The Bush administration today ended its legal fight against California's right to review offshore oil drilling along its coast.

Facing a Tuesday deadline, Interior Secretary Gale A. Norton said the administration would not ask the Supreme Court to overturn two lower court decisions that upheld the state's position that it be allowed to assess, and perhaps halt, any future drilling.

The decision by the Bush administration makes it less likely that new oil wells will be developed along the coast, but it does not mean drilling is banned.

Norton said she would continue discussions with the state and the holders of 36 federal offshore oil and gas leases.

The areas with leases are estimated to hold enough oil to supply California refineries for two years.

"Our administration strongly supports environmental protection and understands the importance of this issue to the people of California," Norton said in a statement. "We believe our efforts will be better spent in negotiation rather than in continued litigation with the state."

Norton said she endorses a moratorium on granting new leases, but she did not signal what she would do about the existing leases -- ones awarded but not yet developed.

California officials want the federal government to buy back the leases from the oil companies just as it did in Florida, but they have been rebuffed by the Bush administration.

With his brother, Gov. Jeb Bush (R) in a tight reelection campaign, President Bush announced plans last year to provide $230 million to protect the Everglades and Florida's Gulf coast from oil and gas development.

"I think California deserves the same generous help Florida received," said California Gov. Gray Davis (D) in a telephone news conference today.

Davis said that California still won big today -- even if the fight is not over.

"I am absolutely thrilled the Interior Department finally gave up this fight," Davis said. "The future of California beaches is now where it should be -- in the hands of Californians. This is a huge victory for California and every other coastal state in the nation."

Rep. Lois Capps (D), who represents the central coastal counties where the drilling leases are sited, said, "Today's decision by the administration demonstrates that Interior Secretary Gale Norton has seen the light, and reversed the misguided position she expressed last summer that 'Florida opposes coastal drilling, but California does not.' Indeed, Californians do oppose drilling, and demand and deserve a say."

California voters and their officials have been vehemently opposed to new offshore drilling ever since a spill off Santa Barbara fouled beaches there in 1969.

The 36 leases along the central California coast were granted by the federal government between 1968 and 1984, and oil companies were given 10-year extensions on the leases in 1999 by Bruce Babbitt, interior secretary under President Bill Clinton.

California sued Babbitt, contending that his decision was subject to review by the state under the federal Coastal Management Act, which grants states authority to determine whether offshore drilling in federal waters is consistent with the state's environmental protections.

In December, a three-judge panel of the U.S. Court of Appeals for the 9th Circuit unanimously blocked new offshore drilling. It agreed that the California Coastal Commission was empowered to review such projects.