Two Democrats active on oil-and-gas issues are applauding Interior Department plans to divide the agency that regulates offshore drilling and collects production royalties.



"It may have the effect of building some additional independence in to the folks responsible for safety issues," Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-N.M.) told The Hill.



Interior Secretary Ken Salazar is expected to announce plans Tuesday to carve Interior's Minerals Management Service into separate branches.



MMS - which is under new scrutiny following the Gulf of Mexico oil spill - currently regulates drilling and production operations in federal waters, and collects billions of dollars in lease bids and royalties from U.S. energy production.



Sen. Mary Landrieu (D-La.) also cheered the plan. 

"I think it's a good move on Secretary Salazar's part and probably long overdue," she told reporters in the Capitol.

House Majority Leader Steny Hoyer (D-Md.) said Tuesday the administration's discussion of splitting up MMS in the wake of the BP spill is "a good thing."

"We have an agency that is primarily focused on the revenue side of the oil industry industry, as opposed to the safety side.  And I think there is going to be some suggestion, with which I agree, to either create another division to separate the responsibilities, so you have a vigorous agency or division to look at the safety aspects, and let somebody else look at the revenue aspects."

Creating a new offshore safety agency would not require congressional approval.

Republican senators used the first hearing into the Gulf of Mexico oil spill to warn against pulling back on offshore drilling, even as they emphasized the need for greater safeguards.

While steering clear of the GOP’s “drill, baby, drill” refrain from 2008, lawmakers nonetheless stressed that the U.S. reliance on oil will continue.

“We all agree that we need to steadily minimize the percentage of oil in our overall energy mix, but under anyone's most optimistic scenario, our nation will need a lot of oil for a long time to come,” said Sen. Lisa Murkowski (R-Alaska), the top Republican on the Energy and Natural Resources Committee.

“For the sake of our nation's economy, for the sake of our national security, and this incident notwithstanding, for the sake of the world's environment, we need to safely produce the maximum amount of that energy at home,” she added.

She said the April 20 explosion of the Deepwater Horizon rig “will teach us here today and for many years to come about how America can strengthen our standards for producing the energy we need without compromising our economy or energy security.”

Sen. John Barrasso (R-Wyo.) said that “blocking future offshore exploration only means we will import more from foreign countries.”

Democrat Mary Landrieu (La.), a strong oil-and-gas industry ally, had a similar message. She said that pulling back on U.S. development would “export some of these problems to countries less equipped and less inclined to prevent this kind of catastrophic disaster.”

The first portion of the hearing focused on increased technical safeguards that may be needed to ensure that blowout prevention devices function proplerly.

Later the lawmakers will hear from executives from BP America Inc., Transocean Ltd.  and Halliburton. BP had leased the Deepwater Horizon rig from owner-operator Transocean, and Halliburton was a contractor on the drilling project.

Sen. Frank Lautenberg (D-N.J.) is introducing a bill that would levy new fees on offshore oil-and-gas leases to fund alternative energy programs, a sign that drilling opponents are seeking to stay on offense politically as the Gulf of Mexico oil spill continues.

The bill would impose a $10 annual fee on each acre leased for offshore drilling. Lautenberg released letters of support from two environmental groups – the Natural Resources Defense Council and Friends of the Earth.

“Instead of just talking about moving ‘Beyond Petroleum,’ this legislation would force the oil companies to put their money where their mouth is and invest in the next generation of clean energy technology,” Lautenberg said in a prepared statement.

His office said the bill could raise as much as $1.8 billion annually, but that figure would assume every acre of offshore tracts available is actually leased and generating the fees.

Lautenberg is a member of the Environment and Public Works Committee, which is holding the second of two Senate hearings Tuesday about the April 20 explosion of the Deepwater Horizon rig leased to BP and the subsequent spill.

The Energy and Natural Resources Committee hearing began Tuesday morning.

Energy and Natural Resources Committee Chairman Jeff Bingaman (D-N.M.) on Tuesday opened the first Capitol Hill hearing into the Gulf of Mexico oil spill with a pledge to work across the aisle on new legislation to prevent future disasters.

Bingaman noted that the April 20 oil rig explosion and ongoing spill present a suite of technological and regulatory questions, and that lawmakers must “determine quickly and to the best of our ability the appropriate next steps.”

“As those steps become clear, through the testimony we receive and the investigative work of our Committee staff, I intend to work with the Ranking Member and the Members of this Committee on a bipartisan basis to develop, introduce and advance the necessary and appropriate legislation through the Senate,” he said.

The committee is hearing today from executives from BP America Inc., Transocean Ltd.  and Halliburton. BP had leased the Deepwater Horizon rig from owner-operator Transocean, and Halliburton was a contractor on the drilling project.

The proposal comes after years of damning reports about the Minerals Management Service.

* On eve of congressional hearings, blame game begins

A day before two congressional committees hold hearings on the Gulf oil spill, executives at the companies involved in the accident began pointing fingers at one another.

From the Wall Street Journal: “BP, the well owner, blames the failure of a big set of valves on the sea floor, known as the blowout preventer, to halt the blowout once it started."

But BP’s contractors, Halliburton and Transocean, as well as by two workers on the drilling rig, are focusing on when a cement plug was installed in the process. 

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A proposed amendment to the Wall Street bill has sparked a fight that will test the oil industry’s political clout.

BP executive says company has already paid $3.5 million to cover 295 claims.

A BP executive mounted a defense of the company’s efforts to contain the Gulf oil spill on Monday, a day before congressional panels hold hearings on the cause of the accident and the threat it poses to coastal states.

David Nagel, executive vice president of BP America, described for reporters several efforts to stop the spreading leak in a clear attempt to stem the political damage from the massive spill, which is now three weeks old.

Nagel said BP was drilling two relief wells to intersect the drill hole so that mud and concrete could be poured down to clog the leak, a process that could take 90 days.

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