H.R. 3534 tackles oil and gas drilling comprehensively

In the months that followed, I led a series of oversight hearings in the House Committee on Natural Resources to examine the current state of the nation’s offshore drilling policy and determine where our efforts would be best focused, while also ensuring the American people are fairly compensated for the energy resources extracted from public lands and waters.

Our oceans, and the natural resources they contain, are too important for us to pursue expanded OCS energy development without doing so in a responsible and thoughtful fashion. By providing for planning and assuring transparency, our nation can better address the multitude of existing concerns — from preserving the environment to protecting local economies — that would come along with increased exploration in offshore waters. And by addressing those concerns upfront, we can provide more certainty to the industry and more reliability to consumers as expanded OCS energy development progresses.

For these reasons, in early September I introduced legislation — the Consolidated Land, Energy, and Aquatic Resources (CLEAR) Act of 2009 (H.R. 3534) — to further the nation’s goals of securing a reliable and sustainable supply of American energy.  This legislation lays the groundwork to ensure those resources are developed as efficiently and expeditiously as possible so that domestic oil and gas can begin flowing from those newly opened areas.

The CLEAR Act would make several important changes to current law in an effort to create greater efficiencies, transparency, and accountability in the development of our public energy resources. Among many important reforms, this legislation would consolidate the federal energy and mineral leasing programs, currently under the purview of the Minerals Management Service and the Bureau of Land Management, into one bureau to provide greater efficiencies in lease sales, inspection, enforcement, and revenue collection.  The bill proposes reforms to the onshore oil and gas leasing program in order to provide a more coordinated, efficient, and competitive use of federal oil and gas resources. It also outlines essential changes to the federal royalty collection program, including elimination of the scandal-ridden Royalty-in-Kind (RIK) program.

I recently led my committee in a two-day hearing on the CLEAR Act, which featured the insightful testimony of Interior Secretary Ken Salazar, NOAA Undersecretary and Administrator Jane Lubchenco, the Interior Inspector General (IG), the Government Accountability Office (GAO), and interested stakeholders.

At our hearing, Secretary Salazar announced that he intends, once and for all, to end the beleaguered RIK program, which he described as “a blemish on the department.” As a constant and vocal critic of the RIK program — which allows oil companies to pay the government in oil and gas rather than in cash — I support this move, believing that it will help to ensure that oil companies finally pay the American people what is owed to them for oil and gas taken from their public lands.

Over the years, multiple reports, audits, and investigations by the Interior IG and the GAO have uncovered a host of problems related to the management and development of federal energy resources. That evidence reinforces the need for the reforms contained in the CLEAR Act. 

Now is not the time to sit back and watch, as multinational conglomerates swoop in to reap the benefits of drilling in newly opened waters of the OCS. Wise planning and reasoned preparation now will ensure that we do not have to take costly steps later to correct mistakes made in haste.

Rahall is chairman of the House Committee on Natural Resources.