Ten minutes. I will try to do it in less. Mr. President, at this point I rise to discuss the legislation currently before the Senate, S. 3711, the Gulf of Mexico Energy bill. I am an original cosponsor of this bill and strongly support its…
Ten minutes. I will try to do it in less.
Mr. President, at this point I rise to discuss the legislation currently before the Senate, S. 3711, the Gulf of Mexico Energy bill. I am an original cosponsor of this bill and strongly support its passage.
Over the last few years, we have seen drastic increases in the prices of crude oil and natural gas. While demand for these products in our country continues to grow, the domestic supply of these commodities remains stagnant at best. This lack of domestic productivity and the volatility of the global energy market are causing the everyday lives of Alabamians and people all across this Nation to become increasingly difficult.
I have no doubt that my colleagues have heard the same stories that I have heard from my constituents in Alabama--that they are having trouble making ends meet because of the prices at the pump. They tell me they cannot afford to commute to and from work, pay their monthly bills--particularly with record high temperatures--or run their small businesses.
These are not luxury costs. These are the basic costs of everyday life. Alabamians have asked that the Congress do something to alleviate the burden of rising energy prices, just as constituents have all over America. While the Gulf of Mexico energy bill will not immediately lower gas prices, it will take a significant step forward in addressing many of the problems that cause rising prices. Whether short or long- term effect, one thing is abundantly clear: The status quo is unacceptable. More importantly is the fact that because we have neglected to tap domestic resources that are currently available to us, we are forced to purchase energy sources from foreign nations that are often hostile to U.S. interests. Economic security is the underpinning of national security. Energy independence, as I have said many times, is vital to economic stability.
To achieve a higher level of energy independence, we must increase domestic capacity and production. While no single solution will immediately solve our current problem, there are immediate steps we can and must take toward that end. I believe the legislation before us, crafted by Senator Domenici, myself and other Senators, represents a critical step in that direction.
According to the Minerals Management Service, MMS, S. 3711 would open more than 8.3 million acres on the Outer Continental Shelf in the Gulf of Mexico for oil and gas leasing. MMS estimates these 8.3 million acres contain at least 1.26 billion barrels of oil and 5.8 trillion cubic feet of natural gas, perhaps more. Tapping these resources would reduce the cost of energy nationwide and serve to move us further down the path of energy independence as we continue to explore and develop new sources of energy.
For Gulf States--and my State of Alabama is one--that choose to allow drilling off their coast, the legislation also contains a long overdue revenuesharing mechanism. Gulf States allowing oil and gas production off their shorelines will receive 37.5 percent of revenues from new leases. In addition, 12.5 percent of the revenues will go to the stateside Land and Water Conservation Fund for the acquisition of parks and recreation facilities across the Nation. The remaining 50 percent will flow into the coffers of the Federal Treasury.
Some in this Chamber will surely object to the provisions of S. 3711. They will say that the legislation diverts needed revenue from the Federal Treasury and bestows upon gulf producing States a financial windfall. It is important to point out that CBO estimates this legislation will produce nearly $1 billion in new and unexpected revenue for the Federal Treasury over the next 10 years. In my view, assertions that the gulf producing States should not receive a share of these revenues assumes that those States have done and sacrificed nothing to deserve a share of the revenues. For too long the gulf producing States have borne the brunt of our Nation's domestic energy needs while receiving virtually nothing in return.
I would also point out that 37.5 percent is less than the 50 percent currently provided to States with onshore production. And I would dare to guess that the impact to our coasts is as significant as any impact from onshore drilling. I would also reiterate that the bill provides 12.5 percent of the stateside LWCF which will be made available to all 50 States. The Gulf States portion will ensure that the States of Alabama, Mississippi, Louisiana, and Texas are compensated for the decades of oil and gas exploration and production that has taken place off their coasts, the impact the production has had on our coastal areas and the billions of dollars this production has brought into the Federal Treasury.
The legislation clearly lays out a formula that compensates the States according to their proximity to drilling as well as their historic production and does so while positively impacting the budget. The legislation also ensures that the coastal counties and parishes that are impacted the most have a dedicated funding source to address the needs of their communities.
This agreement also represents a commitment by the gulf producing States to continue energy exploration and production off their coasts. This commitment contributes to the energy independence of the Nation. It is time that the gulf producing States were rewarded for their contributions and sacrifices. And while it is difficult to estimate what this will mean in the way of revenues over the next 60 years, there is no doubt it will be a great resource to the Nation and provide substantial revenues to Federal and State treasuries.
I have no doubt this legislation will provide billions of dollars to Alabama and its producing partners in the Gulf of Mexico. These funds will be available to our State and local coastal governments to address the problems that come with drilling production and its required infrastructure. It will ensure we can begin to reverse the coastal erosion and begin barrier island restoration that will protect our States from the all-too-familiar hurricanes. These funds will allow Alabama, Mississippi, Texas, and Louisiana to enhance their
fisheries and coastal infrastructure and put hurricane mitigation programs in place to help us better prepare for the storms of the future.
The sponsors of this legislation have also worked closely with the State of Florida to address the longstanding concerns of the State regarding offshore drilling on their coast. Specifically, the legislation includes a 125-mile moratorium on drilling off the coast of Florida until the year 2022. I strongly believe all revenues leading to U.S. energy independence should be aggressively pursued. We should continue to develop alternative sources of energy. We should promote energy efficiency. We should encourage refinery capacity expansion, and we certainly should continue to explore and develop resources that are currently available to us. We recognize that some of these options will take time to affect our current crisis. Others, however, remain current capabilities.
S. 3711 provides that leasing must commence in a substantial portion of the 8.3 million acres within at least 1 year of enactment. It says that leasing must occur in the remainder of the 8.3 million acres as soon as practicable. In the context of Federal energy policy, these are tangible measures that would have a considerable and direct effect in the short term on consumers and businesses and on the Nation's economy as a whole.
In closing, this legislation is the product of careful coordination among affected States on behalf of the needs of the entire country. It makes much needed contributions to the Nation's energy supply and compensates participating States justly. At the same time it accommodates the concerns of those who do not want oil and gas production to occur off their shorelines, and it provides a mitigating mechanism for States that elect to participate. The American people rightly expect their elected representatives to act on their behalf to stem the escalation of our current energy crisis. While this measure alone is not sufficient to solve our energy crisis, it is absolutely a necessary component of the overall solution.
I urge my colleagues' strong support for this crucial legislation.
I yield the floor.