Government Update: May 2006

Government Update: HGS Bulletin, May 2006 by Henry M. Wise, P.G. and Arlin Howles, P.G. EPA News On February 17, 2006, the Houston Chronicle reported that on February 15, 2006, the EPA changed the rule on MTBE that states will no longer have to add ethanol or MTBE to gasoline. According to the Chronicle, this requirement costs as much as $0.08 per gallon of gasoline. This eliminates a mandate from the 1990 Clean Air Act that gasoline used in metropolitan areas with the worst smog contain two percent oxygenate by weight. The law did not say which oxygenate must be used, but most refiners use either ethanol or MTBE. Three states, California, New York and Connecticut, had requested a waiver of the requirement because the states had banned MTBE due to pollution of groundwater. The states were forced to use ethanol, which they contend worsened pollution problems. Ethanol reportedly makes other gasoline constituents more soluble in water. The new rules put into place a part of the energy bill President Bush signed in August that did away with the two percent oxygenate require-ment. The Chronicle quoted Senator Dianne Feinstein (D-CA) as saying, "The announcement means that California refiners will finally be allowed to make gasoline that is cleaner burning than what they are making today." AGI Government Affairs Monthly Review (February 2006)
MMS Releases Draft 5-Year Plan for OCS Leasing Program The Minerals Management Service (MMS) released a draft proposed 5-year plan for the oil and natural gas leasing program on the outer continental shelf (OCS). More than 85% of the OCS around the lower-48 states has been placed off limits to energy development by presidential withdrawals or congressional moratoria. The current draft proposal includes studies to look at the potential for oil and gas development off the coast of Virginia and a previously undeveloped area in the North Aleutian Basin off the coast of Alaska. The inclusion of these two areas is in response to discussions with the state legislatures. The draft proposal includes 21 OCS lease sales in seven of the 26 OCS planning areas. Additional information on the draft proposed plan and on how to submit comments is available at MMS Releases Hurricane Impact Details and Requests Research Areas On January 19, 2006, the Minerals Management Service released its analysis of the effects of hurricanes Katrina and Rita on offshore platforms and pipelines in the Gulf of Mexico. According to the MMS press release, "3,050 of the Gulf''s 4,000 platforms and 22,000 of the 33,000 miles of Gulf pipelines were in the direct path" of these two hurricanes. Hurricane Katrina destroyed 46 platforms and damaged 20 others, and Hurricane Rita destroyed 69 platforms and damaged 32 others. There was "no loss of life or significant oil spills from wells on the outer continental shelf (OCS) attributed to either storm." In response to this damage on OCS offshore facilities, MMS has requested research proposals in six subject areas: "(1) Assess and evaluate pipeline movement or damage; (2) Assess and evaluate platform damage; (3) Provide hurricane hindcast data; (4) Evaluate and assess the performance of jack-up rigs; (4) Assess methods to eliminate hydrates in pipelines and risers during startups after hurricanes; and (6) Assess the response of waves and currents throughout the water column in the northern Gulf of Mexico slope and shelf." Details on the impact assessment of offshore facilities are available at Senators Seeking Response to Climate Change White Paper In early February, Senate Energy and Natural Resources Committee Chair Pete Domenici (R-NM) and Ranking Member Jeff Bingaman (D-NM) released a white paper designed "to lay out some of the key questions and design elements of a national greenhouse gas program in order to facilitate discussion and the development of consensus around a specific bill." Rather than advocate specific viewpoints on a potential greenhouse gas reduction program, the white paper poses four key questions that Senate staff hope will induce discussion between policymakers, industries and environmentalists. The questions are:

  • Should regulations apply to specific sectors or to the economy as a whole, and should the regulatory process be "upstream" (targeting energy producers and suppliers) or "downstream" (targeting emitters)?
  • Should regulatory costs be mitigated through allocation or auction of allowances, and who should receive allocated allowances?
  • Should the U.S. system be designed to eventually allow trading with other systems worldwide?
  • Should the U.S. system encourage "comparable actions" by major trading partners?

The full text of the Climate Change White Paper is available at
AGU Releases Ocean Research Position Statement On February 8, 2006, the American Geophysical Union (AGU) held briefings in the House and the Senate to discuss a new position statement entitled "Renewing Investment in Ocean Research." The statement, which was adopted in December 2005, endorses the findings of the U.S. Commission on Ocean Policy. Specifics of the Commission''s report include implementing a framework of ecosystem-based ocean management, increasing funding for basic ocean research, developing a comprehensive ocean observing system, improving ocean modeling capabilities, modernizing the entire fleet of research vessels and increasing investments in ocean education. Speaking at the briefing, Representative Sam Farr (D-CA), Co-chair of the House Oceans Caucus, noted the importance of ocean research to a number of disparate groups, including fishermen, oil companies and coastal populations. "We''re all in it together," Farr said. Dr. Steven Bohlen, Chair of AGU''s ocean statement panel, added, "We are damaging the oceans, and what we don''t know could hurt us."
The full text of AGU''s ocean research position statement is available at
GSA Releases White Paper on Coastal Impacts of Hurricanes The Geological Society of America and the University of New Orleans have released a white paper titled "The Impact of Hurricanes Katrina and Rita in Louisiana: America''s Coasts Under Siege." Written by Mark Kulp and Shea Penland of the University of New Orleans along with Duncan Fitzgerald of Boston University, the report details the economic importance of the Louisiana coastal zone and the human-induced loss of land in the region. The authors recommend either strategically re-engineering the coast or planning a managed retreat from the coastal areas where hazard risks are greatest. They conclu

Paul Britt
Thursday, June 8, 2006
Government Update