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Energy bill will extend drilling
GOP presses plan for new refineries
Thursday, October 06, 2005

WASHINGTON -- Spurred by the back-to-back hurricanes Katrina and Rita, the Bush Administration and a number of Republicans now are pressing to win support in Congress tomorrow for a wide-ranging energy package that would relax environmental regulations on building new refineries and coal-fired power plants, open areas now banned to oil and gas drilling and provide new tax incentives for the energy industry.

Environmentalists, angry at record-high profits reported by oil companies, say they are aghast.

John Walke, clean air director of the National Resources Defense Council, said the pending legislation amounts to "exploitation of the national tragedy by allowing oil companies to pollute more and hurt the public health."

Environmentalists, however, want Congress to pass a different kind of legislation in the wake of the storms. They favor a bipartisan bill that would raise vehicle fuel-efficiency standards from 25 miles per gallon to 33 miles per gallon. Rep. Ed Markey, D-Mass., a sponsor of the bill, said that the 10-year, $12.3 billion energy bill President Bush signed in August did nothing to reduce dependency on foreign oil or help consumers struggling with ever-higher energy costs.

The administration, which warned that the earlier bill would do nothing to deal with current high gasoline prices, opposes Rep. Markey's legislation, arguing that anything that adds regulation to the beleaguered auto industry restricts its competitive stand. The administration also firmly opposes raising the federal gasoline tax and opening drilling on the outer continental shelf off such tourist-dependent states as Florida and California.

Although the oil industry shut down about 55 refineries in the 1990s, arguing in part that they weren't making enough money, Mr. Bush now says that new refineries must be built. The administration argues for relaxing regulations that restrict where new refineries can be built and how much pollution equipment they must have.

David Hamilton, who is in charge of global warming and energy issues for the Sierra Club, argues that oil companies purposely kept inventories low as a strategic business decision in an effort to raise prices. But oil companies counter that they are having to pay record-high prices for crude oil to keep up with consumer demand

The legislation, which will soon have a vote in the House, is far-reaching. It would end a 25-year-ban on oil and gas drilling along the coasts, permit drilling in the Arctic National Wildlife Refuge, provide tax help to the oil industry and provide incentives to build new refineries.

Rep. John Peterson, R-Pa., says the nation can no longer afford to ban drilling along coastlines because of a critical shortage of natural gas. "We can't wait any longer," he said as the extent of the damage to oil production in the Gulf Coast became more clear.

Rep. Markey, who lost his bids to weaken the bill in committee, angrily says it is a "leave-no-oil-company-behind" bill that will increase pollution without giving any relief to consumers frightened by high gasoline prices and the cost of heating their homes this winter.

The provision that has environmentalists most upset would permit the Bush administration to exempt refineries and coal-burning power plants, allowing them to expand without installing new air pollution controls as they are now required to do.

The Senate's version of the bill, introduced by Sen. James Inhofe, R-Okla., is much milder and would not permit as much new drilling in environmentally sensitive areas or relax clean air standards.

But Anna Aurilio, legislative director of the U.S. Public Interest Research Group, said because the Senate would not be likely to pass the bill pending in the House, she thinks the strategy is to wait for a conference committee to work out differences in the bills, which could result in adoption of some of the House's more controversial provisions.

First published on October 6, 2005 at 12:00 am
Ann McFeatters can be reached at 202-662-7071 or amcfeatters@nationalpress.com
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