Senate Reaches Deal on Offshore Drilling

Senators who want to open new areas of the Gulf of Mexico to oil and gas production heralded came to a compromise. The agreement was supported by a key Florida senator, Republican Mel Martinez, who previously had vowed to block anything he perceived as a threat to the state's multimillion-dollar beach-related tourism industry. The deal, promoted by Senate Majority Leader Bill Frist, R-Tenn., and several Gulf Coast lawmakers, would open an 8 million-acre segment of the eastern Gulf of Mexico to production while barring drilling within 125 miles of the Florida coastline.

Drilling proponents say the new area that would be open to production contains more than 1 billion barrels of oil and more than 5 million cubic feet of natural gas.

The Senate's plan also would give the oil-producing states of Texas, Louisiana, Alabama and Mississippi a share of the royalties generated from the new production.

Martinez promised the agreement would protect Florida's shoreline. Currently, drilling is banned in the waters off Florida and the nation's Atlantic and Pacific coasts. The compromise announced Wednesday would keep that moratorium in place until 2022 in all areas except the western Gulf, which has never been off limits to drilling, and a new area in the eastern Gulf. But Sen. Bill Nelson, D-Fla., said he was worried that the House won't accept the Senate's plan, which is far more modest than a House bill approved last month. The House's bill would allow all coastal states to decide whether to allow oil and gas exploration off their shores and give them a share of royalties from new drilling. Frist said he would try to persuade House Speaker Dennis Hastert, R-Ill., to replace the House bill with the Senate's plan. Source: USA Today