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Drilling deal to hang on House

After a year of arm-twisting, dealmaking and lobbying by environmental and business groups, the drive for more offshore oil and gas drilling has come down to this:

A lame-duck Congress, a frenzied week in December and a vanquished Republican leadership, with one last chance to try to balance protection of Florida's coast against pressure to open more of the Gulf of Mexico.

Congressional negotiators say the House next month is likely, though not certain, to pass a Senate-approved bill that would keep drilling at least 125 miles off the Florida Panhandle and 234 miles off Tampa Bay, in exchange for the right to explore millions of acres of the eastern gulf now closed to oil and gas rigs.

The Senate overwhelmingly passed the bill last summer. It has been stalled in the House because drilling proponents believed it didn't go far enough.

But with environmentally minded Democrats set to take control of Congress in January, and with the long-term prospects for Florida's protection unclear, some pro- and anti-drilling lawmakers are urging the House to act before it adjourns for the year.

"Nothing is set in stone, but I think there's progress being made in discussions between the House and Senate,'' said Rep. Adam Putnam of Bartow, who was recently chosen as the No. 3 House Republican.

Although the GOP leadership has yet to decide whether to bring the bill for a vote, Democratic leaders in both chambers have declared passing the bill a priority.

"With the Democratic leadership now behind it, my suspicion is that we will be able to move a bill that is substantially similar to the Senate-passed bill,'' Putnam said.

Brian Kennedy, deputy chief of staff for the House Resources Committee, said he also thinks prospects for passage are good, though several sticking points remain. Among them, according to aides and lawmakers involved in negotiations:

- Florida Republicans want to add explicit protections for the waters off the Florida Keys and the state's Atlantic coast. The Senate bill only addresses the Gulf Coast.

- Some House members from other coastal states want to ensure that all states with drilling off their shores get an equal share of the royalties that oil companies pay to drill.

- And House members from both parties want oil companies to repay billions in federal royalties that mistakenly weren't collected during the 1990s. Key senators oppose that.

"It just comes down to a question of willingness to compromise," Kennedy said. "But there should be some room for movement."

Congress is set to return from Thanksgiving break on Dec. 4, though it's unclear if they'll stay one week or two before quitting for the year. For the sake of expediency, any drilling deal between the House and Senate likely would be added to a larger spending bill.

Lobbyists for environmental groups, meanwhile, are crossing their fingers that time runs out first.

"The next Congress is going to be much more sympathetic to Florida,'' said Mark Ferrulo, director of Environment Florida.

Earlier this year, with high energy prices and pressure by industry groups to boost supply, House Resources Committee Chairman Richard Pombo began pushing a comprehensive bill to open the nation's outer-continental shelf, which is now largely off-limits. Ultimately a bill passed that would allow drilling just 100 miles off U.S. shores, and closer if states wanted it. Most Florida Republicans voted for it, saying it was the best deal they could get.

In the Senate, meanwhile, Energy Committee Chairman Pete Domenici, R-N.M., targeted the gas reserves of Lease-Sale Area 181 in the eastern gulf, just 100 miles off the Panhandle.

Each chamber passed its bill, but the two failed to reconcile their versions before the elections. With the Democratic takeover of Congress, the outgoing GOP House leadership is under pressure from industry and many of its own members to accept the Senate bill before Democrats take over in January.

The Senate bill would allow access to about 9-trillion cubic feet of natural gas.

"Certainly, that's better than no bill,'' said Jack Gerard, president and CEO of the American Chemistry Council, which is part of a business consortium running ads and urging lawmakers to pass it. "We'd like to send a signal to the marketplace that help is on the way and get some of that gas into the pipeline."

Florida's two senators, Democrat Bill Nelson and Republican Mel Martinez, who helped negotiate the Senate bill last summer, also are urging their House colleagues to accept their version, even though they would rather not permit any drilling.

The Senate bill at least protects the eastern gulf through 2022. Now, the federal ban on drilling off Florida must be renewed every year.

"We negotiated this thing, we got Florida the protection we need, let's get this thing etched into law,'' Nelson said.

Wes Allison can be reached at allison@sptimes.com or (202) 463-0577.

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