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Oil Chiefs Urge Offshore Drilling

AP
Wednesday, 25 Feb 2009 | 4:18 AM ET

Executives of the biggest oil companies are taking their case for expanded offshore drilling to Congress, even as Democratic congressional leaders and the Obama administration promise to put some limits on energy development along the nation's coasts.

The executives were testifying Wednesday before the House Natural Resources Committee.

The panel previously heard from opponents to drilling and from officials representing the governors from a number of coastal states.

Committee Chairman Nick Rahall, D-W.Va., said he's not opposed to offshore drilling, but was holding the hearings to learn more about "the trade-offs that would be involved" if more coastal waters were opened to oil and gas companies.

Congress last October ended the long-standing ban on drilling in about 85 percent of the country's coastal waters, from New England to the Pacific Northwest.

Environmentalists have called for the ban to be re-imposed.

The oil executives to testify are Larry Nichols, chairman of Devon Energy ; Marvin Odum, president of Shell Oil; Lamar McKay, president of BP America; and the top executives of the exploration and production arms of Exxon Mobil and Chevron .

In a conference call Tuesday with reporters, Nichols said the message he and the other executives want Congress to hear is that "for decades to come the vast majority of our energy is going to come from our historic sources, mainly oil and natural gas," and there are substantial resources in federal coastal waters.

Also Tuesday, officials from several coastal states told the committee that states' views must be taken into account before the federal government allows oil drilling in federal offshore waters.

And some states made clear they want no drilling -- period.

"There should be no ambiguity about where California stands on the issue of new offshore oil and gas leasing off California. We oppose it," said Mike Chrisman, the state's secretary for natural resources.

Ted Diers, chairman of the Coastal States Organization, which represents governors of coastal states, said any offshore energy development must have states as full partners, with revenues shared.

"It is vital for state authority and sovereignty to be maintained," said Diers, who manages New Hampshire's coastal programs.

Robert Marvinney, Maine's state geologist, acknowledged competing economic pressures when it comes to offshore development.

More than any other state, Maine is dependent on fuel oil for heating, he noted, and Georges Banks oil off New England "could provide benefits to the state of Maine."

But, he said, Georges Bank also has great economic value to the region as a fishery, and "we are concerned about potential negative impacts" that oil and gas development might have.

Interior Secretary Ken Salazar recently scrapped an ambitious offshore drilling plan -- including energy development along both the Atlantic and Pacific coasts -- outlined by the Bush administration.

He called the Bush plan too broad, clearing the way for a new approach for offshore drilling with greater emphasis on developing wind, solar and tidal wave resources and assurances that some waters remain protected.

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