Group eyes offshore drilling

The bipartisan working group seeking compromise on energy legislation is crafting a bill that would allow oil and gas drilling off the coasts, said a source familiar with negotiations, with one-third of the royalties to go to alternative and renewable energy.

But the group will not consider more ambitious fuel economy standards, which has already caused one Republican member to depart.

{mosads}The group is considering language ordering a release of oil from the Strategic Petroleum Reserve and reining in speculation in oil markets. But members are not discussing opening up the Arctic National Wildlife Refuge to oil exploration.

“Even the Republicans aren’t pushing that too hard,” the source said.

The group was put together by Reps. Neil Abercrombie (D-Hawaii) and John Peterson (R-Pa.), and is operating in relative secrecy. After initially saying they would release the names of members in the group, they have withheld that information.

“This isn’t a formal committee, this is a group of members getting together to discuss an issue,” said Patrick Creighton, spokesman for Peterson.

But the group has met twice, and is expected to meet again this week. The goal, said Creighton, is to introduce legislation before lawmakers leave for the August recess. So far, he stressed, nothing has been finalized.

“What they are working on is a comprehensive energy solution for America,” Creighton said. “There will definitely need to be production, conservation and renewables.”

The group was organized in response to frustration with the leadership in both parties on the energy issue. Members said only highly partisan measures were coming to the floor, with no one looking for a compromise measure as constituents suffered under the growing burden of skyrocketing gas prices.

The House group was initially referred to as the “Gang of 20,” and a counterpoint to the “Gang of 10” senators working on an energy compromise in the other chamber. Both are trying to build on the success of the “Gang of 14” who averted a Senate showdown over judicial nominations.

The Senate group, organized by Sens. Kent Conrad (D-N.D.) and Saxby Chambliss (R-Ga.), wants to find a compromise drilling in restricted areas, focusing on the Gulf of Mexico.

The Abercrombie-Peterson proposal as it stands closely tracks a bill that Abercrombie and Peterson introduced last year that opened up coastal waters to drilling 50 miles out, with one-third of the royalties to go to renewable and alternative energy sources. The rest of the royalties would be split between federal and state governments. The bill has 170 co-sponsors.

The main difference is that the group has added oil, while the previous bill would have allowed only natural gas production. While that pleases those who believe oil drilling would lower gasoline prices, it would also make the bill more controversial.

The main reason that drilling is prohibited is fear of oil spills, with gooey muck washing up on beaches and ruining the economies of tourist towns. That’s much less likely with natural gas, which simply bubbles out of the water, than with oil.

Even if the members are able to come up with a compromise on drilling, they have a huge obstacle looming in House Speaker Nancy Pelosi (D-Calif.). Pelosi has adamantly refused to allow votes on drilling in protected areas, calling the idea that it would lower gasoline prices “a hoax.”

House Minority Leader John Boehner (R-Ohio) says a majority of the members of the House support some sort of drilling, and has vowed that the House won’t leave for August recess without a vote on drilling in new areas.

Members of the group reportedly believe that they represent a broad enough cross section of the full House that they will be able to find a way to get their proposal to the floor.

In addition to Abercrombie and Peterson, Rep. Rahm Emanuel (D-Ill.) is to introduce legislation this week to provide incentives to encourage automakers to make 10 percent of their fleet vehicles that run on natural gas by the year 2018.