McNerney Backs Bill to Encourage Oil Companies to Drill on Existing Leases, Create New Leases in Alaska Petroleum Reserve

July 17, 2008

Washington, D.C. – With California families and businesses increasingly feeling the squeeze from high gas prices, Congressman Jerry McNerney (CA-11) again voted to push oil companies to begin drilling on the 68 million acres of federal land they have already leased for that purpose and specifically for speeding the development of the National Petroleum Reserve-Alaska.  The National Petroleum Reserve-Alaska is a petroleum reserve in Alaska estimated to be able to produce 10.6 billion barrels of oil.

The legislation, H.R. 6515, the Drill Responsibly in Leased Lands Act, also requires that domestically-produced oil from Alaska be sold in the United States, ensuring an increase in available crude oil.

“American families and businesses are suffering from record prices at the pump and they need help.  I’ve consistently called on the President to open the Strategic Petroleum Reserve to provide immediate relief and also asked Attorney General Brown to investigate gas pumps in California to make sure at a time of record high prices that consumers are getting what they pay for,” said Rep. McNerney.

“Today, I said again as I’ve said before, the oil companies have 68 million acres of leased land for drilling and they should start exploring and producing immediately.  We should specifically look to the National Petroleum Reserve in Alaska, which was set aside as an oil reserve.  It already has some leases and is ready for more – unlike ANWR and our pristine coastal areas,” Rep. McNerney continued.

Specifically, the Drill Responsibly in Leased Lands Act:

• Mandates that the Bush Administration conduct annual lease sales for 5 years to ensure that the lands in the National Petroleum Reserve-Alaska are more rapidly leased for oil and gas production.  It has more oil than the Arctic National Wildlife Refuge and is already designated for oil and gas production so it could occur more rapidly. The bill will protect sensitive areas, such as around Teshekpuk Lake.
• Requires the Transportation Secretary to facilitate the necessary pipeline infrastructure to bring the producing oil fields in NPR-A online.  Right now, available pipelines reach to within 5 miles of NPR-A.
• Bans the export of Alaskan oil. In 2000, about 7 percent of crude oil production from the Alaskan North Slope was exported to South Korea, Japan, and China.
• Requires oil companies to diligently develop leases on federal lands that they are already holding.  If they cannot certify that they are doing so, they must give up the unused leases — so that someone else can develop them – before obtaining any new leases.
• Directs the Interior Secretary to take steps to ensure that federal oil and gas lease holders are making prompt and accurate royalty payments so that the owners of these lands, the American taxpayers, are fully reimbursed for their use.

Due to a procedural rule for the consideration of H.R. 6515, even though the legislation ostensibly received sufficient votes to pass the House (244 to 173), because it did not reach the 2/3 majority necessary, the bill did not pass.

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