October 1 is a day for small businesses to celebrate. "American Energy Freedom Day” rang in at midnight, when the moratorium expired on development and exploration of the outer continental shelf (OCS) and oil shale recovery.
Congress came to their senses only because of the tireless work of a handful of members who drove this critical issue to completion, which of course has led to this celebration of sorts today. Moving forward, however, it is crucial that Congress make sure that frivolous lawsuits do not block our ability to bring these home-grown resources to market. Currently, a legal embargo is blocking (or significantly delaying) oil leases and production of these precious resources.
As Rep. John Shadegg (R-AZ) has so meticulously documented in a recent report, some environmental groups are blocking or significantly delaying oil leases and production through hundreds of legal challenges. He notes that these groups have challenged every lease in the Chukchi Sea (487 leases); the entire 2007-2012 5-year national OCS leasing program; as well as challenged exploration activities in every lease in the Chukchi and Beaufort Seas (748 total leases). The groups have filed these challenges and others under the National Environmental Policy Act (NEPA), as well as various other laws.
In sum, all of these law suits are currently pending. In other words, no oil or gas is being produced by these leases recently issued by government.
Legislation introduced today by Senator Jim DeMint (R-SC) -- the Drill Now Act, S. 2646 -- aims to address this issue, as well as expedite the leasing process and make sure states share in revenues.
As I announced in a media release today supporting the Drill Now Act, "There is a way to accelerate the pace of bringing these energy resources to market so that small business owners and consumers benefit more quickly. The proactive design of the Drill Now Act will ensure that the U.S. is not endlessly mired in bureaucracy and frivolous lawsuits, which could endlessly delay energy production."
The summary of the Drill Now Act, as provided by Senator Jim DeMint’s office, is provided below:
DRILL NOW ACT, S. 3646, Summary
• Permanently Ends Bans on Offshore Drilling in Atlantic, Pacific, Eastern Gulf of Mexico and Oil Shale Areas
• Expedites Leasing Process: Allows the Mineral Management Service (MMS) to being preleasing and leasing activities immediately, without the need to completely write a new 5-year leasing plan. The Drill Now Act would eliminate the need to write this 5-year plan, and allows the pre-leasing to begin immediately. Under current law, drilling may not begin until 2011, but under Drill Now Act, drilling could begin in late 2009.
• Ensures 50/50 State Royalty Sharing: Creates revenue sharing for all states that allow drilling off their coasts divided – 50% for states and 50% for the Federal Treasury.
• Expedites Judicial Review of Environmental Lawsuits: Allows only 90 days to submit a legal case to U.S. District Courts. Any appeal of a district court can only be made in the U.S. District Court of Appeals in D.C. Limits judicial review for how the Secretary enforces laws.
For now we can celebrate "Energy Freedom Day" as it is a monumental victory that the moratorium has been lifted. There is still work to be done, however, to make sure that we bring these resources to market.
Karen Kerrigan
President & CEO
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