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White House threatens to veto oil drilling legislation

19.07.2008
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Energie
Geologie
White House threatens to veto oil drilling legislation
WASHINGTON (Reuters) - The White House on Thursday threatened to veto legislation being considered by the U.S. House of Representatives that would force oil companies to give up undrilled federal leases and ban the export of crude drilled in Alaska.

The bill, which the House was to vote on later on Thursday, has a "use it or lose it" provision that requires oil companies to diligently develop their existing federal leases or turn them back to the government before they could obtain new acres to drill.

"By blocking some firms from competing for new leases, this legislation would further increase gasoline prices that already exceed $4 per gallon and result in unintended consequences due to litigation," the White House said in a statement.

"Even though new leases will take years to develop, oil markets are forward-looking, and an expected decline in future supply will raise prices today," the White House said.

The White House also said it opposed the bill's language banning the export of crude oil produced in Alaska. The Congress allowed exports of Alaskan oil in 1995, but virtually none of the state's crude has been shipped to other countries in the past eight years.

"Such a ban would make virtually no additional oil available to U.S. consumers, and would not lower oil prices that are set in a world market," the White House said. "At the same time, such export restrictions are detrimental to the efficient operation of global energy markets and would send the wrong signal to our trading partners who may face pressure to impose similar trade restrictions."

(Reporting by Tom Doggett; Editing by Christian Wiessner)

source: REUTERS

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