Oil Drilling Approvals by EPA Expedited Under House-Passed Bill

The Environmental Protection Agency would have to issue or deny air permits for offshore oil drilling within six months under legislation passed by the U.S. House.

As oil prices climbed 23 percent over the past year, Republicans have pushed legislation that would expand drilling off the Alaska coast and in the Gulf of Mexico. The bill to tighten environmental deadlines passed the Republican-led House yesterday on a vote of 253 to 166.

“We cannot leave exploration and production of critically needed resources in a perpetual state of limbo,” Marty Durbin, vice president of the American Petroleum Institute, a Washington trade group, said in a statement after the vote. “Development of new offshore energy resources will strengthen American energy security, provide jobs, assist economic growth, and increase revenues to the federal treasury.”

The House previously passed bills that would give the Obama administration deadlines to sell offshore oil leases and open additional areas on the Outer Continental Shelf to drilling. The Democratic-led Senate hasn’t acted on similar legislation.

Royal Dutch Shell Plc (RDSA) canceled its plan to drill an exploration well in the Beaufort Sea off Alaska this year, with the Hague-based company saying it didn’t obtain an air permit in time. Shell, blocked since 2007 from developing its Alaska leases, filed a plan last month seeking approval for as many as four Beaufort wells -- two in 2012 and two in 2013.

‘Broken Bureaucracy’

“The exploration on the Outer Continental Shelf has been delayed for years because of the broken bureaucracy,” Representative Fred Upton, a Michigan Republican who heads the House Energy and Commerce Committee, said during floor debate on the bill yesterday. “It has been a never-ending circuit of approvals, and appeals and re-applications.”

In addition to imposing deadlines for EPA action, the House measure would take away the authority of the agency’s Environmental Appeals Board over air permits for drilling.

Drilling a well off the Alaska coast may emit as much pollution as a large, modern refinery, Gina McCarthy, the EPA’s assistant administrator, said in testimony on May 13. The EPA opposes the legislation, saying it might boost nitrogen dioxide, particles and sulfur dioxide pollution, she said.

“It’s a giveaway to the oil industry that will increase pollution along our coast,” Representative Henry Waxman, a California Democrat, said during the debate.

Senator Lisa Murkowski, a Republican from Alaska, introduced a similar bill in the Senate, which hasn’t acted on it.

The House bill is H.R. 2021.

To contact the reporter on this story: Katarzyna Klimasinska in Washington at kklimasinska@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net

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