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Vol. 10, No. 12 Week of March 20, 2005
Providing coverage of Alaska and northern Canada's oil and gas industry

Score 2 for ANWR

Senate OKs 2006 budget with ANWR; supporters hail vote as crucial victory

By Rose Ragsdale

Petroleum News Contributing Writer

In a major victory for President Bush’s energy policy, the U.S. Senate approved a 2006 budget resolution March 17 that includes provisions for opening the Arctic National Wildlife Refuge’s coastal plain to oil drilling.

The Republican-led effort ended in a squeaker 51-49 vote that saw four Republicans join all the Senate’s Democrats and one independent in unsuccessfully opposing the measure.

Elated supporters of ANWR oil exploration hailed the vote and a victory a day earlier in defeating an amendment that would have stripped ANWR drilling from the Senate’s 2006 budget.

Sen. Lisa Murkowski, R-Alaska, said the victories in the Senate were significant, but ANWR legislation still has a long way to go to reach President Bush’s desk.

“As I was explaining to my kids last night — it’s like staying in a tournament. In order to participate in the championship game and win at the end of the day, you’ve got to be winning every step of the way — you’ve got to stay in the game. And right now ANWR is still in the game,” she said.

ANWR proponents praise Senate

By advancing Bush’s proposal for environmentally responsible energy production in Alaska’s 1002 Area, the U.S. Senate cast a vote for America’s energy security and fulfilled a commitment to Alaska residents, who strongly support energy production in the region, Interior Secretary Gale Norton said in a statement March 16.

Alaska Gov. Frank Murkowski also praised the Senate’s actions. In 1995 ANWR passed both the House and Senate through the budget reconciliation process, but was vetoed by then President Clinton, Murkowski told reporters March 16.

The governor said he is gratified that Bush has made opening a small portion of ANWR’s coastal plain one of the top energy priorities of his administration and Congress has a Republican majority.

Alaska lawmakers also commended the Senate for including ANWR drilling in its budget resolution.

“It is encouraging to know that Alaska has spoken, and Congress listened,” said House Speaker John Harris, R-Valdez.

When the Senate budget came to a tally at 9:30 p.m. EST March 17, the outcome remained uncertain until senators cast the final votes. Four Republicans — John McCain of Arizona, Susan Collins of Maine, Gordon Smith of Oregon and Norm Coleman of Minnesota — who voted against opening the refuge March 16 supported the entire budget. Senate leaders had expected a 50-50 split and Vice President Dick Cheney showed up in the chambers as the votes were being cast in case his was needed to break a tie. Instead, he congratulated the Republican majority.

By including ANWR drilling in the budget resolution process, Senate Republicans were able to avoid a Democratic filibuster, which would have required 60 votes to break. This was a key issue for environmentalists who have used the filibuster in the past to defeat ANWR provisions in the Senate.

Three anti-drilling Republicans voted against the budget — Sens. Lincoln Chafee of Rhode Island, Olympia Snowe of Maine and Mike DeWine of Ohio — and were joined by George Voinovich of Ohio, who supported drilling in the amendment vote.

The anticipation of a close vote made some senators targets for lobbying on both sides.

Sen. Mel Martinez, R-Fla., said he voted in favor of ANWR drilling only after getting a promise from the Bush administration to extend a moratorium on drilling off Florida’s shores for five more years, through 2012.

Critics called the concession “crumbs” because it offers no assurance of a long-term or permanent ban on natural gas and oil drilling in the eastern Gulf of Mexico.

But Martinez said the president shares his philosophy that states should take the lead in deciding whether there should be oil drilling within their borders and off their shores.

A key factor in persuading him to support ANWR drilling, he said, was that a majority of Alaskans, and the state’s governor and congressional delegation, want oil exploration there.

Minnesota’s Coleman was another Republican who took a lot of heat for his anti-ANWR drilling stance, but he stuck to his plan to support the overall budget.

Gov. Murkowski, who is recovering from knee surgery, said he spent hours on the phone early March 16 seeking the support of key senators. He also cited the tireless work of Alaska’s congressional delegation, led by senior Sen. Ted Stevens.

As oil prices climbed to record highs in the days leading up to the budget vote, Stevens went to the Senate floor repeatedly to plead for ANWR drilling. At one point, Stevens quoted former President Ronald Reagan, saying a vote for the anti-ANWR amendment “is a vote for the status quo,” which Reagan said “is Latin for the mess we’re in.”

Jerry Hood, chief lobbyist for Arctic Power in Washington, D.C., credited organized labor with helping to persuade senators to support ANWR drilling.

More hurdles to clear

While the Senate budget vote marked a major defeat for environmentalists, it doesn’t mean drill bits will be sinking into the Alaska tundra anytime soon. The measure still must be approved by the House.

“The House and the Senate do not appear to be pursuing parallel courses in their consideration of ANWR,” said Roger Herrera, a longtime ANWR lobbyist. “One is using the budget, the other an energy bill. This only adds confusion, controversy and difficulties.

“I would not start celebrating yet,” Herrera added.

As an officially designated wildlife refuge, ANWR would have been off-limits to drill rigs. But when the 19 million-acre refuge, roughly the size of Maine or South Carolina, was established in 1980, Congress left open to oil leasing and exploration the 1.5 million-acre coastal plain along the Beaufort Sea.

The next hurdle ANWR drilling will face is whether or not the Congress will agree to a budget resolution this year, Sen. Murkowski said. “There is still some question as to whether or not we will be successful (and pass) the budget — I believe that we will be (successful),” she said.

The Senate’s budget resolution now must go through the conference process with the House of Representative’s budget resolution, which the House is expected to consider in April.

Assuming that the final budget resolution also contains ANWR legislation, the Senate Energy Committee will have until June 5 to draw up legislation for leasing in ANWR. Both the House and Senate must then pass budget reconciliation bills to implement the ANWR legislation. A final budget reconciliation conference report containing ANWR legislation from both the Senate and the House energy committees must be adopted and signed by the President — this is likely to take place this summer.

Opposition will be stiff

Sen. Murkowski predicted strong opposition to ANWR drilling will continue to surface. “At any point in time in this process there could again be an effort to strip the ANWR provision from what is being considered … I think it’s going to be a significant battle. We have been up against a well-funded group of committed organizations,” she said. “Sen. (John) Kerry, D-Mass., was sending around emails just yesterday asking for emergency donations to save ANWR.”

Hood said he expects ANWR drilling opponents “to pull every dirty trick in the book” in the weeks ahead. It is especially troubling that ANWR drilling’s opponents do not limit themselves to the truth, he said.

As an example, Hood observed that Sen. Maria Cantwell, D-Wash., told senators ANWR oil in all likelihood will be exported to other countries. Cantwell introduced the amendment that would have stripped the ANWR provision from the Senate budget.

Hood said President Bush’s energy legislation contains a prohibition on exports of ANWR oil.

Another false statement came from Kerry during the final Senate debate. He said ConocoPhillips and British Petroleum were pulling out of Alaska, Hood said.

Oil industry interest remains strong

Drilling opponents, including major media outlets, are expected to continue to downplay industry interest in ANWR drilling. With oil prices at record highs and the close proximity — 60 miles — of the trans-Alaska oil pipeline, oil companies have reaffirmed their eagerness to bid when ANWR oil leases are offered.

One sign of industry interest, according to Gov. Murkowski, will be “a major, major oil company” coming to Alaska this month (March 30) to bid in the Beaufort Sea lease sale.



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