Murkowski and Landrieu Introduce OCS Revenue Sharing Legislation
WASHINGTON, D.C. – U.S. Sens. Lisa Murkowski, R-Alaska, and Mary Landrieu, D-Louisiana, have introduced legislation that would guarantee a fair share of offshore oil and natural gas revenue to coastal states.
The Domestic Energy Security Act of 2009 provides coastal states, including Alaska, a 37.5-percent stake in energy development off their shores.
“This bipartisan bill will serve as the foundation for Alaska and other states to balance local economic and environmental concerns with national energy security,” said Murkowski, the top Republican on the Senate Energy and Natural Resources Committee. “Considering the economic and energy challenges we as a nation face, now is the time to get this right.”
The bill grants participating states 37.5 percent of all rents, royalties and bonuses from environmentally responsible oil and gas development in adjacent federal waters.
“There are real local costs associated with energy production, from the need for bigger ports and airports to the need for schools and housing for energy workers and their families,” Murkowski said. “Providing more local aid will let Alaskans better handle the costs associated with energy production that benefits the entire nation.”
“As our nation weans itself off foreign oil and transitions to the next generation of energy, we need OCS production in U.S. waters to get us there,” Landrieu said. “Coastal states will play a key role in building that ‘energy bridge’ if Congress can guarantee them their fair share of revenue and conservation royalties. This approach has worked in Louisiana, and it can for other states as well.”
The bill authorizes the Secretary of Defense to conduct an annual review of the prohibition against development in portions of the eastern Gulf of Mexico for defense training purposes to determine whether the restriction should be removed. It would also permit leasing of the Destin Dome area near the Florida panhandle.
“This long overdue legislation would recognize contributions of host states, while incentivizing them to undertake new and responsible offshore development,” Landrieu said. “Coastal communities should not shoulder the risks and responsibilities of OCS production without reaping some of the rewards. This bipartisan bill would finally change the inequitable regime that sends 100 percent of revenue to federal treasury.”
In 2006, Sen. Landrieu and then-Energy Chairman Pete Domenici, R-N.M., authored landmark legislation that opened more than 8 million acres in the Gulf of Mexico to drilling and provided a common-sense framework to share 37.5 percent of the revenues with the four energy-producing states: Louisiana, Mississippi, Texas and Alabama. An additional 12.5 percent was directed to the state side of the Land and Water Conservation Fund, which funds parks, bike trails, green space and outdoor recreation areas in all 50 states.
Existing federal data estimates the OCS holds mean undiscovered technically recoverable reserves of 86 billion barrels of oil and 420 trillion cubic feet of natural gas.
“Development of the OCS is key to improving our energy security and economy,” Murkowski said. “At a time when we are struggling to create jobs and produce affordable energy, ignoring the immense natural resources just off our shores is inexcusable.”
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