The House neared final action last night on a bill revising rules for offshore oil and gas drilling which the industry weakened but which the White House feels can be made satisfactory in conference with the Senate.
For the last 25 years, drilling on the outer continental shelf, mostly in the Gulf of Mexico, has been carried on under regulations issued by the secretary of the Interior.
Now as drilling moves up the ocean coasts to help relieve dependence on foreign oil, the administration has asked Congress to write new rules into law to promote competition, protect the environment, give the states more say in drilling off their shores and assure that the government gets its money's worth in the sale of drilling leases.
The Senate strengthened the administration's bill about as much as the House weakened it.
We'll have another shot in conference" between House and Senate to settle the differences, said a White House official keeping track of the bill. "It's compromisable. It lends itself to moving figures around. I think we can work out something that will make everybody happy."
Congress has been working on the bill for three years. Two years ago the House rejected by a four-vote margin a conference agreement, mainly over the issues of exploratory drilling by the government and changing the method of bidding for leases. These are the two most controversial issues again.
The Senate ordered the government to do exploratory drilling so it would have some idea what the drilling rights were worth before asking for bids. The House version prohibits the government from drilling but permits contracting with a private firm to do it.
The Senate bill requires that at least half the bids on leases be in some form other than the cash bonus which is now almost exclusively used and favors big companies with lots of money. The purpose is to bring in smaller operators who could bid without much cash by agreeing to share profits with the government. The House voted to require that between 20 and 50 percent of the bids be some alternative method.
Both bills create funds to repair damage from oil spills. The House version requires that the driller or tanker that caused the spill pay the first $35 million of damages. Both bills also require that states be consulted and their recommendations given weight both in the drawing up of an overall offshore leasing program and when lessees file development and production plans to report what they propose to do.