July 6, 2016

The House Natural Resources Subcommittee on Energy and Mineral Resources held a hearing on the Innovation in Offshore Leasing Act (H.R. 5577). The bill would amend the Outer Continental Shelf Lands Act to direct the Department of the Interior to make offshore lease sales internet-based, ending the practice of accepting sealed offers from companies and then reading bids aloud at the Superdome in New Orleans. The bill would also require all data regarding lease sales to be publically available online.

The bipartisan bill, introduced by Representatives Garret Graves (R-LA) and Alan Lowenthal (D-CA), received support from industry representatives and policy experts, who claimed the transition would increase competition and participation, ensure a fair return for taxpayers, increase revenue for government and revenue-sharing states, and avoid situations like the March protest during a Superdome lease sale.

Committee Chairman Doug Lamborn (R-CO) praised the bill as a “transition to the 21^st century for federal agencies that have been slow to follow suit behind industry.” Some states, such as Texas and Louisiana, have transitioned to online lease sales for onshore oil and gas production, and the Bureau of Ocean and Energy Management (BOEM) already conducts online leases sales for offshore wind production.

Walter Cruikshank, deputy director of BOEM, expressed concerns about the expedited transition to online lease sales within one year and the “prescriptive nature” that could bar the agency from making future improvements to improve its lease sale procedures. However, Cruikshank was supportive of the bill overall, claiming that BOEM is considering live-streaming the proposed Western Gulf of Mexico Lease Sale 248 in August.

On July 13, the full Committee passed the bill with bipartisan consensus. It will now head to the House floor for consideration.

Sources: E&E Daily, EnergyNet, Govtrack.us, House Subcommittee on Energy and Mineral Resources, Morning Consult