner Transocean has sought to use to limit its liability for the disaster.

The bill, which has become entangled in election-year politics, was backed by Democrats who said it would help prevent another oil spill disaster and hold oil companies more accountable for spills. It was opposed by Republicans who argued it would raise the cost of domestic energy production and increase U.S. dependence on foreign oil.

“Let’s vote to ensure that a spill of this kind never happens again,� said Rep. Lois Capps, a Democrat whose Santa Barbara district was the scene of a devastating oil spill in 1969.

Rep. Pete Sessions (R- Texas), who heads the House GOP campaign committee, urged Republican colleagues heading home Friday for summer recess to tell voters that Democrats were “sticking it to the consumer again at the gas pump.�

“If you want to apologize for Big Oil, go ahead,� responded Rep. Jim McGovern (D-Mass.). “The American people are not on your side on this one.�

Gulf Coast lawmakers were among the bill’s sharpest critics.

“This isn’t the answer to help the gulf,� said Rep. Steve Scalise (R-La.), contending that the bill would increase the cost of domestic energy production. “It only helps OPEC.�

The oil industry accused lawmakers of acting in haste without waiting for the results of multiple investigations into the April 20 Deepwater Horizon explosion.

“Congress has not taken the steps to understand not only the causes of the oil spill, but also the full impact of this legislation on the economic and national security of our nation,� said Barry Russell, president and chief executive of the Independent Petroleum Assn. of America.

Rahall dismissed industry criticism as “sheer hyperventilation� and urged critics of the legislation to “take a look at the spill in the gulf to see how an overly permissive attitude can turn into a real horror story.�

The bill would repeal a provision of the 2005 energy law that exempted projects, including the Deepwater Horizon drilling, from detailed environmental analysis. It would bar companies with poor safety and environmental records from receiving new offshore drilling leases. And it would require offshore drilling rigs to operate under the U.S. flag, requiring tougher safety rules than those in effect for the Deepwater Horizon, which was registered in the Marshall Islands.

The measure would prohibit oil companies from bidding on new offshore leases unless they renegotiate royalty-free offshore oil leases that were approved in the 1990s. It would establish new ethics rules for drilling regulators; increase fines to $10 million, from $100,000, for willful violations of drilling rules; and establish new procedures for use of oil dispersants.

A separate measure to provide whistleblower protections to offshore drilling workers was approved.

The House approved an amendment that would lift the Obama administration’s deepwater drilling moratorium for companies that meet new safety rules. Gulf Coast lawmakers have said the moratorium is damaging their region’s economy.

What effect the provision would have is uncertain since a final bill is unlikely to go the White House until September at the earliest. The moratorium is due to expire Nov. 30, but Interior Secretary Ken Salazar has said it could end earlier if drilling can proceed safely.

Senators could take up their version of the legislation before they leave town at the end of next week. The Senate Democrats’ bill, like the House bill, would remove the liability cap. Republicans object to this provision, however, saying that removing the cap would drive smaller companies out of the gulf.

Even though Democrats hold a majority in the Senate, they lack the 60 votes needed to overcome a Republican-led filibuster. Also, energy politics can sometimes divide lawmakers by region, instead of party affiliation. Democrats from energy-producing states like Alaska and Louisiana may be reluctant to support any measure they believe will hurt an industry that is important to their state’s economy.

One common feature of the House bill and the Senate Democrats’ proposal would provide $900 million a year for land purchases for national parks, forests and wildlife refuges.

That would provide a level of funding reached only once since President Lyndon B. Johnson in 1964 signed the Land and Water Conservation Fund Act. Environmentalists already are drawing wish lists of projects.

A funding increase would provide “the catalyst to complete our land acquisition plan� for the Santa Monica Mountains National Recreation Area, said Woody Smeck, acting deputy regional director of the National Park Service’s Pacific West Region. “We have 22,500 acres still to acquire from willing sellers.�

The legislation also would write into law the Obama administration’s revamping of the scandal-plagued federal agency that oversees offshore drilling, in order to reduce potential conflicts of interest.

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