[Congressional Record (Bound Edition), Volume 152 (2006), Part 12]
[Senate]
[Pages 15884-15919]
[From the U.S. Government Publishing Office, www.gpo.gov]




    GULF OF MEXICO ENERGY SECURITY ACT OF 2006--MOTION TO PROCEED--
                               Continued

  The PRESIDING OFFICER. The minority leader.
  Mr. REID. Madam President, today the Senate is considering a bill 
that represents a positive step for our Nation's energy security. The 
Gulf of Mexico Energy Security Act can play a role in building a better 
energy future for our country and especially a better future for the 
people of the gulf coast.
  I want the record to reflect my deep appreciation to Senator 
Bingaman, who is the ranking member of this Energy Committee, for 
working with us on this issue. Senator Bingaman has--at least to my 
understanding--no problems with where this bill will allow drilling. He 
has concerns as to how the money is going to be allocated following the 
drilling. I understand his concern and appreciate it. Senator Bingaman 
is the epitome of a gentleman. Even though he has concerns about how we 
are moving this bill forward, he has not been an impediment, and we are 
moving forward as quickly as we can so, again, I want the record to 
reflect my deep appreciation for Senator Bingaman, what a good friend 
he is and a good Member of the Senate.
  I am going to say more about the specifics of this legislation. Prior 
to doing that, I ask unanimous consent that during the consideration of 
S. 3711, there be a limitation of five first-degree amendments, energy-
related amendments, in order on each side.
  The PRESIDING OFFICER. The Senator from Kentucky.
  Mr. McCONNELL. Madam President, reserving the right to object, I say 
to my good friend, the Democratic leader, as he knows the development 
of this bill was done on a bipartisan basis. It is narrowly targeted 
but represents a delicate compromise between the gulf coast Senators, 
Senators from Florida, and it is the feeling of all those involved in 
developing this legislation, as I say, again, on a truly bipartisan 
basis, that if we open this bill up to amendments--we have lots of good 
ideas on this side of the aisle, and I expect there are lots of good 
ideas on that side of the aisle. I recall when we were doing the major 
Energy bill last year about this time, we spent several weeks on it as 
we considered virtually everybody's good idea about what to do, either 
on the conservation side or the production side.
  So I say to my good friend, the only way to achieve success, it 
strikes the sponsors of the bill, is to keep it very narrowly crafted 
and to pass it as is out of the Senate.
  I know that is not what we customarily do, but this is an unusual 
situation. We are trying to respond to high energy prices in America. 
Even though natural gas prices have subsided somewhat in recent months, 
we anticipate them going up again next fall. There is a good chance 
that the futures market in natural gas will actually respond favorably 
to this measure, if we can get it out of the Senate. Natural gas 
prices, we all know, are set in America. It is not a global price 
setting. It could provide immediate relief to natural gas customers all 
over America.
  For all of those reasons, I object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. REID. Madam President, I am disappointed that the majority has 
objected. I think the proposal I made would permit the Senate to make 
improvements to the bill. We limited the number of amendments and we 
certainly would be willing to limit the time on them. But I understand 
the objection of the majority.
  This legislation opens approximately the same area President Clinton 
proposed when he was President. This would be opening an area of oil 
and gas exploration in the Gulf of Mexico. But when President Bush came 
into office, he narrowed the consideration at the request of his 
brother, the Governor of Florida. This bill moves us back closer to 
President Clinton's proposal with some additional deepwater acreage 
opened south of the 181 area. It satisfies the concerns of the State of 
Florida. It is also a positive step for those who want to see the 
restoration of the gulf coast wetlands. I can remember the first time 
Senator Breaux spoke to me about the State of Louisiana and what was 
happening to his State.
  During the time I am going to be here on the floor, which will be a 
few minutes--I came here 15 minutes ago and listened to the remarks of 
the two Senators from Kentucky and Arizona, and I hope to leave in 10 
or 15 minutes--there will be an area the size of three football fields 
washed into the gulf, gone forever. Huge tracts of land are being 
washed into the ocean every day. We must have coastal restoration. We 
can do this, but it is not easy.
  We learned with Katrina that had Katrina hit several decades ago--50 
years ago--the damage would have been much less than it was because it 
would have had a barrier and the storm would not have hit the City of 
New Orleans as it did, and other coastal areas. I have been there. I 
saw what happened in New Orleans. I have been there a number of times. 
I saw what happened in Pass Christian, MS. I will always remember that 
in my mind's eye--the devastation from the wind.
  But this legislation gives New Orleans, LA, hope because it provides 
a source of money to restore the wetlands that are being devastated. 
That is the basis for my strong support of this piece of legislation. 
This bill will help them get the resources which are needed to rebuild 
in a sustainable manner.
  Everyone in Louisiana should know that they have a tireless champion 
in Senator Mary Landrieu. I wish I could express to her father, Moon 
Landrieu, former mayor of New Orleans, a Cabinet Secretary here in 
Washington, as I

[[Page 15885]]

have done in the past. I wish I could express my support and admiration 
of his daughter Mary Landrieu, a wonderful family of 10 children. She 
has done so much work in this regard. If it weren't for her efforts, 
without any question the Senate would not be considering and passing 
this bill, which we will do in a few days. I am not going to be able to 
say this to Moon Landrieu today, but I am sure I will in the near 
future, and tell him about the good work his daughter has done here. 
Her whole family should be proud of her, and the whole State of 
Louisiana should be happy and satisfied with the work she has done in 
this regard.
  For the first time in the history of this country, the delta area of 
the Mississippi River, because of the work we have done on it through 
the Corps of Engineers, and all the other governmental entities, which 
is one of the reasons the gulf is washing away, that we will be able to 
for the first time have a long-term project to restore the coastland. 
It is expensive and hard, but it is so important for our country.
  Having said all the good things about this bill and about Senator 
Landrieu, I want it to be very clear in my remarks here today that this 
bill is not going to fix America's energy needs. It is not going to 
solve America's energy crisis. We have a failed energy policy in this 
country. The Bush-Cheney failed energy policies--simply more for big 
oil--won't work.
  British Petroleum announced yesterday that their profits have gone 
up. In Reno, NV, the price of gasoline is $3.12 a gallon today. The 
price of gasoline in Nevada on an average has gone up more than 50 
cents a gallon in the last year. The Bush-Cheney energy policies do 
nothing to alleviate the problems we are having in Nevada and around 
the country.
  This bill will do nothing to bring down the price of gasoline or 
diesel. It won't come down as long as demand keeps growing and big oil 
companies are not investing their billions and billions of dollars in 
profits in new American energy jobs and manufacturing and in developing 
alternatives to oil.
  As my friend from Oregon said better than I, we are marinating 
ourselves in oil. The country is being marinated with fossil fuel. We 
need to bring much more fuel-efficient cars and trucks quickly to 
market and to promote as a country energy efficiency and conservation.
  That is the one real difference between Democrats and Republicans--
speed. We have been ready for months and months and months, going into 
years, to fund and uphold a project like energy. If we can get to the 
Moon, we can solve our energy crisis. But we can't do it by continuing 
to do something we have done for 50 years. The Sun is there producing 
energy every day. The wind is there blowing every day and producing 
energy. We need to capture that energy. We need to capture geothermal 
energy. We are not doing it.
  It appears to me the majority is not interested. The Republicans have 
proposed emergency spending on energy and underfunded even the mediocre 
Energy bill from last year. The administration still has not gotten 
around to issuing loan guarantees to build new biofuels plants.
  Democrats want to transform the Nation's energy policy, and we want 
to do it now. But the Bush administration and the Republican Congress 
is content to let the market and Big Oil crush consumers, squeezing 
every last coin out of their pockets.
  I had a press event across the hall in the LBJ Room this morning. I 
had with me a family from Colorado. They have a little 5-year-old boy. 
He is little, but he is a husky little kid, Johnathan. They have to 
fill their two vehicles. One drives a lot to his job, and the other 
doesn't drive as much. But they fill their cars on average of twice a 
week. It costs them $45 every time they fill their gas tank. It is $180 
a month which they cannot afford. They have no health insurance. It is 
true all over America.
  This morning the majority leader said there was a lot more we can do 
relating to energy, and we should do it in the future. I make this 
point to the majority leader through the Republicans and to the 
President, the future is now. Americans are suffering from an energy 
crisis, and have been since well before last year's energy bill.
  In Reno, NV, it's $3.12 a gallon for regular unleaded. The future is 
now. What are we waiting for? Is this the best we can do? I hope we can 
do better before we finish this congressional term. We are not going to 
do it before August. That is what we have demanded, but we have 
tomorrow and a few days next week, and that is it.
  We have good ideas. In May, the Democrats introduced the Clean EDGE 
bill. That stands for Energy Development for a Growing Economy. That 
describes the problems we have in America today. We need to do energy 
development. We have to do it if we want to keep our economy growing. 
It is a bill to accelerate development in commercialization of energy 
efficiency technologies, renewable energy production and alternative 
fueled vehicle market penetration.
  Isn't it a shame that the Federal fleet, the biggest we have in 
America, is not one which we are using with alternative energy? And we 
are not. The Clean EDGE bill adds important provisions to make the 
Federal Government a real leader in energy instead of just the largest 
consumer.
  The Clean EDGE bill contains important provisions to set a national 
oil savings goal, increases penalties to punish price gouging, and 
reigns in energy market speculators who are driving up the price of 
natural gas.
  Let me say this. On public radio this morning--I enjoy listening to 
public radio every morning; I love that medium--I can't remember the 
name of the man who was there in ANWR, but he was there 50 years ago 
with the people who first pushed to set that aside as pristine 
wilderness. What he said today was remarkable. He said, I was there 
more than 50 years ago. He said it is the same today as it was then. He 
is 73 years old now. He was a young man 53 years ago when he was there.
  I know how strongly the Presiding Officer feels about that. America 
feels just as strongly that we did the right thing in protecting ANWR. 
In listening to that radio program, I felt in my heart we had done the 
right thing.
  We need to move forward with innovative, good legislation. The Clean 
EDGE bill does that. A few days ago, 41 Democratic Senators sent a 
letter to the majority leader stating our desire to move legislation 
such as the Clean EDGE bill before we recess to bring down prices and 
give consumers affordable alternatives. Unfortunately, it seems we will 
have to continue looking for other legislative opportunities since we 
need to pass S. 3711 as soon as possible, and send it to the House 
where they can send it to the President.
  But let us not kid ourselves; this bill is good for the gulf coast 
and will contribute to the Nation's energy security and, more 
importantly, for coastal restoration. It will not affect gas prices and 
just extends our addiction to oil.
  I again compliment the very good work of Mary Landrieu in moving this 
bill forward.
  The PRESIDING OFFICER. The Senator from Oregon.
  Mr. WYDEN. Madam President, before he leaves the floor, I want to 
commend the distinguished leader from Nevada. He has for a long time 
championed the needs of consumers. In the West, we understand the 
devastation gasoline prices have had on our consumers. And his case for 
a new energy policy, a red, white, and blue energy policy that makes us 
free of our dependence on foreign oil, is a case he has eloquently 
made, and made frequently. I want him to know how much I appreciate his 
leadership before he leaves the floor.
  I want to start the discussion about the legislation which is before 
us now by acknowledging the enormous pain and hurt so many citizens of 
our Gulf States have endured since Katrina struck their communities. 
Pictures of this tragedy are seared into our minds at this point. In 
the Senate, I sit next to the distinguished Senator from Louisiana, 
Senator Landrieu. She has brought passion, energy, and eloquence to the 
cause of securing help for those

[[Page 15886]]

she represents so well as folks in the Gulf States try and get on their 
feet.
  My view is that the challenge for the Senate is to reconcile the need 
to help those folks hurting in the Gulf States with the urgent need for 
Congress to legislate fresh, bolder energy policies for our entire 
country. My understanding is the distinguished majority leader from 
Tennessee, Senator Frist, will not allow amendments to this 
legislation. If that is the case, my view is this legislation does not 
balance the need to help folks in the Gulf States with the urgent need 
to get that fresh red, white, and blue energy policy for our country's 
future.
  Does the Senate truly believe more shouldn't be done to promote 
renewable energy? Does the Senate truly believe more shouldn't be done 
to promote automobile efficiency? Does the Senate truly believe more 
shouldn't be done to protect consumers from exploitive practices? Does 
the Senate truly believe taxpayer dollars should be used to subsidize 
oil companies even though the President, to his credit, has said 
subsidies aren't needed when the price of oil is over $55 a barrel?
  If no amendments are allowed under this legislation, which is my 
understanding from the statement made by the distinguished majority 
leader, essentially what the Senate will be saying to the country is if 
we go off and drill in the gulf a bit, then the country can call it a 
day as far as getting a new energy policy. I don't think that is good 
enough.
  I support responsible drilling in the gulf. We obviously need more 
energy production. By any realistic calculus, we know oil will be part 
of our future and we are going to need to encourage production in a 
responsible way. In the Senate Committee on Finance, again, working on 
a bipartisan basis, the Senator from Wyoming, the distinguished Senator 
who sits on the Committee on Finance, Senator Thomas, has some 
excellent ideas in terms of encouraging production, particularly 
getting more oil from existing wells. We do need more oil production. 
But drilling alone is not the new energy policy this country needs. It 
is more business as usual.
  We have been down this road before. In the 1990s, for example, the 
Congress passed a royalty program that was supposed to stimulate energy 
production and be good for the Gulf States and for our country as a 
whole. What it has done is something very different than what was 
envisioned. In fact, the sponsor of that legislation, our respected 
colleague from the State of Louisiana, former Senator Johnston, has 
said the program, as it has developed, is nothing along the lines of 
what he envisioned.
  The Government Accountability Office has said with the royalty 
program created in the 1990s when oil was about $19 a barrel--it is 
over $70 a barrel now--that program that was created in the 1990s is 
going to cost taxpayers a minimum of $20 billion and possibly as much 
as $80 billion.
  That is the royalty program we have on the books now. As we start 
this discussion about setting up a new program, I want to make sure the 
Senate is up on how much money is being frittered away under the 
mismanaged program that is on the books today. One would think it is 
common sense to fix the old program before we start a new program. One 
would think it is common sense to take the savings generated by fixing 
the old program and applying those savings to paying for the new 
program before the Senate this afternoon. However, neither of those 
commonsense steps is being taken. A new program is being considered by 
the Senate today when Congress has not corrected the old program which 
even the oil companies acknowledge is not needed today, and even the 
sponsor, our former colleague, Senator Johnston, has indicated is not 
working.
  I have talked with Chairman Domenici about this. Chairman Domenici 
has indicated he wants to fix this old program, this old, mismanaged 
program that has wasted so much of the taxpayers' scarce resources. We 
all know Chairman Domenici is a straight shooter and forthright and I 
have appreciated his discussions with me.
  However, I don't think the oil companies are going to easily give up 
this multibillion dollar boondoggle, this sweetheart deal they have 
obtained. Time is not on the side of those who want to put a stop to 
the billions of dollars being needlessly dispensed under the 1990s 
program.
  The legislation before the Senate now is one of the last 
opportunities the Senate will have to permanently fix the broken 
royalty program that began in the 1990s. Senator Kyl and I have been 
working in a bipartisan way to change this. There has been action in 
both the other body, the House, and in the Senate, in the Senate 
Committee on Appropriations where the distinguished senior Senator from 
California, Senator Feinstein, has done an excellent job of trying to 
advance the cause of stopping these subsidies, but my guess is the 
legislation the Senate has been able to at least start in the 
appropriations process may not even hit the floor of this body, and 
even if it does, the oil companies are very well positioned to run out 
the clock on the effort in this session of Congress to stop the 
needless subsidies that were granted in the 1990s.
  For example, there is mediation now going on between the companies 
and the Government, but it is nonbinding, so the oil companies hold all 
the cards. The appropriations process, of course, only lasts for a year 
so the companies can run out the clock on that, as well.
  Senator Kyl and I spent a lot of time in the Senate making the case 
for why this was a needless expense, particularly at a time when we 
have so many other needs in our country. That day, despite the fact I 
stood in this spot for almost 5 hours, we could not even get a vote on 
a measure to stop these subsidies that the General Accounting Office 
has calculated is at least $20 billion and possibly $80 billion.
  Put me down as pretty skeptical that the oil companies are going to 
voluntarily give up these huge sums of money. As of now, in this 
session, one measure after another has failed in terms of potential 
steps that could protect the consumer. Let's review: The Federal Trade 
Commission, the agency that is supposed to protect the consumer and to 
deal with concentration and mergers in the oil industry, a big goose 
egg from the Federal Trade Commission. In fact, the chair, Deborah 
Majoras, has all but said that high prices are essentially good for the 
consumer because by her theory that will promote more energy 
production. That is a pretty astounding theory of consumer protection, 
but Senators can look it up. That is what she said before the Energy 
Committee.
  The agency that regulates commodities? Zip, with respect to dealing 
with speculative practices, practices that contribute very 
significantly to the cost of oil. In fact, when oil company executives 
came before our committee--the distinguished Senator from Alaska will 
recall--one oil company executive said speculative practices are a big 
factor in driving up the cost of oil for our consumers. We have not 
seen anything to reign in those speculative practices.
  How about stopping needless tax breaks? When the oil company 
executives came before the Energy and Natural Resources Committee, I 
went down the row and asked each one of the executives whether they 
needed all these tax breaks. They now have record profits, consumers 
have record prices, so I made the point, why in the world would you 
need record tax breaks? The executives, when they had to answer in 
broad daylight, said they did not need them. Ever since then, I have 
been trying to roll back some of those tax breaks. The President, to 
his credit, said tax breaks are not needed when the price of oil is 
over $55 a barrel, but we have taken only the most modest step. A tiny 
bit of the tax relief that the oil companies are getting has been 
rolled back under a proposal I made involving a drilling writeoff that 
the companies get.
  So, Federal Trade Commission, zip; anti-speculative efforts, zip; tax 
breaks that are needless expenditures that the oil companies say they 
don't need, virtually nothing. So put me down as pretty skeptical given 
the fact that in each of those areas the Government has ducked taking 
on the oil companies. Put me down as pretty skeptical

[[Page 15887]]

that somehow these oil companies are going to come to the table and 
walk away and leave behind $20 to $60 billion worth of breaks in 
royalty relief from the 1990s. I don't think it is going to happen. I 
hope it does.
  Chairman Domenici is very sincere in his views, but given the track 
record in this Congress of the oil companies being able to escape any 
kind of effort at those various agencies I have outlined, I don't think 
the oil companies are going to voluntarily clean up a program in the 
1990s that has been so mismanaged. My sense is it is going to be 
necessary to pass legislation in this Congress to force the companies 
to give up these needless subsidies.
  There is a compromise with respect to how it could be done in a 
bipartisan way. It is a compromise that I and the distinguished Senator 
from Arizona, Senator Kyl, have been talking about. We actually 
proposed it to the distinguished chairman of the committee, Senator 
Domenici. I suggested what we might do is allow the negotiations 
between the companies and the Government under the 1990s royalty 
program to proceed for a bit longer. Possibly that will work. I am 
skeptical, but possibly it will.
  But if those negotiations did not produce the savings for taxpayers 
and the cleansing of this old program that is so important, then we 
have to be tougher. After a period for negotiations, I would propose as 
part of a bipartisan compromise that the Senate then insist the 
companies get no new leases until the old program has been cleaned up. 
That would bring together some of the ideas advanced by the 
distinguished chairman of the Energy and Natural Resources Committee, 
Senator Domenici, and some of the ideas Senator Kyl and I and others 
have offered on a bipartisan basis.
  We suggested that be done in this bill. We said: Here is an 
opportunity in this legislation to permanently fix the old program 
before you start a new one. We thought it was a chance to take two 
approaches Senators have been talking about and bringing them together 
and permanently fixing the program. I believe if the Senate does not do 
that, the clock is going to run down on the program, and I think, in 
all likelihood, the Senate, in the beginning of 2007, will be in much 
the same place it is today. I do not want to see that happen.
  I think it is time for a fresh approach with respect to how our 
country makes energy policy. I think we need to be much bolder and much 
more creative. I have advanced ideas in this area; a number of Senators 
have. But we have seen precious little of that kind of bold thinking. 
What we have seen is essentially business as usual.
  I hope colleagues will take a look at the analysis that has been done 
by the Senate Budget Committee of the impact of the legislation before 
us today. This is, of course, S. 3711. I asked the Democratic staff of 
the Senate Budget Committee to do an analysis of the impact of the bill 
before us today. The legislation before us now authorizes at least a 
50-year commitment. The oil companies, in my view, under this 
legislation have been able to parlay the suffering of our citizens in 
the Gulf States into something that I believe could become an 
unaffordable gravy train.
  What the Budget Committee staff found is that between 2017 and 2055, 
the U.S. Treasury and Federal taxpayers would be out almost $20 billion 
beyond what is already going out the door under the broken royalty 
relief program from the 1990s that I have described once again on the 
floor of the Senate. But beyond that, all bets are off. Lost revenues 
after that could be as much as $12 billion to $15 billion each year.
  So I would ask the Senate: At a time when clearly folks in those Gulf 
States are hurting, and the Senate ought to step in and be of 
assistance to them, does it make sense to authorize a 50-year program 
that, particularly after the initial period, will involve additional 
sums, additional untold billions of dollars of revenues that could be 
lost?
  The challenge for the Senate now, it seems to me, is, first and 
foremost, to get some amendments to this legislation. I hope the 
majority leader, the distinguished Senator from Tennessee, Mr. Frist, 
will change his mind. I hope the distinguished majority leader will 
allow amendments on automobile efficiency, on renewable energy, on 
protecting consumers from exploitive practices, and protecting 
taxpayers from needless subsidies. We would not be talking about 
hundreds of amendments. I think amendments in those four areas would 
provide an opportunity to strike a balance in this legislation to make 
sure that urgently needed help is directed to these Gulf States, that 
efforts are being made to get a new energy policy for our country.
  It does not make any sense, to me, for the Senate to say: Let's go 
drill a bit in the Gulf--and pretty much call it a day. But that is 
what the legislation in its present form essentially says. It says: At 
a time when the country desperately needs a new energy policy, when 
people are clamoring for it at townhall meetings and in chambers of 
commerce and in virtually every other place a Senator goes, what we are 
going to say is nothing doing. We are going to say a bit of drilling in 
the Gulf will cover it, and a bit of drilling in the Gulf can take 
place, even though billions of dollars are being wasted under a 
program--a previous program--that was directed to the Gulf States from 
the 1990s.
  I think the Senate can do better. I think the Senate can do better on 
a bipartisan basis. Senator Kyl and I are ready to propose what we 
believe could be a bipartisan initiative that would involve 
recommendations made by the chairman of the Energy Committee, Senator 
Domenici, ourselves, Senator Feinstein, and others. We think we could 
save a big chunk of money--billions and billions of dollars--that could 
be applied to the new program that is being considered by the Senate 
today.
  That is the kind of bipartisan work the Senate should focus on. I 
look forward to the discussion and particularly hope the distinguished 
majority leader, Senator Frist, will change his mind. This subject is 
too important to bar Senators from offering meaningful amendments and 
allowing the Senate to get a more balanced energy policy and securing 
the needs of our citizens.
  Madam President, I yield the floor and suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. MARTINEZ. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Thune). Without objection, it is so 
ordered.
  Without objection, the quorum calls will be equally divided.
  The Senator from Florida.
  Mr. MARTINEZ. Mr. President, I rise to express my strong support for 
S. 3711, the Gulf of Mexico Energy Security Act of 2006.
  This is an important and timely piece of legislation that deals with 
an issue that is very near and dear to Floridians, which is protecting 
our gulf coast from drilling.
  Protecting Florida's coastline is an issue of monumental concern to 
me and to my constituents, and I commend Chairman Domenici and his 
staff, as well as Leader Frist and Senator Mitch McConnell, for their 
hard work in forging a strong bipartisan compromise that allows us to 
do just that. I also thank the distinguished Senator from Louisiana for 
her work in bringing about this bill.
  As Floridians know, and many of my colleagues have learned over the 
past several months, our beaches are extremely important to our way of 
life. We value their unique and fragile ecosystem. Our State's special 
scenery and fragile environment bring millions from across the Nation 
and the globe to enjoy its sugar-sand beaches and world class angling 
and boating.
  I have spent a great amount of time and energy since arriving in the 
Senate fighting to protect Florida's treasures from the threat of 
offshore drilling, together with my colleague, Senator Nelson, as well 
as with the Members of the Florida delegation in the House of 
Representatives.

[[Page 15888]]

  Several different pieces of legislation have been introduced over the 
past year in the House and the Senate that the Florida delegation has 
found extremely worrisome, and we have been successful up to this point 
in keeping drilling at bay. But the drilling battle has gotten fiercer 
and the stakes have gotten much higher as our Nation struggles to meet 
our energy demands in an increasingly uncertain world.
  Pressure continues to mount in Congress to develop Federal deepwater 
resources in the Outer Continental Shelf. And because high oil and 
natural gas prices are not a Republican or a Democrat problem but they 
are our Nation's problem, there is a bipartisan majority that grows 
stronger each day behind the effort to open the Eastern Planning Zone 
of the Gulf of Mexico to more drilling.
  So our options are whether to be part of a solution--a real solution 
that provides concrete protections for our State--or watch our 
protections be eaten away year after year by those who do not share 
Florida's values. I chose to be part of a solution for Florida.
  I want to assure Floridians that Florida is protected under this 
bill. This legislation, which I was proud to help negotiate, will 
provide unprecedented protections for the gulf coast of Florida. This 
bill establishes in law a 235-mile buffer from Tampa and a minimum of 
125 miles of protection from the Panhandle of Florida south through the 
year 2022. It provides over 300 miles of protection from Naples west. 
And it protects our very important military mission line. The military 
mission line is important to Florida because we are also blessed in 
Florida to host a great number of military facilities and the very 
important facilities in the Florida Panhandle. Eglin Air Force Base, 
Hurlburt Field, and the Pensacola Naval Air Station are facilities that 
rely on the Gulf of Mexico for training and for firing ranges, all of 
which would be incompatible with drilling.
  Any lease within 125 miles of the coast, inside the no-drill zone, 
can be exchanged for new leases in deepwater in the Gulf of Mexico. In 
addition, the critical ``Stovepipe'' area located in extreme proximity 
to Pensacola will be protected from oil and gas exploration through the 
year 2022. These are historic protections that Floridians can count on 
for years to come.
  I would like to make clear that this is not an opening for 
negotiation. I am firmly committed to this deal. Anything else that 
subtracts from the protections for our State as laid out in this 
legislation is not enough for our State. This is it.
  To me, this compromise is a bridge to the future. It is my hope that 
by 2022, and maybe long before then, we will have developed a long-term 
energy strategy to lessen our dependence on oil. It is that simple and 
something I feel very strongly about for our future.
  Just last year, the Senate passed a large, bipartisan Energy Policy 
Act that doubled the amount of ethanol in our fuel mix to 7.5 billion 
gallons. The bill also included provisions that I supported that 
increased funding for sugarcane and cellulosic ethanol development, as 
well as $50 million in loan guarantees to build alternative energy 
plants. We must buckle down and advance the use of renewables and 
alternative sources of energy. We are only scratching the surface of 
our future potential, and we should not limit the capacity or ingenuity 
of America's scientists to tackle this energy problem. However, we need 
a bridge to get to that future. S. 3711 is a way to keep our industries 
and utilities running while we find new ways to power our cars, heat 
and cool our homes, and create our energy--America's energy.
  As important a priority as it is to Floridians that we protect our 
coasts and our environment, we must be realistic about our own energy 
demands. It is a difficult thing--and it has been a difficult thing as 
I have tried to fight for Florida's environment--to stand here and say 
we want no new drilling, we want no drilling anywhere in the gulf, when 
Florida's size alone makes it one of the Nation's largest consumers. 
And these consumers are Florida's families who are struggling to fill 
their cars and heat and cool their homes. These are struggling families 
who sit around the kitchen table while they balance their family budget 
and find the budget busted by ever-increasing energy costs. The rising 
cost of fuel and the strains that this is placing on their pocketbook 
are dominating talk of America's families.
  In addition, we have to keep in mind how critical energy is to many 
of our industries that help drive the economies of our State. As a 
member of the Energy and Natural Resources Committee, I have heard 
countless testimony from our Nation's chemical, fertilizer, and 
manufacturing industries that are vitally dependent on increasing 
natural gas supplies within our Nation. Unlike petroleum, which is 
traded globally, much of the natural gas market is traded on a regional 
basis, and U.S. natural gas prices are among the highest in the world. 
For example, Florida provides 75 percent of the phosphate fertilizers 
used by American farmers and gardeners every day. The Florida phosphate 
industry is one of the State's oldest and largest economic engines, 
accounting for more than 6,000 direct jobs. The Tampa Port Authority 
estimates that that industry has created more than 41,000 indirect jobs 
and $5.9 billion of economic impact in the Tampa Bay region alone.
  Prior to the significant increases in natural gas prices, the U.S. 
nitrogen industry typically supplied approximately 85 percent of U.S. 
farmers' nitrogen fertilizer needs. As a result of the continuing 
natural gas crisis, farmers have been forced to import more than 50 
percent of the nitrogen fertilizers they use. In total, at least 21 
nitrogen fertilizer production facilities have closed since July of 
1998. Sixteen of those plants have closed permanently. That represents 
a 25-percent drop in total U.S. production capacity, while five plants 
remain idle even today. S. 3711 will provide over 5.8 trillion cubic 
feet of natural gas for our impaired industries, utilities, and also my 
constituents who are dealing with soaring heating and cooling bills.
  I would like to focus now on a series of concerns that have been 
raised regarding this bill, how it is different and, in my opinion, 
better than OCS legislation recently passed in the House of 
Representatives. Let me say, first, that my colleagues in the Florida 
delegation worked tirelessly to find and obtain the best protection 
possible for our State under very difficult circumstances. Some have 
questioned the protections afforded to the buffer zone around Florida. 
The buffer zone provided by S. 3711, in my opinion, is clearly 
preferable to any other one that has been offered as an alternative. 
This legislation ensures that the Federal Government will continue to 
have jurisdiction over the Federal waters off each State's coast. We do 
not cede the responsibility of energy development, environmental 
protection or military preparedness to the desires of State 
legislatures. The buffer zone in the Gulf of Mexico is good through the 
year 2022 and also prohibits drilling in our military critical training 
areas.
  Some have asked why Florida's Atlantic coast is not included in this 
bill. I would say, quite simply, that Florida's Atlantic coast has been 
under relentless attack for the last year and a half by those who want 
to drill. The Atlantic coast of Florida is still under a Presidential 
withdrawal until 2012, as well as the entire eastern and western coasts 
of the United States. This means that until the year 2012, the eastern 
coast of Florida is safe. Our compromise legislation in no way weakens 
the existing coastal protections. The House-passed OCS bill removes the 
entire Presidential withdrawals off of every coast and forces State 
legislatures to pass legislation every 5 years to keep or extend those 
protections.
  Other coastal Senators have raised their objection to S. 3711 because 
they want to increase coastal buffer zones in their own States. This is 
a focused piece of legislation that deals only with the Gulf of Mexico. 
Adding additional protections to areas that frankly are not promising 
to the energy industry should not be an impediment to moving forward 
with this compromise

[[Page 15889]]

bill. To quote the old bank robber, when asked why he robbed banks, he 
replied: Because that is where the money is. The area being opened for 
exploration is the most promising area of discovery for the industry 
and can be leased right away.
  During negotiations, I chose to focus on protecting the area of 
Florida under greatest pressure, and I thank my colleagues, Senator 
Domenici, Leader Frist, and Senator McConnell, for honoring me and 
Florida's environmental concerns.
  The last major concern that has been raised is objection to revenue 
sharing with western Gulf States and targeted revenues to the stateside 
Land and Water Conservation Fund. It is perfectly fitting and 
appropriate that we share revenues with the States that produce our 
Nation's energy and deal with its corresponding onshore repercussions. 
We in Florida do not want to participate in the development of this 
extensive oil and gas infrastructure but recognize that others in the 
western gulf pay the price to bring reliable energy to the country. We 
share 50 percent of revenues on public land within a State's boundary, 
and it is fitting that we provide energy-producing States with at least 
similar treatment. Sharing 37.5 percent of the new OCS revenues will 
not bankrupt the Nation, nor increase the Nation's national debt. 
Currently, these areas off the coast are not being leased and are 
providing no revenue to the General Treasury. Keeping 100 percent of 
zero revenues is just that--nothing.
  Finally, for those concerned with funding the Land and Water 
Conservation Fund, S. 3711 will provide a real boost for the program. 
The mandatory funding stream established under this bill does not 
replace appropriated funding and does nothing to disadvantage the 
program in the appropriations process. The President's budget request 
has been zeroed out the last 2 years for this program and under our 
compromise bill, the Land and Water Conservation Fund will provide up 
to $450 million or 12.5 percent of the revenues generated from the new 
leasing each year.
  This compromise was delicate and difficult to forge. Some argue more 
could have been done for Florida. Others protest that Florida is 
afforded far too many protections, given that our State consumes nearly 
20 million gallons of petroleum per day. High oil and natural gas 
prices are not a Republican or Democratic problem, but they are our 
Nation's problem. It is imperative that we pass the Gulf of Mexico 
Energy Security Act to provide Florida with the critical environmental 
protections it needs, as well as bringing 1.25 billion barrels of oil 
and 5.8 trillion cubic feet of natural gas to keep our industries and 
Nation afloat as we develop future sources of alternative energy. 
Failure to act is not an option. I urge my colleagues to support this 
well-crafted, bipartisan measure.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAIG. Mr. President, I am proud to follow Senator Martinez from 
Florida, who has truly gone the extra mile in realizing his 
responsibility to his home State of Florida but also recognizing his 
responsibility to the Nation and trying to balance the two in a very 
intricate way. There isn't a Senator on this floor who doesn't 
appreciate the value and beauty of Florida's vast coastlines and 
recognize that they are not only a Florida treasure, they are a 
national treasure. We know we have the technology today, as has been 
clearly demonstrated over the last two decades, to drill not very far 
offshore anywhere and make sure that it is done in an environmentally 
sound way to protect the beauty of those beaches and the vistas of 
those marvelous coastlines that make up the great State of Florida.
  For Florida or any State to suggest that the oil that lies off its 
shore is not a national asset and, therefore, should be treated only as 
a State asset is simply wrong. It would be as though my suggesting, as 
a Senator from Idaho with millions of acres of Federal forest lands, 
that not one tree should be cut for the sake of building homes anywhere 
in our Nation. Why? Because of the environmental consequences, when we 
know today we, in fact, can cut trees in a clear, clean, and precise 
way, preserve the environment, and provide the fiber to the national 
fiber market, be it paper or 2 by 4s to build homes. It is also true of 
the minerals that lie under the subsurface of my property--but not my 
property, the Nation's property--on the Federal lands of the State of 
Idaho.
  There is an intricate and important balance between what is a State's 
responsibility and a State's right and what is a Federal property and, 
therefore, the responsibility of the Congress in exercising the 
authority over that Federal responsibility, that Federal resource that 
we are today talking about in an important piece of legislation that is 
now before the Senate.
  Embodied in S. 3711 is an effort to very carefully go at part of the 
resource that lies in the Gulf of Mexico that is a Federal asset and a 
Federal resource and do so in a way that clearly benefits the State of 
Florida but, more importantly, benefits every consumer in America 
today.
  Here is the current situation that Americans face and that America 
simply cannot understand. Every area of this red zone around our 
country is a designated area by a Federal action in which we are not 
allowing our companies to develop and explore for gas and oil. I call 
it the no zone--no, you can't go there; no, you can't touch it; no, you 
can't drill; and, no, you can't develop. What does it mean to our 
country? Well, it means literally billions of barrels of oil and 
trillions of cubic feet of gas all around this area--Alaska, ANWR, the 
west coast from the State of Washington down to the border with Mexico 
off the coast of California, all around Florida, all the way up to the 
State of Maine. It is difficult to determine how many billions of 
barrels of oil are there, but we know that it is significant and it is 
phenomenal.
  Let me give an example. On this little piece of paper is a green 
strip. It is a green strip that recognizes S. 3711. We are going to 
place it in its proper location in this debate. I am going to put it 
right there. That is all this bill does. How big is this spot? This 
spot is 8.3 million acres out of the Gulf of Mexico. This little spot, 
by this perspective, represents 1.6 billion barrels of oil, we believe, 
based on a U.S. Geological Survey, and 5.83 trillion cubic feet of gas 
right there, this little, tiny spot. Is it significant? In the mix of 
all of this, yes, it is. But more importantly, it says that a 
comprehensive broad policy under sound environmental guidelines could 
make this Nation tremendously less dependent on foreign oil and gas 
coming out of Canada.
  The industries that the Senator from Florida talked about that are 
losing their base, agriculture and nitrogen fertilizer, the 
petrochemical industry and natural gas that is now going offshore, and 
we are losing those jobs, all of that would stop if this Senate and 
this Congress and this Government got their heads on right about 
national energy policy. S. 3711 is a step in the right direction. Is it 
a big step? No, it is not. It is a rather small step. But it is a 
tremendously important step, as we head down the road of beginning to 
recognize that this Nation could, in fact, become very much self-
sufficient in many ways in its energy needs through its own energy 
production.
  You have heard some rather tired and old debate about needing a 
comprehensive energy policy, and we shouldn't do S. 3711 without it 
because it simply isn't broad enough. How can any Senator stand on the 
floor today who stood on the floor a year ago today and debate the 
Energy Policy Act of 2005, the most significant, broad-ranging energy 
development, energy conservation, new technology for energy bill that 
this Congress has ever passed? It is now law. It is now being 
implemented. And whether you are in the Midwest or the upper Midwest or 
in Idaho, we have ethanol refineries going up all around us. Twenty 
percent of the corn crop this year will be used in the production of 
ethanol and into the future. Why? Because of new technology and 
national energy policy. You don't need to reinstate or restate what we 
did last year. All you need to do is keep

[[Page 15890]]

adding to it and strengthening it in a way that allows us as a nation 
to become increasingly self-sufficient.
  S. 3711 does just that. Let me bring your eye back to the chart, back 
to this little, tiny spot on the map, this 3.8 million acres. That is a 
lot of land, isn't it? In this case, it is a lot of water. Under that 
water and in that land rests an opportunity to bring down the energy 
costs to the average American consumer by a significant amount and to 
make us less dependent on foreign sources for our oil today in areas of 
the world that are politically very unstable.
  I could go on about a lot of facts, statistics, and figures. But let 
me take you to the real important part of this debate. It is called 
security for the average American family. America is frustrated today, 
and the average consumer and average mom and dad are tremendously 
frustrated because their cost of living is not keeping pace with their 
paycheck. Why? Because instead of driving to the gas pump and filling 
up for $10 or $15, they are paying $40 or $50 each time, or more. What 
does that do to a family budget? You may say that is one energy cost; 
they can surely abide that. Did you check their thermostats and their 
other energy bills, the cost of electricity to turn the lights on and 
keep their computer on for them and their kids? What about the 
temperature in the home in the cold winter months? All of that has 
costs significantly more in a very short period of time.
  In 6 years--that is the life of one term of a Senator--natural gas 
prices that heat the homes of America have gone up 286 percent. While I 
know we ought to be concerned about all of the politics and all of the 
surrounding land and doing it environmentally sound, what we are 
talking about today is beginning to understand the burden and the sense 
of insecurity that the American consumer is suffering from and doing 
something about it. It would be one thing to say there isn't any more 
gas, there isn't any more oil, and we are shifting to a bunch of 
alternatives, and in the meantime you are going to have to pay the 
price.
  The reason the American consumer is paying more at the pump today, 
more for their electrical bill and heating is because of politics, 
because the American politician for the last two decades has denied the 
American consumer the right to have access to the resources they are 
entitled to have. I hope we got the message.
  S. 3711 begins to say to American consumers that we hear you. We may 
be a little late, but we hear you. In hearing you, we are going to 
bring 5.83 trillion cubic feet of gas online in a relatively short 
period of time--18 months to 2 years at the very latest. And we have 
the potential of bringing 1.6 billion barrels of oil into the gulf 
coast refineries. That is billions of barrels that we will not buy from 
Venezuela, Saudi Arabia or any other place that is politically 
unstable. We are going to produce it in this country. That should help 
bring down or stabilize the cost of gas at the pump.
  The American consumer ought to be able to rely on its Government not 
to stand in the way of the private industry sector of our country and 
its ability to produce for that American consumer. But for decades upon 
decades, we have done just that, all in the name of environment--in 
most instances, even when we knew that the environment wasn't going to 
be damaged. And now we know for sure.
  Remember Katrina? Remember what happened a year ago, as one of the 
most powerful storms in the world surged up the Gulf of Mexico and 
across the coast of Louisiana and Mississippi and Arkansas? It tipped 
over oil rigs out in the gulf, shut down thousands of wells that are in 
this green area. And no oil was spilled. Why? Because of the safety 
mechanisms, the environmental ability that our industries have today to 
do it right.
  Few of you remember what happened off of the coast of California in 
the late 1950s and early 1960s; it was an oil spill known as Santa 
Barbara. From that day forward, the environmentalists' call was: 
Remember Santa Barbara. The reason we had so much difficulty with this 
little sale was the ghost of Santa Barbara. Let me tell you, Santa 
Barbara is dead, buried, and gone. From that day forward, the American 
oil-producing industry learned lessons, developed technologies, 
wellhead shutoffs, did all of the right things not only in a voluntary 
way but also because of mandates of public policy from our Federal 
Government. We began to get it better, and it is the best it is today. 
Americans ought not fear drilling off their coasts because it is done 
right. Remember Katrina and not one drop spilled.
  Let me talk about something else that simply demonstrates the reality 
of where we are. Let's dial up your scope and not look at the whole of 
the United States; let's go right to the gulf on this chart. Here we 
are. Here is 181. This is what S. 3711 talks about, this 8.3 million 
acres. We provide excellent buffer for the State of Florida all around. 
Yet we are going to allow production to come off in that area so that 
the American consumer can feel a little more secure, hoping that the 
price at the pump will not go up anymore and might go down a little, 
and their energy bills this winter may go down a little bit. But the 
reason I bring this to the floor is because of the speech I gave some 
months ago on the Senate floor about what is going on right here, the 
Northern Basin off Cuba, 50 miles from the Florida coastline. We have 
five foreign countries drilling there today. That is 50 miles off of 
our coastline; it is property that belongs to the Cuban nation. China 
is there drilling, as are Spain and Canada. It is not 120 miles away, 
not the big buffer zone we created to protect the Florida coastline 
from our own effort, our own expertise, from the world's best deep-sea 
drillers, the U.S. petroleum companies. In some instances there, it is 
nations that know little about the technology and are borrowing it from 
others and don't have our quick shutoff systems and our wellhead 
protection systems. They are not 120 miles off of our coast, they are 
50 miles off of our coast, and we cannot do a thing about it.
  Let me rephrase that. There is something we could do. Right now, we 
have prohibition that no U.S. company can go there. It is Federal 
policy, U.S. foreign policy. Why? Because it is Cuban. Yet the Cubans 
would love to have us there. Why? Because of our expertise and talent. 
They want their beaches protected. This particular area of Cuba has 
beautiful, sandy white beaches being developed by foreign interests 
today for resorts, so foreign tourists can come there from all over the 
world. They don't want those beaches at risk, but they also want oil 
developed. They would love to have us do it, but we have a prohibition 
against that. We will debate that on the floor.
  I have a bill that 20-plus Senators are cosponsors of. It would 
change the policy and allow U.S. companies to play in that area, to 
bid, and to become the producer--not for a Chinese market but for a 
U.S. market. Isn't it phenomenal? Here we go, again. Here is the ``no 
zone.'' We say: No, you can't. No U.S. company can touch any of this. 
But right down here, we say: China can come and drill. We say that by 
the absence of good foreign policy; we don't say it in reality. But by 
denying ourselves the opportunity, we invite the world to come.
  The reason it is important that I say this in the context of S. 3711 
is for the American people to understand that, as we struggle to get it 
right, with lease sale 181 embodied in the Senate bill, it is but a 
small step in the right direction--albeit the right direction--with 
potentially a very significant impact to the consumer's pocketbook. At 
the same time, we have a long way to go as a country, as our economy 
struggles under dramatically increased energy costs, as the average 
family struggles to balance their budget, their household budget.
  There is no way that mom's or dad's salary is going to go up 280 
percent in a few months' time. It will not happen. Yet everything that 
is tied to energy, everything that is tied to the petrochemical 
industry, their costs have gone up dramatically, and all of those are 
put off on the American consumer. Did you hear the Senator from 
Florida? Twenty-five to thirty percent of our nitrogen production has 
gone offshore.

[[Page 15891]]

Now, we are so silly that we are stepping on our food bills. Nitrogen 
goes on the ground, nitrogen produces crops, crops produce food, and 
food gets to the consumer shelf. By our public policy, we are 
suggesting that food costs will even go up, or at least the producer's 
costs will go up. If the producer's costs will go up, they will attempt 
to pass that through to the market shelf, to the grocery store. So not 
only by the absence of good policy are we going to cause mom to pay 
more to get to the grocery store, we are going to ask that she pay more 
when she gets there, all because of an incoherent lack of policy that 
doesn't fit the absolute needs of the American consumer.
  I could go on a lot longer about national security and our dependence 
on foreign oil and, when that dependence is at risk, then we have to 
suffer or we put our military in harm's way, in part, to protect our 
foreign interests and keep rural stability. We will argue that it is in 
the name of human freedom, but in the process it holds down energy 
costs by creating a stable world.
  Senator Domenici chairs the Energy Committee, and he has worked now 
for a year to produce the legislation that is before us. He recognizes, 
as do many of us who serve on the Energy Committee, the reality of 
where we are today and where we have to go. The American consumer will, 
I believe, feel the positive result of this legislation when it becomes 
law, when the drilling starts, when the marketplace recognizes that the 
potential of bringing 5.83 trillion cubic feet of gas to the market and 
1.6 billion barrels of oil is very significant, and it is done in a 
safe way and environmentally sound way and it is out of harm's way from 
the rest of the world that is growing increasingly unstable, which 
happens to be one of the primary producers of crude oil for the world 
market. No, finally the Senate gets it.
  Senator Domenici and I and members of the Energy Committee and this 
Senate struggled for 5 years to craft the Energy Policy Act of last 
year, a very significant bill.
  A lot of work is underway. Billions are being invested in all forms 
of new technology and energy and energy development. But in the 
interim, in the next decade or two, as we transition this great economy 
of ours to different forms of energy, you don't turn off the energy you 
have, you don't tell the consumer not to drive the car for 5 years 
until we can get them a hydrogen fuel cell car that doesn't do any 
emission, or maybe is supplied by energy that is going to cost less. 
Our country doesn't work that way and it never has.
  S. 3711 begins to put us in sync with reality. I say to the American 
consumer that we hear you. We hear you loudly and clearly and we grasp 
your sense of frustration and insecurity at this moment. Passage of 
this bill will help stabilize energy costs and, in some instances, 
especially in natural gas, it may well bring down those prices for the 
winter months and the heating months of 2006 and 2007. If we can 
accomplish that--and I think we can--then this Senate ought to vote 
unanimously for S. 3711. We ought not get caught up in the minutiae of 
the politics of the past because the minutiae of the politics of the 
past have produced $3 gas, have produced $10 and $12-per-million-cubic-
feet gas, and have caused the American consumer to develop a sense of 
insecurity about themselves, their families, and their futures like 
none we have ever had.
  The chairman of the Energy Committee gets it. That is why he has 
worked as hard as he has. I believe I understand those issues, and I am 
proud to be a cosponsor of this legislation.
  Let us say to the American people: Let's take a step further. Let's 
erase this red area from surrounding the American coastline. Let's look 
at new offshore policy that says to the American consumer: Here is an 
opportunity, and we ought to deal with it in an environmentally sound 
way, instead of just saying no. You can't just say no and be able to 
deal with that at the gas pump the next day because when you do, that 
means the American consumer pays more.
  I see that as the essence of this bill. And in supporting S. 3711, 
albeit a strong step, it is clearly a step in the right direction. 
Let's remember the responsibility we have to the consumer as we 
effectively deal with and develop these resources because that consumer 
is also an environmentalist who wants it done in a safe and sound and 
environmentally clean way. That is what we are about.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, first, before the distinguished Senator 
leaves the floor--I see he is still here and I am glad he is--I thank 
him very much not just for me or for that speech, for that statement, 
for that set of thoughts, but I thank him for the American people for 
his thoughtfulness.
  If anyone wants to read the text of something that summarizes from 
beginning to end the problems we are having and why in the areas of 
high costs of natural gas and crude oil and insecurity and lack of 
consistency and fluctuation in prices that are frightening and scaring 
everybody, read the speech that was just delivered by the distinguished 
Senator from Idaho. It is a tremendous introduction to the problem and 
then a total summation and wrap-up of what we can do for ourselves and 
why we should do it and why with the problem of energy supply in the 
fields of natural gas and crude oil, wherever America can, we must use 
our resources, especially these days when insecurity in the world 
causes such a problem. Even if they are supplied, the price is totally 
out of focus, and everybody should know that if we have our own 
supplies, that is what we ought to use--it is sitting right off our 
coast--with no damage, as the Senator from Idaho indicated.
  We saw the little piece of property out of acres and acres and 
miles--this little piece of property, 8.3 million acres. He showed it 
to us on a map. It is loaded with natural gas. How do they know? They 
have already proven it. Part of it was ready to be leased; isn't that 
right, I say to the Senator? Part of it was ready to be leased in the 
regime of the Governor of the State of Florida, a former Senator, 
Lawton Chiles. As a Floridian, he, years ago, acknowledged this must 
happen, that part of this property was prepared. We know it. When we 
put it to bid, it will be ready to go.
  Not only that, as the distinguished Senator indicated, to have an 
impact on the cost, we don't have to wait until they drill--right?--
because it is such a big supply that the marketplace will take 
cognizance, will be aware of, will respond to the fact that we are 
ready to do it.
  Once this bill leaves here, even that might have an impact. But I am 
not sure, until it is signed, as I think of it, that will have an 
impact because there is always a chance for a slip between the cup and 
the lip.
  We have to get it done, and we have to get it voted on. It is ours. 
It is ready to go.
  I once again thank my good friend and valued member of the Committee 
on Energy and Natural Resources--and many others around here--for his 
terrific speech summarizing the problem we have and the way this 
American solution to an American problem should be addressed and why.
  I thank the Senator. I yield the floor.
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. THOMAS. Mr. President, I rise today to join in the conversation 
and the discussion about energy and in support of S. 3711, the Gulf of 
Mexico Energy bill.
  We are coming up on the anniversary of the Energy Policy Act which we 
passed sometime back. It is comprehensive energy legislation that 
recognizes the difficulties we have in this country, recognizes the 
directions we need to go, recognizes in general terms where we have to 
be, whether it is increased production, whether it is efficiency and 
conservation, whether it is alternative methods, whatever. All those 
issues are excellent, and I am glad we did that.
  Of course, now we are in the position of implementing those policies 
and implementing the policies, of course, is

[[Page 15892]]

what will have an impact on people in this country, what will have an 
impact on the costs.
  Despite the Energy bill, prices, of course, have risen. They have 
increased because we haven't been able to implement the bill to bolster 
production. There are a number of things going on, and I think we have 
to continue to remember that there are at least two aspects of the 
future in terms of energy.
  One is, out 20 years, we will be looking at all new kinds of sources, 
all new kinds of supplies, whether they be wind energy, sun energy, but 
those are down the road. We are not there yet. On the other hand, we 
need to be talking about how we are going to supply our cars and how we 
are going to take care of the costs for American families this year, 
next year, and 5 years from now. So there are two aspects that are very 
much involved.
  One of the reasons, of course, is we haven't been able to move. There 
has been some resistance to including production in measures. The 
recent jump in prices has been linked directly to that resistance. It 
is time to do something about U.S. production.
  I echo the comments the senior Senator from Louisiana made earlier 
today that we cannot drill our way to energy independence and we cannot 
conserve our way to energy independence. We have to do both. We have to 
have production, we have to have efficiency, we have to have 
conservation. Oil and gas is the easiest way we know to do this.
  I come from Wyoming, one of the large production States of oil, gas, 
and coal, the largest producer of fossil fuels. We know how to do these 
things, but we have to find new sources, new ways of moving toward the 
energy that is there.
  For the sake of security, we must do more. We must reduce our 
increased reliance on foreign sources of energy. Obviously, as the 
world changes--and we see every day on the TV how difficult it is to 
continue to do that--the Outer Continental Shelf holds great promise 
for accomplishing that goal.
  The higher prices we have seen recently are the result of many 
factors, and we need to address those factors. We all agree increased 
supply lowers prices. We need to produce more energy in the United 
States, and, of course, this is a politically charged issue.
  Many people have proposals they believe will help. I have my own bill 
to reduce prices that Americans pay for energy, increase efficiency, 
new refineries, and better infrastructure and all the things we must 
do.
  We cannot deny the basic economic principle that increased supply 
reduces cost. It is simple. The bill we are debating today will 
increase domestic supplies of gas and oil. It will do so in ways that 
are sensitive to the environment, that will make us more secure and 
bolster economic opportunities. And it represents an agreement between 
the States that are most directly impacted by gulf coast production.
  Too often people complain about the high energy prices and attempt to 
blame others. We have an opportunity to do something about that cost of 
energy today. In 6 months' time it will be winter. I am certain that 
Members will complain about the cost of energy then, too. I am also 
sure there will be a call for more money to spend on LIHEAP and other 
programs. I ask that we deal with those problems now and not later.
  The American people are paying close attention to this bill and want 
us to continue with this debate and make some improvement in domestic 
production.
  If we do not increase supply now, the American people will know who 
to blame. There are, of course, other things that Congress needs to be 
doing on energy. Coal conversion technologies need our full support. We 
have over 200 years' worth of coal in the United States that can be 
cheaply produced. Wyoming supplies a third of our Nation's current coal 
needs.
  We put this coal on railcars and send it across the Nation. That is 
increasingly becoming expensive. We want to put the coal in pipelines 
and convert it to diesel and electric power for cleaner power.
  Our electric transmission grid needs to be modernized. Several 
hundred thousand people lost power this last week in California, 
Missouri, Illinois, and New York. The grid is stressed, and we need to 
encourage investments to strengthen it.
  I would like all of our coasts opened to responsible production. This 
bill makes 1.3 billion barrels of oil and 5.8 trillion cubic feet of 
natural gas available. That is a good thing. Let's not forget there is 
an additional 19.3 billion barrels and 83 trillion cubic feet of oil 
and gas off our coasts that are currently off limits. This bill does 
not make those areas available.
  Yes, I prefer that revenues from these activities be used to reduce 
our Nation's debt. There is continued resistance to all of these 
broader approaches, however.
  I hope that lease sale 181 can serve as an example to other coastal 
States that offshore production works. What we need now is a bill on 
which we can agree, and we have it before us. We need something that 
can make a difference in the short term. This bill is a pragmatic 
approach that achieves these goals. This is something we know can 
happen. We know how to produce it. It is available. It recognizes the 
value of increased production and strikes the necessary balance to make 
those activities a reality.
  We are faced with a broad challenge in energy, of course, a long-term 
challenge. We have all kinds of approaches to it. But here is one 
before us that we know how to handle, that we can handle, it has an 
impact, and it is prepared for us to do today. I urge my colleagues to 
support the bill.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Mississippi.
  Mr. LOTT. Mr. President, I will be glad to defer to the distinguished 
ranking member of the committee. I won't be long. I will go ahead and 
address this very important issue.
  I begin my remarks by thanking the distinguished senior Senator from 
New Mexico, Mr. Domenici, for his leadership in this area. He is one of 
our more knowledgeable Members. After years of watching him at play, I 
now refer to him as our No. 1 utility player. Whatever the problem was, 
he can be helpful. He is knowledgeable on budget issues, energy issues, 
and also has a practical side: Let's find a way to get it done. Once 
again, he has done that with this bill.
  I know he wants to work with his committee. I know he wants to work 
with Members on both sides of the aisle. But I know more than anything 
else he wants to do the right thing for our country. So I thank Senator 
Domenici for his leadership. He has agreed to do some things in ways he 
would not do it if he could do it in a vacuum. But that is what 
leadership is all about. In the legislative process, you don't get it 
100 percent the way you want it. You have to give a little and get a 
little to do the right thing, to produce a product for the American 
people. So that is the main reason I am here. I want to thank you for 
that.
  I also acknowledge the leadership and encouragement of Senator 
Martinez, the Senator from Florida, and others from Florida who have 
been helpful in this effort. I have a great admiration for Florida. It 
is more or less a neighboring State--a little bit of Alabama intervenes 
between my State, where I actually live, and the Panhandle of Florida--
and I haven't been able to understand why they have been so opposed to 
oil and gas production in the Gulf of Mexico. I understand the concern 
about coastal areas--the beaches. But there has to be a reasonable and 
practical way to protect the American people and their needs for this 
production, and shield our beaches and our tourist industry from harm.
  It is easy to say: No, no, I am not going to have it at all. It takes 
courage and leadership to say: Well, let's work this out in a way that 
would be the right thing for our military bases in the Panhandle of 
Florida, and for our tourist industries in Florida, Alabama, 
Mississippi, Louisiana, and Texas--we all have that--and take advantage 
of the tremendous resource that will help the American people, that 
will reduce our dependence on foreign oil. This is what this is all 
about.

[[Page 15893]]

  It is not just the prices at the pump today; it is about the long-
term plan. We have a problem here. It is a growing problem. Are we 
going to do something about it? This is a step in the right direction. 
That is the message here. Will this bill solve the problem tomorrow? 
No. It will have an impact almost immediately, because people will see 
we have taken some action and they will act. And it probably will have 
some impact on natural gas pretty quickly. But it is a clear statement 
to everyone that we realize there is a problem here and we are going to 
do something about it.
  So I thank Senator Martinez for stepping up. Senator Nelson has been 
involved, and I hope we are going to have a unified group of Senators 
from the entire Gulf of Mexico area to endorse this concept. We have 
worked at that. Florida, Alabama, Mississippi, Louisiana, and Texas, 
have met and talked on a bipartisan basis about doing the right thing. 
I have been proud to be a part of that.
  Senator Landrieu of Louisiana has been relentless--relentless--has 
she not, I ask the Senator?
  Mr. DOMENICI. You bet.
  Mr. LOTT. She has worked this issue hard. Senator Vitter has made 
sure we have done it in the right way. He has looked at the language 
very carefully. I commend them in particular. Their State has probably 
been more active involving this issue than any other Gulf States. Their 
State has also taken some of the negative impact--on the coastal 
areas--in recent years. Therefore, it is only right that they get a 
higher percentage of the coastal impact fees and that they be 
recognized for their effort. Senator Hutchison and Senator Cornyn, 
Senator Cochran, Senator Shelby and Senator Sessions also deserve to be 
recognized. We have all been involved.
  The next point I want to make is I don't quite understand why we are 
finding it harder and harder to produce a result. It is has become so 
hard to be bipartisan. I admit it is almost impossible to get a 
bipartisan agreement that is bicameral. Maybe it is just a sign of the 
times; maybe it is the political season we are in which may be a little 
more testy than normal. But here we have a perfect example of a 
bipartisan bill. A wide margin of you vote earlier on the motion to 
proceed to this bill, and we are now in the debate time on that. I 
predict when we get to the final vote, it once again will be 
bipartisan, probably higher than anybody would have thought. But this 
is the way it can happen. This is the way it should happen. So I am 
glad we are working in a bipartisan way.
  I want to say: Look, we made some progress last year with our Energy 
Policy Act of 2005. It didn't entirely address our energy needs, 
obviously, but it was a step in the right direction. Now, here is the 
next step. For years, I have been stressing that our energy policy in 
this country has to be balanced. I would prefer to produce our way out 
of our energy situation. I believe we can have more: more oil, more 
gas, more hydrogen, more nuclear, probably more wind and solar energy 
too. We can do it all. But I finally came to the conclusion we are not 
going to be able to just do one part of this equation; we are going to 
have to produce more, we are going to have to conserve more, we are 
going to have to look for alternative fuels, and we are going to have 
to be innovative. I have made that concession. After all, it makes 
sense. Why don't we do the whole package?
  That is what last year's Energy Policy Act began to do, it made some 
improvements in nuclear and in hydrogen and alternative fuels. However, 
we can't do all of those things instantly. Very few places are ready to 
build a new nuclear plant. My State of Mississippi may have been one of 
the first to build a new nuclear reactor. That is great. We need to 
move towards alternatives such as liquefied natural gas, and once 
again, we have to build the facilities. And that won't happen tomorrow.
  In the meantime, while we need to make stronger conservation efforts 
and come up with more alternatives and innovative ideas, and we need 
more oil and gas. It is that simple. Now, we can get it some way or the 
other from Iraq, Venezuela, Nigeria, Iran or we can get our own safely. 
When I go to my State of Mississippi, people scratch their head and 
say, why is it that people from a certain part of the United States are 
determined we are not going to get oil out of ANWR? What is it to them, 
and what does it mean to the country?
  For whatever reason, without impugning anybody's motives, we haven't 
done it. But we can do it in the gulf. We can do it in the Gulf of 
Mexico because we know it can be done. We think it will be in the best 
interests of our States and our people and we think it is in the best 
interests of America. It is there, it can be obtained safely, miles off 
the coast.
  I want to emphasize right up front: This is not about putting oil 
rigs or natural gas wells within the sight of the beach, although there 
have been natural gas wells in plain view from my front porch in 
Pascagoula, MS. It is not about that. We do not want our beaches to be 
threatened. This is going to be at least 100 miles away--in the case of 
Florida 125 miles away from this 181 and the other areas we are going 
to open. I think it can be done and it will produce very early results.
  Look at what we are talking about here, freeing up 1\1/4\ billion 
barrels of oil that we won't have to get from some unstable government 
overseas, and almost 6 trillion cubic feet of gas, that is huge. Others 
in this country ought to be willing to do the same thing in other 
coastal areas. But I want to emphasize that this is not about any other 
coastal area; this is just about our area. We are prepared to step out, 
do the right thing for our country, take the risks. But we also want to 
get a little of the benefits, a little help in trying to deal with some 
of the problems we have in the coastal region.
  By the way, one little aside: This bill will reduce the Federal 
deficit by almost $1 billion over 10 years--$1 billion--probably more. 
I think all of the numbers are understated. I think we are going to get 
more oil, more gas, more benefits, more money coming into the Federal 
Treasury and our States. We will do it without raising taxes or fees on 
anybody. So we get the benefit of additional supply, we get the benefit 
of impacting our Federal budget, drilling will produce hundreds of 
jobs, good-paying jobs. I know the people who work on those rigs out 
there in the Gulf of Mexico, and I know the kind of money they make. 
Yes, they work hard and they take risks and they are away from their 
families, but these will be good, new jobs for good, hard-working 
people--people who need a little help right now, these are the people 
who have been hammered by Hurricanes Katrina and Rita.
  For decades, almost every dime generated from leasing of Gulf of 
Mexico areas for oil and gas all came to Washington--all of it came to 
Washington. Mississippi, Louisiana, Texas, and Alabama, the States 
which permit energy exploration off their coasts, reaped very little 
benefit, but they incurred a lot of the risks, some of the damage and 
some of the threats. We provide the infrastructure. These boats don't 
just take off from nowhere; they have to be built somewhere. All of 
this goes on--it is not all perfect, let me be honest about that. There 
are certain challenges. So we feel there should be an equitable 
distribution of the royalties from the Outer Continental Shelf to those 
of us who are on the front line.
  For years States that allow energy production on Federal land receive 
50 percent of the Federal revenues from these activities. Those of us 
in the gulf: zip--other than what we get indirectly through the Land 
and Water Conservation Fund and through Federal largess, which, in our 
area, is not much.
  So we think this is important. We are trying to stand up and do what 
we think is right for our country, but we want to also do the right 
thing for our States. There is a coastal impact. We all know that. This 
is an acknowledgment of that. The Gulf States which will be producing 
this would get under this agreement 37\1/2\ percent of the Federal 
revenues from the new leases entered into after the date of enactment. 
Twelve and one-half percent, though, of the revenues would go to the 
Federal

[[Page 15894]]

Land and Water Conservation Fund, for all of the States to use. We are 
not greedy, but we want our fair share for a change. There was a time 
when we wouldn't stand up, speak up, and fight for what is right for 
our people. This time, we are going to. It is a win-win. It is right 
for our country and it is right for us. I think this is a good 
arrangement.
  The money that goes to the States--Senator Landrieu and I have felt 
it shouldn't all go to the States. Our State capitals and our State 
Governors are quite often not from the marshes of Louisiana or the 
beaches of Mississippi. We have to make them understand where we are 
and who we are. Once again, part of the problem over the years has been 
our own fault because the attitude in the south of Louisiana and the 
south of Mississippi is: Oh, well, we will do it ourselves. Well, we 
are trying to get a better rate. We are trying to make more sense. So 
20 percent will go to the coastal counties that are impacted.
  I know the Senator from New Mexico, Senator Bingaman, is here, and he 
cares about those areas. I want to tell him what these monies will be 
dedicated to. They will not be frivolously squandered on some project 
that is not along the coastline. The funds are going to go to coastal 
conservation, coastal protection, and restoration. Hurricane 
protection--hello--do we need to do that? By the way, if we don't do 
it, we know who is going to pay our bill because when we are flat on 
our back the Federal Government will have to come in again with 
hundreds of billions of dollars. Let's be proactive. Let's try to do a 
better job in protecting our coastal areas and our marshes. If we do 
not take action, the impact on fisheries could be absolutely 
detrimental. If you don't have these areas of brackish water, you are 
not going to have the shrimp and the fish we have been trying to 
develop there. This money will provide for mitigation of natural 
resource damage.
  I firmly believe this will have a great impact in our area. It is the 
right thing to do. These areas will be better, and in some instances 
they will be restored. Louisiana is losing land every hour, and 
although we may not have that big a problem in Mississippi yet, this 
problem is only going to get worse. We can take action to protect the 
future.
  We have a chance to do some innovative work. In my State of 
Mississippi, we are not trying to put things back as they were before 
Hurricane Katrina; we want them to be better. We are coming up with 
innovative ideas. We are thinking about how can we be better prepared 
to withstand a hurricane. These funds will make a huge difference in 
the long run.
  I want to make this clear: I think this is a great effort that we 
will all be able to point to in the future and say that we did 
something great. This is something that will make a difference. We will 
be saying to the American people: We understand your pain, we feel it, 
and we are taking steps to do something about it.
  This will not be the last effort. We are going to have to do more. 
But now is the time to do this. Now is when the people are suffering 
due to higher prices for oil and for natural gas. It has made it very 
difficult for people. This legislation will reduce our dependence on 
foreign oil, it will help us with our budget needs, it will provide 
more money to protect natural resources, and it will bring much needed 
funds and jobs to the gulf area which was hammered by Katrina and Rita. 
This is truly a plan which Congress should pass and be proud of and the 
President should adopt.
  I look forward to working with my colleagues as we go forward in the 
next couple of days to complete action on this important legislation.
  Mr. LOTT. Obviously, people who have the time to look at this believe 
it has been a very unfair situation, one that for some reason or 
another we have tolerated for years. When they realize the way it is 
handled in other parts of the country, they feel very strongly it is 
time we step up and get some benefit.
  It is also further exaggerated and exacerbated by the fact that if we 
believe that we are on the line, dealing with all the costs and all the 
potential problems that could go along with this, we ought to get some 
of the benefits so we can prepare for that.
  I want to say that the people in the Senate and the American people 
have been very concerned, sympathetic, and helpful to us after the 
hurricane. But they know we have coastal impact problems. We need to 
address some of those problems now, not later, because they have become 
very serious. There are areas we are losing that are basically going 
into the Gulf of Mexico, and we can also take steps to preserve what we 
have and to better prepare for hurricanes, use for protection and 
mitigation for the future.
  The people feel very strongly about it. It is not just our Governors 
who see this obviously as one way to help us deal with the future needs 
we have, but also just the rank-and-file people. We understand we need 
to get it done.
  This proposal, which would give our Gulf States some share for our 
coastal impact, will give us the benefit of getting some help. Also, 
the people understand this is something we need to do for our country 
and are willing to do it in the gulf. I wish the rest of the country 
would follow our lead. However, we are not going to fuss about that, we 
are just going to step up and do the job.
  Our people do feel very strongly about it. They believe we have not 
been treated fairly and it is time to do something about it.
  I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  Mr. BINGAMAN. Mr. President, how much time remains on the two sides?
  The PRESIDING OFFICER. The Senator from New Mexico controls 2 hours 
23 minutes, and the majority controls 1 hour 50 minutes.
  Mr. BINGAMAN. Let me speak for a few minutes to give my view of the 
legislation.
  First, let me just say energy issues are very much on the minds of 
the American people. Rightly so. We have oil trading at above $75 a 
barrel. We have the price of gas at the pump above $3 in most parts of 
this country today. Clearly there are a lot of explanations for that, 
but that is part of the reason we should be focusing on this set of 
issues.
  We have high and growing demand for energy in the world. We have high 
prices because not only do we have high demand, we have constrained 
supply, and we have great uncertainty in the world. All of that affects 
the price of oil and the price of natural gas as well. Whether the 
uncertainty is in the Middle East, whether it is in the Nigerian Delta, 
whether it is threats of curtailed imports from Venezuela--there are 
all kinds of reasons the price of oil is high.
  We need to focus on how do we begin to pursue a strategy that helps 
solve these problems. The truth is, our country is on the wrong track 
when it comes to oil and gas. According to the Energy Information 
Administration Annual Energy Outlook, our projected future demand for 
oil and natural gas is going to far outstrip our domestic production 
capabilities, and that circumstance is getting worse, not better. All 
of the projections are that after the passage of this bill, it will 
continue to get worse, not better.
  We have the opportunity, the Members of the Senate and Members of 
Congress, to try to make some decisions to get the supply/demand 
equation better into balance. How can we use oil and gas more 
efficiently and thereby need less than the projections would indicate 
we might wind up needing? How do we substitute the alternative fuels in 
our energy mix on a faster basis, on an accelerated basis? How do we 
produce more and how do we find ways to be more efficient?
  A year ago this coming Saturday, we had final passage of the 
comprehensive Energy bill we passed last year, the Energy Policy Act of 
2005. On balance, I believe--I still believe and believed at that 
time--that was a good piece of legislation. Mr. President, 74 Senators 
voted for it. We had a majority of Republicans voting for it. We had a 
majority of Democrats voting for it. The bill was put together on a 
bipartisan basis in the Senate Energy Committee under the leadership of 
its chairman,

[[Page 15895]]

Senator Domenici, from my home State of New Mexico.
  When the bill came to the floor, of course, Senators on all sides of 
the many issues in that bill were given an opportunity to bring their 
amendments to the floor, to debate those amendments, to have them voted 
on, and despite the broad sweep of that legislation, we completed that 
process in 2 weeks.
  After passage of the bill, we went ahead and had a very fair and open 
and inclusive conference with the House of Representatives that 
resulted in a conference report that enjoyed broad, bipartisan support.
  The Energy Policy Act addressed energy production. It addressed 
energy conservation. It addressed energy technology and renewable 
energy, and it addressed oil and gas and coastal impact assistance, 
including assistance to the States which are most interested in this 
legislation. It made significant strides in the right direction on a 
host of issues.
  I had hoped, frankly, that we could continue to move forward in the 
energy policy area this year by acting on a series of measures to 
address the remaining issues. There are clearly remaining issues that 
need attention. One of those is the lack of effective steps to increase 
efficiency in the use of oil and natural gas.
  We did not do what we should have done in last year's Energy bill to 
deal with that issue. The Senate version of the bill had some good 
ideas in it. Unfortunately, they were dropped in the conference. We 
were not able to persuade the House to agree to those. For that reason, 
this past May, I joined with a bipartisan group here in the Senate to 
introduce S. 2747, the Enhanced Energy Security Act. That bill 
addresses oil savings and alternative fuel infrastructure and provides 
for a renewable portfolio standard and various other efficiency and 
conservation measures.
  Another energy measure I hoped we could act on this year is S. 2253. 
That is the bill which would have required the Secretary of the 
Interior to offer for lease lands within this original lease sale 181 
area we have been discussing as part of this legislation. Early this 
year, I joined with Senator Domenici to develop and introduce the bill 
on a bipartisan basis. The bill would have opened portions of the 
original lease sale 181 area that had been proposed for leasing in 1997 
by the Clinton administration. That proposal by the Clinton 
administration was made after negotiations with then-Governor Lawton 
Chiles, our former colleague here in the Senate, Governor Lawton Chiles 
from Florida.
  Those areas had been taken off limits by a decision by the Bush 
administration. I think some may not realize that we would not even be 
here today talking about opening lease sale 181 for possible drilling 
if the Bush administration had followed through on the Clinton 
administration's schedule for leasing. They proposed to do that, and it 
was on their schedule when this administration came into office.
  The bill Senator Domenici and I introduced did nothing to affect 
areas under congressional moratoria or areas that had been withdrawn by 
Presidential decree or order. No part of the area to be leased was 
closer than 100 miles from any point in Florida.
  We have a map here that will give people an idea of what was involved 
with lease sale 181. This is the bill which was reported out of the 
Energy Committee with bipartisan support. You can see the line there, 
which is the 100-mile line, showing we are not getting within 100 miles 
of Florida and showing the additional area that would be open for 
leasing.
  I should point out that between the time Senator Domenici and I 
introduced S. 2253 and the date our committee had a hearing on that 
bill, the administration published its own draft proposed program for 
oil and gas leasing for the period 2007 through 2012. That 5-year plan 
called for a lease sale in the 181 area in the fall of 2007. The area 
the administration proposed for leasing contained about 3.07 trillion 
cubic feet of natural gas and 620 million barrels of oil.
  The current state of play under current law is that even if this 
legislation does not become law, the administration plans to open that 
area for leasing beginning in the fall of 2007. It was good news when 
we learned the administration intended to proceed to lease this new 
area. It meant that a substantial new development of oil and gas would 
take place even if we didn't succeed with the bill Senator Domenici and 
I introduced.
  At the hearing we had on S. 2253, I asked the Director of the 
Minerals Management Service, which is the agency with responsibility 
for this leasing, Ms. Johnnie Burton, whether the administration's 
plans would wind up coinciding with what the bill envisioned if passage 
of the bill was delayed. She replied that that certainly would be the 
case.
  After the Energy Committee reported the bill in early March, we 
received additional evidence that the plans for leasing new areas in 
this draft 5-year plan were on fairly solid ground, and the new 
evidence was that the Congressional Budget Office booked the expected 
revenues from royalties and bonus bids in the budget baseline for this 
10-year period, 2006 through 2016.
  Even though a good portion of the oil and gas contemplated in the 
original bill reported by the Energy Committee was incorporated into 
the developing plans of the Minerals Management Service, I thought it 
made sense that with the balance of the initial area opened by S. 2253, 
we go ahead with the bill and try to enact it. Unfortunately, at least 
from my perspective, events since the committee reported the bill to 
the full Senate have changed the bill in very substantial ways. In my 
view, this is not the bill that we worked on in committee. Several of 
our colleagues in the Senate took the position that S. 2253 should not 
move forward without certain modifications.
  My colleagues from Florida expressed a desire for a long-term 
moratorium off the coasts of their State. My colleagues from other Gulf 
Coast States indicated that they would object to S. 2253 being 
considered without those States receiving a fixed percentage of the 
revenues from the oil and gas produced in the Federal Outer Continental 
Shelf off their coasts.
  Both of these demands, which were satisfied in this bill, which has 
now come to the Senate floor, S. 3711, in my view, have undermined the 
goals of the original bill. Because S. 3711, which is the bill now 
pending in the Senate, locks up vast areas of the Outer Continental 
Shelf off Florida, and because the bill provides for the ceding to 4 of 
our 50 States billions of dollars of Federal revenues, I find myself in 
the position of having to oppose the bill.
  The chairman of the Energy Committee will point out that S. 3711 
opens two new areas in the Gulf of Mexico. That is true. Beyond the 
area proposed for opening by the new 5-year plan that I talked about, 
Minerals Management Service, S. 3711 opens a triangular sliver in the 
area known as ``the bulge.'' You can see that sort of orange area on 
here. That is new under this legislation. The legislation also opens 
the so-called 181 south area, which is currently under a congressional 
moratorium that expires this September 30.
  There is also a Presidential withdrawal for that area which is 181 
south. That is the lighter orange area down below the area that we have 
been talking about.
  In order to get these additional resources that are provided for in 
this bill, which amounts to 2.76 trillion cubic feet of gas, S. 2711 
puts 21.83 trillion cubic feet of natural gas in the eastern Gulf of 
Mexico off limits until 2022.
  I don't think it is a very good trade for the people of America for 
us to give up access to 21 trillion cubic feet of natural gas in order 
to gain access to 2.76 trillion cubic feet. Some of that 21 trillion 
cubic feet of natural gas that is being put under a 16-year moratorium 
in this bill is in areas that have never been controversial in 
Congress. These areas were part of the original lease sale 181 area 
that every annual congressional moratorium had exempted.
  We are talking about this entire yellow area. I think this chart is 
very similar to the chart that the Senator

[[Page 15896]]

from Florida, Mr. Martinez, has been using. It shows a very much larger 
area that is being subjected to this 16-year moratorium than we have 
ever put under moratorium before.
  These yellow moratorium areas that are within the blue of the 
original lease sale 181 area shown on the chart, these three resource-
rich areas are not now under moratorium. If Congress does not enact S. 
3711, these areas could be leased under the next 5-year plan, if the 
administration decided to include them, instead of being locked up 
until 2022.
  Let me, also, for a moment show a chart that our colleague, Senator 
Craig, was using earlier this afternoon. He has a chart showing what is 
happening south of the area that we are locking up for the next 16 
years. This is the thatched area down near Cuba. I think looking at his 
chart sort of brings home the unfortunate handicap we are putting 
ourselves under with this legislation. In fact, Senator Craig's bill, 
of which I am a cosponsor, would allow U.S. oil companies to 
participate in the development of this thatched area, the oil and gas 
resources in this thatched area down near Cuba, some of which is as 
close as 50 miles from the State of Florida. But at the same time in 
this legislation, we are saying we are going to prohibit drilling for 
the next 16 years in areas as far as 230 miles from the State of 
Florida. To my mind, that doesn't make good sense.
  It would be ironic if Cuba proceeded with drilling in its waters to 
extract at least 4 billion barrels of oil under its territory, while at 
same time we were passing legislation saying there would be no drilling 
in the waters we control through 2022. That is exactly what this 
legislation says.
  Referring again to Senator Craig's statement, he talked about the 
``no zone''--the large ``no zone'' all around the country, where nobody 
wants to allow drilling. I will say we are adding to the ``no zone'' 
very substantially with this legislation by putting in this yellow area 
areas that had not been subject to moratorium and certainly have not 
been subject to anything such as a 16-year moratorium, as we are about 
to enact here.
  In addition to being bad energy supply policy for the long term, S. 
3711 is also, in my view, bad fiscal and budgetary policy for the long 
term.
  The bill directs, as I think many have mentioned, 37.5 percent of 
revenues from new leases to the four States, Texas, Louisiana, 
Mississippi, and Alabama. Starting in 2017, a second royalty diversion 
using the same percentage would be applied to new leases in existing 
areas of the Gulf of Mexico open to production.
  We have a chart which makes the case as to what we are talking about. 
We are saying, in the western Gulf of Mexico and the middle Gulf of 
Mexico, that we are, in fact, going to cede 37.5 percent of the 
royalties from production on new wells in those areas to these four 
States as well; that those are funds which otherwise would go into the 
Federal Treasury.
  In order to avoid a point of order under the Budget Act, S. 3711 
purports to cap the revenue sharing, from 2016 to 2035, at $500 million 
per year. And then it has a very interesting provision. It says ``net 
of receipts.'' Rather than actually capping the revenue sharing, the 
bill allows receipts from the 181 and the 181 south area to be added to 
the $500 million cap. That makes the so-called cap, in my view, at 
least much higher. However, even with the cap, the amount flowing to 
the four Gulf States is estimated to be somewhere between $27.5 billion 
and $30.5 billion during this period. After 2056, the full entitlement 
comes into play with estimated losses to the Federal Treasury of 
between $12.5 billion per year and $15 billion in 2056 alone.
  This underscores the point which people need to understand--that this 
legislation calls for this sharing of revenue or ceding of revenue to 
these four States in perpetuity. This is not in any way sunset. There 
is no time limit. This is from now on. The legislation says these 
States will be entitled to the money.
  As many of my colleagues know, I have strongly opposed diverting 
revenues from the Outer Continental Shelf. It is clear to me, in 
reading the history of this country and the laws of this country, that 
this is a Federal asset and that ceding of these revenues to State and 
county treasuries of coastal States is bad policy. The resources of the 
Outer Continental Shelf belong to the entire Nation. Over the years, 
there have been several attempts by coastal States to assert some form 
of ownership rights over the Outer Continental Shelf. In the 1940s, 
coastal States tried to issue leases to oil companies in these Federal 
waters. That led to a landmark decision in our Supreme Court in 1947. 
The Supreme Court ruled in 1947 that offshore lands were, and always 
had been, owned by the United States as a feature of its national 
sovereignty.
  Having been stopped by the courts, the States turned to Congress to 
request that it turn these so-called submerged lands over to the States 
themselves. President Truman strongly objected to this. He vetoed the 
legislation that was sent to him. Let me read the quotation from his 
veto statement. He said that he could not:

     approve this joint resolution because it would turn over to 
     certain States as a free gift very valuable lands and mineral 
     resources of the United States as a whole; that is, all the 
     people of the country. I do not believe such an action would 
     be in the national interest. I do not see how any President 
     could fail to oppose it.

  That was the basis for his very veto.
  President Truman left office and Eisenhower took a different view. He 
signed the Submerged Lands Act of 1954 that granted the coastal States 
title to submerged lands within 3 miles of their coasts.
  Later that year, Congress also passed the Outer Continental Shelf 
Lands Act, asserting Federal control over the subsoil and the seabed of 
the Outer Continental Shelf. The legislative history of these acts is 
clear. They were intended as a final settlement of the issue of who 
owned what on the Federal Outer Continental Shelf.
  In recent years, as the resources of State waters which were granted 
under the 1953 act have been depleted, and as the great resource 
potential of the Federal waters has come into full review, a new 
drumbeat has arisen. The claim is that coastal States should have a 
preferential share of the resources of the Outer Continental Shelf over 
and above other States that, under current law, are equally entitled to 
these receipts, and under the Supreme Court's view are entitled to 
these receipts.
  We are not talking about trivial sums of money. Oil and gas receipts 
from the Outer Continental Shelf are the third largest source of income 
to the United States after taxes and Customs duties.
  Over the next several decades, it is estimated that oil and gas 
royalties from the Outer Continental Shelf will exceed $1.2 trillion. 
As we look to the future, a future in which we will have large bills 
coming due at the Federal level, with the retirement of the baby boomer 
generation, it is unwise, in my opinion, to consider permanently 
diverting these revenues away from the Federal Treasury to these four 
coastal States.
  I have often heard the argument that we ought to give a percentage of 
Federal royalties to the Outer Continental Shelf, to the nearby States 
because Western States, such as my own, New Mexico, receive a portion 
of the royalties from the Federal lands within their borders.
  Let me address what I believe is a false comparison head on. The 
first obvious point is that the Mineral Leasing Act which has been 
adopted made provisions for my State to receive 50 percent of the 
royalties for production on Federal lands. This Mineral Leasing Act 
does not discriminate against Louisiana, Mississippi, or any other 
coastal State. To the extent that the Federal Government reduces oil 
and gas and collects royalties on Federal land within their borders, 
the Federal Government pays 50 percent of those revenues to the States 
just as they do in my State, just as they do in Wyoming, just as they 
do in every other State in the Union.
  Indeed, according to the Minerals Management Service, between 1982 
and

[[Page 15897]]

2003 the Federal Government distributed $14.8 million to Louisiana from 
onshore Federal leases under the Mineral Leasing Act. The reason 
Louisiana did not get more was because there is very little Federal 
land in Louisiana that produces oil and gas. Most onshore oil and gas 
development in Louisiana takes place on State or private land and not 
on Federal land.
  Louisiana, like any other State, receives 50 percent of the royalties 
collected by the Federal Government from Federal oil and gas leases. 
Western States, such as New Mexico, and eastern States have very 
different histories when it comes to patterns of life ownership. A long 
time ago, in the 19th century, a large part of States such as Louisiana 
consisted of public land. But the laws at that time allowed that 
Federal land to be patented and bought into private ownership or given 
to the State where it now forms the tax base for those States. That 
explains why there is relatively little Federal land in a State such as 
Louisiana. The State enjoys the ability to levee taxes, including 
severance taxes on all the oil and gas that is produced within the 
State, which is considerable.
  The development of the western States took a very different turn in 
1920 when it became clear that there was a significant amount of 
Federal land that had oil and gas potential. Instead of allowing that 
land to be patented and brought into private ownership under the mining 
laws, as had happened in earlier years in States further east, Congress 
passed a new law--and that is the Mineral Leasing Act I was just 
referring to. This act forges a very different bargain.
  In return for keeping the lands with rich oil and gas resources under 
Federal ownership, therefore, out of the State's tax base, the Federal 
Government agreed to give the States a share of the Federal royalties 
as compensation for the lost tax revenue involved. This compromise 
represented no injustice to any State that had previously had all of 
its Federal lands converted into private land through land patents. 
These eastern States already had what the western States were giving 
up; that is, the ability to tax all of the economic activity within 
their borders.
  If you read the legislative history of the Mineral Leasing Act of 
1920, it is clear that the split of revenues between the Federal 
Government and the State governments was in compensation for removing 
lands from the tax base of the States.
  So when you recognize the reason for the 50-50 split of royalties on 
Federal lands within the boundaries of States under the Mineral Leasing 
Act, it is clear to me that transposing this system to the Outer 
Continental Shelf makes absolutely no sense. Federal ownership of the 
Outer Continental Shelf takes nothing away from the tax base of any 
coastal State. To the contrary, Federal development of national assets 
on the Outer Continental Shelf actually results in enhanced economic 
activity, increased tax revenues in adjacent coastal States.
  One report that illustrates this fact is published in 2002 by 
Louisiana Midcontinent Oil and Gas Association. It is entitled ``The 
Energy Sector Still A Giant Economic Engine for the Louisiana 
Economy.'' That title is a pretty good thumbnail description of the 
true impact Outer Continental Shelf activity has on the Gulf Coast 
States. That activity is a giant engine for their economies.
  Here are some of the facts in that report. The report says the energy 
sector has a $93 billion impact in Louisiana and employs 62,000 people. 
The energy sector in Louisiana supports $12.5 billion in household 
earnings. It pays $1.14 billion in State taxes. Workers employed by the 
offshore oil and gas industry can expect to earn salaries between 
$75,000 and $100,000 a year. That was in 2002 when the report was 
issued. Oil exploration and production value-added income already 
exceeds $17 billion and refined value-added income is nearly $5 
billion.
  The same facts can be told for each of the coastal States that border 
the Gulf of Mexico. They derive substantial economic benefit from their 
strategic location next to these oil and gas deposits that are still 
owned by the United States.
  For these reasons, I cannot support the current proposal to set in 
motion a permanent and a very large diversion of Federal royalties from 
the Outer Continental Shelf to these four States. I am sympathetic to 
the environmental damage that has been caused over the years to coastal 
wetlands. Much of that damage in the past was from causes other than 
oil and gas activities. An important source of the future threat is 
from factors such as global warming.
  Last year, in the Energy Policy Act, we enacted a Coastal Impact 
Assistance Program that directed $1 billion be paid as mandatory 
spending over 4 years to the Gulf Coast States. I strongly supported 
that measure. I have strongly supported funding for reconstruction of 
the gulf coast in the tragic aftermath of Hurricanes Katrina and Rita 
last summer.
  The policy rationale for the permanent revenue diversion proposed in 
this bill, in my opinion, is highly flawed, just as the energy policy 
rationale for the bill is also flawed. If you want to have a strong and 
fiscally solvent Federal Government, you need to be very careful about 
new spending entitlements and claims on Federal revenues being created 
by the Congress. The provisions of this bill do not reflect that kind 
of concern.
  If we are to cope with the rising demand for energy, and particularly 
for natural gas, we must also approach that matter. Strictly giving up, 
for the long term, access to 21 trillion cubic feet of natural gas just 
to obtain just over 2 trillion cubic feet is shortsighted, in my view. 
Undertaking to solve our long-term problems with natural gas supply and 
demand by focusing just on the supply side I also see as shortsighted.
  Let me talk a little bit about the precedent of what we are doing. I 
see that as another and somewhat separate reason for opposing this 
legislation. S. 3711 sets bad precedent both in the energy policy area 
and in the fiscal policy area. There is no reason I can think of why 
coastal States up and down our seaboards will not demand the same kinds 
of treatment being demanded by the States that are insistent upon the 
provisions in this legislation.
  Let me put up the chart that shows what we are talking about. The 
Outer Continental Shelf is the blue area surrounding the country. Of 
course, this bill just deals with the gulf. We all understand that. But 
let's just think about the precedent we are setting that will come back 
to haunt us when we have this issue revisited in the future.
  My sincere concern is that if we take the steps that we are proposing 
to take in this legislation that lock up Florida until 2022, or the 
areas off the coast of Florida going out at least 125 miles until 2022, 
we are well on our way to making these other resources unavailable also 
until 2022.
  We are also setting a bad precedent in the fiscal arena, as well. 
Where production is allowed, other States are likely to demand the 
treatment that we are here affording to Texas, Louisiana, Mississippi, 
and Alabama.
  Take Alaska, for example. If you do a little reading on where our 
undeveloped natural gas and oil resources are, much of it is off the 
coast of Alaska. The Federal Outer Continental Shelf off the coast of 
Alaska covers a vast area, some 600 million acres. The Outer 
Continental Shelf off Alaska's coast is more than twice the size of 
Alaska itself.
  To give an idea of the immensity of this OCS area, the onshore lands 
of the State of Alaska comprise some 366 million acres. The Federal 
Outer Continental Shelf off Alaska contains vast resources, an 
estimated 26.6 billion barrels of oil, and 132 trillion cubic feet of 
gas.
  If we start down this road, as this bill does, in my opinion, with 
respect to the Gulf Coast States, we will certainly be asked to give 
37.5 percent of the revenues of producing these Federal resources off 
Alaska's coast to the State of Alaska. In fact, such a proposal has 
already been developed. Other States are likely to follow. This is a 
precedent that I think we will all come to regret.
  I know there are strong feelings on the other side of this issue. I 
understand the sentiments that some have,

[[Page 15898]]

but I am persuaded this is bad energy policy for the country, that this 
is bad fiscal policy for the country, and I hope that we are able to 
make some changes in this legislation before we finally dispose of it 
so we can correct these problems.
  I yield the floor.
  Mr. DOMENICI. Mr. President, I will yield quickly, but I want to try 
to get the record straight with Senators so they will know where we are 
timewise. We are in postcloture where every Senator has a certain 
amount of time. By consent today, we are taking 6 hours, 3 hours to 
those in favor and 3 hours to those against. I am in charge of the 3 
hours in favor, and Senator Bingaman, so far, has been the only one who 
has spoken. But he is in charge of the time on the opposition. He might 
give us some of his 3 hours today if we run out, or we would ask the 
leader. I have a lot of speakers.
  In any event, Senator Bond asked to be next. He is here. Senator 
Sessions is speaking for our side. We will go back and forth. Senator 
Sessions asked he be next on our side. And the senior Senator from 
Alabama who is here, also, would like to speak next.
  How much time does Senator Bond want?
  Mr. BOND. Seven minutes.
  Mr. DOMENICI. Senator Sessions?
  Mr. SESSIONS. Fifteen minutes.
  Mr. DOMENICI. Senator Shelby?
  Mr. SHELBY. Ten minutes. I will try to do it in less.
  Mr. DOMENICI. I have 1 hour 50 minutes; is that right? And Senator 
Bingaman has how much?
  The PRESIDING OFFICER (Mr. Martinez). One hour forty-five minutes.
  Mr. DOMENICI. Senator Landrieu wants to speak 10 or 15 minutes. We 
will welcome that. If we add that up, we have plenty of time.
  I want the Senators to know we have a schedule. It is not me; Members 
have to follow each other.
  I take a minute and say to Senator Bingaman, I am not going to answer 
now the detailed allegations today. I think two or three are 
significant, but I am just going to say to the Senate I have the most 
respect for my colleague. I think everyone knows we work together, 
shoulder to shoulder. It is good to work with him. I think he must feel 
the same. We got something great done.
  However, I believe there is one flaw in the argument that is 
imperative. That is, plain and simple, do you want to hang tight with 
an ideology of the past and get no bill and no new development or do 
you want to adjust to change and get something significant?
  Now, he might not agree, my friend might not agree that I am correct 
in saying what we are getting, but I truly believe the final product of 
the path we were going to follow--which was to not share the revenue; 
and we had not made any arrangement with Florida--was doomed to yield 
nothing, and we would be back where we were.
  Secondly, if we want to wait around for MMS to do their plans and 
assume that they end up with what they started with, then just look at 
history. They hardly ever come out anywhere close to what they started 
with, and they probably would have done it again on this one. We are 
better off, in my opinion, adjusting a bit to the reality of getting 
something real than to stand rigid on the philosophy of the past.
  Revenues: If you do not drill, you do not get any revenues. We have 
been in a no-drill posture for the American Treasury for almost 20 
years. I do not know how many more years we will be with no revenues 
and no drilling, so I am not worried about the fiscal policy because I 
am worried about the effect on the economy and on people of not using 
the resource.
  I can hardly measure that, I say to Senator Bond. It is too big for 
me to measure as a budgeteer. So I wanted to make that point just in 
kind of a summary manner, which is part of what my friend and great 
colleague has been arguing in derogation of this bill on the Senate 
floor.
  Then I had one more observation. As to the big piece of land we are 
not going to be able to drill in in the future that my friend has 
alluded to, if you just look at that map, the perpendicular line is a 
line established in a letter from the military which said they needed, 
for future use, everything beyond that line. And everybody had been 
agreeing we would not, without the military's consent, ever drill 
there. And that is essentially why most of that property is off limits. 
Now, there is more to the story than that, but that is the biggest 
portion of the story.
  Having said that, I would certainly like to say to my colleague, 
Senator Bingaman, I trust that we are back together soon to get another 
great Energy bill; and we will. I would feel much better if you and I 
were together on this, but I feel just as confident, or more so than I 
did on the Energy bill, that the way to get Outer Continental Shelf 
drilling is to start with this new precedent and get it going. And I 
think the ball will roll. If you get this, you will get offshore 
drilling in real quantities. You will get more than ever to the 
Treasury and more than ever to the bounty of production. That is what 
the real ball game is about. And you either do something like that or 
you sit around and wish. We have been wishing, and it never happens.
  So with that, I yield to Senators. I will be off the floor. You can 
take time in your sequence. I will come back in an hour and a half or 
so, and if there is time, I will wrap up this afternoon.
  Thank you very much.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SESSIONS. Mr. President, I just ask that my and Senator Shelby's 
time slots be reversed.
  Mr. DOMENICI. Sure.
  Mr. SESSIONS. He has another appointment, and I would be glad to 
yield to him and take the slot you originally had for Senator Shelby.
  Mr. DOMENICI. Sure. Senator Shelby would go right after Senator Bond 
on the proponents list. And they would be followed by Senator Sessions.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, could I just indicate for my colleague, 
I appreciate his comments. We do have a couple of Senators who are in 
opposition who are coming to the floor and will wish to speak, too, at 
some stage. I do not want to line up so many proponents that they are 
not able to make their statements within a reasonable period of time. 
So if we can fit them in at some stage in the proceedings, that would 
be great, as soon as they arrive.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, let me say to my colleague, that is 
fine. I noted your staff had apparently gone and checked, and there 
might be somebody. I would like to ask that they let you know as soon 
as possible so you do not have people with the expectation of being 
next because they are right here, and all of a sudden somebody drops in 
and says: I am next because I am in opposition. I think that would be a 
little unfair. I wish the Senator would work with us on that.
  All right, having said that, I yield the floor.
  The PRESIDING OFFICER. The Senator from Missouri.
  Mr. BOND. Mr. President, I rise to offer a compromise and support a 
compromise. I have agreed to limit my remarks to 7 minutes in the hope, 
however faint it might be, that people might listen to me.
  Secondly, I am here to support a compromise. I am here to support a 
compromise led by our good friend, Chairman Domenici, involving the 
occupant of the Chair, the Senator from Louisiana, and a distinguished 
bipartisan group of Senators who are coming together to bring out a 
compromise that is going to solve a major problem.
  We hear--on the floor, and wherever politicians gather, and pundits 
gather, and at coffee shops--people complain about the high cost of 
gasoline, the high price of natural gas, and our unhealthy dependence 
on foreign oil. Well, my gosh, they are all right. They are all 
correct. We are importing over 60 percent of our petroleum.
  We hear lots of people pontificate about the skyrocketing costs of 
natural gas, heating homes, and how that affects the need for low-
income heating assistance programs, and how it squeezes all of us who, 
like me, depend

[[Page 15899]]

upon natural gas to heat a house. Once again they are right. Over the 
last few years, natural gas prices in America have been some of the 
most expensive in the world. Some people cry out for the need to do 
something to reduce these high oil and gas prices.
  Well, in the past, when it has come down to it, too many people have 
stood up and said: No, we are not going to do it. The reasons range 
from ``not in my backyard''--they do not want anything produced right 
near them, whether it is oil or minerals or a manufacturing process--
that is called the NIMBY approach. Others are pushing environmental 
concerns to the extreme, not realizing that modern-day exploration of 
oil and gas is done with new techniques that are designed to be as 
friendly to the environment as possible. Then of course, there are 
others who think that high gas prices make a great campaign issue in an 
election year, and that it is in their best interest to do nothing 
before November.
  Well, there is a way to begin to reduce the price of oil and natural 
gas; and that is to increase domestic supplies. Let me point out to my 
colleagues that for all the laws we pass, we have not been able to 
repeal the law of supply and demand. If you have more demand than you 
have supply, the cost goes up. And that is what we have.
  Now, we are trying to reduce the demand by conservation, but people 
continue to make choices, and the economy grows. Not only our economy 
grows, but the economies of India and China, which are putting real 
pressure on demand, grow faster. But we are not keeping up with the 
demand from production in the United States. Thus, our percentage of 
contribution to supply continues to decline.
  The area specified in S. 3711 will open up 8.3 million acres of the 
Outer Continental Shelf for oil and gas leasing as soon as practicable, 
but no later than one year from the date of enactment. This area, which 
includes Lease 181 and an area south of Lease 181, is estimated to 
contain roughly 1.26 billion barrels of oil and 5.8 trillion cubic feet 
of natural gas. The natural gas supply alone made available under this 
bill is enough to heat and cool 6 million homes for 15 years. That is a 
good start. We would like to have more, but with the demand for energy 
so high, and the supply limited, we need to take what steps we can.
  With the price of gasoline over $3 a gallon, all of us are looking at 
the need to conserve, and that is one way we can make a difference: 
stop driving so much, carpool, walk. People still get there. I used to 
walk to school, ride a bicycle to school. That is not a bad idea for a 
lot of kids. It keeps you in better shape.
  In addition to the growing demand for energy, disruptions in supply 
due to geopolitical instability in the middle east and South America 
have caused energy prices to spike upward. All of these factors have 
caused the price of gasoline to increase by over 125 percent since 
2000. As fighting continues in the Middle East and political 
instability remains in South America and North Africa, energy analysts 
warn that $100 barrel oil could indeed be a reality in the future.
  The situation with natural gas is no different. To say that we are in 
a natural gas crisis is an understatement. Why is this the case? Again, 
the answer is quite simple. Over the years demand for natural gas has 
skyrocketed while domestic supplies have dwindled. And when that 
happens, simple economics tells us that prices soar as they have in 
recent years for natural gas.
  We have a lot of demand for natural gas because of the increasing 
demand for this resource in the generation of electricity. More and 
more electric utility generation plants have been forced to switch to 
natural gas. Natural gas is also in short supply because of all the 
restrictions on its production and delivery, including restrictions on 
access to these gas supplies and strict environmental regulations, 
which have pushed a massive expansion of natural gas usage as opposed 
to the use other energy resources such as coal.
  According to a Wall Street Journal editorial, there has been a 40-
percent increase in the use of natural gas since 1986, and that 
accounts for nearly 25 percent of our energy. And it is set to increase 
by another 40 percent by 2025. We cannot afford to do that. Our 
production of natural gas has fallen from 19.2 trillion cubic feet to 
18.2 trillion cubic feet. That is a 7.2-percent decline. We cannot 
afford to do that.
  We need to liquefy and gasify coal so coal gas can fit in, too. That 
is some ways down the line. But in the meantime, we have to go ahead 
with lease 181 and the adjacent areas.
  Price increases hurt our economy. They hurt people who drive cars. 
U.S. consumers spent $200 billion on natural gas in 2005, which is four 
times as much as we spent in 1999. This has caused both Federal Reserve 
Chairmen Greenspan and Bernanke to repeatedly warn that ``natural gas 
bottlenecks endanger economic expansion'' and ``pose risks to both 
economic activity and inflation.''
  High natural gas prices cost us manufacturing jobs. The National 
Association of Manufacturers says that roughly 3 million manufacturing 
jobs have been lost due in large part to natural gas price increases. 
Chemical plants are moving overseas along with and fertilizer plants.
  According to the U.S. Chemistry Council, it is estimated that from 
2000 to 2005, the chemical industry saw the loss of 100,000 jobs and 
$50 billion to overseas competition. Furthermore, the magazine Business 
Week reported that of the 120 major chemical facilities in the planning 
and construction stages around the world, only one is in the United 
States--50 plants are going up in China.
  Job loss due to increased natural gas prices has also had a 
devastating impact on the fertilizer industry because natural gas is a 
key component in the production of nitrogen fertilizer. Late last year, 
Ford B. West of the Fertilizer Institute informed the Senate 
Appropriations Subcommittee on Interior that sixteen U.S. production 
facilities have closed permanently and an additional five have been 
idled due to rising natural gas prices--this represents a 35 percent 
decline in U.S. fertilizer production
  The agricultural sector is also taking it on the chops. The president 
of the Missouri Farm Bureau, Charlie Kruse, on March 17, 2005, 
testified that in the last 4 years, the retail nitrogen fertilizer 
prices, because of the shortage of the supply of natural gas, have 
skyrocketed from $100 per ton to $350 per ton. These are real costs 
being put on our farmers.
  Analysis from the Food and Agricultural Policy Institute, FAPRI, at 
the University of Missouri-Columbia indicates that fertilizer prices 
paid by agricultural producers increased by almost 50 percent between 
2002 and 2006, with fuel prices increasing over 100 percent in the same 
time frame. This leads to cost increases of over $80 per acre for rice, 
$50 per acre for corn and $10 to $25 per acre for soybeans, wheat and 
cotton.
  Farmers are hurting. These increased costs are going to curtail the 
availability of our food supply and raise the cost of our food as well. 
Transportation costs will also rise.
  Well, the concern has been raised by the distinguished Senator from 
New Mexico that this legislation is not the best deal.
  I might agree with him, but I will tell you something. Standing here 
on the floor of the Senate, it is the best looking one of the whole 
ugly bunch because I have been waiting for a long time to find a way to 
increase the supply of oil and gas produced in the United States. This 
is a start. He has pointed out, we need to do a lot more things. Well, 
I will be there to support whatever we can do to make a reasonable 
compromise to overcome the objections, so we can start producing gas in 
deep sea offshore drilling.
  I hope one of these days we can go back up to the barren reaches 
above the Arctic Circle in ANWR. I have been up and watched them drill 
in Prudhoe Bay. There is no harm to the environment. I will tell you, 
the caribou and the birds love it. The mosquitos are great. They are 
just as healthy as they are in southern Alaska.
  Tapping the energy resources in the areas specified in this bill can 
have an

[[Page 15900]]

immediate impact on both the price of oil and natural gas because these 
areas are located in the Gulf of Mexico near existing oil and gas 
production infrastructure. With its proximity to major oil and natural 
gas transport terminals and pipelines, these new energy resources could 
be quickly shipped to the market for use.
  Well, in closing, I commend Senator Domenici for putting together a 
bipartisan group to support this bill. I laud his efforts. It is going 
to be done in an environmentally friendly manner. Last year's 
devastating category 5 hurricane did not cause any significant oil or 
gas spillage. And this new technology can produce this oil and gas from 
offshore areas in an environmentally friendly manner and begin to break 
the logjam where supply cannot keep up with demand.
  I urge my colleagues to support S. 3711.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. BOND. I thank the Chair and yield the floor.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SHELBY. 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

[[Page 15901]]

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.
  The PRESIDING OFFICER. The Senator from Rhode Island.
  Mr. REED. Mr. President, I yield myself 20 minutes.
  The PRESIDING OFFICER. The Senator is recognized.
  Mr. REED. Mr. President, the Senate today is considering the Gulf of 
Mexico Energy Security Act. I believe this legislation is not 
appropriate energy legislation and also not responsible fiscal policy 
for the United States, as we face a Federal deficit of $8.4 trillion 
and looming cuts to many vital programs that the Federal Government 
must support. Next week we will begin to take up the Defense 
appropriations bill for this year. As we consider that bill, we will 
discover huge unmet needs to finance the current operations of our 
military. If we diminish the Federal Treasury, our ability to respond 
to that issue and a host of other issues will be contemporaneously 
diminished.
  This legislation would mandate that almost 38 percent of revenue from 
Federal resources generated by new leases in new areas of production 
made available by this bill will be given to four Gulf Coast States. 
Revenues that currently would be provided to the Treasury for the 
benefit of the Nation as a whole will be diverted to four States. This 
bill, if passed, will cost the Federal Treasury billions of dollars 
over time. I am not alone in my opposition to this legislation. 
Taxpayer advocates and environmentalists share my concerns. I ask 
unanimous consent that the text of several letters be printed in the 
Record expressing these concerns.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                   Taxpayers for Common Sense,

                                                    July 24, 2006.
       Dear Senator: Taxpayers for Common Sense Action (TCS 
     Action), a non-partisan budget watchdog organization, urges 
     you to oppose S. 3711, the Gulf of Mexico Energy Security Act 
     of 2006. TCS Action is alarmed by provisions in the bill 
     which alter existing federal-state revenue sharing provisions 
     for royalty payments. Royalty payments represent the second 
     largest source of federal revenues after federal taxes. These 
     provisions will siphon off billions of dollars that would 
     have gone to the Treasury, further straining the nation's 
     fiscal health.
       TCS Action is not opposed to off-shore oil and gas 
     exploration and development. However, federal waters are 
     owned by all U.S. taxpayers and the public has a right to 
     receive a fair return for the resources they own. Oil and gas 
     resources located within federal waters should not be 
     converted into cash cows benefiting only four Gulf coast 
     states. Gulf coast states currently receive significant 
     royalty payments from waters within 6 miles of their 
     coastline. In fact, under current policy, Louisiana received 
     nearly a billion in revenue from oil and gas royalty payments 
     from 1986-2003.
       This legislation would dramatically deplete federal revenue 
     generated by leases in lease sale 181 and 181 south and all 
     leases that are issued after enactment of the bill. Currently 
     royalties from these waters would return entirely to the 
     federal government. Moreover, lease sale 181 would likely be 
     opened in the next several years regardless of this 
     legislation. Despite attempts to disguise this legislation as 
     a revenue generator, opening these tracts of off-shore waters 
     under the proposed royalty-sharing provisions with the four 
     Gulf coast states would have detrimental long-term effects on 
     the federal budget. The Administration has also raised 
     similar concerns to changes in revenue-sharing on current 
     leases and their cost to federal taxpayers.
       With the federal debt mounting and oil and gas prices 
     nearing record highs, reducing the federal earnings on our 
     natural resource royalties does not make fiscal sense. We 
     urge you to vote against the S. 3711 and return some fiscal 
     sanity to our nation's energy policy. If you have any 
     questions, please contact Autumn Hanna at (202) 546-8500.
           Sincerely,
                                                      Steve Ellis,
     Vice President of Programs.
                                  ____



                                League of Conservation Voters,

                                                    July 24, 2006.
     Re oppose S. 3711, the so-called Gulf of Mexico Energy 
         Security Act of 2006.

       Dear Senator: The League of Conservation Voters (LCV) is 
     the political voice of the national environmental community. 
     Each year, LCV publishes the National Environmental 
     Scorecard, which details the voting records of Members of 
     Congress on environmental legislation. The Scorecard is 
     distributed to LCV members, concerned voters nationwide, and 
     the press.
       LCV urges you to oppose S. 3711, the so-called Gulf of 
     Mexico Energy Security Act of 2006. This backward-looking 
     legislation fails to address our energy problems, raids the 
     federal treasury, and threatens our coastal economies and 
     ecosystems with pollution and oil spills.
       Opening more of our coastlines to drilling is clearly not 
     the answer to our energy problems, especially given that 
     eighty percent of offshore oil and gas resources are already 
     open to drilling, and oil companies currently hold more than 
     4,000 untapped leases in the Gulf of Mexico. Instead of 
     despoiling our shores and perpetuating our dependence on oil, 
     Congress should pursue faster, cheaper, and more 
     environmentally friendly solutions, including making cars and 
     trucks go further on a gallon of gasoline and increasing our 
     use of clean, renewable energy such as wind and solar power.
       Unfortunately, rather than using American ingenuity to 
     advance a new energy future that benefits both the economy 
     and the environment, S. 3711 continues to promote failed 
     policies of the past. It opens eight million acres of 
     Florida's Gulf Coast waters to offshore drilling rigs, 
     including more than six million acres that are currently 
     protected by the bipartisan moratorium on offshore drilling 
     that has been in place for twenty-five years. S. 3711 would 
     also divert tens of billions of dollars in offshore drilling 
     revenues from the federal treasury and give the money to just 
     four states. If the Senate were to pass S. 3711, it would 
     pave the way for a conference with H.R. 4761, the even more 
     harmful House-passed bill that would lift the moratorium on 
     offshore drilling for all of our coastlines across the 
     country.
       We urge you to protect our coasts, our environment, and our 
     economy by voting NO on S. 3711, and instead supporting real 
     solutions to our energy problems. LCV has scored votes 
     related to energy policy and coastal protection on numerous 
     occasions in the past few years, and the Political Advisory 
     Committee will strongly consider including votes on this bill 
     in compiling LCV's 2006 Scorecard. If you need more 
     information, please call Tiernan Sittenfeld or Nat Mund at my 
     office at (202) 785-8683.
           Sincerely,
                                                   Gene Karpinski,
     President.
                                  ____



                                                  Sierra Club,

                                                    July 25, 2006.
       Dear Senator: On behalf of the nearly 800,000 Sierra Club 
     members, I urge you to defeat The Gulf of Mexico Energy 
     Security Act, sponsored by Senator Domenici, and instead 
     fight for energy solutions that will save American families 
     money and cure our addiction to oil.
       The Gulf of Mexico Energy Security Act, S. 3711, will open 
     an area the size ofthe State of Maryland to new oil and gas 
     drilling, approximately 8 million acres in the Gulf of 
     Mexico. This bill would also repeal parts of the offshore 
     drilling moratorium that has protected America's coast for 
     more than 25 years. It would also divert 37.5 percent of the 
     revenues from new oil and gas drilling in the Gulf to just 
     four states, costing the Federal Treasury nearly $20 billion 
     over the next 20 years.
       Not only does this bill lift the moratorium on drilling in 
     the eastern Gulf of Mexico, it jeopardizes every other 
     coastal state. The House has already passed an expansive 
     drilling bill that puts the entire Atlantic and Pacific 
     coasts on the chopping block. If the Domenici bill passes the 
     Senate it will certainly get much worse in a House-Senate 
     conference committee, putting our wetlands, marine 
     environments, beaches and coastal economies at risk.
       The Sierra Club strongly supports permanent protection for 
     our beaches and coastal waters. Our coasts provide essential 
     habitat for fish and wildlife, a detination for thousands of 
     vacationing families each year, and

[[Page 15902]]

     the economic lifeblood for thousands of tourism and fishing 
     communities.
       The Domenici drilling bill continues to lead America away 
     from smart energy solutions. It is estimated that drilling 
     off of Florida's coast would only bring 47 days of oil and 4 
     months of natural gas, and we wouldn't see any of it for at 
     least 7 years. There are faster, cheaper, cleaner and 
     longerterm energy solutions like energy efficiency and clean, 
     renewable energy that will start saving families and 
     businesses money today.. We do not need to sacrifice our 
     beaches and coastal waters to meet America's energy needs.
       Thank you for consideration of our recommendations. If you 
     have questions, please feel free to contact Athan Manuel at 
     202-548-4580.
           Sincerely,
                                                        Carl Pope,
     Executive Director.
                                  ____



                            Defenders of Wildlife Action Fund,

                                                    July 25, 2006.
     Re oppose S. 3711, the budget-busting offshore drilling bill.

       Dear Senator: The Defenders of Wildlife Action Fund is an 
     independent organization committed to giving conservation 
     issues a political voice on Capitol Hill and around the 
     nation. The Action Fund publishes an annual Conservation 
     Report Card which highlights the voting records of Members of 
     Congress on legislation vital to protecting our nation's 
     wildlife and wild landscapes for future generations.
       Protection of marine life in the outer continental shelf is 
     one of Defenders of Wildlife Action Fund's highest 
     priorities. S. 3711, the Gulf of Mexico Energy Security Act, 
     would dismantle the 25 year bipartisan offshore drilling 
     moratorium by opening 6 million acres of currently protected 
     waters in Florida's Gulf coast to oil and gas development. 
     The Action Fund urges you in the strongest possible terms to 
     oppose S. 3711, which will most likely be included in the 
     next Conservation Report Card.
       The eight million acres proposed for oil and gas 
     development in the Gulf of Mexico are home to more than 20 
     species of whales and dolphins, five species of sea turtles, 
     dozens of fish species and hundreds of species of birds. All 
     would be put at risk of collision and exposure to the routine 
     pollution associated with oil and gas drilling if S. 3711 
     were to pass. An oil spill would further devastate our marine 
     wildlife.
       While the bill would threaten our marine wildlife and 
     coastal economies, it would do nothing to lower oil or 
     natural gas prices; it will simply feed our country's 
     unsustainable addiction to oil. From enforcing strict 
     conservation measures to making our cars go farther on a 
     gallon of gas, Defenders of Wildlife Action Fund supports 
     faster, cleaner, cheaper solutions than oil and gas drilling 
     to meet our energy needs.
       I further urge you to oppose S. 3711 so that a conference 
     report with HR 4761, the House-passed offshore drilling bill 
     authored by Rep. Richard Pombo (R-CA), never sees the light 
     of day. The House bill lifts the entire offshore drilling 
     moratorium nationwide, and Rep. Pombo has made clear that the 
     House intends on using the conference process to add as many 
     of the House bill's provisions to the Senate bill as 
     possible. We oppose S. 3711 in its own right; a conference 
     with the House bill would be disastrous.
       Thank you for your consideration in this matter.
           Sincerely,
                                              Rodger Schlickeisen,
                                                        President.

  Mr. REED. In 1952, President Truman, speaking about proposals to give 
coastal States Federal offshore oil and gas revenue said:

       If we back down on our determination to hold these rights 
     for all the people, we will act to rob them of this great 
     national asset. That is just what the oil lobby wants. They 
     want us to turn the vast treasure over to a handful of States 
     where the powerful private oil interests hope to exploit it 
     to suit themselves.
       Those sentiments are not far off from today. In 1953, 
     Congress enacted the Submerged Land Act. This law provided 
     that each coastal State would have a seaward boundary of at 
     least 3 miles and that the Federal Government would 
     relinquish to the States the interests of the United States 
     in lands beneath the navigable waters within the State 
     boundaries. Importantly, the law affirmed the Federal 
     Government's ownership in lands seaward of the State 
     boundary. Revenues from Outer Continental Shelf drilling 
     belong to the American people in all 50 States. The 
     legislation the Senate is considering today violates this 
     pact with the American people, and it denies the Federal 
     Treasury and the American people essential revenue to address 
     the needs of our Nation.

  Again, to quote President Truman, since his comments still ring true 
today:

       I can see how Members of Congress from [affected areas] 
     might like to have all the offshore oil for their States. But 
     I certainly can't understand how Members of Congress from the 
     other 45 States can vote to give away the interest the people 
     of their own States have in this tremendous asset. It is just 
     over my head and beyond me how any interior Senator or 
     Congressman could vote to give that asset away. I am still 
     puzzled about it. As far as I am concerned, I intend to stand 
     up and fight to protect the people's interest in this matter.

  Proponents of this bill argue that their coastal States deserve to 
share in the Federal revenues because they have tremendous costs and 
environmental challenges arising from energy development and production 
that benefits the whole Nation. They argue, with some validity, that 
they bear costs, although the benefits are shared by the entire Nation. 
I acknowledge that. I fully acknowledge that energy development is 
harming our coastal zones, leading to habitat loss and erosion. For 
this reason, in 2001 Congress authorized a coastal impact assistance 
program that provided Federal funding to States and local communities 
for mitigating the impacts of OCS oil and gas development and 
production. It is also the reason why I supported an amendment to the 
Energy Policy Act of 2005 that mandated $1 billion over 4 years in 
direct Federal spending to gulf coast States and other producing States 
for the purposes of remediating environmental problems caused by the 
extraction and production of energy. That is the right approach, to 
appropriate Federal resources, directed to help States address a 
problem that is caused in large part by production activity.
  What I object to is a permanent entitlement that does not state 
specific eligible uses to mitigate the environmental harm of OCS 
production. For example, the bill before us today would allow the 
States to decide to fund a category described as ``mitigation of the 
impacts of Outer Continental Shelf activities through the funding of 
onshore infrastructure projects.'' This could cover any appropriate 
bricks and mortar project in any State along the gulf coast, from 
schools to highways to community centers, all of which I think could 
and would be legitimately argued by a State official as somehow 
mitigating the impacts of outer Continental Shelf activities.
  So in a sense what we have opened up here is a general revenue 
sharing, not a targeted approach to mitigating the specific harms 
caused by the extraction and production of petroleum and natural gas 
products.
  Nothing in this bill requires the States and communities to report 
back to taxpayers and the Federal Government how the funds are being 
used. I don't think there is any appropriate mechanism of routine 
reporting. I suppose that if you objected to a particular project, you 
might sue in Federal Court saying they violated the act, but that is 
hardly an appropriate and routine and rational way to ensure that the 
spending is appropriate.
  Again, reading the very general language in the bill, I would think 
that you could make a case that a school, community center, and a range 
of other projects would be infrastructure that would mitigate in some 
way the broad effects of production of energy in these States. An 
argument may be made that a vote against the bill is a vote against the 
communities and people harmed by Hurricanes Katrina and Rita. I don't 
think that is true. This debate has to be about responsible national 
energy and responsible fiscal policy.
  We in this body have voted to provide $123 billion to help the gulf 
coast recover. That money, because of our difficult financial 
situation, is literally being borrowed. The interest on that debt and 
the principal of that debt will be paid by all Americans. It is an 
example of why we need Federal resources in difficult times, because 
there will be other occasions where other Americans will see the same 
kind of suffering, the same kind of destruction that was visited upon 
the gulf coast, and we as a Congress have to be able to stand up, not 
just with words but resources, to help these people. As we diminish the 
Federal resources by a very narrow revenue-sharing plan for four 
States, we diminish our capacity to respond.
  We have also directed and voted recently for a $2 billion 
authorization for Louisiana's coastal restoration program as part of 
the Water Resources Development Act. If more money is necessary to 
restore the gulf coast,

[[Page 15903]]

then more money should be provided, and that is not the sentiment of 
just the people who live there, that is the sentiment of the American 
people because, frankly, if any part of our country was similarly 
devastated, we would all be here asking our friends and colleagues to 
help us, and I think they would respond. What they may not be able to 
do, if we pass this bill, is respond with the same kind of financial 
clout because we will have already given Federal resources for the 
benefit of only four states.
  There are other aspects of funding that inure to the benefit of these 
coastal communities. Section 8(g) of the Outer Continental Shelf Lands 
Act provides coastal States with a share of the revenues received by 
the Federal Government from leases on Federal tracts that are adjacent 
to and within 3 miles of a State's seaward boundary. That is a 
specialized source of revenue which goes to coastal States. Between 
1986 and 2003, Alabama, Louisiana, Mississippi, and Texas received 
nearly $2 billion in revenues from the Federal Government under section 
8(g). This funding is precisely the type of funding that could be used 
to mitigate the impacts of OCS production.
  Further, the Coastal Zone Management Act's ``Federal consistency'' 
provision ensures that Federal actions, such as OCS leases for energy 
production, that are likely to affect any land or water use or natural 
resources of the coastal zone must be consistent with a coastal State's 
approved coastal zone management programs. That means that if Gulf 
Coast States put into place strong coastal zone management plans to 
protect against erosion and the loss of wetlands and environmental 
complications, the law would require a Federal OCS lease to be 
consistent with these plans and make these States less vulnerable to 
storms. So not only is this an issue of funding, it is an issue of 
States taking action to ensure that they have strong environmental 
protections, and these plans, in turn, according to the law, will be 
imposed upon the OCS leases.
  Now, we understand that energy production is a burden to the States, 
but it is also, in many situations, an economic benefit to these very 
same States.
  The oil and gas industry is central to Louisiana's economy, with an 
estimated $93 billion impact in 2001. Over $1.3 billion worth of oil 
and gas is produced annually in Alabama. The State receives direct 
benefits of approximately $285 million annually in the form of lease 
bonuses, royalties, trust fund investments, and severance taxes. In 
2005, Texas petroleum and coal were valued at $8.89 billion. All of 
these revenues provide a strong and powerful force of economic progress 
for all of these communities. I daresay that, as much as a burden is 
imposed, there would be great reluctance for any of these States to try 
to curtail this economic production because it benefits the community.
  Now, what is also troubling about the legislation is not only the 
fiscal implications, but also it is proposing a permanent entitlement 
that is unnecessary to generate new domestic natural gas and oil 
supplies. There are over 40 million acres of Federal Outer Continental 
Shelf under lease, but the oil and gas industry is sitting on over 33 
million acres of undeveloped leases. They have less than 7 million 
acres in production, and there is 328 trillion cubic feet of 
recoverable natural gas in the nonmoratoria areas.
  The United States consumes 25 percent of the world's energy, and yet 
we have less than 3 percent of the world's oil supplies. We cannot 
drill our way to energy security; yet this bill essentially provides 
only one way forward--to drill in the Gulf of Mexico. We deserve an 
energy bill that will reduce our dependency on fossil fuels and 
strengthen our economy.
  On July 20, I joined 40 of my colleagues in sending a letter to the 
majority leader asking that we consider energy legislation that sets 
national goals to reduce our overall national dependence on petroleum 
by increasing fuel efficiency and alternative vehicle technologies, 
that protects Americans from price-gouging and market manipulation, and 
that levels the playing field for new renewable and energy efficiency 
technology and, more specifically to this debate we are having, ensures 
that new energy proposals that affect spending or revenues must be 
fiscally responsible and take into account the true long-term impact of 
these proposals. That is not the bill we are considering today.
  I am left wondering why, as the Senate finally takes up energy 
legislation, we are not debating and voting on a bill to increase fuel 
efficiency in cars and trucks. Why are we not voting on oil savings 
provisions? Where are the provisions in our energy legislation to 
protect consumers from price-gouging or restore lost royalties to the 
Federal Treasury from oil and natural gas companies making record 
profits? Where is the mandated Federal funding dedicated to fully 
funding energy efficiency and renewable energy?
  I hope the Senate will get to vote on an increase in fuel efficiency 
standards. Gasoline consumption in the transportation sector represents 
about 44 percent of total oil consumption in the United States each 
year. Including diesel fuel, the number jumps to 57 percent. To bring 
about any serious reduction in our dependence on foreign oil, we must 
increase the fuel efficiency of our cars and light trucks, as well as 
promote the use of hybrids and vehicles that use alternative fuels.
  I also hope we will have a chance to amend this bill. I hope we have 
a chance to have a debate on an energy bill that will include not only 
supply-side considerations but also demand-side considerations. All of 
this legislation is important to consider, but I fear we will be 
constrained to this bill.
  Finally, I am concerned that whatever we do in the Senate would open 
up a conference with the other body. Their legislation, H.R. 4761, the 
Deep Ocean Energy Resources Act, would lift the moratorium on offshore 
drilling for all of our coastlines, not just the gulf coast. I believe 
this would be a serious step, putting in jeopardy fisheries and marine 
sanctuaries, further depleting the Treasury, further eroding States' 
current positions with respect to drilling, and undermining 
environmental mitigation for energy development and production. My 
Rhode Island coastline, like the coastline of every State, is something 
we want to preserve and protect, and there is a fear that if the House 
version prevails, these coastlines will be jeopardized.
  We are in a situation where we have a burgeoning energy crisis. We 
just have to go to the gasoline pump to figure that one out. This 
burgeoning energy crisis impacts our foreign relations. We have scores 
of troops across the globe today because of our dependency on oil. But 
this should not be the occasion to entertain legislation that is unwise 
in terms of energy policy and potentially very damaging to the fiscal 
integrity of the United States.
  Before we open new lands to development, we need to ensure that the 
oil and gas industries are putting undeveloped leases into production, 
and we need to take meaningful action to reduce our consumption and 
increase renewable energy supplies. We need to be more independent with 
respect to energy, reduce our consumption of fossil fuels overall. This 
is an energy policy which we should pursue, and as a fiscal policy, we 
have to maintain Federal resources for Federal responsibilities.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Alabama is recognized.
  Mr. SESSIONS. Mr. President, I ask unanimous consent that the order 
of speakers be as follows: Sessions, Menendez, Cochran, Landrieu, and 
Alexander.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. SESSIONS. Mr. President, I believe I had asked for 15 minutes. I 
will try to do it in 10. I ask that I be notified at the end of 10 
minutes.
  Mr. President, I travel my State, and I know that Senator Shelby, who 
spoke earlier, travels Alabama, also. We meet with people and talk with 
people. I see people back in my hometown in church and in other places, 
and I get asked about energy prices all the time. People are concerned 
about it.
  I have studied some of the economic numbers in this country, and I am 
a bit

[[Page 15904]]

troubled. I think it is a valid concern for our Nation that, while the 
country is doing well economically and unemployment is down, middle and 
lower income workers' salaries have not increased as much as we would 
like them to. In fact, the higher income salaried workers, wage and 
hour workers, are doing better percentage-wise than the lower income 
workers. That means the cost of energy impacts them significantly. They 
ask me to do something about it. I talk about what I have been trying 
to do since I came to the Senate 10 years ago, which includes voting 
and working to try to open up the ANWR region, where large reserves 
exist, and to support nuclear power and clean coal. I have been a 
supporter of ethanol, and I am hopeful that we will see ethanol, 
biodiesel and matters of that kind really advance as an option for 
America.
  I have to tell you that the most certain and direct thing we can do 
is to increase domestic production of oil and gas in this country. That 
is what we are about to act on now. This legislation is a concrete, 
direct way that will make a difference in the price of oil and gas in 
our country.
  One of my colleagues mentioned that some people like to use this 
phrase: Big oil companies. I want to make one thing clear: the reason 
we should open up production in the Gulf of Mexico is not to help big 
oil companies. We should open it up if, and only if, it is good for the 
American consumer and the American economy.
  In fact, I am confident that many of the big oil companies will have 
no interest in producing oil and gas from the Gulf of Mexico. They may 
be sitting on large reserves of oil and gas right now, and they may be 
very happy with $75 a barrel. Why should they want a competitor to go 
out and produce more in some other area if it might reduce the value of 
the oil and gas reserves that they possess? It is a myth and a 
falsehood that this has anything to do with oil and gas companies.
  What it has to do with is increasing the supply of natural gas and 
increasing the supply of oil for American consumers, keeping our wealth 
at home.
  One thing is obvious to us: We very much depend on natural gas. 
Eighteen percent of U.S. electricity comes from natural gas--18 
percent--is generated from natural gas. Nuclear power provides 20 
percent of our electricity. Nuclear power is the only source of clean, 
reliable, and affordable electricity. Nineteen applications for nuclear 
powerplants have been issued since we passed the Energy bill last year. 
Nineteen applications for new nuclear powerplants have been issued 
since we passed the Energy bill last year. It will make a big 
difference, but I have to tell you, I don't expect 18 percent of 
electricity that comes from natural gas to be reduced any time in the 
future.
  Oil prices are at high levels. On July 14, 2006, the price of crude 
oil closed around $77 a barrel. Many Wall Street analysts say it may 
hit $80 if this Mideast crisis continues. By comparison, the price of 
crude oil 2 years ago was $35 a barrel. That has been an increase of 
100-plus percent.
  High energy prices, for all practical purposes, result in a tax on 
the American consumer. And to whom do we pay that tax? We pay it to 
foreign nations. Many of those nations are hostile to us diplomatically 
and politically. They are not our greatest friends. In fact, somebody 
has written an article stating that the more oil wealth a country has, 
the less friendly that country becomes.
  Mr. Bernanke, the Chairman of the Federal Reserve Board, in April of 
this year said:

       Rising energy prices pose risk to both economic activity 
     and inflation.

  On June 15, he said:

       The steep increases in energy prices over the past several 
     years have had significant consequences for households, 
     businesses, and economic policy.

  One article I saw recently estimated that higher energy costs have 
knocked down our growth in GDP by 1 percent this year.
  The average price of gasoline has now hit $3.02. It is up from $2.28 
a year ago. This hurts families. It hurts consumers. We know that. We 
hate to see that happen. We know there is a worldwide increase in 
demand for oil and gas. We know that China and India are growing. I was 
in South America recently. Almost every country I visited had been 
having a 5-percent or more increase in growth. That means they will use 
more oil and gas.
  I will tell you it makes a big difference to a working Alabamian, a 
working man or woman anywhere in this country, who now has to pay an 
additional $50 a month for gasoline and maybe some more for heating as 
a result of natural gas.
  Natural gas prices have risen dramatically. On July 14 of this year, 
natural gas in the United States was a little over $6.25 per million 
Btu's. Not too long ago it was $12. It has dropped about half, which is 
great news. But in Russia and Oman, for example, natural gas comes in 
at about $1.25 per million Btu. These higher costs do impact American 
businesses, particularly, as well as consumers.
  The vice president of Nucor Steel in Tuscaloosa, AL, said recently:

       The high price of natural gas significantly impacts our 
     ability to remain competitive and have a productive 
     manufacturing sector.

  Some of the natural gas spike in prices is the result of speculation, 
it is the result of a fear of shortage, a fear that is out there. We 
have seen that prices have gone up and down in natural gas.
  I would say this: Natural gas production in the Gulf of Mexico is at 
a point where we need to expand our areas of drilling. Natural gas 
wells produce for a good long time, but they dry up faster than oil 
wells do. And if we don't constantly replace them, then we have a 
problem.
  We have had a controversy in Alabama recently about LNG, liquefied 
natural gas. This is natural gas that may be produced in the Middle 
East. It is liquefied, frozen or brought to a point of liquid by 
reducing its temperature. It is brought to the United States. A plant 
is set up, probably offshore, to heat it up and put it into the 
American pipeline after we pay the foreign shipper, after we pay the 
people to produce it in the foreign country, after we pay the foreign 
country for this natural gas. That is what Alan Greenspan told us we 
will have to do more of, importing LNG. And we will be doing more of 
that if we're not careful.
  How silly it is to do that when right off our own shores we have huge 
reserves of natural gas. We could keep all that wealth at home in our 
Nation. We could produce that oil and gas so it goes right into our 
American pipelines without having to be liquefied. It would go right to 
the consumers around the country.
  Mr. President, 60 percent of our oil comes from foreign sources, 
including, 49 percent from OPEC nations in all, 14 percent from Saudi 
Arabia, and 12 percent from Venezuela--boy, they have been taking 
action recently to see if they can discomfort the United States--10.5 
percent from Nigeria, and 6.4 percent from Iraq.
  We paid $200 billion last year for foreign oil and gas--$200 billion, 
wealth that Americans would rather see invested in our country, hiring 
Americans to produce oil and gas. They would pay taxes and be able to 
raise their families, have high wages and good retirement plans and 
good health care plans.
  A lot of people have wondered why these companies try to buy up our 
ports and are buying up American industries. Why are these foreign 
countries able to do it? One reason is, a number of them are oil-
producing nations. These oil-producing nations have wealth they don't 
know what to do with. They want to invest it wherever they can, and the 
United States is a good, safe place. I think that is a factor. The 
transfer of our wealth to foreign nations, many of whom are not our 
friends or allies, impacts American jobs and American companies.
  With regard to where we get our natural gas, less than 20 percent of 
it is imported. Most of it is imported through pipelines from Canada or 
Mexico, but only 2.8 percent represents liquefied natural gas. That 
comes in from Algeria, Egypt, and Trinidad.
  So we are, in many ways, a self-contained natural gas community. If 
we have a real shortage, the price is going

[[Page 15905]]

to go up. It means if you heat your home with natural gas--and many 
Americans do--or if your business depends on natural gas for 
operations--and many American businesses do, their costs are going to 
go up significantly.
  If we produce natural gas off our coast and put it directly in our 
pipelines, that will help in a dramatic way to contain the price of 
natural gas in America.
  Alan Greenspan recently said:

       Notable cost productions for both liquefication and 
     transportation of LNG--Liquefied natural gas--and high gas 
     prices projected in the American distant futures market have 
     made us a potential very large importer. Access to world 
     natural gas supplies will require a major expansion of LNG 
     terminal import capacity.

  He has been warning about that for some time. That is what we are 
wrestling with in Alabama today: Do we want an LNG plant? We already 
produce a lot of oil and gas offshore that goes directly into our 
pipelines. People are comfortable with that. We have had no significant 
spills in our State. We are comfortable with that. But 
environmentalists and others are uneasy about this LNG terminal and 
whether we should go in that direction.
  So for every argument, from the environmental argument to the 
American economy, to reducing the cost, we would do better to use oil 
and gas offshore.
  Conservation, alternative fuels, and domestic production are all 
important things we need to work on. The Government has had moratoriums 
on producing from offshore areas. It is something I have been involved 
in since I have been in the Senate, almost 10 years. We have had debate 
after debate, vote after vote, but for a whole host of reasons, we have 
not been able to get around this moratorium. We have not been able to 
produce more oil and gas in the Gulf of Mexico because of it.
  The State of Alabama produces oil and gas in Mobile Bay. I live in 
Mobile. It is almost close enough to throw a rock at from Fort Morgan 
Peninsula and hit it. It is right off the coast. We have them in the 
gulf right off the coast. They produce a lot of oil and gas for this 
country.
  In fact, I will show this chart. It is sort of amusing to me. I used 
to complain about it back in 2002. We were building a pipeline then. I 
see Senator Cochran from Mississippi is now on the floor. He has seen 
all this before. We have been producing oil and gas up in Mississippi 
and Alabama for quite a number of years.
  In 2002, our good friends down in Florida, who want no drilling 125 
miles or more offshore, objected to new natural gas exploration. But 
they were perfectly happy to build a pipeline to take our oil and gas 
down to Tampa, FL, so they can sit out on the dock and have their mint 
juleps and watch the sunset over the gulf before they go back in their 
big houses kept cool with air-conditioning run by natural gas. I 
understand their environmental concerns. But at some point, the 
producing States have to feel we have been taken here a little as 
chumps in this deal, getting not 1 cent from the 4,000 wells that exist 
in the gulf--4,000 wells.
  By the way, we have 4,000 wells in the gulf, and this most powerful 
storm, Katrina, came through so did several other powerful hurricanes 
last year. Mr. President, over 3,000 of those wells were in the direct 
paths of those hurricanes, and we never had any significant spill of 
oil in the gulf. It goes to show how good the technology is, how hard 
they have worked scientifically to make oil and gas production safer. I 
think that is why Florida is beginning to reevaluate this and are being 
more amenable to the idea. Senator Martinez has worked hard to try to 
protect Florida's interest as much as he can but allow some additional 
drilling there. I think we have gotten past that. So I would say to my 
colleagues I have been in the Senate for 10 years and we have been 
trying to open up additional reserves in the gulf, and we should do 
that. But we haven't been successful. It hasn't worked. We have tried 
and tried and tried some more.
  Now Chairman Domenici has worked his heart out, and Senator Landrieu, 
working on the Democratic side, has met him halfway, and they have 
worked and planned, and so many other Members of this body have worked 
on it.
  So we have a proposal now which I think will clear this Senate, will 
open up huge areas, 8 million acres of gulf for production that can 
produce, and, as we heard from other speakers, large amounts of oil and 
gas. It will be done in a way that is bipartisan and in a way that we 
all can be happy about.
  We can keep the oil and gas people busy for the period that the oil 
and gas moratorium on the other parts of the gulf remains in effect. So 
at that time we will see what happens. If there is a mess or if there 
is unhappiness--maybe nothing will change. Or, maybe at that point we 
can decide to open up more land in the gulf for production.
  Mr. President, I don't know what my time was.
  The PRESIDING OFFICER (Mr. Coburn). The Senator has used 19\1/2\ 
minutes.
  Mr. SESSIONS. I have gone beyond the 10 minutes I was looking to 
speak--far too far. I will wrap up and say I thank each of the Members 
of this body who has worked hard to reach an accord that will have 
bipartisan support that should pass. Because this is important to the 
American consumer; it is important to the American economy; it is 
important to jobs in this country. It will reduce the transfer of 
American wealth to foreign nations where we are now sending it to buy 
the energy we must have.
  This is not a little matter; it is a huge matter. Every now and then 
we have an opportunity to truly do something about an issue that our 
constituents have raised with us. They have asked us to do something 
about rising energy prices. This plan will work. It will produce large 
amounts of oil and gas for our Nation and it will keep us producing 
energy for quite a number of years.
  This is what we should do to fulfill that obligation to our 
constituents.
  I thank the Chair, and I yield the floor.
  The PRESIDING OFFICER. The Senator from New Jersey is recognized.
  Mr. MENENDEZ. Mr. President, I yield myself 20 minutes of Senator 
Bingaman's time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. MENENDEZ. Mr. President, I rise in strong opposition to this bill 
which would do little, if anything, to improve the energy situation in 
this country. It would end up costing the Federal Government tens of 
billions of dollars in the long run, and it would create an opening for 
those who want to eliminate coastal protections that tens of millions 
of Americans want and enjoy.
  My primary concern with this bill is the fact that it does absolutely 
nothing to protect New Jersey. I don't think it does anything for 44 
other States, either, but I am here to represent the people of New 
Jersey, and they are ill-served by the legislation.
  We do have a large chemical industry in the State, and I am sensitive 
to the problems they are facing with the high cost of natural gas, 
which is a critical feedstock for them. I have received letters from 
the industry urging me to support this bill, saying we must pass this 
bill to lower gas prices and put ourselves on the path toward energy 
independence. But this bill will do nothing of the sort, particularly 
in the short term. I believe the outside groups supporting this bill 
know this, and they are hoping this is a ticket into a conference with 
the bill the House of Representatives passed last month, a bill that is 
stunning in its disregard for environmental protections.
  The bill passed by the House would immediately eliminate the long-
standing moratoria that protect our coastlines, not just in one part of 
the country but everywhere along the Atlantic, along the Pacific, the 
Arctic, and gulf coasts. Then it would be a free-for-all. States that 
wanted to could allow drilling a few miles off their shores. 
Neighboring States that could be heavily impacted by the drilling, 
particularly in the event of a spill, would have almost no say in the 
process. States that didn't want to drill would be given 50 miles of 
protection, way down from the

[[Page 15906]]

200 miles we have now. If a State wanted to get an extra 50 miles, it 
would have to apply to the Federal Government every 5 years for that 
privilege.
  The House bill also has a provision that opens national parks and 
marine sanctuaries to drilling. As long as your rig is parked outside 
of a protected area, you are free to directionally drill into that 
region. No thought is given to the environmental damage that might be 
occurring, the drill cuttings and toxic metals that can litter the sea 
floor. But then again, some thought must have been given, because the 
House bill also provides broad waivers for a number of environmental 
laws.
  One of the fundamental flaws of the House bill is an idea that we can 
split up the ocean into administrative boxes with each State 
controlling its offshore territory. But the ocean has no boundaries, 
and an oil spill will not respect any artificial lines we draw. There 
is territory off the eastern seaboard less than 75 miles from the coast 
of New Jersey the administration has already proposed opening to 
drilling. The House bill is yet another opportunity for that to happen. 
It is another assault on the Jersey shore, one of the most ecologically 
sensitive and economically important parts of the State of New Jersey.
  Our beaches are part of our $222 billion tourism industry, which is 
responsible for over 10 percent of the jobs in the State. The New 
Jersey coastal counties are home to over 1.5 million people.
  New Jersey is also home to a huge fishing industry. According to the 
American Sports Fishing Association, there are over 800,000 
recreational anglers in the State, contributing over $1.3 billion and 
12,000 jobs to the State economy. Our commercial fisheries are critical 
as well. The port of Cape May and Wildwood is the fifth largest 
commercial port in the country, by value. According to the National 
Marine Fisheries Service, New Jersey landed over 185 million pounds of 
fish last year, worth over $139 million.
  The waters off the coast of New Jersey are home to over 300 species 
of fish and 300 species of birds, and our beaches are crucial stopping 
points for countless numbers of migratory birds, including some 
endangered and threatened ones such as the red knot.
  The House bill is a direct threat to all of this, and if S. 3711 
passes, the House will have an opportunity to move their bill forward 
another step toward becoming law.
  I know we have been told that the Senate will try to avoid a 
conference--and I certainly appreciate that--and that we may be able to 
get the House to accept this bill as is. I have not heard any sort of 
commitment to that effect from the majority leader, and no one has 
presented a clear way to this body to avoid a conference with the 
House. The House, meanwhile, seems quite clear that it doesn't find 
this bill satisfactory at all. Richard Pombo, the chairman of the House 
Resources Committee who would lead the House delegation in a 
conference, has been fairly blunt about this. Here are two of his 
quotes:

       Given the fact that the House bill passed with overwhelming 
     support, it is unlikely that the House would accept the 
     Senate bill without having the opportunity to debate at least 
     a couple of provisions, if not the opportunity to bring it up 
     to par with the House bill.

  Referring to the Senate bill:

       It is a third of the bill that the House passed 
     overwhelmingly in a bipartisan fashion just two weeks ago,

  Pombo spokesman Brian Kennedy said yesterday:

       The House passed a comprehensive national solution.

  Here are two news reports from this week:

       House Resources Committee Chairman Richard Pombo, the lead 
     advocate of the House plan, has scoffed at the idea of simply 
     accepting the Senate plan.
       Richard Pombo said that if the Senate passes its bill this 
     week, he plans to work in conference to add as many of the 
     House provisions as possible.

  Then yesterday, in an AP report:

       Representative Richard Pombo, a key sponsor of the House 
     bill passed last month, said Tuesday he saw no way the House 
     would accept the limited Senate legislation as a substitute 
     for its bill--no way.

  Any Member of this Chamber who believes we can get the House to 
accept this bill as is should listen to these statements and think 
again.
  But I also don't believe this is all that great a bill to begin with. 
First, the fact is it doesn't do that much. Let me show you this map of 
the region we are talking about.
  This region outlined in black, the contours of it are lease sale 181. 
The purple lines are the existing pipelines in the gulf over here, and 
the gray squares are the oil and gas platforms that already exist. This 
orange rectangle right here has already been opened. So S. 3711 would 
open this red area in the middle, and these two tan areas, but the red 
area is already likely to be open next year by the administration 
anyway. Congressional action isn't necessary here at all. It is not 
under a moratorium, it is not under withdrawal, so there is no need for 
us to act to get that gas.
  The only new areas the bill opens are these two tan areas here, a 
wedge-shaped area in 181, and a bigger area called 181 south. They may 
look pretty big, particularly this one here in the south, but combined, 
these two areas have less gas than this red region alone.
  Look how far these new regions are from the existing infrastructure 
in the region. Even if they were opened today, it would take years for 
companies to start developing them. And once they do start developing 
them some years down the road, there is not all that much gas there to 
begin with.
  Here is the claim the proponents of this bill make: 5.8 trillion 
cubic feet of gas opened in this whole bill, which would be enough to 
heat and cool 6 million homes for 15 years. It would take care of the 
Nation's needs for 3 months. That is what they say. But how long will 
it take to get that gas?
  Here are the estimates that the Mineral and Mines Management Service 
say even going out 50 years--even going out 50 years--we only get about 
80 percent of that 5.8 trillion cubic feet, about 2\1/2\ months' worth.
  Looking into the median term, in the next 15 years, this whole bill 
would open half a trillion cubic feet of gas. That is about 9 days' 
worth. The new areas, the areas that wouldn't be opened, anyway, 
provide less than half of that, enough to take care of the country for 
a cozy Thanksgiving weekend.
  But in the near term, in the next 10 years, we get almost nothing out 
of this bill, and there will be absolutely nothing until 2011.
  Take a look at these numbers from the Minerals Management Service and 
ask yourself, will this have a real effect on natural gas prices, with 
this type of supply? Will this have any effect on natural gas supply?
  Nothing in the short term. But, in exchange for that ``nothing,'' we 
give away 37.5 percent of the royalties, money that could be used for 
homeland security, defense, housing, education--or actually helping the 
coastal States in this region to actually meet their challenges. I do 
believe we should help them meet their challenges, particularly 
Louisiana. Senator Landrieu has made a powerful argument on behalf of 
her State and those needs. But the question is, How do we best achieve 
that? Money for these other priorities we cede to four States, and for 
those four States it is a great deal, but for New Jersey and the other 
45 States, I don't see how it is.
  There are some people who might support this bill because of the 
money that will go directly to the Land and Water Conservation Fund 
stateside program. But the amount of money in that fund that we will 
get in the first 10 years is a trifle. These are the funding levels for 
the stateside grant program for the past 6 years--see where they are--
and the amount in this year's Senate Appropriations Committee report. 
The average over that time is about $82.3 million.
  Under the bill we are debating, this new direct funding for the Land 
and Water Conservation Fund would provide a small fraction of what it 
had been getting in the past and barely even meet the lower funding 
levels of recent years. While this does not replace the appropriations 
process for the

[[Page 15907]]

Land and Water Conservation Fund, it could make it harder in the future 
to get appropriators to provide additional funds to this program, 
beyond that which is allocated in this bill. This is no windfall for 
the Land and Water Conservation Fund, and it certainly doesn't make up 
for the giveaways from the Federal Treasury.
  Finally, this bill provides statutory protections for Florida's 
western coast until 2022. That is unprecedented and treats Florida 
differently from all other coastal States. I do not begrudge Florida 
their attempts to get statutory protections to 2022. They deserve the 
right to try to protect their coastline. But New Jersey also deserves 
the right to protect our own. While we must fight each year for a 1-
year extension to the drilling moratorium and are beholden to the whims 
of the executive branch which could remove the Presidential withdrawal 
at any time, Florida would be protected.
  We simply seek the same protections Florida is being offered, a 
continuation of the moratorium until 2022. So I will be filing an 
amendment, cosponsored by a broad, bipartisan coalition of Members from 
both coasts, including Senators Snowe, Feinstein, Lautenberg, Boxer, 
Collins, and many others, that would put the Atlantic and Pacific 
Oceans off limits to oil and gas drilling until 2022.
  While we file those amendments, we are being told, unfortunately, 
that we will not be given the opportunity to offer any amendments to 
this bill. I believe that is wrong. We have record-high gas prices. We 
face even higher ones in the future due to instability in the Middle 
East. We are putting a squeeze on families around the country while 
allowing oil and gas companies to report new record profits this week. 
We also have an electric grid in California that is straining under a 
record heat wave, and global warming threatens to bring us even more 
heat waves like this in the future. Yet this is the only piece of 
energy legislation which is likely to move this year, and we are not 
likely to be given the opportunity to address any of the real energy 
problems this country faces.
  There are a number of excellent amendments that are being filed by 
people on both sides of the aisle, amendments that would raise fuel 
efficiency or provide for a real plan to cut down on the amount of oil 
we use or create new incentives for renewable energy. I will be filing 
amendments to encourage the production of biofuels and the development 
of new vehicle technologies, increase the amount of renewable energy 
the Federal Government is required to purchase, spur the growth of 
transit-oriented development corridors to help reduce people's 
dependence on cars, and others.
  But at the very least, we should be allowing other coastal States, 
such as New Jersey, the opportunity to protect their own beaches the 
same way Florida has already been taken care of in this bill. The 
complete lack of protections for the New Jersey shore in this bill and 
the lack of guarantees that something much worse will not come out of a 
conference with the House forces me to oppose this bill. That is our 
fundamental problem. I certainly hope, if the bill is to pass the 
Senate, it certainly does not come back in any way other than its 
present version, or else we will clearly be forced to do anything and 
everything necessary to achieve its defeat.
  I yield the remainder of my time. I yield the floor.
  The PRESIDING OFFICER. The Senator from Mississippi.
  Mr. COCHRAN. Mr. President, I am pleased to be a cosponsor of the 
Gulf of Mexico Energy Security Act. The legislation will expedite oil 
and gas production in areas that are at least 100 miles from the 
coastlines of Gulf Coast States and will enable our Nation to reduce 
our dependence on foreign sources of energy. This will improve our 
national economy and help increase job opportunities for American 
citizens across the country. It also authorizes the sharing of 37.5 
percent of the revenue from new production of oil and gas in the Gulf 
of Mexico with the States of Alabama, Mississippi, Louisiana, and 
Texas.
  Mr. President, 12.5 percent of the revenue from this production will 
be shared with all States through the Land and Water Conservation Fund. 
The sharing of revenue with States is consistent with the way other 
areas of the country have benefited from oil and gas production, such 
as the western Rocky Mountain region, where 50 percent of oil and gas 
revenue goes to the producing States.
  The Congressional Budget Office estimates that this legislation will 
reduce Federal spending by $900 million over the 2008 through 2016 
period. It increases domestic energy production and saves the Federal 
Government money.
  The legislation will open 8.3 million acres to production on the 
Outer Continental Shelf, and it will do it responsibly. The offshore 
program will be conducted under Federal environmental mandates, 
including the Outer Continental Shelf Lands Act and the National 
Environmental Policy Act.
  As unrest in the Middle East continues, the development of an 
uninterrupted supply of domestic energy becomes more and more important 
to our national interests. Our economic security depends on it. At the 
present time, 37 percent of our petroleum comes from the Middle East or 
Africa. This legislation will reduce our dependence on these foreign 
sources of oil and gas.
  American families and businesses feel the impact of increasing energy 
costs every day. As gasoline prices rise, the heating and cooling of 
homes becomes more and more costly. The new supply of natural gas which 
will be made available by the Gulf of Mexico Security Act is enough to 
heat and cool nearly 6 million homes for 15 years.
  Small businesses are strained by unexpected increases in the cost of 
energy. As the cost of raw materials and fuel rise due to supply not 
meeting demand, the cost of production and transport of goods is passed 
on to consumers. Disruptions in our supply mean higher prices, lower 
productivity, and ultimately the loss of jobs--especially in small and 
medium size businesses.
  American manufacturers face intense competition from foreign 
companies who have an energy cost advantage. Increased domestic 
supplies of natural gas would assist our Nation's industries whose 
competitiveness relies on natural gas as a raw material. The U.S. 
agricultural industry, for instance, has been facing a natural gas 
crisis since 1999. Farmers across the country use natural gas for food 
processing, irrigation, and in the production of crop-protection 
chemicals and fertilizers. The U.S. fertilizer industry estimates that 
in the 1990s, 85 percent of its domestic needs were supplied through 
U.S.-based production. But today, this industry relies on imports for 
more than 50 percent of natural gas supplies. This adversely affects 
businesses such as Terra Industries in Yazoo City, MS, which produces 
nitrogen fertilizer and relies heavily on natural gas as a feedstock.
  We must act now to take advantage, in an environmentally acceptable 
way, of our national resources in the Gulf of Mexico. This legislation 
will do just that. It is estimated that this legislation will provide 
us with 5.8 trillion cubic feet of gas and 1.26 billion barrels of oil. 
The process to begin extracting those resources could begin almost 
immediately upon the enactment of this legislation.
  I compliment the distinguished Senator from New Mexico, Mr. Domenici, 
the chairman of the Energy Committee, for his leadership in bringing 
this bill to the floor of the Senate. The Gulf of Mexico Energy 
Security Act is a step in the right direction and will benefit our 
entire Nation. I encourage its adoption by the Senate.
  The PRESIDING OFFICER. Who yields time? The Senator from Louisiana is 
recognized.
  Ms. LANDRIEU. Mr. President, I intend to speak for about 15 minutes. 
I think that was part of our unanimous consent agreement earlier. I 
know there are other Senators who want to speak for and against.
  I wish to begin again by thanking Senator Domenici for his strong and 
able leadership. I want to associate myself with the remarks of the 
chairman of the Appropriations Committee,

[[Page 15908]]

the senior Senator from Mississippi, Mr. Cochran, who has been a real 
leader in our effort to pull a coalition of Senators together who are 
concerned about the Nation's energy supply and our growing dependence 
on areas of this world that are not friendly to downright dangerous. 
This coalition of Senators understands how important a partnership is 
to maintain a long-range, mutually beneficial relationship that helps 
the coastal States that agree to drill and the Nation that so 
desperately needs new supplies.
  I am going to try to answer some of the charges that were made. As 
the chairman, the Senator from New Mexico, said, some of them are not 
worth responding to because they are so weak on their face. But some do 
need to be responded to.
  One of them that I want to set right is President Truman's position. 
Somebody might say: Senator Landrieu, why is it so important to know 
what President Truman did? We need to look forward, not backward.
  But you know, as a leader and as an elected official, I find it very 
helpful sometimes to understand history--the things we did right and 
the things we did wrong--because it helps us to make wiser decisions in 
the future. When so many lives depend on it--300 million, in this case, 
in the United States, and more in the rest of the world--I think it is 
important for us, as fast as we move up here, to try to get it right. 
So I want to get something right for the record. If somebody wants to 
come down here and debate me, please do, because I have many books 
about the Tidelands oil controversy with which I am prepared to debate. 
I have excerpts of the veto letter Truman sent. I read the original 
law. Why would I do this? Because this is very important to my State.
  The truth of the matter is this: In the late 1940s, we didn't know 
there was oil and gas in the waters off the coast. I think the first 
well was found in Pennsylvania, maybe the second one in Texas, and the 
first offshore well was off of a pier in California. I say a pier 
because that is the way they first were because nobody knew how they 
could swim out. They made a pier to walk out to put the rig in the 
water. And lo and behold, they discovered oil and gas. It wasn't soon 
after that first well, there was a second well offshore in Creole, LA. 
I know about it because it is in my State, a little town that was 
virtually destroyed by Katrina and Rita, where a lot of brave souls, 
pioneers--just like the West is proud of the cowboys and the pioneers 
and the wagon trains that went out West, those of us along the gulf 
coast, the roughnecks who started this industry, those who own pirogues 
and skiffs and flat boats and walked in the marsh are proud of the 
industry which we developed.
  We don't hang our head in shame about it, despite the rambling up 
here about big oil companies this and big oil companies that. People 
have made a good living. It helped this country to be the strongest 
economy in the world and in large measure because of the way we manage 
our resources. We need to do a better job of that.
  President Truman offered the Gulf Coast States 37.5 percent. He said 
the land belongs to the Federal Government. There is no question it is 
Federal Government land and it is Federal resources. But as your 
President, I will agree to share the bounty.
  Why? Because he was a smart man. He was an able leader, and wise, and 
knew that sharing is always better than hoarding. It is the first 
lesson kids learn in kindergarten. Why we can't learn it in Congress I 
don't know. But President Truman figured that partnership is better 
than in lateral taking. So he offered us 37.5 percent and he put a bill 
in and sent it to the Congress. You can read what happened.
  But because of States rights issues and all sorts of other politics 
of the time, the Congress, for whatever reason, decided the States 
should get 100 percent. They amended his law that he sent to Congress 
to give 100 percent and the Federal Government to get nothing. That, of 
course, didn't make any sense. And President Truman was correct. He 
vetoed it. I would have, too, if I were the President, and so would 
Thad Cochran, if he were the President back then. It didn't make any 
sense.
  But for Members to come to the floor and read only a part of the 
history and use it for their argument is not being forthright. That is 
what history books will say. That is why those of us in Louisiana 
understood that it was Leander Perez, who was leading the charge for a 
greater share, 100 percent. We were so angry because we basically ended 
up with nothing. We should have taken the 37.5 percent.
  That is what brings us here 50 years later--not to rob the Federal 
Treasury, not to ask for something that is not ours but to cut a good 
deal, a fair deal, a square deal for the people of the gulf coast, for 
the coastal States, and to honor the wise offer made to us by President 
Truman.
  Here is a picture of it. I would have no such objection to such a 
provision, which is similar to existing provisions under which the 
States receive 37.5 percent of revenues from the Federal Government, 
oil-producing public lands within their borders. Because in the 1920s 
the record will reflect, when oil was discovered on land, the Minerals 
Leasing Act gave 37.5 percent to States such as New Mexico, to States 
such as Wyoming, to States such as Colorado. No oil or gas had been 
discovered in water. So there was no reason for the coastal States to 
be included.
  The Senator from New Mexico is correct because western States came 
into the Union under completely different rules than the eastern 
States. There was a lot more western land. So the Minerals Leasing Act 
was passed. It was set at 37.5 percent. When oil and gas began to be 
discovered in little places such as Creole and off the coast of 
California, there was interest in having the coastal States at 37. But 
because there was an overreach, we got nothing.
  Yes, we have had jobs, we have had economic opportunity. I am not 
denying that. But what I am saying is a partnership is always better 
than going it alone. The strategy of going it alone has resulted in not 
one new refinery being built in this country in the last 30 years and 
only expansion very recently, no new nuclear powerplants being built 
until recently, and no new areas opened under leasing because of no 
partnership.
  I wanted to get the Truman issue straight this afternoon.
  I also want to say that this bill is good overall energy policy. I 
know we cannot drill our way out of the situation we are in. But we had 
better change course. Since 1960, we have been on a course of further 
dependence on oil and gas. We are building and trying to permit more 
liquefied natural gas terminals, which is good, but we are building an 
infrastructure of dependence. We need to build an infrastructure of 
independence so that we can make wise choices and not be beholding to 
the suppliers of a commodity and a resource which we need to keep the 
lights on and to keep this economy moving forward.
  This bill comes to the floor not saying it is the solution to all of 
our energy problems but arguing forcefully that increasing supply is 
important and saying we have not done that in over 20 years. We need to 
open areas of new drilling.
  As a story, I had a group of French Parliament members from France in 
my office not too long ago. I cochair the French caucus. We talked 
about a lot of issues. They were particularly interested in the issue 
of energy. I put up a map of the United States. And first they asked me 
about nuclear because, of course, the French are leaders of the world 
in that. They produce a different kind energy technology than we do, 
and 80 percent of their energy comes from nuclear sources. They were 
asking me about that. They also asked me about other aspects of the 
energy legislation. I showed them a map of the United States. I said 
this is where we allow drilling, and this is where we don't, but we 
think we might have reserves in many other places. When they saw the 
map of how restricted drilling is they were dumbfounded. They said: 
Senator, why? This is a great country. America has resources. I said: 
Because we have a backward-looking approach. We have not recognized new 
technology. We have not recognized that

[[Page 15909]]

you can drill in places and minimize the footprint and expand 
opportunities for the economy while making sure that you are protecting 
the environment.
  This is a step in right direction. The gulf coast is our Nation's 
only energy coast. Three-hundred million Americans depend on this coast 
to work--and work we do.
  This is a picture of a graph that I like to show. I have shown it 
many times. The red is a natural gas pipeline company, and all the 
pipeline companies that exist in the Nation. You can see there is a 
great cluster right here along the Texas coast, Louisiana, Mississippi 
and Alabama. It comes right here at Mobile Bay. This one lonely little 
pipeline brings gas right over here to Florida because we are not able 
to drill for several reasons. That is a subject for another day. But 
this is the gulf cost compromise. By the nature of it, we all can't get 
what we want. It is a compromise. These five States--four that are 
drilling States and one that is a nondrilling State--have come 
together, Senators Martinez and Nelson, all of us, to say: OK. Let's 
stop fighting and let us start working for the benefit of the country. 
Let us give Florida a reasonable buffer, new revenue sharing to these 
States, open some additional drilling and help the country get the 
domestic oil and gas it needs. Maybe it makes too much sense for people 
to vote for, but there is another reason that this money is so critical 
to Louisiana and Mississippi, Alabama and Texas and, in particular, 
Louisiana because our topography is different. I know people can't 
grasp it because you do not see pictures of it very much. We don't have 
beaches similar to California and Florida. We have only two. They are 7 
miles long each--Holly Beach on the west and Grand Island on the east. 
All the rest of our coast is quite expansive. It is marshland and 
grassland. It is the home of the mouth of the greatest river--the 
Mississippi River--system in North America. That river goes all the way 
through our country. So this land is very fragile. Because of global 
warming, and because of other things, because of some of the canals 
that were dredged back in the early days before we understood the 
degradation that can be caused, this coastal land is eroding. The 
hurricanes that are coming are more fierce and strong. We lost in Rita 
and Katrina alone total land equal to 73,000 football fields. We lose 
the equivalent of one football field every 38 minutes, 73,000 football 
fields in 48 hours. That is the size of the District of Columbia gone 
in 2 days because of the great surges from the water and wind from 
Katrina and Rita.
  This money is critical. And unlike our opponents who say there is no 
direct use of this money, the people of Louisiana are poised to pass a 
constitutional amendment that all of that money will go to coastal 
restoration and hurricane protection.
  I might add we are happy to do that. It is obviously popular and 
quite necessary in the State of Louisiana to do that. That is what our 
State wants to do. I might add that the interior States of New Mexico, 
Colorado, and Wyoming have no restrictions. The States that share 50 
percent of their revenues have no restrictions on the way the money can 
be spent. They can reduce taxes with it. They can build universities 
with it. They can build highways with it. They could put it in a trust 
fund and give out a check to everybody who lives in the State. But we 
have targeted uses for these funds in this bill. We want them to go for 
general environmental purposes and to secure our coast--not just for 
the benefit of the 10 million people who live along the coast but the 
300 million people who depend on this coast to be there decades from 
now, hopefully, centuries from now--a very valuable working coast for 
the Nation.
  Energy comes from this coast, fisheries come from this coast, the 
Mississippi River empties into the gulf here, and 70 percent of the 
rain from the Midwest comes down through this river system. It is 
important that we don't wash it away.
  I know my time is up. I will come back again to speak. Maybe there 
are some other Senators who would like to speak. But I wanted to get 
President Truman's position straight for the Record. I wanted to say 
that our uses are going to go for environmental purposes and I wanted 
to say that without this money the coast will wash away.
  I yield the floor. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. KYL. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KYL. Mr. President, I ask unanimous consent the order of speakers 
be as follows: Senators Kyl, Murkowski, Talent, and Alexander, with the 
understanding that Democrats will be accommodated if they come to the 
floor.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KYL. Mr. President, today I come to the Senate floor to talk 
briefly about S. 3711, the Gulf of Mexico Energy Security Act of 2006, 
which will open new federally controlled areas in the gulf to oil and 
gas leasing. I support the purpose of this bill as a necessary step in 
securing American oil and natural gas for America's energy consumers. 
It will start to address the root cause of high energy prices which is, 
of course, demand outpacing supply.
  However, there is one aspect of our Federal oil and gas leasing 
program that needs fixing. That program is the Royalty Relief Program. 
I am hoping we will have the opportunity to offer some modest reforms 
to this part of the program.
  Let me first explain how it works. Royalties are collected by the 
Department of Interior from leases as a fixed percentage of the net 
value of oil or gas produced from the leased area. The terms of the 
lease specify the royalty rate that applies to future production from 
that area, on average, about 15 percent, as well as the conditions 
under which the lessee may qualify for a royalty holiday, a waiver of 
royalty payments commonly called royalty relief.
  Mandatory royalty relief was provided pursuant to the Deep Water 
Royalty Relief Act of 1995 as an incentive to companies to undertake 
investment in the deep waters. The incentive was intended to provide 
companies that undertook these investments specific volumes of royalty-
free production to help recover a portion of their capital costs before 
starting to pay royalties. The act also gave the Secretary of the 
Interior the authority to limit royalty relief based on market price. 
These limits are called price thresholds. Price thresholds act to set a 
gross revenue ceiling so that companies do not benefit from both high 
market prices and royalty-free volumes.
  These incentives were offered at a time when oil and gas prices were 
low and interest in deep water exploration and development was lacking. 
Since the passage of the 1995 act, natural gas production is up 407 
percent and oil 386 percent based on figures provided by the American 
Petroleum Institute.
  Despite the program's successes, recent news reports and the 
administration's own statements suggest that the Government may be 
unable to collect billions in royalties from leases issued under this 
act. Many have probably heard the reports to the effect that in 1998 
and 1999 the Clinton administration issued leases that did not include 
price thresholds. Why is this a big deal? It is a big deal because 
energy prices have skyrocketed and without price thresholds to trigger 
payment of royalties, we will not see a dime from these leases. GAO 
estimates that the mistake could cost up to $10 billion in lost 
revenues.
  I wish that were the only problem, but it isn't. A few producers who 
signed leases in 1997, 1998, and 2000 that did include price thresholds 
have refused to pay royalty on production even though the thresholds 
have been exceeded. One of the companies has sued the Department of the 
Interior, arguing that Interior does not have the authority to 
establish price thresholds for leases issued between 1995 and 2000. 
This could have significant implications for royalties already 
collected. GAO estimates

[[Page 15910]]

the potential return revenue to be almost $60 billion.
  Despite these concerns, the Congress enacted the Energy Policy Act 
which, again, made royalty relief mandatory in deep water leases but 
did not require that royalty relief be conditioned upon price 
thresholds.
  This brings me back to the bill under consideration and the modest 
reforms to the royalty program that I seek to offer to improve the 
program going forward. First, Congress must require that the Secretary 
of Interior impose price thresholds in all new leases that include 
royalty relief. Directing the Secretary to include price thresholds in 
all leases is an important near-term action that will ensure that the 
American taxpayer gets a fair return for the oil and gas produced from 
Federal land. The 1998 and 1999 leases demonstrate that the Interior 
Department cannot be trusted to do this on its own, and we cannot 
afford another $10 billion mistake.
  Second, Congress must reaffirm the Secretary's authority under the 
1995 act to put price thresholds in leases. Congress intended that 
royalties be paid when prices were high. We must ensure this is the 
case.
  This bill is a natural place to make these fixes to the Royalty 
Relief Program. After all, any royalty payments made or not made will 
directly affect the revenues that can be shared under this bill.
  I urge my colleagues to work with me on these important reforms. I 
hope we can all agree that including these reforms in this bill will 
improve and not hinder the bill.
  I conclude by saying that I have spoken with Senator Domenici, the 
author of the bill, and that Senator Wyden and I have urged some form 
of this relief be included in the bill. I appreciate very much Senator 
Domenici's leadership on this issue overall and hope that we can reach 
some kind of agreement.
  In conclusion, I ask unanimous consent to have printed in the Record 
a Legislative Notice produced by the Republican Policy Committee on S. 
3711.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                           Legislative Notice

          S. 3711--Gulf of Mexico Energy Security Act of 2006

       Read the second time on July 21, 2006, and placed on the 
     Senate Legislative Calendar under General Orders; no written 
     report.


                               noteworthy

       On Monday, the Majority Leader filed a cloture petition on 
     the motion to proceed to S. 3711, the Gulf of Mexico Energy 
     Security Act of 2006. As per Senate rules, a vote on cloture 
     on the motion will occur on Wednesday. The Majority Leader 
     has announced his intention to hold the vote prior to the 
     11:00 a.m. Joint Meeting of Congress.
       Americans are facing high energy costs due to supply 
     problems for both oil and natural gas, which are having an 
     adverse effect on the nation's economy. Opening up the Outer 
     Continental Shelf (OCS) to energy development would increase 
     U.S. energy supplies, which in turn would help reduce energy 
     prices.
       In April 2006, the Senate Energy Committee reported S. 
     2253, a bipartisan bill cosponsored by Chairman Domenici and 
     Ranking Member Bingaman, by a vote of 16-5 (with 1 
     ``present'' vote), requiring the Secretary of the Interior to 
     offer for oil and gas leasing 3.6-million acres of Original 
     Lease Sale 181.
       Concerns over S. 2253 prompted additional negotiations, 
     culminating in a new bill, S. 3711, which was introduced by 
     Chairman Domenici on July 20 with 10 cosponsors, including 
     Senator Landrieu (D-LA), the Senator who had voted 
     ``present'' on reporting S. 2253.
       S. 3711 represents a bipartisan agreement among Gulf State 
     Senators to enact legislation that would increase domestic 
     supplies of oil and natural gas.


                               highlights

       S. 3711 would:
       Require the Secretary to offer a portion of the Gulf of 
     Mexico, including a portion of Lease Sale 181 and an area 
     south of Lease Sale 181, for oil and gas leasing.
       Make available to U.S. consumers an additional 1.26 billion 
     barrels of domestically produced oil and 5.83 trillion cubic 
     feet of natural gas.
       Put into place a 125-mile buffer until [statutory] 2022 for 
     energy development in waters off the coast of Florida in the 
     Gulf of Mexico.
       Put some areas within Original Lease Sale 181, previously 
     available for energy development, under moratoria.
       Extend existing moratoria on energy exploration and 
     development in the Gulf from 2012 to 2022.
       Distribute 37.5 percent of lease sale revenues (by a 
     formula to be established by the Secretary of the Interior) 
     to Alabama, Louisiana, Mississippi, and Texas. These revenues 
     must be dedicated to coastal protection, restoration, and 
     mitigation.
       Distribute 12.5 percent of lease sale revenues to the 
     stateside Land and Water Conservation fund, which provides 
     matching grants to States and local governments for the 
     acquisition and development of public outdoor recreation 
     areas and facilities.
       Retain 50 percent of lease sale revenues in the General 
     Treasury.


                               Background

       The following background information is drawn from two RPC 
     policy papers issued last month and titled, ``Revisiting 
     Energy Development in the Gulf of Mexico,'' and ``Evaluating 
     the Risks of Opening an Area to Energy Development.''


         evaluating the need for energy development in the ocs

       Americans are facing high energy costs due to supply 
     problems for both oil and natural gas, which are having an 
     adverse effect on the nation's economy. Crude oil prices, for 
     example, have hovered around $70 per barrel since April and 
     recently reached $77 per barrel. As a result, American 
     consumers have been faced with high gasoline prices, 
     sometimes exceeding $3 per gallon on average.
       As high as gasoline prices have been, the high price of 
     natural gas may be having a greater impact on the economy. 
     Throughout most of the 1980s and 1990s, the wholesale price 
     (commonly referred to as the ``city gate'' price) of natural 
     gas hovered around $3 per thousand cubic feet. By 2004, 
     wholesale prices exceeded $6, and by the end of 2005, they 
     exceeded $10. Since then, the price has moderated somewhat, 
     but it is still high at $6.19 per thousand cubic feet. In 
     2005, natural gas consumers spent $200 billion on natural 
     gas, which is four times as much as was spent in 1999, the 
     last time natural gas traded within its historic price band 
     (the yearly average wholesale price during the 1980s and 
     1990s was between $2.78 and $3.95).
       High natural gas prices have led directly to job losses, 
     particularly in the manufacturing sector. The U.S. chemical 
     industry, whose products are found in 96 percent of all U.S. 
     manufactured goods, has been hit hard by high natural gas 
     prices. The industry uses natural gas as both an energy input 
     and as a key ingredient in its products (accounting for more 
     than 10 percent of total U.S. consumption). It has been 
     estimated that, from 2000 to 2005, the industry lost $50 
     billion in business to overseas competition, and reduced U.S. 
     jobs by 100,000 In the same time frame, the National 
     Association of Manufacturers estimates that, overall, the 
     United States lost 2.9 million manufacturing jobs, due in 
     large part to high natural gas prices.
       Opening up the OCS to energy development would increase 
     U.S. energy supplies, which in turn would help reduce energy 
     prices. To the extent that energy development would add to 
     the world supply of oil, it would reduce the world price for 
     oil. More importantly, developing domestic natural gas 
     resources would substantially reduce natural gas prices, 
     thereby lowering Americans' heating and electricity bills. It 
     would also help halt job losses in the nation's manufacturing 
     industry and contribute to robust economic growth within that 
     industry and the economy as a whole.


                    history of moratoria on the ocs

       The Outer Continental Shelf (OCS), as a whole, is estimated 
     to contain approximately 60 percent of the remaining 
     undiscovered oil in the U.S., or 75 billion barrels of 
     technically recoverable oil. It also contains as much as half 
     of the remaining undiscovered natural gas, or 362 trillion 
     cubic feet of natural gas. However, much of the OCS, 
     including the U.S. waters off the coasts of New England, 
     California, the Eastern Gulf of Mexico, the Mid-Atlantic, 
     South Atlantic, Alaska's North Aleutian Basin, and the 
     Pacific Northwest have been put off limits by Congressional 
     moratoria or Presidential withdrawal.
       Although Congress had enacted moratoria on Interior 
     Department appropriations bills beginning in 1982, the areas 
     covered by the moratoria varied from year to year. The 
     initial action to remove most of the OCS from energy 
     development activities on a more permanent basis began in 
     1990 when President George H.W. Bush issued an Executive 
     Order prohibiting lease sales off the East and West coasts 
     for 10 years. In 1998, President Clinton, in a memorandum to 
     the Secretary of the Interior, withdrew from leasing through 
     June 30, 2012, those areas of the OCS put under Congressional 
     moratoria in the Department of the Interior and Related 
     Agencies Appropriations Act of 1998. Those areas included 
     those previously put under moratoria by President Bush, as 
     well as the North Aleutian Basin, the eastern Gulf of Mexico, 
     and the Mid-Atlantic and South Atlantic. Not included in 
     either of these Bush or Clinton acts was the Lease Sale 181 
     area.


                       history of lease sale 181

       In November 1996, President Clinton's Secretary of the 
     Interior, Bruce Babbitt, adopted a five-year leasing program 
     (1997-2002) to start the multi-step process to allow for

[[Page 15911]]

     eventual energy exploration and development in the Original 
     Lease Sale 181 area. The Secretary's decision was made after 
     extensive consultations by the federal government with 
     coastal states, including the State of Florida (which, among 
     the Gulf Coast states, has traditionally offered the 
     strongest opposition to energy activities off its coasts).
       In June 2001, after President George W. Bush came into 
     office, a Final Environmental Impact Statement was completed 
     for the full 181 area, giving the lease owners the green 
     light to begin development activities. However, within weeks, 
     the U.S. House of Representatives passed an amendment to the 
     FY2002 Interior Appropriations bill (H.R. 2217) to prevent 
     the use of funds to execute a final lease agreement. The 
     amendment passed by a vote of 247-164, but was eventually 
     stripped out in conference. However, the strong opposition 
     demonstrated by the House vote convinced the Administration 
     to offer a compromise proposal to adjust the lease sale area 
     from 5.9 million acres to just 1.5 million, such that every 
     point of the proposed area would be at least 100 miles from 
     the coast of Florida.
       In April 2006, the Senate Energy Committee reported S. 
     2253, a bipartisan bill cosponsored by Chairman Domenici and 
     Ranking Member Bingaman, by a vote of 16-5 (with 1 
     ``present'' vote). It required the Secretary of the Interior 
     to offer for oil and gas leasing, within a year of enactment, 
     3.6 million acres of Original Lease Sale 181 that were not 
     subject to any moratoria or Presidential withdrawal. Concerns 
     over S. 2253 prompted additional negotiations, culminating in 
     a new bill, S. 3711, which was introduced by Energy Committee 
     Chairman Domenici on July 20 with 10 cosponsors, including 
     Senator Landrieu (D-LA), the Senator who had voted 
     ``present'' on reporting S. 2253.
       The Senate Energy and Natural Resources Committee estimated 
     that the area that would have been made available for energy 
     development under S. 2253 contains 930 billion barrels of 
     technically recoverable oil and 6.03 trillion cubic feet of 
     technically recoverable natural gas. This new bill would make 
     available an area for energy development containing 1.26 
     billion barrels of technically recoverable oil and 5.83 
     trillion cubic feet of technically recoverable natural gas, 
     according to the Committee.


         Evaluating the Risks of Energy Development in the OCS

       As with virtually any economic activity, energy development 
     in the OCS carries risk. A major oil spill, for example, 
     theoretically could occur and could reach the U.S. coast, 
     thereby imposing major costs on the affected state. Such a 
     spill could also inflict significant, even irreversible, harm 
     on certain marine species. Nobody denies these possibilities; 
     nor should the mere possibility of harm (no matter how small) 
     justify inaction. Policy makers attempt to weigh risks and 
     benefits--they evaluate the likelihood of harm and then weigh 
     the potential costs of action against the costs of inaction. 
     When framed in this way, sensible decisions can be made on 
     the acceptable level of risk.
       An actual analysis of the last 30 years of experience with 
     offshore exploration and production activities shows that any 
     harms are likely to be small in size and cost, and are 
     unlikely to pose a significant threat to the survival of any 
     species populations. Due to advances in exploration and 
     extraction technology, major oil spills associated with U.S. 
     offshore oil and gas production have been virtually 
     eliminated. Indeed, since 1980, there has not been a single, 
     significant oil spill from a U.S. exploration and production 
     platform. The last oil spill to reach U.S. shores occurred 37 
     years ago, in 1969, in California's Santa Barbara Channel. 
     Further, there is no documented evidence of any oil spill 
     occurring in U.S. waters more than 12 miles from the shore 
     reaching the shore. Moreover, only 2 percent of total 
     petroleum inputs into the U.S. marine environment originates 
     from offshore oil and gas development activities. Rather, 
     fully 63 percent of total petroleum inputs into the U.S. 
     marine environment comes from natural seeps on the ocean 
     floor. This strongly suggests that the risk associated with 
     deepwater energy development is very low.


                            Bill Provisions

       [Note: This Notice includes a map that details the area 
     that would be made available for energy development in the 
     deep waters of the Gulf of Mexico under this bill.]
       Section 1--Title: Gulf of Mexico Energy Security Act of 
     2006.
       Section 2--Definitions.
       Section 3--Offshore Oil and Gas Leasing in 181 Area and 181 
     South Area of Gulf of Mexico.
       This section requires the Secretary of the Interior to 
     offer the 181 Area (that is, the tan area within the blue 
     border on the map above) for oil and gas leasing not later 
     than 1 year after the date of enactment of this Act. It also 
     directs the Secretary to offer the 181 South Area (tan area 
     outside blue border), previously under moratorium, for 
     leasing as soon as practicable.
       Section 4--Moratorium on Oil and Gas Leasing in Certain 
     Areas of Gulf of Mexico.
       This section expands the moratorium on oil and gas leasing 
     to include areas previously available for leasing in the Sale 
     181 Call Area (the full area within the blue border, 
     sometimes referred to as ``Original Lease Sale 181'') and 
     extends moratorium until June 30, 2022. The moratoria apply 
     to: any area east of the Military Mission Line in the Gulf of 
     Mexico; any area in the Eastern Planning Area (east of the 
     green line) that is within 125 miles of the coastline of the 
     State of Florida; or any area in the Central Planning Area 
     (west of the green line) that is within 100 miles of the 
     coastline of the State of Florida (the yellow area, both 
     inside and outside the 181 area, west of the green line).
       This section provides for oil and gas development east of 
     the Military Mission Line after June 30, 2022, though the 
     Secretary of Defense retains authority to veto leasing in 
     these areas.
       It also provides that owners of existing oil and gas leases 
     within the areas newly under moratorium may exchange those 
     leases for a bonus or royalty credit that may only be used in 
     the Gulf of Mexico; that the value of the lease to be 
     exchanged will be equal to the amount of the bonus bid and 
     any rent paid for the lease; and that within a year of 
     enactment, the Secretary shall promulgate regulations to 
     govern the lease exchange process.
       Section 5--Disposition of Qualified Outer Continental Shelf 
     Revenues From 181 Area, 181 South Area, and 2002-2007 
     Planning Areas of Gulf of Mexico.
       This section provides that 50 percent of revenues derived 
     from lease sale revenues in the OCS be deposited into the 
     general fund of the Treasury and 50 percent shall be 
     deposited into a special account in the Treasury, 75 percent 
     of which (i.e., 37.5 percent of the total) will be disbursed 
     to Gulf producing States and 25 percent of which (i.e., 12.5 
     percent of the total) will be disbursed to the stateside Land 
     and Water Conservation fund.
       The 37.5 percent of total OCS revenues reserved for Gulf 
     producing States shall be distributed according to a formula 
     established by the Secretary of the Interior. The formula 
     will distribute the funds in amounts that are inversely 
     proportional to the distance between the point on the 
     coastline of each Gulf producing State that is closest to the 
     geographic center of the applicable leased tract and the 
     geographic center of the leased tract. In other words, the 
     further away a Gulf producing State is from the leased tract, 
     the less money it gets. Each Gulf producing State shall 
     receive a minimum allocation of 10 percent in each fiscal 
     year.
       Beginning in 2017, the same allocation formula will apply 
     to the 181 Area and the 181 South Area. For leases entered 
     into for the 2002-2007 planning area, starting in 2017 
     revenues shall be allocated to Gulf producing States in 
     amounts that are inversely proportional to the distance 
     between the points on the coastline of Gulf producing States 
     that are closest to the geographic center of each historical 
     lease site and the geographic center of the historical lease 
     site, as determined by the Secretary. Again, the minimum 
     allocation for Gulf producing States in each fiscal year is 
     10 percent. Historical lease sites include all leases entered 
     into by the Secretary in the 2002-2007 planning area from 
     October 1, 1982 to December 31, 2015. The ending date will be 
     extended every five years beginning on January 1, 2022. For 
     each of the fiscal years 2016 through 2055, the amount to be 
     distributed from Continental Shelf revenues shall not exceed 
     $500 million.
       Twenty percent of the share disbursed to each Gulf 
     producing State shall be paid by the Secretary to the coastal 
     political subdivisions of the Gulf producing States to be 
     allocated according to an existing formula.
       Gulf producing States shall use the amount received under 
     this section only for one or more of the following purposes: 
     coastal protection; mitigation and damage to fish, wildlife, 
     or natural resources; implementation of a federally approved 
     marine, coastal, or comprehensive conservation management 
     plan; mitigation of OCS activities through funding of onshore 
     infrastructure projects; and planning assistance and the 
     administrative costs of this section (no more than 3 
     percent).


                                  Cost

       The Congressional Budget Office estimates that S. 3711 
     would reduce direct spending by $926 billion through 2016.


                        Administration Position

       A Statement of Administration Policy (SAP) on the bill was 
     not available at press time.

  Mr. KYL. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Mr. President, let me ask that my time be taken from the 
time allotted to Senator Bingaman.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Indian Health Care

  Mr. DORGAN. Mr. President, I will speak to an issue I spoke about 
nearly

[[Page 15912]]

a month ago in the Senate. Because nothing has happened substantially 
since then, I wanted to raise the issue. We are coming to the end of 
the legislative session. We will be here the rest of this week and next 
week. The time for consideration is going to be devoted to legislation 
the majority leader has already described. Then we are off in August 
for an August break, back in September, off in October for the 
election.
  The issue I want to talk about is the Indian Health Care Improvement 
Act. The reason I want to do that is I want to describe something that 
is happening in this country that very few people think much about, 
perhaps some don't care much about, but I know that there are some in 
this Senate who do, and I believe they would agree with me that we need 
to move forward and pass the Indian Health Care Improvement Act.
  Let me describe why this is urgent. Some while ago I came to the 
Senate and told my colleagues about a young woman--I did that with the 
consent of the young woman's relatives--a young woman named Avis 
Littlewind. Avis was, I believe, 14 years old. Avis took her own life. 
She laid in a bed for 90 days. She was supposed to have been in school. 
Instead, she lay in a fetal position in bed. At the end of that time 
she took her own life.
  No warning signs went up to anyone, nobody from the school, nobody 
from the mental health area, the tribe, or the family. Somehow she just 
escaped attention. She, like her sister, 2 years before her who had 
also taken her life, decided that life was hopeless, that she was 
helpless, and she ended her life.
  I went to that Indian reservation because there are clusters of 
teenage suicides on some of these reservations. We had a cluster on the 
Standing Rock Indian Reservation shortly after that period.
  I talked to the folks on this reservation, the school officials, the 
family members, the classmates, the tribal council. I discovered that 
had this young woman been referred to treatment, there was very little 
treatment available, very little mental health capability available to 
this young girl, and that is the case on most reservations.
  Because I have known about the sad situation with respect to health 
care for American Indians for some long while, I was not particularly 
surprised at what is happening with respect to mental health treatment 
on reservations.
  We have a trust responsibility for American Indians. We have a trust 
responsibility for their health care. We fail miserably. We have 
tried--my colleague, Senator McCain, myself, and other members of the 
Committee on Indian Affairs--to put together a piece of legislation to 
extend the Indian Health Care Improvement Act and try to make some 
improvements in delivery of health care to American Indians--yes, for 
children, but elderly folks and others who are suffering. Yet that 
piece of legislation languishes. Senator McCain and I just talked about 
it yesterday, and the committee wants to get that legislation through, 
get it passed, complete it.
  Let me describe the circumstances in terms of numbers. Then I will 
talk about some of the Indian folks who have had some difficulty. We 
have a responsibility under Medicare. Here is what we provide: The per-
person expenditure on Medicare is $5,900 a year. We also have a 
responsibility, by the way, for health care for Federal prisoners, 
those whom we arrest and convict and send to Federal prison, putting 
them away from society. We provide a cell, a bed, and we are required 
to provide for their health care. With respect to their health care, we 
spend $3,800 a year for Federal prisoners' health care.
  We have a responsibility, a trust responsibility, for the health care 
of American Indians, as well. That responsibility is met in this 
manner: Indian Health Care Services medical care, $1,900. We spend 
exactly one-half of what we spend for Federal prisoners on health care 
for American Indians. The per capita expenditures are exactly one-half.
  I have asked the Indian Health System, the folks in charge, how much 
health care is delivered versus what is needed. The answer is about 60 
percent. Forty percent is not available. So the question is: Who is 
sick, who is hurting, who is injured, who does not get treatment on 
these Indian reservations?
  I mentioned, when I spoke about this before, that one of the chairmen 
of the Indian tribes in my State said that you cannot get sick after 
June. The answer is: Don't get sick after June. If you get sick after 
June, our contract health money is gone, and you are not going to get 
any help because then the criteria is the only help you get is life or 
limb. If you lose a limb or lose your life, you get help; otherwise, 
hobble around in pain. Whatever that chronic condition is, sorry, tough 
luck, out of luck, out of money. Don't get sick after June.
  What an unbelievable message. This is not a Third World country. This 
is a big country, and we do a lot of things. But some things we don't 
do nearly well enough; and that is, keep our promise and keep our trust 
responsibilities with respect to health care for Native Americans.
  A man from the Turtle Mountain Band of Chippewa Indians in my State 
said: Well, the doctor told me that I needed an MRI urgently on my 
knee. But he said: The Indian Health System facility on Turtle Mountain 
has no money, so you don't get an MRI. You have a bad knee, you have 
trouble, you have pain, but we are sorry, there is no money to find out 
what the problem is. No MRI.
  A member from the Mandan, Hidatsa, and Arikara Tribes had a daughter 
who was born prematurely and suffered some complications as a result. 
That child died when she was 2 years old because they did not have any 
funds, the Indian Health Service had no funds to send that young child 
to a high-risk hospital, one that could probably begin to treat those 
conditions.
  The chairman of one of the tribes told me one day about being out 
riding a horse with another tribal member when the other member was 
injured. He was bleeding severely from his injury. That reservation 
does not have a 911 emergency service. There was no ambulance to take 
the man to the hospital, not to mention that the health facility on the 
reservation is not open after hours anyway. And it is not open on 
weekends.
  On that reservation, there are isolated communities, some 30 minutes, 
almost an hour from an ambulance or a health care facility. So the 
chairman of this tribe then tried to play doctor and made a tourniquet 
and tried to find a way to get this person to a health care facility 
before the person bled to death.
  It is pretty unbelievable what is happening with respect to Indian 
health care. We have a very serious diabetes issue. The prevalence of 
diabetes on Indian reservations, in many cases, is not double or triple 
or quadruple; it is even much higher than that. The Indian diabetes 
mortality rate is quadruple the diabetes mortality rate among other 
Americans.
  On the Spirit Lake Indian Reservation, a couple of the elders ran out 
of insulin. It was not a very good beginning to that story. You need 
insulin if you have diabetes. But it got much worse. They went to the 
Indian Health Service clinic that serves that reservation, and there 
was no insulin available--none. They said: We will not get another 
shipment for 24 hours.
  That sort of thing goes on because there is not sufficient resources 
devoted to meet our responsibility to the Indian health needs.
  In addition to the kinds of things I have described--these things are 
rampant--in addition to that, we have this methamphetamine scourge that 
has a devastating impact all across this country but especially on 
Indian reservations. The statistics that describe the problems and the 
chronic difficulties that the Indian Health Service confronts dealing 
with methamphetamine is just, as I said, devastating.
  At a recent hearing we had in the Indian Affairs Committee, a young 
woman who is a tribal judge from the Turtle Mountain Chippewa 
Reservation

[[Page 15913]]

testified that methamphetamine is related to 90 percent of the cases of 
tribal individuals who enter treatment on the reservation. And there 
are very few places to get treatment, as a matter of fact.
  The plain fact is, this is an area of responsibility for this 
Congress, and we are not meeting it. We passed a piece of legislation 
through the Indian Affairs Committee a long while ago, describing the 
need and describing the requirement for reauthorizing the Indian Health 
Care Improvement Act, and that bill languishes. We have lots of things 
to bring to the floor of the Senate that should not be here and do not 
need to be here. This Congress often treats the light far too seriously 
and the serious far too lightly.
  This is a serious matter, and we ought to be dealing with it. We 
ought to deal with it now. We have responsibilities. Go to Indian 
reservations and take a look at these children and ask yourself whether 
the health care of these children ought to be a function of whether 
this Congress decides to appropriate enough money. It ought not be. A 
sick child is a sick child anywhere in this country and ought to feel, 
and their parents ought to feel, they have access to decent health care 
when that child is sick.
  So on behalf of myself and Senator McCain and other members of the 
Indian Affairs Committee, I say that I believe this is a priority. This 
is not a Third World country. I do not want anybody to say to me: In 
our area the refrain is ``Don't get sick after June 1 because there is 
no money.'' Let's not have that happen in this country anymore. Let's 
provide the funding that we require for the Indian Health Service to do 
what they should do to provide the kind of health care we know is 
necessary.
  Once again, we have responsibility for prisoners whom we incarcerate 
in Federal prisons, and we have trust responsibility for the health 
care of American Indians; and we are spending half as much for the 
health care for American Indians per capita as we spend on Federal 
prisoners. That, in my judgment, is a shame. I am not suggesting we 
spend too much on Federal prisoners. They are our charge. They are 
incarcerated. We are responsible for their health care, but so too are 
we responsible, under a trust relationship, to help take care of the 
health care needs of that population.
  Mr. President, I hope that with the cooperation of the majority 
leader and others in this Chamber, that Senator McCain and I and others 
can move this piece of legislation through the Senate and through the 
House and get it to the President for signature--the sooner the better.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Alaska.
  Ms. MURKOWSKI. Thank you, Mr. President.
  Mr. President, I rise to speak to the legislation before us, the OCS 
lease sale 181. I know there have been colleagues before me this 
afternoon who have spoken to the need for additional oil and gas 
reserves and resources in this country. The fact is, this Nation badly 
needs to accelerate its efforts to obtain more natural gas and more oil 
and doing it domestically.
  We have heard the comments that we are addicted to oil, that we need 
to be looking to renewables, and I do not dispute or doubt that for one 
moment. We absolutely do. We need to be conserving more. We need to be 
focused more on renewables and alternatives. That is the next 
generation. But our reality is we are here and now with a reliance on 
fossilized fuels. We need to transition out of that to that next 
generation of fuels. But until we do so, we are in an extremely 
vulnerable spot, particularly with our oil and our nearly 60 percent 
dependency on foreign sources and with our natural gas and recognizing 
the trends in terms of our supply and the demand picture for natural 
gas.
  In the past 5 years, the price of natural gas in this country has 
more than tripled, rising sevenfold after last summer's hurricanes. We 
all know the prices at the gasoline pump. There is not a day goes by 
where there is not some exchange about what somebody was paying 
somewhere for a gallon of gas at one location or another. And I can 
tell you, prices in my State--when you get out into the rural 
communities and you look at paying $4.50 for a gallon of gasoline, I 
can tell you, the hurt is real. The tripling of natural gas prices has 
had, of course, a very severe impact. And it is not just on those who 
heat their homes with natural gas. Manufacturing jobs--we have heard 
this today--manufacturing jobs have fallen by 3.1 million jobs, 18 
percent in the past 6 years.
  We talk to those in the petrochemical and chemical industry. Jobs in 
that industry are being forced to move overseas. We have had over 20 
fertilizer plants in this country close. And as has been mentioned 
already on this floor, America's annual natural gas bill has risen to 
more than $200 billion a year. This is up from $50 billion, and that 
was just 6 years ago.
  While natural gas prices today, following a warm winter, are 
temporarily below $6 per 1,000 cubic feet, we know the hurricane season 
is coming upon us in the gulf, we have global political disruptions, 
and we could have continued hot summer weather, and that we can 
anticipate a cold winter, and that any one of these--and certainly a 
combination of them--could promptly send our natural gas prices 
skyrocketing again.
  I cannot speak to the issue of natural gas without mentioning the 
opportunity we have in Alaska for incredible quantities of natural gas 
coming down from Alaska's North Slope. And while we await the 
construction of a pipeline that can deliver this needed commodity from 
the North Slope into the lower 48, we have to recognize one of the best 
ways we can bring down prices that will increase the domestic supplies 
of gas is to produce more gas from the gulf coast, where the existing 
infrastructure is in place, and to figure out a way to get that gas to 
market quickly.
  Mr. President, we cannot fool ourselves and say we can just snap our 
fingers and the price of natural gas is going to go down, we are going 
to have a ready and available supply just because we pass legislation. 
We recognize it is a period of time in coming. But what can be sent is 
the signal to the market that that supply of natural gas is on its way 
in an expedited manner.
  The best way--the best way--to produce more gas quickly, to get it on 
more quickly, is to open parts of the eastern Gulf of Mexico. This 
proposal before us is to finally allow OCS development in part of 
formally proposed lease sale 181 off the Florida, Alabama, and 
Mississippi coasts and to open acreage south of that sale--some 8.3 
million acres in all that have been previously closed in moratoria. In 
return for speeding such leasing, this bill prevents development within 
125 miles of the Florida Peninsula, swaps out existing leases within 
that buffer, and prevents leasing east of the Military Mission Line to 
protect the military training facilities, at least until the year 2022.
  This proposal, this legislation that we have in front of us, is a 
reasonable compromise. It was one that was attempted but not completed 
during the debate last year over the Energy Policy Act of 2005. So what 
we have in front of us today is an outgrowth of that bill.
  In the Energy Policy Act, we allocated billions of dollars to foster 
energy conservation and greater energy efficiency. We moved toward and 
we pushed renewable energy development, such as wind, solar, and 
biomass. We funded new technology to further coal while working to help 
sequester the carbon. There was a push made on the front of a new 
generation of nuclear power. We funded hydrogen fuel-cell vehicle 
development and new transportation and building technology. There were 
good things contained within that Energy bill. But what was not 
contained in that legislation--or since that legislation was passed--
was an increase in domestic production of fossil fuel.
  This legislation will balance last year's Energy bill by actually 
letting us get up to 5.8 trillion cubic feet of natural gas flowing to 
the market and, again, flowing to the market in a more

[[Page 15914]]

expedited manner than might otherwise be seen.
  There have been those who have stood on the floor today speaking 
about the various protections contained in this legislation. There is a 
protection of Florida's tourism and military bases. It doesn't 
jeopardize the fisheries. When we look to what happened last year when 
these massive hurricanes came through the gulf, while there were a few 
minor spills following those hurricanes, there were no well failures or 
major pipeline breaks from the record intensity of the hurricanes. So 
we look to the development that is out there in the OCS area and can 
really point to environmental integrity.
  The proposal before us gives the States of Alabama, Mississippi, 
Louisiana, and Texas reasonable revenues to offset the impacts of OCS 
development off of their coasts, particularly, again, in view of what 
they suffered after Hurricanes Rita and Katrina. It allows the Federal 
Government to keep 50 percent of the revenues in the Federal Treasury. 
This is the exact same percentage that it gets from oil and gas 
development onshore, whether the onshore development is in New Mexico 
or California or Oklahoma. It gives the coastal States 37.5 percent to 
offset their cost as being the host for that offshore development. It 
also shares 12.5 percent of such revenues with all the States for park 
and habitat improvements through contributions to the stateside Land 
and Water Conservation Fund. This is an effort to help alleviate the 
truly chronic underfunding of the Land and Water Conservation Fund 
without affecting land ownership and private property rights. This 
money would generally go toward building ballfields, neighborhood 
parks, recreational opportunities, not buy up the private land or to 
harm private property rights.
  As I have reviewed this legislation and have worked with the 
sponsors, I do need to certainly give credit to the chairman of the 
Energy Committee, Mr. Domenici, for his efforts in bringing this matter 
to where we are today, and also to my colleague from Florida, Senator 
Martinez, who has been working with the chairman to craft legislation 
that he believes will work for the people of Florida, and certainly to 
my colleague and friend from Louisiana, who has been working for years 
to achieve a level of revenue sharing for her State, a battle we know 
has been waged for many years. That is what I would like to speak to 
right now.
  My only major disappointment with this measure is that it doesn't 
provide revenue sharing to all the States that choose to allow OCS 
development off of their coasts. The question has to be asked, why not? 
Why would you not include all of those States which have made the 
choice to allow for that development off of their coasts? If they are 
going to allow for it, why would they not be eligible or able to take 
advantage of Federal revenue sharing as well? I don't believe there is 
a rational explanation for not including all the States.
  We have heard some of the arguments--that the Federal Government 
should share revenues with the States only in those waters from 3 to 12 
miles offshore where Federal production might drain onshore or State 
hydrocarbon reservoirs. Again, the question has to be asked: Why is 
that? For the past three decades, the Federal Government has shared 
revenues from onshore development with all States. The only possible 
excuse for not extending that policy to the offshore would be if the 
coastal States bore no impacts from offshore development. But that 
would imply that somehow or other the development offshore kind of 
sprouts magically from nowhere without any onshore activity. We know 
that is not the case.
  I had the opportunity to go to Port Fourchon, LA, which is the 
jumping-off place for the offshore activity. It is a beehive of 
activity through there--airports and helicopter pads, all the services 
that have to come in, whether it is the food or the people moving back 
and forth, to support that offshore activity. We know that offshore 
activity just doesn't magically happen without some onshore impact. I 
know my friend from Louisiana has spoken quite eloquently to the 
impacts of OCS development in their waters. I will let her and others 
from the Gulf States speak to that impact.
  I wish to talk about the impact of OCS development on my State of 
Alaska. In Alaska, we have been seeking some sort of Federal revenue 
sharing to offset the cost of OCS development along our 34,000 miles of 
shoreline for nearly two decades. For budget reasons, we lost out in 
the 1991-1992 Energy bill. We lost it again in 1995 with the 
Conservation and Recovery Act, CARA. It was proposed and debated. It 
ran into other political hurdles. And we lost again last year in the 
Energy bill. That was partially because you had certain landlocked 
States that didn't want to see current Federal revenues go to just the 
coastal States. But you have to stop and think, if there is not some 
fair form of revenue sharing to offset the impact costs, why should the 
coastal States allow OCS production, particularly given the recent ease 
of obtaining the moratorium to prevent them? And without such 
production, where are we going to be as a country? Americans will be 
paying even more when they fill up their cars, their trucks, cook their 
food, heat their homes. That is reality. That is the consequence.
  In Alaska, we currently have OCS production from just one field. This 
is the Northstar field in the Beaufort Sea. It produced 22.4 million 
barrels of oil last year. Since it was within 12 miles of the shore, 
Alaska received $10.8 million in revenue sharing. If that field had 
been more than 12 miles from the shore, Alaska would have received 
nothing. There is actually a little bit of an exception to that because 
last year in the Energy Policy Act, there was a very small amount of 
aid that was directed to the State for 4 years to assist with the 
impact onshore of the offshore development.
  Previously, Senator Bingaman made a point. I believe he was correct 
when he said that Alaska contains nearly a dozen OCS bases off of our 
coast, all but one of them--this is the North Aleutian Shelf, down near 
Alaska's Bristol Bay--being open to leasing. The North Aleutian Shelf 
is closed by Presidential moratorium. But when we look at Alaska's 
Outer Continental Shelf, we are looking at the potential of 26.6 
billion barrels of oil and 132 trillion cubic feet of natural gas. This 
is according to the mean estimates. That production would more than 
double the Nation's known reserves of oil and nearly equal the amount 
of gas likely along the coasts of the rest of the Nation. But to 
accommodate OCS development and any proposed future OCS development in 
the Beaufort and Chukchi Seas--we have other potential areas, in Cook 
Inlet, the State governmental units--the State of Alaska, the North 
Slope Borough, local governments have to spend millions of dollars on 
hosts of services to protect, to regulate, to inspect, and to support 
the OCS development.
  For instance, the State of Alaska's Department of Environmental 
Conservation spends more than half a million dollars a year to inspect 
and monitor oil and gas operations. This is just in northern Alaska. 
The State's Department of Transportation and Public Facilities spends 
nearly $10 million each year to keep the Dalton Highway going up to the 
North Slope open so that we can move oil and gas equipment and our 
supplies north. This also helps to maintain the Deadhorse Airport.
  The North Slope Borough spends nearly $1 million for search-and-
rescue capabilities. This is not counting the cost to the Alaska State 
troopers if they have to mobilize to assist oil workers who might 
perhaps get in trouble. The State of Alaska spends money on coastal 
zone planning to understand the impacts of OCS development. The State 
also spends millions of dollars on new infrastructure to handle the 
arrival and the movement of employees and materials that are needed to 
support the oil industry offshore.
  Last week in Fairbanks, the State broke ground on a $90 million 
expansion of the Fairbanks International Airport terminal. This 
expansion is

[[Page 15915]]

partially needed to accommodate the oil workers who may be jumping off 
for OCS work. Last year down in Anchorage, the State finished work on a 
440,000-square-foot terminal expansion at the airport there, costing 
well over $100 million. So our airports are clearly impacted by the 
effects on the industry.
  As things are happening, we see the impact within our communities. 
The local governments, smaller communities from Barrow to Kotzebue, 
Kenai to Dillingham, and Kodiak to Sitka, are all spending money to 
prepare for the possible development of the State's coast. The point is 
to recognize that there are very real costs to offshore development 
that are borne by the States that serve as service and support bases 
for the development.
  It is true that States sometimes recoup part of the costs through 
income taxes on workers or through property taxes on businesses that 
will support the facilities onshore. They may gain a small stipend from 
Federal coastal zone planning funds. But when you look at how much is 
gained, it is fair to say that the recovery has seldom covered their 
costs.
  So the question would be to the State: Why would you even welcome OCS 
development off of your coast? This is where you need to take the 
bigger picture. Our energy security, reliability, the whole issue 
surrounding the vulnerability we have as a nation because of our 
reliance on others for our energy sources, this is why it is essential 
that we as a nation figure out a way to produce more oil and gas 
domestically. Sharing oil and gas revenues with States in a fair manner 
will ensure that energy can get to market. It is that fact which is 
probably the difficulty with this legislation in terms of passage of a 
fair revenue-sharing system. That may be because we have some around 
here who would want to discourage States from allowing any OCS 
development, perhaps out of environmental concerns, perhaps displaced 
environmental concerns. But denying coastal States needed revenues is 
one way to discourage greater offshore oil and gas production.
  Last week, Senator Stevens and I sought to ensure that any revenue 
sharing proposed in this bill would apply also to Alaska or to any 
State that allows OCS development off of its shores. We were told at 
that time that if that provision stays in, it would be a death sentence 
for this bill.
  I have been asked many times in the past few days have I changed my 
position on this legislation, have I changed my position in support of 
opening lease sale 181 to exploration and development. I have not. I 
have not changed that. I remain committed to a sound policy, which I 
believe this is, that allows for the opening of lease sale 181.
  I can appreciate why it was tailored so that revenue from the gulf 
would only be shared among the Gulf States. I can appreciate where they 
are coming from. I can appreciate the narrow scope of the Senate 
version and the delicate negotiation that went into it. But from a 
matter of equity, from a matter of fairness, for those States that are 
willing to open their coasts, their States, to allow for the 
development offshore, it is only right that allowing all the States who 
have OCS development off their shores to share in some form of revenue.
  By structuring the revenue sharing that we have before us in this 
legislation in this manner, Alaska is the only currently producing OCS 
State that allows new development that would not receive any aid. It 
was suggested last week that, well, Alaska is asking for a special 
deal. That is absolutely not the case. We are asking to be treated the 
same as any other currently producing State when it comes to 
revenuesharing. So to those of you who suggested this was something 
special for Alaska, it was absolutely not. It was equitable for all 
those States that are currently producing. So by excluding Alaska, we 
are the only State that is disenfranchised when it comes to the Federal 
revenue sharing right now.
  I have had an opportunity to go down and observe for myself--so I 
have seen with my own eyes--what is happening in Louisiana, in the 
gulf, with the erosion. As I was presiding earlier, I was reminded 
again by the minority leader that Louisiana loses three football fields 
of land a day. But we also, in the State of Alaska, face serious 
erosion challenges. We have some 80 villages that are facing coastal 
erosion problems. I use the word ``problems'' lightly, because in some 
of the communities it is an absolute crisis; the villages are dropping 
into the ocean. We may not be hit by the hurricane forces we see in the 
gulf that are given names and much publicity through the media, but 
many parts of coastal Alaska are hit by storms that meet the definition 
of hurricanes. There are winds exceeding 75 miles an hour, waves and 
storm surges that can equal those of the hurricanes. The big difference 
is they are not named as hurricanes. We don't get that attention or 
that focus. Money from OCS development could help pay for mitigation 
efforts and perhaps, in some cases, pay for village relocation costs. 
So Alaska is not unlike the other Gulf States--Louisiana, Mississippi, 
Alabama, and Texas--for coastal mitigation and habitat protection.
  I am sure we will have an opportunity on this floor to discuss a lot 
more about the coastal erosion problems in Alaska in the future. I do 
feel strongly that we need to pass a bill to speed oil and natural gas 
leasing in the Gulf of Mexico. It will provide natural gas for our 
Nation, while helping the Gulf Coast States gain the revenues they need 
not just to recover from the hurricanes but to deal with the coastal 
erosion and wetlands habitat loss issues they face.
  I believe the formula for such aid should cover all States that allow 
OCS development off their coasts, while providing other aid to all 
States that need it.
  I tell my colleagues that, regardless of the outcome of the bill--and 
I intend to support the measure--I will continue to seek to provide aid 
to all of the coastal States that allow OCS development, especially 
since all other States gain an equal sharing of revenues from energy 
development on-shore. It truly is the only equitable thing to do.
  With that, I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. TALENT. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. TALENT. Mr. President, I ask unanimous consent that I be allowed 
to speak on the measure without counting against the time on this side.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. TALENT. Mr. President, I rise in support of S. 3711, the Gulf of 
Mexico Energy Security Act, which can certainly be described simply 
that it will open a portion of the gulf to exploration for oil and 
natural gas.
  I don't want to be understood as criticizing or begrudging anybody 
their opinions in opposition to the bill, but it seems to me that given 
what the country has gone through and is going through because of the 
high cost of energy, it should not be a difficult debate to allow the 
United States to explore for oil that is within or close to its 
borders, doing that in a way that is sensitive to the environment and 
to other considerations in order to produce more oil and natural gas 
that will lower costs, ease the pressure on our consumers, and allow 
our economy to grow and continue to produce jobs.
  How difficult is it in a time such as this to decide that we are in 
favor of getting more oil and natural gas? I speak as a person who 
offered the renewable fuel standard in committee. I am cochairman of 
the renewable fuels caucus. I am a huge believer that ethanol, 
biodiesel, and renewable fuel attained through those feedstocks and 
other feedstocks is the future of this country in terms of energy. It 
is the way we are going to get energy independence and reduce 
dependence on foreign oil in the long term.
  But our people need relief now, or as soon as we can get it to them. 
Natural gas prices set record highs last winter.

[[Page 15916]]

They exceeded $15 per thousand cubic feet. We are paying much higher 
than our competitors are paying and, as a result of that, according to 
the Industrial Energy Consumers of America, since 2001, natural gas 
prices have significantly contributed to the loss of 3 million 
manufacturing jobs and the shifting of future investment overseas.
  I know this is true. There are people who have come to my office and 
told me they don't want to send jobs overseas, but they cannot compete 
because of the high cost of natural gas. The Government has encouraged 
industry to use natural gas and utilities to use natural gas in 
producing energy because natural gas is a clean fuel. We have all heard 
the commercials--and it is true--that natural gas is environmentally 
very friendly. It makes no sense to pass laws and otherwise encourage 
producers to rely on natural gas and then not to explore for the 
natural gas we have available.
  It is hurting the American farmer. It hurts the farmers for a lot of 
reasons. Farmers have to absorb the high energy costs just as any other 
consumer, but, specifically, most of the price of nitrogen 
fertilizers--90 percent of the price of nitrogen fertilizers is due to 
the cost of natural gas, because natural gas is a feedstock in the 
production of virtually all commercial nitrogen fertilizers 
manufactured in the United States. It is not just used to power the 
facilities that produce fertilizers; it is actually part of the 
fertilizer itself. So in 2002, farmers were paying $250 per ton for 
anhydrous ammonia, and in 2005, $415 per ton, an increase of well over 
50 percent.
  Why is this happening? Why is the price of natural gas and oil going 
up? It is because supply relative to demand is going down. Demand is 
expected to grow--demand for natural gas--by over 30 percent. Yet, 
since 1998, even though we are drilling more for natural gas, 
production has declined by 1.5 percent. That shows we are getting all 
we can out of the available fields. Yet that is not enough. We must 
have access to domestic resources and specifically to the easily 
recovered oil and gas in the Gulf of Mexico.
  Energy is vital to any economy. We all know that. We have learned in 
the last year or two that high energy prices are certainly not a good 
thing. That is something most of us knew as a matter of common sense, 
but we have now learned that as a matter of experience.
  We can make a difference with this piece of legislation and we can 
make a difference soon. Resource estimates for the area that would be 
opened indicate that there are 1.26 billion barrels of oil there and 
5.8 trillion cubic feet of natural gas. The natural gas supply made 
available by this compromise legislation would be enough to heat and 
cool nearly 6 million homes for 15 years. I don't know why they use 6 
million homes for 15 years as a measurement, but that surely seems a 
lot to me, and certainly it is a lot more natural gas than we now have 
available.
  I have listened to the arguments offered against the legislation. A 
lot of them have centered around where the revenue from the natural gas 
exploration is going to go. A lot of it is going to go to the coastal 
States under this compromise. I certainly would be willing to consider 
something that directed that revenue somewhere else. But the reality is 
this is what we have to do in order to get the oil and natural gas in 
the first place. If we cannot pass this legislation, there is not going 
to be any exploration. If there is no exploration, there are no 
revenues. So I am certainly willing to support the legislation on that 
basis. It will help ease the energy situation for the employees of my 
manufacturers in Missouri. It will help ease the price of fertilizer 
for my farmers. It will help ease the energy crisis in this country. 
Clearly, it seems worth doing to me.
  It is certainly not all we need to do. We should not structure our 
energy policy on the assumption that we can continue to rely on oil and 
natural gas indefinitely, because we cannot. That is why the Energy 
bill last year encouraged a production of so many other different kinds 
of energy--nuclear, renewables, coal, wind. It is all important to the 
future, but this is important to the future as well. So I am pleased to 
support the legislation.
  I congratulate the Senators who have worked so hard on a bipartisan 
basis. I know it has not been easy. Certainly, it has been nowhere near 
as easy as it should have been given the common sense that I think 
underlies this piece of legislation. I am glad they put it together. I 
have wanted to do something such as this for some time. It makes no 
sense when our manufacturers are crying for energy, our farmers are 
crying for energy, our consumers need energy, to turn down the 
opportunity to explore for the energy we have right offshore and that 
we can get in a way that fully protects the environment and other 
concerns.
  Mr. President, I thank the Senate for its indulgence, and I yield the 
floor.
  The PRESIDING OFFICER. The Senator from Colorado.
  Mr. ALLARD. Mr. President, I ask unanimous consent to speak on behalf 
of S. 3711 and that the time not be counted against the Republican 
time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ALLARD. Mr. President, I rise in support of S. 3711, which is the 
Gulf of Mexico Energy Security Act. I am heartened by the fact that 
this is a bipartisan effort, agreed to by those Senators who represent 
our Gulf States. It is an important step in continuing to reduce our 
dependence on foreign oil, and we need to increase our supply of 
domestic oil and gas. Certainly, this is a step in the right direction.
  My approach to the energy needs of this country has always been that 
we need to have a broad-based approach. I was pleased with the Energy 
bill we passed in the last session of Congress which provided for a 
broad approach to meet our energy needs in this country.
  I think we understood as a body that in order to meet the short-term 
needs of this country's energy needs, we need to continue to rely on 
fossil fuels. We need to continue to expand exploration for oil and 
gas. We need to continue to rely on coal. But in addition, we also need 
to be looking at additional sources of energy, particularly the 
renewable energy area, which is wind, solar, geothermal, and biofuels, 
as well as looking at sources such as hydroelectric and nuclear power.
  As I look back on the effects of that bill we passed last session, I 
am already beginning to see positive effects from that legislation, and 
I am heartened by that. I can see those energy developments occurring 
in my own State, which involves new technologies, such as looking at 
oil shale as a source of a high-grade fuel that requires little 
refinement.
  Our current energy prices clearly still indicate that all is not well 
with supply, and the demand is still greater than supply. We need to 
also look at conservation. But right now with this bill, we are 
concerning ourselves with supply.
  While the price of natural gas is well below what it was this time 
last year, these prices are still well above what we were paying 
several years ago; and, as my colleague from Missouri mentioned, it is 
having an adverse impact throughout our economy, not the least of which 
it is having a serious adverse impact on our agricultural sector.
  I believe the fact that prices have decreased at all is directly due 
to the fact that we passed the Energy Policy Act last year. We have all 
seen the figures: 27 new ethanol plants have broken ground; 401 E-85 
fueling pumps have been installed. These are pumps that provide an 
ethanol-gasoline mixture. And the number of hybrid vehicles has 
increased. Between now and the year 2020, the 15 new efficiency 
standards included in the bill will save 50,000 megawatts of energy, 
and the amount of electricity generated from renewable sources has 
increased dramatically. But we need to do more to encourage domestic 
production of oil and gas.
  It is argued--and I think argued well--that we should be reducing our 
energy consumption and increasing the amounts of energy we get from 
renewable and alternative sources. I agree. But the reality is that 
reducing consumption and increasing alternative resources does not 
happen overnight. I cannot ask my constituents to park

[[Page 15917]]

the car and turn off the lights until we get there.
  The estimates of the resources that will be made available under this 
proposal are 1.26 billion barrels of oil and 5.8 trillion cubic feet of 
natural gas. These are not insignificant amounts. These resources will 
provide a strong source of domestic energy for our country.
  I believe that the compromise struck by this bill is a good one. The 
fact that almost every Member who represents a coastal State that is 
affected cosponsored this bill strikes me as significant. I strongly 
believe in local control, and as part of that, I often defer to Members 
who represent a State if a bill will directly affect that State. I use 
the example of wilderness designation. If a bill designating wilderness 
in a certain State is sponsored and supported by both Members of that 
State, I see no reason not to support it. The same is true here. If the 
Members from the coastal States are supportive of this bill, I support 
them.
  I was hopeful that we would have the chance to address an amendment I 
wanted to offer on funding for the Payment in Lieu of Taxes Program. 
This particular program is extremely important to States, such as 
Colorado, that have a high percentage of federally owned land. Many 
people are unaware of the fact that 35 percent of Colorado is owned by 
the Federal Government. Federal ownership of these lands can be 
beneficial, but there is an unseen cost to local communities, to local 
governments. The Federal Government does not pay property taxes, and 
this translates into reduced revenue for local governments while there 
are some costs that they are burdened with in trying to meet the needs 
of the Federal agencies that are in that county or local community.
  For Colorado, it means $129 million each year in lost property tax 
revenue. This is funding that could be used for education, law 
enforcement efforts or road building. Unfortunately, PILT, or payment 
in lieu of taxes, is chronically underfunded, and the amendment I 
planned on offering would have helped to overcome this annual 
shortfall.
  Regardless of the fact that my amendment will not be considered, I am 
pleased that we are moving on this bill. I am hopeful that we can 
continue to put in place policies that will allow us to increase 
domestic production of all energy sources which will, in turn, reduce 
our reliance on foreign sources.
  Mr. President, I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. Will the Senator withhold his request?
  Mr. ALLARD. I withhold my request, and I yield the floor.
  The PRESIDING OFFICER. The Senator from Tennessee is recognized.
  Mr. ALEXANDER. Mr. President, is there a limit on the amount of time 
I may speak?
  The PRESIDING OFFICER. The Senator needs consent to speak, as the 
majority's time has expired.
  Mr. ALEXANDER. Mr. President, I ask unanimous consent to speak for up 
to 15 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ALEXANDER. Mr. President, 2 years ago, the Senator from South 
Dakota, Mr. Johnson, and I introduced a bill we called the Natural Gas 
Price Reduction Act. We did that to give focus to the energy debate. We 
were hearing a lot about the price of gasoline. Gasoline prices were 
high and remain high because of the huge demand around the world. We 
know that. We know that is going to continue for a while, most likely. 
We know that China is growing. We know that India is growing. We know 
that the United States and our huge economy uses 25 percent of all the 
oil in the world. And so the supply and the demand are going to require 
that the price of oil, therefore gasoline, is going to be high for a 
while.
  We wanted to shift the focus to natural gas, which we didn't hear 
about as much at that time, because natural gas prices in this country 
had gone from the lowest in the world to the highest in the world. This 
was a huge problem for our country.
  High gasoline prices are a big problem every day. Natural gas prices 
are a bigger problem every day. They are a bigger problem for farmers 
who have seen their fertilizer costs go up. They are a bigger problem 
for homeowners as they pay to heat and cool their homes, and they see 
their bills go up. They are a bigger problem for blue collar workers in 
this country, such as the 1 million blue collar and white collar men 
and women--Americans in good-paying jobs--who work in the chemical 
industry. These are the kinds of jobs about which we all make speeches. 
We don't want them to be outsourced. We don't want their jobs to go 
overseas.
  If a chemical plant uses natural gas as a raw material--meaning, for 
example, as Dow Chemical testified before our Energy Committee that 40 
percent of the cost of its product was natural gas--and if the price of 
natural gas is $14 or $15 a unit in the United States compared to $2 or 
$3 a unit in some other part of the world that has a good, reasonable 
economy, guess where that chemical plant is going to end up. It is 
going to be there, not here. Guess where those 1 million jobs are going 
to be. They are going to be there, not here.
  That is why of the 70 or 80 new chemical plants being built around 
the world, only one of them is in the United States. There are several 
reasons for that, but the main reason is the high cost of natural gas.
  So for the farmer, for the blue collar worker, for the homeowner, the 
high price of natural gas is a great big problem. We saw that 2 years 
ago, and so Senator Johnson and I offered our bill to try to lower the 
price of natural gas.
  Energy policy is like a big freight train. It is hard to get started, 
it takes a long time to get going, and then it is hard to stop.
  So the Energy Policy Act that the Congress adopted in a bipartisan 
way a year ago, which included a great many of the parts of our Natural 
Gas Price Reduction Act, is just beginning to have some effect. But 
today as we talk about this deep sea drilling in the Gulf of Mexico, it 
is important that we put it in the context of the whole picture because 
this is the whole picture: If we want to reduce the price of natural 
gas in the United States and lower the cost of home heating and cooling 
bills, and lower the cost of fertilizer for farmers, and if we want to 
keep those chemical jobs and other jobs in the United States, then 
there are several things we need to do.
  The first thing we need to do is conservation, and the Energy Policy 
Act of a year ago had an important section on conservation.
  The second thing we need to do is produce large amounts of 
electricity in some way other than using natural gas. Using natural gas 
to produce electricity is like burning the antiques in your backyard to 
make a fire. But most of the new electric powerplants have been using 
natural gas over the last 10 or 15 years.
  The Energy Policy Act had important new sections to encourage the use 
of nuclear power, which supplies 20 percent of our power while 
producing no mercury, no sulfur, no hydrogen, and no carbon. It is 70 
percent of our carbon-free energy. That affects global warming.
  So the first way to reduce the cost of natural gas is conservation. 
We provided for that.
  The second way was to encourage nuclear power, and there has begun to 
be a renaissance of nuclear power production in the United States.
  The third thing we did was to encourage the production of power from 
clean coal. Fifty percent of our electricity comes from coal. We have a 
lot of coal. We are the Saudi Arabia of coal--we all say that--but it 
is dirty. It does produce mercury, it does produce nitrogen, it does 
produce sulfur, and it does produce carbon. So we need clean coal, and 
eventually we need to capture the carbon, put it in the ground to store 
it somewhere, and we need large amounts of energy.
  We also had significant dollars in support of renewable energy, 
whether it was for fuels or for electricity. We also made it easier to 
import natural gas through LNG terminals from around the world, which 
we are going to have to do for a while. We also made it easier to 
refine. All of those things

[[Page 15918]]

had to do with natural gas. But one thing we didn't do was increase our 
supply of natural gas at home.
  But we have come a long way. Two years ago, you couldn't even talk. 
You couldn't have a polite conversation on the Senate floor about 
offshore drilling because it was an unmentionable word. People would 
run out of the room as if you said something bad. But, last year, when 
the Energy Policy Act came up, we had a majority of votes on this floor 
for an offshore drilling provision that would have permitted a State 
such as Virginia, for example, to drill for gas and oil--with the rigs 
so far off the coast you couldn't see them--and give a share of the 
revenues to Virginia, which it might use for education or to lower 
taxes or for coastal beach refurbishment, and put the rest in the 
Federal Treasury. That is a pretty good idea, but we couldn't get it 
passed because here it takes 60 votes to overcome objections from a 
minority of senators.
  We also had the perfectly obvious idea of enlarging the area of 
drilling in the area called Lease Sale 181 in the Gulf of Mexico, deep 
sea drilling for natural gas which we are talking about today, but we 
weren't able to do that a year ago. So what this piece of legislation 
does--at a time when high natural gas prices still are problems for the 
homeowner, the blue-collar worker, and the farmer in this country--is 
to give the most immediate relief we can in terms of supply. It doesn't 
take the place of conservation. It doesn't take the place of nuclear 
power. It doesn't take the place of coal or renewable energy or LNG or 
all of these other things we authorize--but it adds to that, and we 
ought to do it. Lease Sale 181 means that the four gulf producing 
States will have a chance to share in the revenues that come; that is 
coastal assistance in this area damaged by the hurricanes.
  Twelve and a half percent of the revenues will go to the Land and 
Water Conservation Fund, so every State will have that for city parks, 
soccer fields and other things. That is an appropriate use. The 
remaining half of the revenues will go to the Federal Treasury.
  So I am delighted that this bill has come to the floor. I was 
delighted with the large vote we had this morning--86 votes--to move 
ahead. I am very hopeful that with the cloture vote on Monday, we will 
have more than 60 votes.
  I believe this is important for the American people to know that 
sometimes senators stand up and say: Well, why are we debating this 
issue or that issue? I see the assistant Democratic leader on the 
Senate floor. Sometimes I hear the assistant Democratic leader saying 
things like: Why are we talking about this issue or that issue? Why 
aren't we talking about gasoline prices or natural gas prices? Mr. 
President, we are. This legislation is about natural gas prices, this 
is about blue-collar workers, this is about farmers, and this is about 
homeowners. This is the way we increase the supply and lower the price.
  It is that simple: produce energy here instead of bringing it in from 
the Middle East or some other part of the world.
  Senator Domenici deserves an enormous amount of credit for working on 
this bill, as do Senator Martinez, Senator Landrieu, Senator Vitter, 
and many others. The bill is a limited, sensible step in the right 
direction. I would like to see us go further and give Virginia the 
opportunity if it wishes to have offshore drilling, but that would 
disrupt the consensus we have here, and I don't want to disrupt that 
consensus.
  So it is very important that the American people know that as we 
continue the debate this week and then come back here Monday and vote, 
we will be voting on the surest way to increase the supply of natural 
gas in this country. That will make it more likely for the 10,000 
workers at Eastman Chemical in east Tennessee that their jobs will stay 
in east Tennessee instead of moving to Germany, and that the farmers' 
jobs will stay in west Tennessee instead of moving to Brazil, and that 
the homeowners will be able to turn on their heat in the winter and 
turn up their air-conditioner in the summer and still be able to afford 
it. That is exactly what this is about. A vote for this legislation is 
a vote for the blue-collar worker, for the farmer, and for the 
homeowner, and a vote against it is a vote against the blue-collar 
worker, against the farmer, and against the homeowner. That is pretty 
simple. That is pretty straightforward. We have several days to think 
about it.
  I am delighted to see that there are Democrats and Republicans for 
this. I hope the large number of votes we saw in favor of cloture this 
morning continues.
  We have a big economy, which means we have big energy needs. Yes, we 
want the conservation we put into law a year ago. We want this 
renaissance of nuclear power. We want clean coal with carbon 
recaptured. We want renewable power, we want LNG from overseas, and we 
want other things. We want more refining capacity. But supply is a part 
of the picture, and the legislation we are debating today is the most 
obvious example of increasing supply.
  I am pleased to be a cosponsor of this legislation. I am delighted 
with the way the leadership has presented it to the Senate. It will 
help the country. I hope the blue-collar workers, the farmers, and the 
homeowners are listening because this debate and this vote will be 
about them and their future and their pocketbooks.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Illinois is recognized.
  Mr. DURBIN. Mr. President, I thought my colleague from the great 
State of Tennessee, Senator Alexander, made an excellent statement. 
Although I might disagree with some part of it, I really believe he is 
speaking to this issue in good terms. I was heartened by the fact that 
the first thing he said about energy was conservation. I believe that 
is a critical starting place.
  I am going to give the Senator from Tennessee four numbers--not for 
the lottery, for the Powerball or anything, but four numbers to think 
about. The numbers are 3, 25, 4, and 3 again. Here is what they 
signify.
  We have within our command and control in the United States of 
America 3 percent of the energy reserves of the world--3 percent. 
Everything we could possibly turn to and explore and bring out of the 
Earth, whether offshore or in the continental United States, is 3 
percent.
  Twenty-five: We consume 25 percent of the world's energy. It is clear 
that we cannot drill our way into energy independence. It just does not 
work. The numbers do not come together.
  The next number is 4. Four represents the number of months of natural 
gas which we hope we can bring out of this offshore drilling for the 
United States--a 4-month supply of natural gas for our country.
  The final number, 3, represents a 3-month supply of the oil our 
country consumes.
  So as important as exploration is and finding new sources, you had 
the right starting point. You hit the nail on the head. We cannot drill 
our way out of energy dependence, looking at the 3 percent that we 
have, the 25 percent we consume, and we cannot rely on even offshore 
drilling to give us more than just a respite from the demands we are 
going to face in the future, the competition we face around the world.
  So my feeling--and I think the feeling of many on both sides of the 
aisle--is what we should look for is environmentally responsible 
exploration.
  I have made no secret of the fact that I think the notion of drilling 
in the Arctic National Wildlife Refuge is a terrible idea. It has been 
rejected by Congress year after year. It is an act of environmental 
desperation that we would go to a wilderness area--a wildlife refuge 
area, I should say to be more specific--and say that after a few years, 
we have to start drilling there because there is no other place for 
America to go in order to give us confidence we will have energy 
sources in the future. So I haven't hidden my feelings about that 
particular project, but I am open to the suggestion that this may work.
  I have not made a final commitment on the bill pending before us. I 
join

[[Page 15919]]

with my colleagues in moving it forward. Let's move this debate 
forward. Let's bring this issue to the floor.
  A couple of the things mentioned by the Senator from Tennessee are 
intriguing. Nuclear power--I am not sure nationally how much 
electricity is generated by nuclear power. It may be a third, it may be 
a little more.
  Mr. ALEXANDER. Mr. President, if the----
  Mr. DURBIN. I am happy to yield to the Senator from Tennessee.
  Mr. ALEXANDER. The answer is 20 percent of all our electricity in the 
United States and 70 percent of our carbon-free electricity is produced 
by nuclear power.
  Mr. DURBIN. Mr. President, I thank the Senator from Tennessee. In my 
home State of Illinois, the number is 50 percent. Fifty percent of our 
electricity is generated by nuclear power. So for those who say: Get 
rid of it tomorrow, they better be ready to sit in darkness for a while 
in my State of Illinois if that is their option.
  But I hope the Senator from Tennessee feels as I do, that the future 
of nuclear power is wedded to two issues we have to deal with 
forthrightly: what are we going to do with the nuclear waste that is 
likely to threaten us in some form or another for generations to come, 
for hundreds, if not thousands, of years; and secondly, how do we 
promote nuclear power without promoting the production of nuclear 
weapons?
  We are facing that issue everywhere--in North Korea, in Iran. As we 
look at the world, we worry that countries moving toward nuclear power 
are, in fact, also creating an option for the production of nuclear 
weapons, which would make the world perhaps more self-sufficient when 
it came to electricity but in a more dangerous state if it led to 
nuclear proliferation.
  Those are the two challenges with nuclear power as I see them.
  I believe--maybe I am not being realistic here, but I believe they 
can be addressed and they should be addressed. If we address them in a 
responsible fashion, the day may come--and I hope it does--when we can 
say that the spent nuclear fuel rods coming out of the nuclear 
powerplants are no longer a threat to the health and safety of America 
and that the production of nuclear power is not an invitation to 
produce nuclear weapons. Those are two things I think we have to face 
head-on.
  I am lured by the notion that this is carbon-free power--
electricity--having seen a production of a documentary by a gentleman 
from Tennessee by the name of Gore. Al Gore's documentary ``An 
Inconvenient Truth'' was an unsettling experience as he laid out in an 
hour and a half or so, I thought with real clarity and precision, the 
challenge of global warming and what will happen if we continue to add 
carbon dioxide to the atmosphere, increasing greenhouse gases and 
global warming, watching climate change, and all of the things that are 
likely to occur. It is a challenge to all of us. So I salute the 
Senator from Tennessee because there are many things he said with which 
I agree.
  I am going to look at this bill carefully. I am troubled; I think the 
allocation of money to the States is very generous. It is a departure 
from where we have been in the past for offshore drilling to this 
extent, this far away from the coast. But I am going to look at it 
carefully and honestly to see if it is the right approach before I make 
a final decision. But I thank him for his statement on the floor here 
this evening relative to energy, and there is probably more that brings 
us together than divides us on this important issue.
  (The remarks of Mr. Durbin pertaining to the introduction of S. 3744 
are located in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')
  Mr. DURBIN. I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BENNETT. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. DeMINT). Without objection, it is so 
ordered.

                          ____________________