House backs oil drilling in Alaskan refuge

By Tom Doggett

WASHINGTON (Reuters) – The U.S. House of Representatives on
Monday approved opening Alaska’s Arctic National Wildlife
Refuge (ANWR) to oil drilling.

The House approved the measure when it voted 308-106 in
favor of a defense spending bill that contained the ANWR
drilling language.

Giving oil companies access to the refuge’s possible 10
billion barrels of crude oil is a key part of the Bush
administration’s national energy plan to increase U.S.
petroleum supplies and cut America’s oil imports.

Rep. Tom Cole, an Oklahoma Republican, noted that
majorities in the House and Senate have voted in favor of ANWR
drilling only to be “frustrated” by minority-party Democrats
who used procedural tactics to block Senate passage.

The initiative is expected to be debated by the Senate this
week, where it is likely to face stiff opposition from
pro-environmental Democrats and possibly some moderate
Republicans.

“The defense bill should be about delivering equipment and
support to our troops. Instead, it is being used to deliver a
multi-billion bonanza to oil companies,” said Rep. David Obey
of Wisconsin, the senior Democrat on the House Appropriations
Committee.

The administration believes ANWR oil production could
eventually reach 1 million barrels a day. However, drilling
opponents want the refuge protected and say that raising
vehicle fuel standards for new cars, mini-vans and sport
utility vehicles could save the same amount of oil.

ANWR is home to caribou, polar bears, migratory birds and
other wildlife. About 1.5 million acres of the refuge’s coastal
plain would be opened to drilling under the current
congressional plan.

Republican Sen. Ted Stevens of Alaska pushed to get the
drilling plan included in the annual defense budget because it
was the only major bill moving through the Congress that ANWR
could hitch a ride on.

His state would get half the estimated $10 billion in bids
that energy companies would pay for the right to drill in ANWR
if oil prices were around $50 a barrel, according to government
estimates. The federal government would get the other half.

Democrats said the Pentagon’s annual budget bill was not
the place for such a controversial policy decision to be
settled.

Democratic Rep. Nita Lowey of New York said the ANWR
language was “a measure so contentious and wrong-headed they
(Republicans) had to hide it behind our courageous troops to
get it done.”

If Congress opened ANWR to drilling, the refuge’s oil would
not flow into market for 10 years, according to the U.S. Energy
Information Administration (EIA).

Once the refuge reached peak production in 2025, its oil
would shave about 2 percentage points off the share oil imports
would have in meeting domestic demand, the EIA said. That would
moderate U.S. oil imports to a forecast 58 percent of total
demand in 2025, equal to current import levels.

LINKS:

*Oil firms may pay $10 bln to drill in ANWR

*US Senate backs drilling in Alaska refuge

*Some Republicans shun Alaska oil drilling

*House panel OKs Alaska oil drilling plan

*FACTBOX-Key facts about ANWR land, oil

*CHRONOLOGY-Congress debates ANWR drilling

*Reuters top energy news