Oil and gas producers and consumers have strongly criticized the bill, HR 2337, which, among other things, would repeal parts of the 2005 Energy Policy Act, restrict uses of produced water, and limit federal oil royalty in-kind (RIK) payments to Strategic Petroleum Reserve purchases.

Republican members of the committee protested that oil and gas industry groups were largely excluded from the bill"s development. Rahall responded that they could submit comments before the committee returns to mark up the bill following the Memorial Day recess.

Presidents of three gas industry groups expressed deep concerns about the bill in a May 22 letter to Rahall. Barry Russell of the Independent Petroleum Association of America, Skip Horvath of the Natural Gas Supply Association, and Donald F. Santa of the Interstate Natural Gas Association of America said HR 2337 "would move significant and much-needed natural gas supplies out of reach while making it more difficult to build new pipeline infrastructure."

In a statement distributed to reporters before the hearing, the American Exploration & Production Council called the bill "a prescription for slowing natural gas exploration, reducing production, and increasing prices."

"Weren"t invited"

Oil and gas industry groups also said they were being excluded. "We"re here, but we weren"t invited to testify," Marc W. Smith, executive director of the Independent Petroleum Association of Mountain States, told OGJ before the hearing began.

Representatives of federal agencies involved in resource management and development made up the first panel of witnesses. Rahall said he acceded to requests from the committee"s Republican minority to let a second panel of presidents of two organizations representing energy consumers testify.

John Engler of the National Association of Manufacturers and James L. Martin of the 60-Plus Association, a senior citizens advocacy group, separately questioned the wisdom of imposing more restrictions on domestic energy production as prices are rising.

As he welcomed the first panel (US Bureau of Land Management Deputy Director Henri Bisson; Minerals Management Service Deputy Director Walter Cruickshank; Melissa Simpson, deputy undersecretary for natural resources and environment at the US Forest Service; Vickie VanZandt, senior vice-president for transmission services at the Bonneville Power Administration, and Timothy R.E. Kenney, deputy assistant secretary for oceans and atmosphere at the National Oceanic and Atmospheric Administration), Rahall quipped, "I am probably the first committee chairman to hold a hearing consisting only of witnesses who are hostile to his position."

But he also said the Natural Resources Committee was taking a different approach to developing legislation than it used in recent years. "During the 6 years that I served as the ranking member, the practice was for the majority to toss out energy bills a day or two before a markup, with no hearings, affording the members of this committee little time to completely understand what they were voting on," he said.

In contrast, he continued, HR 2337 was introduced a full week before the hearing. "The record will be open for submitted testimony and, with the House not being in session next week, interested parties are afforded even more time to dissect provisions of the legislation before it is marked up," Rahall said.

He said the primary witnesses were limited to representatives of the current presidential administration to give it "the opportunity to testify in person in the event that it wanted to defend its position with respect to specific provisions or to offer constructive advice in its capacity as the entity that would have to implement provisions of the bill should it become law."

As they testified, however, the federal witnesses generally said their agencies needed more time to consider the bill"s potential impacts and would have to submit written comments later.

PIN/OGJ.COM