The House yesterday passed, 291 to 91, a bill to revise 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 off Louisiana and Texas in the Gulf of Mexico, has been carried on under regulations issued by the secretary of the interior.
Now, as offshore 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 competion, protect the environment, give the states more say in drilling off their coasts and assure that the government gets its money's worth in sale of drilling leases.
The Senate strengthened the bill about as much as the House weakened it.
"We'll have another shot in conference" between House and Senate to settle their differences, said a White House official keeping track of the bill. "It's compromisable 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 4-vote margin, a conference agreement, mainly over the issues of exploratory drilling by the government and changing the system of bidding for leases. These again are the two most controversial issues.
The Senate bill would direct the government to conduct exploratory drilling so it would have an idea of the potential worth of drilling rights before asking for bids. The House version would forbid the government to drill, but would permit contracting with a private firm to do it.
The Senate bill would require that at least half the leases be bid on by a method other than the cash bonus, which is now almost exclusively used, and favors big companies with large amounts of cash to put up in advance for the leases. 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 by some alternative method.
The House bill met to some degree the major demands of oil state members, but most issues were compromised.
Rep. Hamilton Fish Jr. (R-N.Y.), senior Republican on the committee that drafted the bill, had strongly opposed the committee version. But he said the House, to his surprise, had so improved the bill that he voted for it. He recalled that the House defeated a conference report two years ago, and warned House conferees not to give in to the Senate on exploratory drilling and other issues.
The bill, like the Senate's would require that state recommendations be considered when the government draws up a long-range offshore drilling plan, and that states be shown development and production plans showing exactly what companies plan to do off their coasts.
A new fund would be created by both bills to repair damage done by oil spills, and the liability of drillers or tankers causing spills is spelled out.
The House increased impact aid to coastal states adversely affected by offshore drilling to a maximum of $200 million a year. This was more than the administration wants, but the government would keep some control over how it is spent.
The committee bill would have given the Occupational Safety and Health Administration a role in regulating the safety of offshore divers. The House knocked this out, leaving this function with the Coast Guard.
Rep. John M. Murphy (D-N.Y.), floor manager of the bill, was defeated 208 to 201 when he tried to add a "buy America" provision. This would have required that drilling rigs, ships and other equipment used in OCS drilling be manufactured in the United States.
Opponents said this would lead to retaliation by other countries against the United states, which produces most of the equipment used to drill for offshore oil around the world. The bill already required that Americans be hired to operate the equipment.