‘This is awful’: GOP slams offshore energy budget

Republicans raised concerns during a hearing about a slowdown in oil leasing and panned increased funding for offshore wind.

May 24, 2024

House Natural Resources Republicans assailed Bureau of Ocean Energy Management Director Liz Klein in a hearing Thursday for seeking increased funding for offshore wind while slowing down offshore oil leasing.

“We cannot let the Department of the Interior sacrifice the livelihoods and security of Americans on the altar of hollow commitments to environmental activists,” said Energy and Mineral Resources Chair Pete Stauber (R-Minn.), calling on Klein to hold more offshore oil sales.

Republicans on the committee have criticized BOEM’s offshore energy strategy after its winter announcement of just three oil lease sales over the next five years — a historic low.

And in March the agency requested $52 million for BOEM’s renewable energy program to help streamline wind permitting and increase tribal engagement, an increase over the fiscal 2024 enacted level.

Klein defended the agency’s budget request to lawmakers as a forward-looking strategy for offshore energy.

“BOEM is taking a leading role in transitioning the U.S. to a clean energy future, one that will advance renewable energy, create good-paying jobs and ensure economic opportunities are accessible to all communities while managing the development of oil and gas resources,” she said in a prepared statement.

That proved a tough sell for many Republican lawmakers.

Rep. Garret Graves (R-La.) said Klein’s agency is strangling future oil production by limiting leasing. He dismissed arguments from Klein that three-quarters of active offshore oil leases are yet to be drilled.

“This is awful,” Graves told Klein. “You are completely screwing — completely screwing — the next administration and the one after from this completely failed energy plan.”

Rep. Jared Huffman (D-Calif.) dismissed Republican outrage as “cartoonish fealty” to the fossil fuel industries.

“We continue to hear this rhetoric about the Biden administration declaring a war on oil and gas," he said. "It's just not something that can credibly be said."

Pushing oil leases

Lawmakers also pushed Klein on mandates for offshore oil leasing in the Inflation Reduction Act. The Democrats' landmark climate law requires an offshore oil sale of at least 60 million acres before holding an offshore wind sale.

“Do you interpret this as Congress wanting you to offer robust acreage for oil and gas leasing? Or do you see it as oil and gas will only get the 60 million acres if the wind industry decides so?” Stauber asked Klein.

Klein answered that BOEM is preparing for its next offshore oil sale — scheduled for next year — as planned.

She also defended offshore wind’s contribution to coastal economies, after Republican lawmakers said offshore wind sale revenue does not benefit local communities.

Klein noted that BOEM offers credits during offshore wind lease sales for workforce development and economic investment shoreside. Whether revenue goes to local communities is dictated by Congress, she said.

Oil and gas revenues are shared with states and Tribes, per federal law, while current law requires that offshore wind sale revenues go to the U.S. treasury.

Huffman said he was planning legislation to change that for offshore wind. A bipartisan group of lawmakers have for years tried to pass legislation that would share wind revenue with states.

Huffman also defended as “just fine” BOEM doing “minimum compliance” with the IRA mandate to hold oil sales ahead of offshore wind sales.

“The 60 million minimum and other provisions of the IRA you were asked about are formulas that one U.S. senator insisted on. It is not sacred, and it doesn’t mean you have to go over and above that,” Huffman told Klein, referring to Democratic Sen. Joe Manchin's (W.Va.) demand that such oil provisions be included in the bill before he would vote for it.

Dems urge tribal consultation

Huffman asked Klein about a letter he, Rep. Val Hoyle (D-Ore.) and Rep. Raúl Grijalva (D-Ariz.) sent to her agency today requesting stronger tribal consultation on offshore wind.

The letter asks for a tribal council to advise BOEM. It also asks BOEM to deliver a plan for how it will advance co-stewardship, as mandated in a 2021 order by Interior Secretary Deb Haaland.

“We’ve heard loud and clear from tribes that we need better engagement by BOEM,” Huffman said.

Klein noted that BOEM’s budget requests additional funds to improve its work with Native American tribes.

“There is a long history of mistrust between many tribes and the federal government, and I think working together with the subcommittee we can begin to address that,” she said.

Bureau of Safety and Environmental Enforcement Director Kevin Sligh also testified Thursday on his agency’s $253 million budget request. He said the agency was focused on decommissioning old oil assets and addressing orphaned wells offshore, in addition to its safety and enforcement duties.

“This funding will help to properly plug and abandon orphan wells on that OCS and properly decommission associated orphan pipelines and structures,” he said. “Plugging these wells is critical to helping reduce pollution risk and eliminate safety hazards.”

BSEE came under fire earlier this year when the Government Accountability Office criticized the bureau’s oversight and found more than 75 percent of idle and end-of-lease offshore oil assets overdue for decommissioning.

Howard Cantor, director of the Office of Natural Resources Revenue, told lawmakers the agency disbursed $18 billion for energy revenues on public land and waters in fiscal 2023 — money that is split between the U.S. Treasury, Native American tribes, states and funds like the Land and Water Conservation Fund.


By:  Heather Richards
Source: E&E Daily