Food and Water Watch explains one important provision of Jindal's now-defunct bill: Section 19 of the Federal Deep Ocean Energy Resources Act, H.R. 4761 – or ‘‘Rigs to Reefs Act of 2006’’- allows present and future decommissioned oil and gas rigs to remain in place even after production ceases so they can be used for other purposes, including offshore fish farms. The result would be that 1) energy companies would no longer be responsible for removing their oil and gas platforms; and 2) large polluting fish farms could be permitted on and around these rigs without any specific environmental standards.
The bill is a give-away to oil and gas companies. Current law requires owners of oil and gas rigs to remove them within one year after production ceases. Section 19 allows energy companies to avoid paying the costs of removing their existing rigs (an estimated $9.9 billion from 1985-2020) if the Secretary of Interior allows the rigs to be abandoned or transferred. Oil and gas companies’ future platforms, such as those that are established in areas where the current moratorium on new oil and gas leases is lifted, could also avoid removal. These same oil companies are already making record profits at a time when consumers are paying record-high prices at the gas pump.
The bill establishes “artificial reefs” that may not actually benefit the environment and wild fish populations. Section 19 allows any decommissioned oil and gas rig to be designated as a “reef,” even if that rig could negatively impact the marine environment and wild-fish populations. There is little evidence that rigs contribute to larger, healthier fish populations. Some rigs may harm fish populations, as they distract them from their natural habitats to a less stable environment. Reports have established a connection between oil and gas rigs and elevated mercury levels in surrounding sediments and fish ac. Abandoned rigs are also affected by storms, such as the recent Hurricanes Katrina and Rita, which severely damaged many offshore energy platforms.
The bill was not only a "give-away" to big oil; it also appeared to be a ridiculous partisan manuever designed to undermine and compete with Louisiana's Democratic Senator. Mary Landrieu successfully authored and passed the bipartisan Domenici-Landrieu bill, known as the Gulf of Mexico Energy Security Act, an act that even former Speaker of the House Newt Gingrich urged Congress to support. New Orleans City Business reports: "Congress must act to provide the infrastructure necessary to prevent a Katrina-scale disaster from ever reoccurring along the Gulf Coast while providing for our growing energy needs," Gingrich wrote in his column headlined "An important first step," in today's Washington Times. The Domenici-Landrieu bill would open 8.3 million acres in the Gulf of Mexico to new oil and gas production and share 37.5 percent of the revenues with Louisiana, Mississippi, Alabama and Texas. The money would be dedicated to coastal restoration, hurricane protection and flood control projects. Another 12.5 percent of the revenues would go to the state side of the Land and Water Conservation Fund, benefiting all 50 states. The Senate passed the bill with a bipartisan 71-to-25 vote in August.
The Domenici-Landrieu Act opened up more than 8 million acres for new exploration, but Jindal's failed bill would have removed the 25-year-old moratorium on drilling in some of our nation's most ecologically important areas. The Wilderness Society explains: The bill contains provisions that could lead to the reckless development of oil shale in Colorado, Utah and Wyoming by imposing less than fair market value royalties on commercial oil shale development on federal lands in those states. Another provision establishes an entitlement program for federal oil and gas lessees to be compensated from the Treasury if their drilling permit applications are not reviewed by the Bureau of Land Management within 10 days of receipt, or if other deadlines are missed. This bill is so poorly conceived that even the Bush Administration has objected to aspects of it, noting that it could cost taxpayers over 69 billion dollars. The outer continental shelf is rich in marine life, one reason why, our western, eastern and Florida coastlines have been protected from oil and gas development since the 1980s. But the oil and gas industry is pushing its allies in Congress to remove those protections. The bill, H.R. 4761, would transfer control of leasing decisions on the federal Outer Continental Shelf to the coastal states, and encourages them to lease along coastlines by promising states up to 75% of revenues from drilling.
Jindal's bill infuriated environmentalists, garnering numerous letter writing campaigns and causing dissension within his own party. Pointecoupeedemocrat unpacks the legislation in a previous post. Quoting: The bill, in other words, died in the Senate as a result of the chamber's unwillingness to consider it, even though it passed the House on 29 JUN 2006. Jindal, in fact, drew the opposition of 18 Republican moderates in the House, who viewed Jindal's bill as so much "ideological sparring" that would "open the entire US Coastline to drilling," which they viewed as a violation of states' rights, "sweep away environmental protections, undermine local control, [sic] and increase the deficit." They even linked Republican losses in November 2006 to legislation such as that of Jindal's Offshore Oil and Gas Bill. Because these Republican moderates found Jindal's bill so egregious, they urged John Boehner, then Majority Leader, to "take up the Senate-passed bill without any changes." And this segues into the notion that Landrieu's bill, the bill that actually passed, as it was a targeted and pragmatic piece of legislation that only considered offshore royalties for Gulf Coast drilling, not drilling off the shores of the entire nation, was a compromise bill Jindal's bill shaped. This is not true. And in fact, Jindal vigorously opposed Landrieu's bill, joining Vitter in their ideologically motivated attempt to undermine it behind Landrieu's back. And when Landrieu's bill was considered on the House floor on 8 Dec 2006, only Charlie Melancon spoke on its behalf. Jindal, on the other hand, remained silent, even though a House amendment to the omnibus Bill, HR 6111, to which Landrieu's bill was attached, that would have killed Landrieu's bill failed by the slimmest of margins. Because Jindal refused to support Offshore Oil and Gas Royalties unless his bill and only his bill would be considered, thereby politicizing revenue Louisiana needs and deserves, he refused to facilitate the passage of Landrieu's bill, a bill our state needed in order to fund hurricane recovery efforts and wetland restoration projects. Moreover, Landrieu's bill was a bill created in the Senate Energy Committee, while Jindal's was crafted in the House Committee on Resources. The bills were never related, and for him to claim Landrieu's bill was a compromise is sign of his willingness to lie. For the bills were never jointly considered in conference. Only Landrieu's bill was discussed in conference, and only Landrieu's bill became Public Law. Jindal's bill, to reiterate, only passed the House, and it was vigorously opposed by members of his own Party. This is why many consider Jindal ineffective.
The bill not only speaks to Jindal's ineffectiveness; it also demonstrates how he has used his seat on Capitol Hill to make a political name for himself, often at the expense of his constituents. His lack of finesse backfired, provoking strong words from his colleagues on both sides of the aisle. When you place Jindal's "energy" record in context, it is little wonder why he has been able to raise hundreds of thousands of dollars from Texas-based oil and energy companies and individuals associated with Texas-based oil and energy companies. So, who are these people and how much did they give Jindal? There's Michel Bechtel, the President and founder of Bechtel Exploration Company and Blue Moon Exploration. He personally gave Jindal $5,000, and then Blue Moon Exploration, his company, also decided to donate $5,000. A few days later, Bechtel was joined by Jerry M. Crews, one of the founding members of EnergyQuest, a subsidiary of Quantum Energy Partners, "a private equity firm specializing in the energy industry with more than $670 million of capital under management." Crews also gave Jindal $5,000. Bruce H. March, who is listed as the Manager of Exxon-Mobil's Baton Rouge refinery, sent Bobby Jindal a $250 contribution from an address in the Woodlands, Texas. On the same day, December 31, 2006, Charlie Moncla donated $5,000 to Bobby Jindal. That's Charlie Moncla of Moncla Industries. The donation came from a P.O. Box in Houston. Later that day, Jindal received a $2000 check from Southern Bay Operating, LLC. We learn from Business Wire: Southern Bay Energy, LLC ("Southern Bay" or the "Company") announced today it has acquired all of the oil and gas assets of AROC Inc. for approximately $9.7 million. These properties are located principally in South Texas, South Louisiana and the Permian Basin. The acquisition also includes the general partner interest in AROC Energy, L.P., which is an oil and gas partnership that was formed in 2003 to monetize the bulk of AROC assets. Southern Bay will manage the partnership and operate the majority of partnership and other acquired properties. The purchase was financed by Southern Bay's equity partners and borrowings from the Company's bank credit facility. Southern Bay was advised by Mitchell Energy Advisors, LLC in this transaction. Frank A. Lodzinski, president, stated, "This acquisition adds significant assets to our platform and positions us for future growth in our key focus areas which include South Louisiana, Gulf Coast and South Texas and the Permian Basin. We will develop these assets to their fullest potential and are actively soliciting additional corporate and asset acquisitions and drilling opportunities." Southern Bay and its affiliates, Southern Bay Operating, LLC and Southern Bay Oil & Gas, LP, were formed and capitalized by Frank A. Lodzinski, members of management and private investors in September 2004. The entities were initially capitalized with existing oil and gas producing properties and equity commitments totaling more than $30.0 million. Members of management include officers and staff of prior successful entities, including Texoil Inc. and AROC Inc., who have closed profitable corporate and asset sales of over $250 million.
Southern Bay is just the tip of the iceberg. In April, Bobby Jindal went to Texas for Round Two. In early April, he accepted $1,000 from Lee Barberito, President of Manti Enterprises. Authentix.com explains: Lee Barberito is President of Manti Resources, a privately held, highly successful advanced technology exploration and production company founded in 1989. Prior to that, he worked in various capacities for Exxon and Netherland & Sewell. He is also co-founder of CIMEX BioTech, a research and development firm dedicated to next-generation medical devices A week later, Bobby took another thousand bucks from Kevin Blasini, the HR Director at McDermott, one of the nation's largest off-shore engineering and construction firms. Blasini is not the only McDemott executive who gave money to Bobby. Bruce Wilkinson, the Chairman and CEO, also donated. Cornelius Dupre of Maverick Oil and Gas gave Bobby $5,000 in mid-April, and so did his "friend" Celia Hickenbotam, who lists the same Post Oak address as Mr. Dupre. The list of Texas-based oil interests who donated to Bobby Jindal is almost too cumbersome to completely unpack. When you begin to scratch at the surface, you notice a theme. Jindal's Texas support is, by and large, made up of oil executives or their spouses and small subsidiaries of big oil. The list will continue in Part III. |
"The Nation needs to take a new approach to our energy problems." -- Bobby Jindal
