Landrieu Again Urges Administration to Revise 6-Month Drilling Moratorium

June 16, 2010

Senator says energy bill will not pass the Senate without accelerating revenue sharing to begin immediately.

WASHINGTON — In comments on the Senate floor today, U.S. Senator Mary L. Landrieu, D-La., reacted to the President’s address to the nation last night, while outlining a series of steps the Obama Administration and Congress can take to help the Gulf Coast.

Sen. Landrieu renewed her call for the President to revise his plan that places a six-month moratorium on all new deepwater drilling activities, saying that the ban would result in the loss of thousands of good-paying jobs along the Gulf Coast. Sen. Landrieu supports a thorough review of offshore safety regulations, but believes that process can and should take far less time than six months.

“This work has to be done more quickly,” Sen. Landrieu said. “The Commission was announced last month, but it was just seated a few days ago. The work is just beginning. There doesn’t seem to be a sense of urgency. We need a greater sense of urgency to get this work done. I was pleased to hear the President say that he’s urged the Commission to get its work done before the six-month timeframe. That was a slight step in the right direction. But this work has to be done in a much shorter period than six months and let me take a minute to explain why. These rigs won’t stay in the Gulf for six months, idling at a cost of $500,000 a day. They can’t be financially responsible to their investors and do that. They have to move to where they can drill. So they will. We have already gotten signals that they will pick up and move off the coast of Africa or Brazil or Cuba or other places, like Venezuela, to drill. They can’t sit idly in the Gulf….We’re going to continue to put pressure on this White House and Secretary Salazar, respectfully, but appropriately, to say let’s get our safety work done in the Gulf. But we cannot lose this industry. We cannot lose these jobs. Our economy depends on it.”

Sen. Landrieu also sent a clear signal to her Senate colleagues that she would lead the effort to block any energy-climate change bill that does not include a provision to accelerate offshore revenue sharing for coastal states so that it begins immediately instead of 2017. Interior states have received 50 percent of revenues from natural resource development on federal lands since 1920.

“There will be no energy bill of any magnitude without recognizing the vital need for these Gulf Coast states to share appropriately, as do interior states, the revenues from drilling,” Sen. Landrieu said. “Interior states like New Mexico, Wyoming, Utah keep 50 percent of the revenues. So the state of Wyoming last year got $1 billion. You could clean up a lot of pelicans with $1 billion. Louisiana got virtually nothing. Our people are on the front line with oil washing up to their knees, and this Congress basically keeps 100 percent of the money. Those days are over with.”

Sen. Landrieu’s full remarks, as delivered are as follows:

“I rise today for the purposes of giving some context — I’m commenting in response to the President’s speech last night, as well as to some of my colleagues who have spoken on the need for comprehensive energy policy as we move forward.

“But I’d like to begin by just reminding us all that today is the 57th day of what may prove to be one of the most damaging environmental accidents in our nation’s history. Fifty-seven days ago the tragic explosion of the Deepwater Horizon took the lives of 11 men and unleashed an uncontrolled and uncontrollable, to date, torrent of oil and gas into the Gulf of Mexico. It threatens our environment. It threatens our economy, and the wetlands that underpin a way of life, a precious way of life, in the Gulf region.

“I’ve had the, I guess, unfortunate, opportunity to spend some time with the widows. And I say unfortunate because I wish I could have met them under different circumstances. But to hear their remembrances of their husbands, to hear the way that they expressed to me the heartfelt commitment that their spouses had to this industry and to their work, and their call for this work to be more safe, for companies to be held accountable. But also their call, Mr. President, which serves as a real testimony on their behalf to the American people, their call for this industry – this deepwater industry – to continue, was very moving to me and to all people, I think, who have had the opportunity to meet these young and very impressive women.

“I was very proud to introduce the Senate resolution honoring these men and their families. I want to thank my colleagues for passing this resolution unanimously.

“But today I want to speak on three important issues relative to this general situation. One, the need for better safety regulations and improvements at MMS (the Minerals Management Service). The other, the impacts of this moratoria; the call for accelerated revenue sharing and an accelerated claims process.

“First, let me begin with the need for better safety regulations. There are more than 300,000 men and women, Mr. President, that work in the oil and gas industry in Louisiana alone. There are a significant number of them that work offshore and directly support both the offshore and onshore industry. The offshore crewmen know that this work can be dangerous. They go through a variety of safety drills and regulations routinely, and we owe it to them to make sure that these activities are safer in the future.

“For this reason, I fully supported a thorough review of offshore drilling safety standards and have applauded the Interior Department, and particularly Secretary Ken Salazar for his willingness to clean house at the Minerals Management Service. This tragedy brought to light an unhealthy relationship that has existed, unfortunately, for many years between the oil industry and the federal regulators that are called to regulate them to make sure this industry is safe. And that must be changed.

“The regulators didn’t have the resources to push back. They didn’t have the expertise. We in Congress bear some responsibility for that and that did not start under President Obama’s Administration. But it should end under President Obama’s Administration. This Congress systematically undermanned and underfunded this important agency by not giving it the appropriate attention that it needs, and it’s our responsibility to fix it.

“I look forward to meeting with the man (Michael R. Bromwich) that the President has nominated to head MMS. I will be making my own independent decision about whether he’s the right person for this position or not. Until I meet him, and talk with him, and understand a little bit more about him, I will reserve my judgment. We need a Minerals Management Service that is a proud, competent, and respected industry watchdog. We need the watchdog back. We need the cop back on the beat, if we are to ensure that an accident of this magnitude never happens again off of our shores.

“As I said, Minerals Management — many of these employees are my constituents, Mr. President. One of their main offices is in Metairie, Louisiana. I’ve been there. I’ve met many of them, and there’s some very good people. But they need to be well-managed. They need to be well- led. They need to be given the resources they need to do the job that they can do, if that happens.

“The Coast Guard also has a role to play and we should strengthen the Coast Guard’s role and make sure that between Interior and Coast Guard, they’re getting the job done for the American people. Nobody in the country wants this job done better, nobody wants this industry more safe than the people from Louisiana and Mississippi and Alabama and Texas that man these rigs.

“Although, as you know, when you were with me, Mr. President, some of our people said to you in the meeting just last week, we were grateful for the men from Illinois that came down to work on these rigs. So we want people to know, we’ve got people from all over the country – from Illinois and Maine – that come do shifts two weeks offshore, make a good living for their family, Mr. President, and support their families for years. We want it to be safe for everyone. So I applaud the President and Secretary Salazar for getting MMS back on the right track. That work needs to be done. As I said, the cop needs to be put back on the beat.

“Let me speak for a few minutes, though, about this ill-conceived and arbitrary six-month moratorium. The effort that the President is making to ensure that this terrible tragedy never happens again is commendable. This disaster is beyond aggravating. It is disgusting. It angers us so much to see the terrible tragedy unfolding on our televisions and to open newspapers across the land and see the most horrific pictures of wildlife being affected, of dolphins and pelicans and birds, precious places to us that we not only work, but vacation with our families for many years. It’s very hard to look at those pictures. Americans are suffering through this as we watch this horror movie unfold.

“But what the President and his Administration have done could cause, in my view, even more economic damage than the spill itself, by putting a six-month moratoria on all rigs drilling below 500 feet. Now, I know that we have to make sure that these 33 floating rigs that drill in deepwater and the other standard platforms that drill between 500 and 1,000 feet are safe, but I want to say unequivocally and with support of the majority — vast majority of people in my state and throughout the Gulf – six months is too long. The industry – the deepwater industry – cannot survive in the Gulf with a six-month pause.

“This work has to be done more quickly. The Commission was announced last month, but it was just seated a few days ago. The work is just beginning. There doesn’t seem to be a sense of urgency. We need a greater sense of urgency to get this work done. I was pleased to hear the President say that he’s urged the Commission to get its work done before the six-month timeframe. That was a slight step in the right direction.

“But, Mr. President, this work has to be done in a much shorter period than six months and let me take a minute to explain why. These rigs won’t stay in the Gulf for six months, idling at a cost of $500,000 a day. They can’t be financially responsible to their investors and do that. They have to move to where they can drill. So they will. We have already gotten signals that they will pick up and move off the coast of Africa or Brazil or Cuba or other places, like Venezuela, to drill. They can’t sit idly in the Gulf.

“So we have got to figure out a way to make sure they’re safe, and make sure this never happens again and make sure they don’t leave. That is the challenge before this Administration in the next couple of days and weeks, and starting with the meeting I’m going to have with Secretary Salazar this afternoon with a broad coalition of leaders, both from the private sector and the public sector that are committed to keeping the economy of the Gulf Coast strong. We have to find a way forward. That is somewhere between doing nothing and having all of these rigs leave and not come back for several years. So that is one of the points on the moratorium.

“Secondly, I want to ask the President for his personal support and the support of this body to accelerate revenue sharing — to accelerate a large stream of revenue that’s reliable for the Gulf Coast states to be able to rebuild up our barrier islands, to rebuild our coasts, to be able to sustain this economy and this ecology and this environment over the long run, so that we can produce the oil and gas, Mr. President, that this country desperately needs. Even though this Deepwater Horizon accident happened 57 days ago, 57 days ago this country was using 20 million barrels of oil a day. Today, 57 days later, 11 lives lost, the rig at the bottom of the ocean, we’re still using 20 million barrels a day. The President didn’t say to people last night to park your cars and walk to work. He didn’t say that. I didn’t hear him say that.

“So we have to understand that we’ve got to continue to drill for oil and gas, but when we drill for oil and gas, the taxes that are paid to this federal government and have been paid over years to the tune of $165 billion to the federal government from severances and royalties, that some of that money come back to the states of Louisiana, Mississippi, Alabama, Texas, and, yes, even Florida, in my view. Even if Florida decides not to drill, they are at risk. They’re at the frontline. We’re not the only coastal states, but we’re the frontline coastal states and those revenues need to come back us to.

“We passed a bill some years ago, a bill that I worked on for 15 years called the Domenici-Landrieu Gulf of Mexico Energy Security Act. And that bill is in effect. But because of concerns about the deficit, because of a lack of understanding of the urgency by this Congress and past Congresses, that money, Mr. President, doesn’t come to us until 2017. We can see that’s too late now. We can see it with our own eyes. We can feel it with our own heart. We can see it is too late now. We needed that money 20 years ago. We needed it five years ago. We need it today.

“And so with any energy bill that passes, with all due respect to my good friend, Byron Dorgan, with all due respect to Senators that have been leading this energy effort, there will be no energy bill, the Gulf Coast senators will not allow it, there will be no energy bill of any magnitude without recognizing the vital need for these Gulf Coast states to share appropriately, as do interior states, the revenues from drilling. Interior states like New Mexico, Wyoming, Utah keep 50 percent of the revenues. So the state of Wyoming last year got $1 billion. You could clean up a lot of pelicans with $1 billion. Louisiana got virtually nothing. Our people are on the front line with oil washing up to their knees, and this Congress basically keeps 100 percent of the money. Those days are over with.

“So we are going to have some kind of accelerated revenue sharing in any energy bill. The Gulf Coast senators will not allow a bill to pass this floor without something that we believe is fair to our people.

“And then the third thing that I want to speak to the President about, and to this Congress about, and the President mentioned it last night is an accelerated claims process. These claims are going to be different than any kind of claims process that’s been paid, and maybe similar to what happened after Katrina and Rita as Mississippi and Louisiana and Alabama struggled with how to make people whole. This is going to be a very complicated and difficult situation. Mr. President, you have workers that can’t work that were used to making $500 to $1,000 a week. These are fairly decent wages, not great, but decent. They haven’t been able it to work in a long time.

“But, Mr. President, it gets a lot more complicated than that. There are boat captains that were just getting their businesses back after Katrina and Rita that are recreational boat captains, fishing captains. It’s unlike Florida where people will come to the beach and then they’ll see a boat charter, and they’ll sort of wander onto the wharf and charter the boat. That doesn’t happen in Louisiana because we don’t have any beaches people can wander on.

“People call from Mexico and Canada and all over the country months in advance and charter a specific boat with a specific captain, because we had some of the best fishing in the world. They would come down with their sons and their daughters and grandsons and their granddaughters or they’d come down with major corporate groups and do this charter fishing. These companies, Mr. President, make millions of dollars a year. They can’t work either.

“So this claims process is going to be very difficult. We have restaurants in New Orleans that are 70 miles from the Gulf. They’ve had to either shut their doors or turn down their number of hours of operating or taken things off their menus. I don’t know how we’re going to calculate that economic damage to them. That’s what I mean – this is going to be complicated. We have hotels. We have retirees that own three or four condos. A woman came up to me said, ‘Mary, my mother, she’s not a business person, she’s a retiree. She owns a couple of condos in Florida, that’s her retirement income. She rents these condos out. She’s had all cancellations this summer. What am I going to do for her?’ That’s a good question. She’ll file a claim.

“So from retirees who rent condos to supplement their incomes, to fishing boat captains, to hotels, to restaurants, and to those who work for themselves. So I’m glad that the President is taking the bull by the horns with this claims process. I hope he’s having a frank discussion with Tony Hayward at his office today to make sure that we don’t have one bankruptcy, not one, that we don’t have one business, a small business or medium-sized business or large business that goes bankrupt because of BP’s gross negligence in the Gulf of Mexico. They’ve put the industry at risk. They’ve put the Gulf Coast at risk. The claims process needs to work.

“So we have a great job to do ahead of us, Mr. President, and those are the three points that I wanted to make. One, we most certainly need to move forward on a balanced energy bill. But there will be no energy bill — the Gulf Coast Senators will block any bill that does not have immediate help for these Gulf Coast states. So let my colleagues be on notice. And then we can debate the rest of the bill, how we move forward, whether we do nuclear or a portion of drilling or wind or solar, but these Gulf Coast states are on the front lines and we are going to get justice for them in the near future.

“We’re going to accelerate and make more robust this claims process. And we’re going to continue to put pressure on this White House and Secretary Salazar, respectfully, but appropriately, to say let’s get our safety work done in the Gulf. But we cannot lose this industry. We cannot lose these jobs. Our economy depends on it.”

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