House Rejects Drilling Measures

Chemical manufacturers expressed disappointment Friday over a decision by House Republican leaders to drop controversial provisions in a budget bill intended to expand offshore oil and natural gas drilling and open Alaska's Arctic National Wildlife Refuge (ANWR) to energy development.

The changes were made in a bid to win the support of moderate Republicans. After concluding the measure still lacked enough votes for passage, however, the leadership yesterday postponed a vote on its $50 billion fiscal 2006 budget reconciliation legislation. GOP leaders hope to take up the bill again next week.

The Senate approved its version of the bill, a smaller $36 billion deficit-reduction package, on Nov. 3. It would allow the Interior Department to lease oil and gas drilling rights in 2,000 acres of the Alaskan refuge, but it does not include language allowing states to “opt out” of a federal moratorium that limits offshore drilling.

The dispute over ANWR will have to be settled by House and Senate negotiators, provided the House passes its own budget reconciliation bill. Meanwhile, Senate Energy & Natural Resources Committee Chairman Pete V. Domenici (R-N.M.) has promised to offer separate legislation next year to expand offshore drilling.

The chemical industry, which has been hit especially hard by high and volatile natural gas prices, will continue to lobby lawmakers for legislation to increase domestic energy supplies, according to industry leaders.

“I’m flabbergasted that some in Congress continue to live in a fantasy world in which the government encourages use of natural gas while cutting off supply, and then they wonder why prices go through the roof,” says American Chemistry Council President Jack N. Gerard.

“Consumers and industries that rely on natural gas will not continue paying exorbitant prices when a solution is at hand,” Gerard remarks. “When Americans start spending hundreds of dollars more to heat their homes this winter, maybe then Congress will get the message that it’s in the national interest to bring down natural gas prices.”