ALASKA POWER ADMINISTRATION ASSET SALE AND TERMINATION ACT; Congressional Record Vol. 141, No. 121
(House of Representatives - July 25, 1995)

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[Pages H7576-H7587]
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       ALASKA POWER ADMINISTRATION ASSET SALE AND TERMINATION ACT

  Mr. YOUNG of Alaska. Mr. Speaker, pursuant to section 2 of House 
Resolution 197, I call up the Senate bill (S. 395) to authorize and 
direct the Secretary of Energy to sell the Alaska Power Administration, 
and to authorize the export of Alaska North Slope crude oil, and for 
other purposes, and ask for its immediate consideration.
  The Clerk read the title of the Senate bill.
  The text of the Senate bill is as follows:
                                 S. 395

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

                                TITLE I

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Alaska Power 
     Administration Asset Sale and Termination Act''.

     SEC. 102. SALE OF SNETTISHAM AND EKLUTNA HYDROELECTRIC 
                   PROJECTS.

       (a) The Secretary of Energy is authorized and directed to 
     sell the Snettisham Hydroelectric Project (referred to in 
     this Act as ``Snettisham'') to the State of Alaska in 
     accordance with the terms of this Act and the February 10, 
     1989, Snettisham Purchase Agreement, as amended, between the 
     Alaska Power Administration of the United States Department 
     of Energy and the Alaska Power Authority and the Authority's 
     successors.
       (b) The Secretary of Energy is authorized and directed to 
     sell the Eklutna Hydroelectric Project (referred to in this 
     Act as ``Eklutna'') to the Municipality of Anchorage doing 
     business as Municipal Light and Power, the Chugach Electric 
     Association, Inc., and the Matanuska Electric Association, 
     Inc. (referred to in this Act as ``Eklutna Purchasers''), in 
     accordance with the terms of this Act and the August 2, 1989, 
     Eklutna Purchase Agreement, as amended, between the Alaska 
     Power Administration of the United States Department of 
     Energy and the Eklutna Purchasers.
       (c) The heads of other Federal departments and agencies, 
     including the Secretary of the Interior, shall assist the 
     Secretary of Energy in implementing the sales authorized and 
     directed by this Act.
       (d) Proceeds from the sales required by this title shall be 
     deposited in the Treasury of the United States to the credit 
     of miscellaneous receipts.
       (e) There are authorized to be appropriated such sums as 
     may be necessary to prepare, survey, and acquire Eklutna and 
     Snettisham assets for sale and conveyance. Such preparations 
     and acquisitions shall provide sufficient title to ensure the 
     beneficial use, enjoyment, and occupancy by the purchaser.

     SEC. 103. EXEMPTION AND OTHER PROVISIONS.

       (a)(1) After the sales authorized by this Act occur, 
     Eklutna and Snettisham, including future modifications, shall 
     continue to be exempt from the requirements of the Federal 
     Power Act (16 U.S.C. 791a et seq.) as amended.
       (2) The exemption provided by paragraph (1) does not affect 
     the Memorandum of Agreement entered into among the State of 
     Alaska, the Eklutna Purchasers, the Alaska Energy Authority, 
     and Federal fish and wildlife agencies regarding the 
     protection, mitigation of, damages to, and enhancement of 
     fish and wildlife, dated August 7, 1991, which remains in 
     full force and effect.
       (3) Nothing in this title or the Federal Power Act preempts 
     the State of Alaska from carrying out the responsibilities 
     and authorities of the memorandum of Agreement.
       (b)(1) The United States District Court for the District of 
     Alaska shall have jurisdiction to review decisions made under 
     the Memorandum of Agreement and to enforce the provisions of 
     the Memorandum of Agreement, including the remedy of specific 
     performance.
       (2) An action seeking review of a Fish and Wildlife Program 
     (``Program'') of the Governor of Alaska under the Memorandum 
     of Agreement or challenging actions of any of the parties to 
     the Memorandum of Agreement prior to the adoption of the 
     Program shall be brought not later than ninety days after the 
     date on which the Program is adopted by the Governor of 
     Alaska, or be barred.
       (3) An action seeking review of implementation of the 
     Program shall be brought not later than ninety days after the 
     challenged act implementing the Program, or be barred.
       (c) With respect to Eklutna lands described in Exhibit A of 
     the Eklutna Purchase Agreement:
       (1) The Secretary of the Interior shall issue rights-of-way 
     to the Alaska Power Administration for subsequent 
     reassignment to the Eklutna Purchasers--
       (A) at no cost to the Eklutna Purchasers;
       (B) to remain effective for a period equal to the life of 
     Eklutna as extended by improvements, repairs, renewals, or 
     replacements; and
       (C) sufficient for the operation of, maintenance of, repair 
     to, and replacement of, and access to, Eklutna facilities 
     located on military lands and lands managed by the Bureau of 
     Land Management, including lands selected by the State of 
     Alaska.
       (2) If the Eklutna Purchasers subsequently sell or transfer 
     Eklutna to private ownership, the Bureau of Land Management 
     may assess reasonable and customary fees for continued use of 
     the rights-of-way on lands managed by the Bureau of Land 
     Management and military lands in accordance with existing 
     law.
       (3) Fee title to lands at Anchorage Substation shall be 
     transferred to Eklutna Purchasers at no additional cost if 
     the Secretary of the Interior determines that pending claims 
     to, and selections of, those lands are invalid or 
     relinquished.
       (4) With respect to the Eklutna lands identified in 
     paragraph 1 of Exhibit A of the Eklutna Purchase Agreement, 
     the State of Alaska may select, and the Secretary of the 
     Interior shall convey to the State, improved lands under the 
     selection entitlements in section 6 of the Act of July 7, 
     1958 (commonly referred to as the Alaska Statehood Act, 
     Public Law 85-508, 72 Stat. 339, as amended), and the North 
     Anchorage Land Agreement dated January 31, 1983. This 
     conveyance shall be subject to the rights-of-way provided to 
     the Eklutna Purchasers under paragraph (1).
       (d) With respect to the Snettisham lands identified in 
     paragraph 1 of Exhibit A of the Snettisham Purchase Agreement 
     and Public 

[[Page H 7577]]
     Land Order No. 5108, the State of Alaska may select, and the Secretary 
     of the Interior shall convey to the State of Alaska, improved 
     lands under the selection entitlements in section 6 of the 
     Act of July 7, 1958 (commonly referred to as the Alaska 
     Statehood Act, Public Law 85-508, 72 Stat. 339, as amended).
       (e) Not later than one year after both of the sales 
     authorized in section 102 have occurred, as measured by the 
     Transaction Dates stipulated in the Purchase Agreements, the 
     Secretary of Energy shall--
       (1) complete the business of, and close out, the Alaska 
     Power Administration;
       (2) submit to Congress a report documenting the sales; and
       (3) return unobligated balances of funds appropriated for 
     the Alaska Power Administration to the Treasury of the United 
     States.
       (f) The Act of July 31, 1950 (64 Stat. 382) is repealed 
     effective on the date, as determined by the Secretary of 
     Energy, that all Eklutna assets have been conveyed to the 
     Eklunta Purchasers.
       (g) Section 204 of the Flood Control Act of 1962 (76 Stat. 
     1193) is repealed effective on the date, as determined by the 
     Secretary of Energy, that all Snettisham assets have been 
     conveyed to the State of Alaska.
       (h) As of the later of the two dates determined in 
     subsections (f) and (g), section 302(a) of the Department of 
     Energy Organization Act (42 U.S.C. 7152(a)) is amended--
       (1) in paragraph (1)--
       (A) by striking subparagraph (C); and
       (B) by redesignating subparagraphs (D), (E), and (F) as 
     subparagraphs (C), (D), and (E) respectively; and
       (2) in paragraph (2) by striking out ``and the Alaska Power 
     Administration'' and by inserting ``and'' after 
     ``Southwestern Power Administration,''.
       (i) The Act of August 9, 1955, concerning water resources 
     investigation in Alaska (69 Stat. 618), is repealed.
       (j) The sales of Eklutna and Snettisham under this title 
     are not considered disposal of Federal surplus property under 
     the Federal Property and Administrative Services Act of 1949 
     (40 U.S.C. 484) or the Act of October 3, 1944, popularly 
     referred to as the ``Surplus Property Act of 1944'' (50 
     U.S.C. App. 1622).
       (k) The sales authorized in this title shall occur not 
     later than 1 year after the date of enactment of legislation 
     defining ``first use'' of Snettisham for purposes of section 
     147(d) of the Internal Revenue Code of 1986, to be considered 
     to occur pursuant to acquisition of the property by or on 
     behalf of the State of Alaska.

     SEC. 104. DECLARATION CONCERNING OTHER HYDROELECTRIC PROJECTS 
                   AND THE POWER MARKETING ADMINISTRATIONS.

       Congress declares that--
       (1) the circumstances that justify authorization by 
     Congress of the sale of hydroelectric projects under section 
     102 are unique to those projects and do not pertain to other 
     hydroelectric projects or to the power marketing 
     administrations in the 48 contiguous States; and
       (2) accordingly, the enactment of section 102 should not be 
     understood as lending support to any proposal to sell any 
     other hydroelectric project or the power marketing 
     administrations.

                                TITLE II

     SEC. 201. SHORT TITLE.

       This title may be cited as ``Trans-Alaska Pipeline 
     Amendment Act of 1995''.

     SEC. 202. TAPS ACT AMENDMENTS.

       Section 203 of the Act entitled the ``Trans-Alaska Pipeline 
     Authorization Act'', as amended (43 U.S.C. 1652), is amended 
     by inserting the following new subsection (f):
       ``(f) Exports of Alaskan North Slope Oil.--
       ``(1) Subject to paragraphs (2) through (6), of this 
     subsection and notwithstanding any other provision of law 
     (including any regulation), any oil transported by pipeline 
     over right-of-way granted pursuant to this section may be 
     exported after October 31, 1995 unless the President finds 
     that exportation of this oil is not in the national interest. 
     In evaluating whether the proposed exportation is in the 
     national interest, the President--
       ``(A) shall determine whether the proposed exportation 
     would diminish the total quantity or quality of petroleum 
     available to the United States;
       ``(B) shall conduct and complete an appropriate 
     environmental review of the proposed exportation, including 
     consideration of appropriate measures to mitigate any 
     potential adverse effect on the environment, within four 
     months after the date of enactment of this subsection; and
       ``(C) shall consider, after consultation with the Attorney 
     General and Secretary of Commerce, whether anticompetitive 
     activity by a person exporting crude oil under authority of 
     this subsection is likely to cause sustained material crude 
     oil supply shortages or sustained crude oil prices 
     significantly above world market levels for independent 
     refiners that would cause sustained material adverse 
     employment effects in the United States.

     The President shall make his national interest determination 
     within five months after the date of enactment of this 
     subsection or 30 days after completion of the environmental 
     review, whichever is earlier. The President may make his 
     determination subject to such terms and conditions (other 
     than a volume limitation) as are necessary or appropriate to 
     ensure that the exportation is consistent with the national 
     interest.
       ``(2) Except in the case of oil exported to a country 
     pursuant to a bilateral international oil supply agreement 
     entered into by the United States with the country before 
     June 25, 1979, or to a country pursuant to the International 
     Emergency Oil Sharing Plan of the International Energy 
     Agency, any oil transported by pipeline over right-of-way 
     granted pursuant to this section, shall, when exported, be 
     transported by a vessel documented under the laws of the 
     United States and owned by a citizen of the United States (as 
     determined in accordance with section 2 of the Shipping Act, 
     1916 (46 U.S.C. App. 802)).
       ``(3) Nothing in this subsection shall restrict the 
     authority of the President under the Constitution, the 
     International Emergency Economic Powers Act (50 U.S.C. 1701 
     et seq.), or the National Emergencies Act (50 U.S.C. 1601 et 
     seq.) to prohibit exportation of the oil.
       ``(4) The Secretary of Commerce shall issue any rules 
     necessary for implementation, including any licensing 
     requirements and conditions, of the President's national 
     interest determination within 30 days of the date of such 
     determination by the President. The Secretary of Commerce 
     shall consult with the Secretary of Energy in administering 
     the provisions of this subsection.
       ``(5) If the Secretary of Commerce finds that 
     anticompetitive activity by a person exporting crude oil 
     under authority of this subsection has caused sustained 
     material crude oil supply shortages or sustained crude oil 
     prices significantly above world market levels and further 
     finds that these supply shortages or price increases have 
     caused sustained material adverse employment effects in the 
     United States, the Secretary of Commerce may recommend to the 
     President who may take appropriate action against such 
     person, which may include modification or revocation of the 
     authorization to export crude oil.
       ``(6) Administrative action with respect to an 
     authorization under this subsection is not subject to 
     sections 551 and 553 through 559 of title 5, United States 
     Code.''.

     SEC. 203. ANNUAL REPORT.

       Section 103(f) of the Energy Policy and Conservation Act 
     (42 U.S.C. 6212(f)) is amended by adding at the end thereof 
     the following:
       ``In the first quarter report for each new calendar year, 
     the President shall indicate whether independent refiners in 
     Petroleum Administration for Defense District V have been 
     unable to secure adequate supplies of crude oil as a result 
     of exports of Alaskan North Slope crude oil in the prior 
     calendar year and shall make such recommendations to the 
     Congress as may be appropriate.''.

     SEC. 204. GAO REPORT.

       The Comptroller General of the United States shall conduct 
     a review of energy production in California and Alaska and 
     the effects of Alaskan North Slope crude oil exports, if any, 
     on consumers, independent refiners, and shipbuilding and ship 
     repair yards on the West Coast. The Comptroller General shall 
     commence this review four years after the date of enactment 
     of this Act and, within one year after commencing the review, 
     shall provide a report to the Committee on Energy and Natural 
     Resources in the Senate and the Committee on Resources in the 
     House of Representatives. The report shall contain a 
     statement of the principal findings of the review and such 
     recommendations for consideration by the Congress as may be 
     appropriate.

     SEC. 205. RETIREMENT OF CERTAIN COSTS INCURRED FOR THE 
                   CONSTRUCTION OF NON-FEDERAL PUBLICLY OWNED 
                   SHIPYARDS.

       (a) In General.--The Secretary of Energy shall--
       (1) deposit proceeds of sales out of the Naval Petroleum 
     Reserve in a special account in amounts sufficient to make 
     payments under subsections (b) and (c); and
       (2) out of the account described in paragraph (1), provide, 
     in accordance with subsections (b) and (c), financial 
     assistance to a port authority that--
       (A) manages a non-Federal publicly owned shipyard on the 
     United States west coast that is capable of handling very 
     large crude carrier tankers; and
       (B) has obligations outstanding as of May 15, 1995, that 
     were dated as of June 1, 1977, and are related to the 
     acquisition of non-Federal publicly owned dry docks that were 
     originally financed through public bonds.
       (b) Acquisition and Refurbishment of Infrastructure.--The 
     Secretary shall provide, for acquisition of infrastructure 
     and refurbishment of existing infrastructure, $10,000,000 in 
     fiscal year 1996.
       (c) Retirement of Obligations.--The Secretary shall 
     provide, for retirement of obligations outstanding as of May 
     15, 1995, that were dated as of June 1, 1977, and are related 
     to the acquisition of non-Federal publicly owned dry docks 
     that were originally financed through public bonds--
       (1) $6,000,000 in fiscal year 1996;
       (2) $13,000,000 in fiscal year 1997;
       (3) $10,000,000 in fiscal year 1998;
       (4) $8,000,000 in fiscal year 1999;
       (5) $6,000,000 in fiscal year 2000;
       (6) $3,500,000 in fiscal year 2001; and
       (7) $3,500,000 in fiscal year 2002.

     SEC. 206. OIL POLLUTION ACT OF 1990.

       Title VI of the Oil Pollution Act of 1990 (Public Law 101-
     380; 104 Stat. 554) is amended by adding at the end thereof 
     the following new section:

     ``SEC. 6005. TOWING VESSEL REQUIRED.

       ``(a) In General.--In addition to the requirements for 
     response plans for vessels established in section 311(j) of 
     the Federal 

[[Page H 7578]]
     Water Pollution Control Act, as amended by this Act, a response plan 
     for a vessel operating within the boundaries of the Olympic 
     Coast National Marine Sanctuary or the Strait of Juan de Fuca 
     shall provide for a towing vessel to be able to provide 
     assistance to such vessel within six hours of a request for 
     assistance. The towing vessel shall be capable of--
       ``(1) towing the vessel to which the response plan applies;
       ``(2) initial firefighting and oilspill response efforts; 
     and
       ``(3) coordinating with other vessels and responsible 
     authorities to coordinate oilspill response, firefighting, 
     and marine salvage efforts.
       ``(b) Effective Date.--The Secretary of Transportation 
     shall promulgate a final rule to implement this section by 
     September 1, 1995.''.

     SEC. 207. EFFECTIVE DATE.

       This title and the amendments made by it shall take effect 
     on the date of enactment.

                               TITLE III

     SEC. 301. SHORT TITLE.

       This Title may be referred to as the ``Outer Continental 
     Shelf Deep Water Royalty Relief Act''.

     SEC. 302. AMENDMENTS TO THE OUTER CONTINENTAL SHELF LANDS 
                   ACT.

       Section 8(a) of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1337(a)(3)), is amended by striking paragraph (3) in 
     its entirety and inserting the following:
       ``(3)(A) The Secretary may, in order to--
       ``(i) promote development or increased production on 
     producing or non-producing leases; or
       ``(ii) encourage production of marginal resources on 
     producing or non-producing leases; through primary, 
     secondary, or tertiary recovery means, reduce or eliminate 
     any royalty or net profit share set forth in the lease(s). 
     With the lessee's consent, the Secretary may make other 
     modifications to the royalty or net profit share terms of the 
     lease in order to achieve these purposes.
       ``(B)(i) Notwithstanding the provisions of this Act other 
     than this subparagraph, with respect to any lease or unit in 
     existence on the date of enactment of the Outer Continental 
     Shelf Deep Water Royalty Relief Act meeting the requirements 
     of this subparagraph, no royalty payments shall be due on new 
     production, as defined in clause (iv) of this subparagraph, 
     from any lease or unit located in water depths of 200 meters 
     or greater in the Western and Central Planning Areas of the 
     Gulf of Mexico, including that portion of the Eastern 
     Planning Area of the Gulf of Mexico encompassing whole lease 
     blocks lying west of 87 degrees, 30 minutes West longitude, 
     until such volume of production as determined pursuant to 
     clause (ii) has been produced by the lessee.
       ``(ii) Upon submission of a complete application by the 
     lessee, the Secretary shall determine within 180 days of such 
     application whether new production from such lease or unit 
     would be economic in the absence of the relief from the 
     requirement to pay royalties provided for by clause (i) of 
     this subparagraph. In making such determination, the 
     Secretary shall consider the increased technological and 
     financial risk of deep water development and all costs 
     associated with exploring, developing, and producing from the 
     lease. The lessee shall provide information required for a 
     complete application to the Secretary prior to such 
     determination. The Secretary shall clearly define the 
     information required for a complete application under this 
     section. Such application may be made on the basis of an 
     individual lease or unit. If the Secretary determines that 
     such new production would be economic in the absence of the 
     relief from the requirement to pay royalties provided for by 
     clause (i) of this subparagraph, the provisions of clause (i) 
     shall not apply to such production. If the Secretary 
     determines that such new production would not be economic in 
     the absence of the relief from the requirement to pay 
     royalties provided for by clause (i), the Secretary must 
     determine the volume of production from the lease or unit on 
     which no royalties would be due in order to make such new 
     production economically viable; except that for new 
     production as defined in clause (iv)(aa), in no case will 
     that volume be less than 17.5 million barrels of oil 
     equivalent in water depths of 200 to 400 meters, 52.5 million 
     barrels of oil equivalent in 400-800 meters of water, and 
     87.5 million barrels of oil equivalent in water depths 
     greater than 800 meters. Redetermination of the applicability 
     of clause (i) shall be undertaken by the Secretary when 
     requested by the lessee prior to the commencement of the new 
     production and upon significant change in the factors upon 
     which the original determination was made. The Secretary 
     shall make such redetermination within 120 days of submission 
     of a complete application. The Secretary may extend the time 
     period for making any determination or redetermination under 
     this clause for 30 days, or longer if agreed to by the 
     applicant, if circumstances so warrant. The lessee shall be 
     notified in writing of any determination or redetermination 
     and the reasons for and assumptions used for such 
     determination. Any determination or redetermination under 
     this clause shall be a final agency action. The Secretary's 
     determination or redetermination shall be judicially 
     reviewable under section 10(a) of the Administrative 
     Procedures Act (5 U.S.C. 702), only for actions filed within 
     30 days of the Secretary's determination or redetermination.
       ``(iii) In the event that the Secretary fails to make the 
     determination or redetermination called for in clause (ii) 
     upon application by the lessee within the time period, 
     together with any extension thereof, provided for by clause 
     (ii), no royalty payments shall be due on new production as 
     follows:
       ``(I) For new production, as defined in clause (iv)(I) of 
     this subparagraph, no royalty shall be due on such production 
     according to the schedule of minimum volumes specified in 
     clause (ii) of this subparagraph.
       ``(II) For new production, as defined in clause (iv)(II) of 
     this subparagraph, no royalty shall be due on such production 
     for one year following the start of such production.
       ``(iv) For purposes of this subparagraph, the term `new 
     production' is--
       ``(I) any production from a lease from which no royalties 
     are due on production, other than test production, prior to 
     the date of enactment of the Outer Continental Shelf Deep 
     Water Royalty Relief Act; or
       ``(II) any production resulting from lease development 
     activities pursuant to a Development Operations Coordination 
     Document, or supplement thereto that would expand production 
     significantly beyond the level anticipated in the Development 
     Operations Coordination Document, approved by the Secretary 
     after the date of enactment of the Outer Continental Shelf 
     Deep Water Royalty Relief Act.
       ``(v) During the production of volumes determined pursuant 
     to clauses (ii) or (iii) of this subparagraph, in any year 
     during which the arithmetic average of the closing prices on 
     the New York Mercantile Exchange for light sweet crude oil 
     exceeds $28.00 per barrel, any production of oil will be 
     subject to royalties at the lease stipulated royalty rate. 
     Any production subject to this clause shall be counted toward 
     the production volume determined pursuant to clause (ii) or 
     (iii). Estimated royalty payments will be made if such 
     average of the closing prices for the previous year exceeds 
     $28.00. After the end of the calendar year, when the new 
     average price can be calculated, lessees will pay any 
     royalties due, with interest but without penalty, or can 
     apply for a refund, with interest, of any overpayment.
       ``(vi) During the production of volumes determined pursuant 
     to clause (ii) or (iii) of this subparagraph, in any year 
     during which the arithmetic average of the closing prices on 
     the New York Mercantile Exchange for natural gas exceeds 
     $3.50 per million British thermal units, any production of 
     natural gas will be subject to royalties at the lease 
     stipulated royalty rate. Any production subject to this 
     clause shall be counted toward the production volume 
     determined pursuant to clauses (ii) or (iii). Estimated 
     royalty payments will be made if such average of the closing 
     prices for the previous year exceeds $3.50. After the end of 
     the calendar year, when the new average price can be 
     calculated, lessees will pay any royalties due, with interest 
     but without penalty, or can apply for a refund, with 
     interest, of any overpayment.
       ``(vii) The prices referred to in clauses (v) and (vi) of 
     this subparagraph shall be changed during any calendar year 
     after 1994 by the percentage, if any, by which the implicit 
     price deflator for the gross domestic product changed during 
     the preceding calendar year.''.

     SEC. 303. NEW LEASES.

       Section 8(a)(1) of the Outer Continental Shelf Lands Act, 
     as amended (43 U.S.C. 1337(a)(1)) is amended as follows:
       (1) Redesignate section 8(a)(1)(H) as section 8(a)(1)(I); 
     and
       (2) Add a new section 8(a)(1)(H) as follows:
       ``(H) cash bonus bid with royalty at no less than 12 and 
     \1/2\ per centum fixed by the Secretary in amount or value of 
     production saved, removed, or sold, and with suspension of 
     royalties for a period, volume, or value of production 
     determined by the Secretary. Such suspensions may vary based 
     on the price of production from the lease.''.

     SEC. 304. LEASE SALES.

       For all tracts located in water depths of 200 meters or 
     greater in the Western and Central Planning Area of the Gulf 
     of Mexico, including that portion of the Eastern Planning 
     Area of the Gulf of Mexico encompassing whole lease blocks 
     lying west of 87 degrees, 30 minutes West longitude, any 
     lease sale within five years of the date of enactment of this 
     title, shall use the bidding system authorized in section 
     8(a)(1)(H) of the Outer Continental Shelf Lands Act, as 
     amended by this title, except that the suspension of 
     royalties shall be set at a volume of not less than the 
     following:
       (1) 17.5 million barrels of oil equivalent for leases in 
     water depths of 200 to 400 meters;
       (2) 52.5 million barrels of oil equivalent for leases in 
     400 to 800 meters of water; and
       (3) 87.5 million barrels of oil equivalent for leases in 
     water depths greater than 800 meters.

     SEC. 305. REGULATIONS.

       The Secretary shall promulgate such rules and regulations 
     as are necessary to implement the provisions of this title 
     within 180 days after the enactment of this Act.
               amendments offered by mr. young of alaska

  Mr. YOUNG of Alaska. Mr. Speaker, pursuant to section 2(b) of House 
Resolution 197, I offer amendments.
  The Clerk read as follows:

       Amendments offered by Mr. Young of Alaska: (1) Strike title 
     I.
       (2) Strike sections 201 through 204 and insert the text of 
     H.R. 70, as passed by the House. 

[[Page H 7579]]

       (3) Strike section 205.
       (4) Strike section 206.
       (5) Strike title III.

  The SPEAKER pro tempore. The question is on the amendments offered by 
the gentleman from Alaska [Mr. Young].
  The amendments were agreed to.
  The Senate bill was read a third time and passed, and a motion to 
reconsider was laid on the table.
  The title of the Senate bill was amended so as to read: ``A bill to 
permit exports of certain domestically produced crude oil, and for 
other purposes.''
                        Appointment of Conferees

  Mr. YOUNG of Alaska. Mr. Speaker, I offer a motion.
  The Clerk read as follows:

       Mr. Young moves pursuant to House Resolution 197 that the 
     House insist on its amendment to S. 395 and request a 
     conference with the Senate thereon.

  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Alaska [Mr. Young].
  The motion was agreed to.


         Motion to Instruct offered by Mr. MILLER of California

  Mr. MILLER of California. Mr. Speaker, I offer a motion to instruct.
  The Clerk read as follows:

       Mr. Miller of California moves that the managers on the 
     part of the House at the conference on the disagreeing votes 
     of the two Houses on the House amendments to the bill S. 395 
     be instructed to insist upon the provisions of the House 
     amendments which strike Title III of S. 395.

  The SPEAKER pro tempore. Under the rule, the gentleman from 
California [Mr. Miller] will be recognized for 30 minutes, and the 
gentleman from Alaska [Mr. Young] will be recognized for 30 minutes.
  The Chair recognizes the gentleman from California [Mr. Miller].
  Mr. MILLER of California. Mr. Speaker, I yield myself 6 minutes.
  Mr. Speaker, the reason that we are offering this motion to instruct 
today is, this bill which has been passed by the House, and passed by 
the House with a substantial vote, goes to the Senate. There will be an 
attempt in the Senate to put a provision into the bill which is simply 
a raid on the Treasury by the Senate and by the major oil companies in 
this country.
  It has to do with the idea of drilling for oil in deep water in the 
Gulf of Mexico. However, it is an idea whose time has come and has 
gone, because technology and the economics of the oil business have 
overwhelmed that idea. What we once thought was deep water today is no 
longer deep, and the oil companies are in a mad rush to secure the 
right to develop these properties in the Gulf of Mexico.
  They have engaged this past May in the fourth largest bid sale in the 
history of the Outer Continental Shelf, furiously bidding against one 
another with bonus bid dollars for the right to develop these leases in 
deep water. They need no further incentive from the Federal taxpayers. 
They need no gift of money from the Federal taxpayers for them to 
engage in this activity. They are going to drill these deep water 
leases in the Gulf of Mexico because they have a financial incentive to 
do so.
  These are some of the most promising fields in the entire world. 
There are promising quantities of oil now that only a few years ago we 
never believed would be present. These are some of the most promising 
fields in the world in terms of the security of the reserves, once we 
have located them.
  Many oil companies spent the last 5 years going to Vietnam and going 
to China and going to Indonesia and going to the Soviet Union and going 
to Kazakhstan and going to Russia. What they have found out is while 
they have found oil, they have found great amount of trouble. All of a 
sudden, the United States of America looks awfully good to these oil 
companies in terms of a security of reserves, in terms of their ability 
to go to Wall Street and be able to borrow money because they have 
reserves, like mining companies and others, they have it in the United 
States of America. That is why they are going to the Gulf of Mexico.
  They have no need for Federal taxpayer incentives to do so. Also, 
they are going to the Gulf of Mexico
 because now the technology allows them to go to Mexico. It allows them 
to go there with greater certainty, because of the development of 
computerized and digital data that is available on a geological basis 
that we simply did not have 5 and 10 years ago. It may be speculative, 
but the speculation is dramatically reduced. We can look at pools of 
oil that we could not see 5 years ago. That is why the oil companies 
are going there. They are going there simply because it is in their 
best interests.

  Mr. Speaker, the fact of the matter is that it is just simply a sound 
business judgment to go to the Gulf of Mexico to develop these 
resources. When they go there, we are told now in the business journals 
that this oil will be developed for about $3 a barrel, which they will 
sell at the wellhead for about $14 to $15 a barrel, which will sell 
into the world price of oil at somewhere between $18 and $20, or $22, 
depending on that current price. This is a profitable venture.
  Now comes along Senator Johnston from Louisiana, who says the way you 
can really get these people to drill is to go out there and to offer a 
royalty holiday.
  Let me remind the Members of the House, this is July 25. This is not 
December 25. This is not Christmas. This is the middle of July. We 
should not be making this Christmas in July for the oil companies, who 
have already made the determination by putting millions of dollars on 
the table, billions of dollars into research, to go there and to drill 
this oil.
  This is too late and it is out of date. It does not make any sense. 
This is the equivalent of telling General Motors that we will give them 
a tax credit for every car that gets 20 miles per gallon. They already 
have the technology. They are already doing it. This is the equivalency 
of saying, ``We will give you $500 if you put an air bag in the car.'' 
They have already determined it is in their financial interests to put 
an air bag in the car, because that is what the public wants. We should 
not be handing out incentives that are not needed and cost the public.
  Mr. Speaker, many people on this floor have railed
   against corporate welfare. Here we are on the ground floor. The 
decision we can make today is whether or not we want to create a new 
category of corporate welfare. Corporate welfare is when we give 
corporate entities the public's taxpayer dollars, we give them the 
taxpayer dollars, whether they need it or not, whether there is any 
showing that they need it or not, and whether there is any public 
benefit. That is the nature of corporate welfare.

  Mr. Speaker, that is the nature of corporate welfare: no economic 
showing, no public benefit, and no showing of need by these entities. 
Yet, we are prepared to shower this money on them in the bid sale, 
where there was this furious competition last May. If this provision 
becomes law, we stand to lose $2.3 billion of the taxpayers' money that 
we will simply transfer from hardworking people in this country to 
Chevron and Shell and BHP and BP and other companies, both foreign and 
domestic. If this bill becomes law from existing leases in deep water, 
where they have already made the economic decision to drill, we stand 
to lose somewhere between $10 and $15 billion additional, and we have 
not even dealt with the issue of the future leases.
  The House should support this motion to instruct. There were no 
hearings on this bill in the House. The Senate, the last time they had 
a chance to vote on this measure, voted overwhelmingly to defeat this 
measure, because it was not in the interests of the taxpayers and/or 
the Nation.
  Mr. Speaker, the Senate, with no debate, has added a non germane 
royalty holiday to S. 395, which is the Senate version of the Alaska 
oil export bill. No comparable bill has been introduced in the House. 
We have held no hearings on this scheme. We have held no markup. We are 
going to be asked to accept it in conference carte blanche, and I would 
bet you dollars to doughnuts that the authors of the bill before us 
will accept the holiday scheme in a nano-second.
  The royalty holiday scheme is premised on the argument that rich oil 
companies need multibillion-dollar inducements to buy leases in the 
deep water of the Gulf of Mexico. There are two basic problems with 
this argument: first, it is completely, utterly, documentedly false; 
and second, even if some relief is warranted, the amounts provided are 
grotesquely excessive. If the oil industry truly needs a holiday paid 
for by the American people, does it 

[[Page H 7580]]
really need to fly on the Concorde, stay at the Ritz, and dine at Le 
Gastronie Extraordinare?
  I wonder how many Members of the House remember the old sideshow 
trick where a magician would keep everyone busy watching one hand while 
he picked someone's pocket with the other. That's what is going on with 
this legislation.
  The Republican leadership of the House is trying to distract the 
attention of the American public with hysterical hearings on Whitewater 
and Waco. Meanwhile, the Republicans are carefully and comprehensively 
wreaking havoc on the American economy, the economic security of middle 
income working families, students, the elderly, and taxpayers.
  Let me tell you what is going to happen to this bill when it goes to 
a conference with the Senate, because it is part of a well-orchestrated 
plan to pick the pockets of the American taxpayer be several billion 
dollars.
  False premise No. 1: Without royalty forgiveness, oil companies will 
not bid on deep water leases.
  On May 10, representatives of 88 oil companies braved a torrential 
Louisiana rainstorm to submit nearly 900 bids for leases--many of the 
deep water leases--in the Gulf of Mexico. It was the fourth largest 
lease sale in gulf history. The huge success of the auction illustrates 
why the holiday is not needed. Indeed, had the royalty holiday been in 
place on May 10, it is estimated taxpayers would have lost over $2 
billion in future royalties.
  The oil industry itself is the best source for discrediting the 
royalty holiday scheme.
  The New York Times of June 18, 1995, reported, ``The Great Oil Rush 
of the mid-1990's is on, and in a most unexpected setting,'' the Gulf 
of Mexico. ``It will be the
 biggest thing since Prudhoe Bay--there is no question about it,'' one 
industry analyst concluded.

  The great interest in the May sale came as no big surprise to serious 
observers of the industry. Business Week had predicted ``furious'' 
bidding at the May 10 lease sale because of a ``feverish black-gold 
rush in the Gulf [in which] new players are rushing to get in, while 
old ones scramble to return.''
  ``Improved economics, better technology, and growing experience are 
converging in the Gulf of Mexico's ultra-deep water areas to fuel a new 
era of U.S. offshore development,'' the Oil and Gas Journal reported in 
March.
  Forbes noted last November that Shell and British Petroleum admit 
they could develop the first 500 million barrels from the nearly 3,000 
foot deep MARS platform at a cost of just $3 a barrel!
  The Wall Street Journal reported in January of this year that 
``industry executives believe tension leg platforms can be affordable 
in water as deep as 6,000 feet.''
  Oil executives are not making any of these decisions on the faint 
hope of a royalty holiday from Washington; like most business people, 
they do not make decisions on the hope of a tax break. They are going 
to the deep water for the same reason bank robber Willie Sutton went to 
the banks: that's where the money is.
  And I would note that the national media has already figured out this 
outrageous scam. The Senate-passed royalty holiday has already been 
featured on NBC and ABC evening news programs as examples of outrageous 
waste.
  False premise No. 2: Oil companies need the royalty relief contained 
in the Senate bill to finance development of deep water leases.
  But the Senate bill doesn't merely allow the Secretary of the 
Interior to forgive development costs. It mandates that whenever the 
Secretary finds that royalties would present any obstacle to 
development on existing leases, royalties must be forgiven on no less 
than 17.5 million, 52.5 million, or 87.5 million barrels of oil, 
depending on the depth. And on future leases--for 5 years--there be no 
finding of hardship; royalties must be forgiven at the prescribed 
level, even if it is many times the true cost of development.
  Now, it is not as though the oil industry is laboring under such tax 
burdens. According to the Congressional Research Service, the effective 
tax rate for oil and gas companies is just 17 percent, and independent 
producers enjoy a rate of zero, thanks to the depletion allowance, 
depreciation, and tax credits. And, the tax plan passed by the House 
would eliminate the alternative minimum tax, driving down the burden 
even further.
  Last, let me address the argument that this royalty holiday costs 
taxpayers nothing, as its proponents claim. True, the Congressional 
Budget Office scored the holiday as having no cost, but only because of 
the clever way the question was phrased.
  CBO says the holiday is without cost because it presumes that, as the 
bill asserts, deep water leases would not be developed without a 
holiday. Therefore, none of the revenues derived from these tracts 
would be realized without the holiday, and there is no loss to 
government from giving away tens of millions of barrels of oil.
  Of course, the premise is absurd. As we have noted, companies are 
bidding on deep water tracts without a holiday. In addition, for future 
tracts, no finding of the need for financial relief is required, so the 
argument that there is no loss may well be unsubstantiated.
  Last, as the CBO analysts have admitted to my staff, CBO's findings 
could just as easily apply to every cent of revenue ever derived from 
deep water tracts, even beyond the tens of millions of barrels allowed 
under the royalty scheme, because of the assumption that none of these 
tracts would have been developed but for the forgiving of royalty 
payments.
  When my staff asked CBO whether the amounts of free oil given away by 
S. 395 bore any relationship to actual development costs--the supposed 
basis for the holiday--CBO admitted there is no relationship. The 
holiday may allow many times the amount of free oil required to pay 
back development costs.
  So, CBO's conclusion is more a matter of defining the tracts as 
unproduceable absent a royalty holiday than accurate fiscal analysis. 
And the definition of the tracts is contained in the legislation 
itself. It is a purely circular piece of logic that camouflages a 
multibillion-dollar loss for the U.S. taxpayer.
  Mr. Speaker, we cannot amend the royalty holiday provision today, but 
as sure as we are sitting here, it will be in the version of this bill 
that comes back to us from conference, where we will not be able to 
address it. The bill before you is the host for this parasitic 
legislation designed to suck away billions of dollars from the 
taxpayers who own this valuable oil and gas, and we cannot allow that 
legislation to pass.
  We are lectured to ``run government like a business.'' We are cutting 
programs for children, the elderly, the disabled, the sick, and the 
hungry. It is a scandal and a disgrace to lavish billions of additional 
dollars on one of the wealthiest industries in America in an absurd 
inducement to encourage it to do what it is already doing: drill for 
deep water oil in the Gulf of Mexico.
  If the Congress is adamant about giving a multibillion-dollars 
holidays away, there are many Americans far more deserving than the oil 
industry.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield 2 minutes to the gentleman 
from California [Mr. Calvert], chairman of the Subcommittee on Energy 
and Mineral Resources of the Committee on Resources.
  Mr. CALVERT. Mr. Speaker, I rise in opposition to the motion offered 
by the gentleman from Martinez, CA, to instruct House conferees to not 
agree to the Senate-passed provision providing an incentive for leasing 
of the Outer Continental Shelf lands in water depths exceeding 200 
meters.

                              {time}  1230

  Mr. Speaker, I chair the Subcommittee on Energy and Mineral Resources 
of the Committee on Resources. We are the panel of jurisdiction on OCS 
oil and gas matters. I do not disagree with his assessment of the 
process at issue, the committee and subcommittee have not had a hearing 
on deepwater leasing incentives this Congress. However, the gentleman 
is very aware that the committee did hold an oversight hearing on June 
23, 1994, on the ``Economic Health of the Domestic Offshore Oil and Gas 
Industry'' which focused on the desirability of incentives for the 
development of the Gulf of Mexico oil and gas resources.
  The Clinton administration was noncommittal at that hearing but has 
since agreed with legislative provisions drafted in the other body 
which provide an incentive to lease and develop deepwater tracts. The 
gentleman makes reference to a lease sale conducted by the Minerals 
Management Service a few months ago which did indeed bring in nearly 
one-third of a billion dollars in bonus bids, some of which were for 
deepwater tracts. But, the gentleman from California misses the point--
as the CBO has acknowledged by the revenue score on this provision, 
while a certain volume of oil and gas which may be discovered and 
developed on such tracts will be royalty free, the lost revenue is 
offset by expected increases in bonus bids at competitive auction of 
such tracts. In other words, Mr. Speaker, had the deepwater incentives 
been in effect for the leases offered up for bid in April, the sum of 
the high bids would likely have been much greater than even the 
admittedly large sum which was collected.
  The MMS believes this to be the case, as well, and has thrown its 
support behind deepwater incentives structured in the manner outlined 
in the Senate position. That is, the average depth of water in the 
lease tract determines the number of barrels of oil, or equivalent 
volume of natural gas, for which no 

[[Page H 7581]]
royalty would be due. Let me emphasize, Mr. Speaker the risk remains 
entirely with the lessee that hydrocarbon resources will be discovered 
in paying quantities. If a dry hole is drilled on a deepwater tract no 
royalty relief is available, of course, yet a bonus bid will have been 
paid to the U.S. Treasury, a bonus bid which will be incrementally 
larger than it would be without deepwater incentives. And if oil or gas 
is discovered, the economics of developing the field is enhanced such 
that wells will likely stay on line longer generating a larger domestic 
supply of an important resource.
  For these reasons, Mr. Speaker, I join with the chairman of the 
Resources Committee in opposing the motion of the gentleman from 
California. We should give our conferees as much latitude as possible 
to strike a deal with the other body which best serves the Nation. This 
motion restricts our ability to achieve that end, and should be 
defeated.
  Mr. MILLER of California. Mr. Speaker, for purposes of debate only, I 
yield 5 minutes to the gentleman from Hawaii [Mr. Abercrombie].
  Mr. ABERCROMBIE. Mr. Speaker, obviously there are not a lot of people 
on the floor now. I presume, and I sincerely hope that there are people 
looking in over C-SPAN in their offices or there are staff people and 
that they have not made their mind up on this.
  I am speaking obviously in favor of this motion to instruct. Very 
frankly, I have been through this before on this floor. It has not 
succeeded yet, but I am appealing. You see I am looking right at the 
gentleman from Alaska [Mr. Young] and the gentleman from California 
[Mr. Calvert] now. I am sincerely making an appeal on the basis that I 
am the ranking member on the Subcommittee on Energy and Mineral 
Resources, and very happy to be working with the gentleman from 
California [Mr. Calvert] and with the gentleman from Alaska [Mr. 
Young].
  Our Committee on Resources, what used to be Interior, while it has 
had a division of opinion as to what should be done and what is in the 
national interest, has always had great comity and we have worked 
together and respected each other's opinions. On this, I have worked 
very hard as the ranking member to try and be a good and productive 
person on the subcommittee and in the committee as a whole.
  Obviously, coming from Hawaii, some of the issues that are involved 
here are something where people could say, ``Well, you don't have to 
pay attention to it.'' But on the other hand that means I can be 
objective about it, too. I do not have axes to grind on this.
  I want it made clear, I am for this kind of drilling. I am not 
opposed to the oil in the gulf. On the contrary. I see it as security 
for the United States. We do not have to go overseas looking for oil, 
either currently for our uses or for looking to reserves. I think it 
should be profitable. From my understanding of the situation, it is 
going to be. That is what bothers me.
  Many of the people here in the House this year have made particular 
references about deficit reduction. I have found, in my membership on 
this Subcommittee on Energy and Mineral Resources, that everybody who 
comes in wants to get rid of the royalties.
  This is due the public, it is due to the taxpayers. It is nobody 
being ripped off. If anybody is being ripped off, it is the taxpayer in 
the sense that these royalties go into the Treasury and help us to form 
the fiscal basis for being able to reduce the deficit, or able to fund 
other much needed programs.
  That is why I am making my appeal to the gentleman from Alaska [Mr. 
Young] and the gentleman from California [Mr. Calvert] to have a 
revelation, to have an epiphany here on the floor as a result of this 
discussion, perhaps, that yes, you do see that we are not trying to 
stop people in Louisiana, we are certainly not trying to stop the oil 
companies from being able to make a profit. We want people to work. I 
do. I am for this as an activity, as I indicated.
  But it is absolutely clear that there is no reason that is persuasive 
that, absent this royalty holiday, if you will, that the oil will not 
be drilled for, that the jobs will not be there, that the security of 
the United States in terms of being able to have oil will be mitigated 
in any way. It is quite the opposite.
  I know that in other instances, other than just the oil question, 
where there are other minerals that are extracted on the mainland of 
the United States, they also want to get royalty relief. Yet I find 
that the States have severance taxes, they have excise taxes, they have 
all kinds of taxes that they impose. But when it comes to the Federal 
taxpayer being able to get a share in terms of revenues coming into the 
Treasury, we want to cut it off.
  My bottom line is this, then: You cannot have it both ways. You 
cannot say that we are going to have deficit reduction, that we are 
going to cut spending and have table-thumping, table-pounding rhetoric 
in that regard, and then turn around and give all the money away. This 
is a real test.
  I do appeal to the chairman of the committee and the chairman of the 
subcommittee, join with us on this particular issue. This was put in 
from the Senate side. This did not come out of the House.
  The gentleman from California [Mr. Calvert] is quite correct. There 
was a hearing in June 1994. It did deal with whether or not this was 
going to be an economic drag. What we found with the lease bidding, it 
is not.
  I do appeal to you. This did not come out of our committee hearings. 
We have not had a fight over this in the House. We do not have to 
acquiesce to this in the Senate. That is what this motion to instruct 
is all about. Please join with us on this. Think about it a little, as 
to whether it is in our interest to move ahead and simply acquiesce 
with the Senate.
  I say on behalf of, I believe, our process in the House and the 
relationships we have on our Committee on Resources, and on behalf of 
the taxpayers who will not benefit from this move, please, let's agree 
with this motion to instruct. Let's try and do, for once, something 
that is sensible in terms of the security of our oil reserves and the 
security of our taxpayer, that we mean it when we talk about having the 
proper incentives vis-a-vis the Treasury.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield 5 minutes to the gentleman 
from Louisiana [Mr. Tauzin].
  Mr. TAUZIN. I thank the gentleman for yielding me the time.
  Mr. Speaker, I rise in opposition to the motion to instruct. My 
friend the gentleman from Hawaii has asked some legitimate questions. 
Let me try to answer them if I can right now.
  First, the Secretary of the Interior currently has the authority in 
new leases to grant initial royalty holidays based upon water depths. 
The notion is that we can and in fact in the next 5-year lease plan, 
the leases will contain royalty relief for these deep water drills. 
Why? Because they will not occur without some royalty relief. Louisiana 
has recognized the same thing in our State and has granted royalty 
relief to get wells drilled that would not otherwise be drilled. The 
Secretary has the authority as to new leases and intends to exercise 
it.
  Second, he is not sure of his authority in regard to current leases 
where drills are not going to occur unless some royalty relief is 
provided. He is asking for a clarification of that authority. In fact, 
the Clinton administration and the Secretary of the Interior supports 
what the Senate has done in S. 158 which was negotiated at the end of 
the last Congress and is not contained in the Senate version of the 
bill we are debating now.
  The motion to instruct would invalidate what the Secretary of the 
Interior and the Clinton administration want to see happen and in fact 
have encouraged the Senate to include in the bill we are debating.
  What do they want to include? They want to include a provision that 
clarifies the Secretary's authority to grant royalty relief on existing 
leases in deep waters of the central and western Gulf of Mexico only in 
those areas where drills would not occur but for this royalty relief. 
In short, what the Secretary is asking for, and these are his words 
through Bob Armstrong, the Assistant Secretary of Land and Minerals 
Management, U.S. Department of the Interior:

       We support S. 158. It is consistent with the 
     administration's objectives. The deep water areas of the gulf 
     contain some of the most promising exploratory targets in the 
     United States but industry confronts substantial economic and 
     technological challenges to bringing it into production. The 
     responsible and orderly development of these resources are in 
     the national interest.


[[Page H 7582]]

  Our Interior Secretary is asking for this clarification. The Senate 
has provided it in the bill. The motion to instruct would eliminate it. 
We ought to vote against this motion to instruct.
  Why is it important to have this clarification? Because without it, 
the Secretary may not be able to in fact provide the same royalty 
holiday that he is going to provide in the new lease program on current 
leases that are not going to be developed without this authority.
  The expectation is that if the Senate provision is adopted later on 
when the conference reports or later on by action of this House as 
well, that we are likely to see at least two new fields, and the 
Secretary of the Interior has said probably 12 new fields are going to 
be brought in that would not be brought in otherwise.
  What does that mean? That means that we are not going to get that 
production unless this royalty relief is provided just as the Secretary 
has concluded new leases are not going to be developed in the next 5 
years without some assistance to make sure that those leases are 
brought forward, some royalty relief.
  Does it mean we are giving up the royalty income indefinitely? No. It 
simply means that a royalty holiday is provided to get the project 
started.
  What is the effect of it? The effect is that if you bring in leases 
that would not otherwise be developed, the Nation gets the benefit of 
that oil.
  Second, once the leases are in production and the royalty holiday is 
over, the Government then begins collection the money. The likelihood 
is tat the Treasury will collect millions upon millions of dollars that 
it would not otherwise collect because the leases would never get 
drilled. It is that simple.
  We in Louisiana who have been from time to time the No. 1 gas-
producing State in America, the Nos. 2, 3 or 4 depending upon whose 
calculations and what kind of depression we are in oil-producing State 
in America, we in Louisiana have come to understand that. We give 
royalty relief for the same reason, to get the wells drilled. Once they 
are drilled and production is on board, the royalty holiday is over, 
then the people of Louisiana start collecting not only the benefits of 
the jobs and the production but the royalties from those fields that 
would not otherwise be drilled.
  The Secretary of the Interior is asking for that same authority. It 
is on the administration's request now that the Senate has included 
this language. To adopt this motion to instruct is to go against the 
wishes of the administration and against the national interest.
  I ask that Members oppose the motion to instruct.
  Mr. MILLER of California. Mr. Speaker, for purposes of debate only, I 
yield 3 minutes to the gentleman from Connecticut [Mr. Gejdenson].
  Mr. GEJDENSON. Mr. Speaker, a holiday and a vacation is something you 
take normally. But this time what is happening is the American people 
are being taken. Because when you go on a holiday, you pay for it. What 
these guys want is the oil companies are going to get a holiday and the 
taxpayers are going to pay for it.
  We have had stories on this floor about welfare queens getting double 
dips on welfare and we have talked about government outrages. This is 
the biggest check of all. This is someone in business buys an oil 
field, confident there is going to be oil there. They are going to 
drill for this oil. We say, ``Wait, please stop, don't drill yet. We 
want to send you a couple extra million from the Federal taxpayers.''
  Again, who pays for the holiday? The taxpayers are going to pay for 
the holiday.
  We just heard the previous speaker say these are lucrative fields. 
That means there is lots of oil in these fields. The oil companies bid 
for these fields without the prospect of this holiday.

                              {time}  1245

  Now, we are telling them, ``Hang on just a minute, if you will just 
wait a little bit, we will give you some extra money.'' I do not 
understand this method of doing business.
  Republicans come to Congress and they say they are going to run this 
place like a business. Yes, this is the way to run a business; when you 
are going out of business, when you are having a distress sale. We do 
not need to have a distress sale.
  My colleagues would not run their family assets this way, and their 
family portfolios. They would not be sitting there after they had sold 
off a piece of land, they would not call up the buyer and say, ``Wait a 
minute. Let me give you another million and a half dollars for you to 
farm that land. Let me give you a couple extra million dollars to drill 
on that land.''
  Mr. Speaker, this drives up the deficit and it shifts the burden to 
average taxpayers. This is a rip-off for the richest oil companies in 
America. This is welfare for people that have billion-dollar 
corporations. And for the rest of us, it is going to mean higher taxes 
for families in America.
  Mr. Speaker, we will not be able to take a vacation to pay for this 
oil holiday for the oil companies that got this language in the bill.
  Mr. YOUNG. Mr. Speaker, I yield 3 minutes to the gentleman from 
Louisiana [Mr. Hayes].
  Mr. HAYES. Mr. Speaker, the gentleman from Hawaii [Mr. Abercrombie] 
said that he hoped that there were those who were watching on C-SPAN. I 
can just imagine the group that is watching in my home State of 
Louisiana, which consists of former employees in the oil industry in 
the United States, when there was a domestic program. But 450,000 of 
those people lost their jobs because of incredibly shortsighted energy 
policy.
  Mr. Speaker, what we are hearing this afternoon is, in the terms of 
the vernacular, logic that resembles a dry hole. What we have in the 
Gulf of Mexico is nothing more than an opportunity for which people 
compete and they take their technology and make a determination, 
through a bidding process, as to whether they will roll the dice in the 
Gulf.
  If these gentleman are so sure of where there is oil, I can guarantee 
them they can get a much higher paying job in private industry. They 
can certainly do better from their seats here in Washington guessing 
where oil is than those poor engineers who have simply spent most of 
their life with an educated guess, 9 out of 10 of which ends up with a 
dry hole.
  But what are we really talking about today? We are not talking about 
oil or even the politics of oil. We are talking about the politics of 
politics. Some of my colleagues live in areas where they do not have 
employees who understand this industry, and who realize the high risk 
and who also understand that you do not bid at all when the risk raises 
itself above those levels of not being rewarded in any way.
  Mr. Speaker, the State of Texas is light years ahead of our policy. 
What did they do? They figured out that when they gave people 
incentives on marginal and low possibility land, they would do 
something they were not going to do anyway. That has resulted in 
revenue increases in Texas; not revenue losses.
  The Secretary of the Interior must certify that the area under 
consideration for his leniency, and a delay of royalty payments, will 
not otherwise receive a bid or be drilled upon. It will not happen 
without this occurrence. It will not happen without his certification. 
And, therefore, we have both the logic, the inducement, and two States 
have already shown us that it is economically beneficial to do so.
  Mr. Speaker, I cannot imagine having someone enter into a more easily 
predictable outcome based on the experience of two States that know an 
awful lot more about this subject than those folks who are so 
chagrined. If anything, it reminds me of being back in debate class 
when a group from Oxford once told me that an argument that I made was 
much like the way a drunk used a lamppost; it was support and not 
illumination.
  We have heard a lot of that this afternoon from areas that would not 
understand what a rig looked like, would not know what a blowout 
preventer did, and by the way, that never offered one bit of assistance 
to the half million people who intimately are familiar with those areas 
of Kazakhstan, those areas in the North Sea, the areas around the 
world, because they had to give up their Louisiana jobs to go to work 
there and see their families now and again.

[[Page H 7583]]

  Mr. Speaker, we can help the Treasury, we can help an industry, and 
do them both at the same moment, and it is incredible to me that we 
would be wasting time arguing about it.
  Mr. MILLER of California. Mr. Speaker, I yield myself 1 minute.
  Mr. Speaker, I would first say the presentation by the two gentlemen 
from Louisiana is interesting. It is simply not factual. There is no 
certification by the Secretary for the new leases that we are talking 
about. And the fact is that this bill says that deep water is 200, 400 
meters. The fact is that we have platforms that are working in 2,860 
feet, 2,900 feet. And the Wall Street Journal tells us this is now 
profitable, developable oil at 6,000 feet of water.
  So, Mr. Speaker, we run around chasing these people with taxpayer 
dollars to get them to drill in 400 or 500 foot water. Their rigs are 
in the water today at 2,900 feet, at 2,800 feet, at 3,000 feet, and 
they have an all-time record in terms of the gushers. Why? Because the 
technology blew right past this Government's policy. When the 
technology enabled them to see for the first time 3-dimensional 
formations, then they went back to the gulf, because the economics said 
go to the gulf; not because of us.
  These rigs have been built. They have been built in Houston, they 
have been built in Louisiana, they have been built around the world, 
and we are sitting here debating the policy and the rigs are pumping 
oil today. They do not need any help from the Treasury.
  Mr. Speaker, I yield 3 minutes to the gentleman from Oregon [Mr. 
DeFazio].
  Mr. DeFAZIO. Mr. Speaker, the question before the House is not 
whether these leases will be developed. They will be. It is now 
economical to go down to several thousand feet. They are predicting 
they will go to 10,000 feet in the future.
  An article from Forbes, ``Deep and Deeper,'' interviewing a gentleman 
who has developed a new company for deep-water exploration. ``We think 
we can make serious money out of 20-million-barrel fields in 15,000 
feet of water.'' An article from Business Day, the New York Times, 
``Oil Companies Drawn to the Deep,'' and on and on.
  The fact is, these leases will be developed. The sole question before 
the House of Representatives and for the Members to think about before 
they vote is whether or not the free market will prevail and taxpayers 
will get a fair return for the depletion of these Federal resources.
  That is the sole question before the House. Do we need to give the 
oil companies an incredible break for something they are already 
prepared to do; something for which the technology already exists; 
something that is already profitable? Do we want to give them a break 
to keep doing it? That is the question.
  Are we going to run this Government like a business? Are we serious 
about balancing the budget? Or do we have $15 billion to give away to 
an industry that is beginning to again enjoy record profits?
  Mr. Speaker, I think the average American parked at the gas pump 
filling up their tank would say, We do not think these companies need a 
tax break. They are already gouging us at the pump. I do not want them 
to gouge me in Washington, DC, too.
  These leases will be developed without a tax break; without a break 
in the royalties.
  Mr. MILLER of California. Mr. Speaker, will the gentleman yield?
  Mr. DeFAZIO. I yield to the gentleman from California.
  Mr. MILLER of California. Mr. Speaker, these leases are developed. 
This bill responds to a problem that existed in 1988, 1989; not the 
economics of the oil industry worldwide today and not the economics of 
the American oil industry.
  Mr. DeFAZIO. Mr. Speaker, this is, plain and simple, an attempt to 
obfuscate the facts. And for those around here who supported the 
balanced budget amendment, for those around here who are voting for 
these appropriations bills, slashing student loans, and they are going 
to cut Medicare, there are alternatives. The alternatives are to raise 
and maintain revenues.
  Mr. Speaker, if my colleagues do not vote for this motion to 
instruct, they will be ceding another $15 billion of revenues, royalty 
giveaways, to companies that are full well prepared to make profits 
under the existing scheme, but they are happy to take an additional $15 
billion of taxpayers' money. They are always happy to take more of the 
money that is due to the taxpayers.
  Mr. Speaker, it is time to have true fiscal responsibility in this 
House, to stop BS'ing the people about the issue here. The issue is not 
development or nondevelopment or national security. We all agree they 
should be developed, but we do not need to give away $15 billion to do 
it.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield 4 minutes to the gentleman 
from Colorado [Mr. Allard].
  Mr. ALLARD. Mr. Speaker, I rise in opposition to the motion to 
instruct.
  Mr. Speaker, I am looking at what has happened over the years with 
the exploration of oil and it seemed to me that it was not too many 
years ago that we were talking about how we needed to develop our own 
resources here at home so that we could be more secure.
  Mr. Speaker, I am looking at some of the budget arguments and I have 
before me a publication here from the Congressional Budget Office that 
talks about the economic impacts of trying to encourage drilling in the 
outer continental shelf and it says that no adverse budgetary impacts 
in most cases, and it goes ahead and lists four of those specific 
cases.
  First of all, it says if the Department of the Interior waived 
royalties only for production from existing leases that would otherwise 
be unprofitable and would shut down anyway, the Government would not 
lose receipts.
  It goes on and says that if the Department of the Interior waived 
royalties only for new production from existing leases, the Government 
would not lose receipts in instances in which that new production 
resulted from some specific expenditures, for example, capital costs as 
in Senate bill 318, that the company would not probably make without a 
waiver.
  Third, it goes on to say that the Department of the Interior, if it 
waived royalties only for new leases that firms in the industry would 
bid on, even in the absence of waivers, bonus bid payments which are 
categorized as offsetting receipts, would be likely to rise 
commensurate with the drop in the present value of future royalty 
payments.
  A fourth case of no adverse budgetary impact would arise if the 
Department of the Interior waived royalties for new leases that would 
otherwise be unprofitable for companies to bid on. In other words, 
without a waiver of royalties, these additional lease sales would not 
occur under current law because potential bidders will view these lease 
properties as uneconomical. Hence, the net budgetary impact would be 
zero for pay-as-you-go purposes under the congressional scorekeeping 
rules.
  Mr. MILLER of California. Mr. Speaker, I yield myself 30 seconds just 
to say, it is interesting, but the fact is the CBO analysis has already 
been disproved, because the leases are being developed. The rigs are on 
site. The oil is being pumped. It is being sent to market.
  As the Wall Street Journal and the New York Times have pointed out, 
it is being sent to market now in record volume from the gulf. So CBO 
says if these leases were never developed, yes, we would never get any 
revenue. However, the leases are being developed because the 
development is being driven by the economics of the oil industry, not 
governmental policy.
  Mr. Speaker, I yield 3 minutes to the gentleman from Minnesota [Mr. 
Vento].
  Mr. VENTO. Mr. Speaker, I rise in strong support of the Miller 
instruction to the conference.
  Mr. Speaker, my colleagues favored the export of Alaskan oil 
yesterday and they favor this bill today, but this issue has nothing to 
do with it. It is not, as has been described, some sort of a clarifying 
and technical amendment. It is a slam dunk.
  This is the sort of issue, this issue added with no or little debate 
on the Senate floor, not subject to hearings in the House, is the 
reason that the American public is up in arms across this country when 
these actions happen in this House. How do the oil companies and the 
others get these type of fantastic billion dollar breaks? This will 

[[Page H 7584]]
make a good program for ``Believe It Or Not'' in terms of what is 
happening to the Federal budget.
  Mr. Speaker, at a time when the majority is advocating $280 billion 
in cuts in Medicare, then on the other hand they are falling all over 
themselves trying to give away the revenue of the Federal Government 
that comes from offshore oil, in this instance the deep oil resources. 
The majority of Republicans are falling all over one another trying to 
provide incentives. Incentives that are not needed.
  Mr. Speaker, I listen to my colleagues talk. What is the effective 
tax rate on oil companies? The big ones pay 17 percent, the 
independents pay virtually nothing when all the deductions are taken 
into consideration. Who else in this country has a 17-percent tax rate 
or a zero tax rate?
  But yet it is not enough that oil and energy corporations have 
decimated the Tax Code. Now they are going back to the royalties, those 
dollars that flow so that we can restore the natural resources and pay 
for some of the problems that are associated with the development of 
this deep oil development.
  If this is such a good bill, why can it not be subject to hearings? 
Why can it not be subject to full debate? Why does it have to be a slam 
dunk on an unrelated measure? I will tell my colleagues why. Because 
this will not stand up to the light of day. That is why. It is bad 
process. It is bad policy. It is bad politics and it is a type of issue 
that ought to be stricken from this bill and stripped and given, if it 
can stand up to justification.
  Mr. Speaker, I listen to my colleagues talk about free enterprise and 
how they are in favor of free enterprise, but yet there are some who 
want to play the game and rhetoric of free enterprise, they just do not 
like to practice it so much.

                              {time}  1300

  They do not like the part where they invest money, take a chance, and 
lose the money, and so what my colleagues in the Senate and the House 
here that come from these areas and represent those types of advocates 
are saying is when they have problems, when they have layoffs, when 
they do not have jobs, then we are going to come back and try to 
guarantee them they can have a profit no matter what.
  What type of subsidy, what type of guarantees and assurance do you 
need? If there is a need for this subsidy, this measure not only gives 
the permits to go back or the Secretary to retroactively provide for a 
lifting of the royalties on existing leases, which would cost $2.3 
billion based on just the leases made in May, it mandates it 
prospectively also. There is no opportunity for flexibility or 
judgment, this Senate language mandates the application of this new 
policy.
  What happens if the price of oil changes? That happens just about 
every day. If the price goes up, obviously these leases and the 
recovery of this oil becomes even more economically feasible than 
today.
  If this legislation were put in law, it is a policy. The money flows 
out no matter what.
  Mr. Speaker, I urge support of the Miller motion to instruct.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in strong opposition to this motion to recommit, 
and it never ceases to amaze me the beautiful rhetoric that occurs on 
this floor and the emotionalism that happens with very little, what do 
I say, validity or honesty in it.
  I suggest respectfully they ought to tell the truth. This is nothing 
more than the Secretary is already doing. The Secretary has asked for 
this. The Secretary has asked for this; in fact, I have a letter from 
Mr. Armstrong----
  Mr. MILLER of California. Mr. Speaker, will the gentleman yield?
  Mr. YOUNG of Alaska. No; no.
  Mr. MILLER of California. You are accusing Members of not telling the 
truth. Will the gentleman yield?
  Mr. YOUNG of Alaska. I apologize if they take it from that. The fact 
is Mr. Armstrong says, in fact, he needs this.
  Mr. MILLER of California. This is nothing different than what the 
Secretary is already doing. This takes discretion away from the 
Secretary.
  Mr. YOUNG of Alaska. Reclaiming my time; just sit down; reclaiming my 
time.
  Mr. MILLER of California. You are accusing Members of not telling the 
truth.
  Mr. YOUNG of Alaska. Referring to the Secretary, if I may--reclaiming 
my time----
  The SPEAKER pro tempore (Mr. McInnis). The gentleman from Alaska will 
suspend. The gentleman from California will suspend.
  Mr. YOUNG of Alaska. I say respectfully this is my time.
  The SPEAKER pro tempore. The gentleman from Alaska will suspend. The 
gentleman from California will suspend.
  The gentleman from Alaska controls the time. The gentleman from 
Alaska has reclaimed his time. The gentleman from Alaska now has the 
floor.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, may I suggest respectfully the idea I heard the word 
``gouge'' at the pump, that the oil companies are gouging people at the 
pump; if we do not accept the gentleman's motion to recommit, they will 
be further gouged. That is not true. You know that. If there is any 
gouging at the pump, it is by this Congress, by other government 
agencies taxing these people that are using that gas. That is the high 
price of gasoline at the pump.
  Let us not kid ourselves. That is where the high price comes for 
every consumer. If you do not believe it, go down the list and see the 
amount of money you are paying for gasoline. Today it is probably less 
than 1951 for the gas itself. It is all the other money this Congress 
raises and every other government raises. That is what it is. Let us 
not use the term ``gouge,'' that this is going to happen.
  Again, may I stress this is an action on behalf of the 
administration, your President, your Secretary of the Interior. It is 
rare that I embrace Secretary Babbitt; I mean that does not happen. In 
this case, Mr. Babbitt has asked for it. The President has asked for 
it. It is very similar to what we have done and other countries have 
done, Canada, Norway, Great Britain.
  May I stress one of the things that bothers me the most, the people 
talking for this motion to recommit have never ever supported any type 
of domestic oil production of any type, and may I suggest respectfully 
we never have, I have never done this, I have been here 24 years, I 
have never seen anyone that has been speaking supporting domestic oil 
production.
  We have lost 400,000 jobs or more in this field, and we have sent our 
technology over to China, we have sent it to Colombia, we have sent it 
to Venezuela, we have sent it to Russia. I would feel a lot better if I 
thought for a moment they were sincere in this idea the taxpayers are 
getting ripped off. The taxpayers are not getting ripped off.
  The CBO report says specifically this is budget neutral. In fact, 
what we will do, we will be raising money for the taxpayer because 
there will be areas where we will be drilling.
  I also heard it is already happening. If you read it very carefully, 
what we are suggesting here, the Secretary can grant the so-called 
holiday, I call it incentive, in areas that are not profitable or will 
not be open, that have already been leased, or those areas that would 
be very difficult to develop a further stage in deep water.
  Those who may be listening on the TV station in their offices, let me 
suggest one thing: If you want drilling off the coast of California, if 
you want drilling off the coast of Florida and Oregon and Washington 
and Maine and Massachusetts, North Carolina, if you want drilling 
there, then you go for the gentleman's motion to instruct conferees, 
because that is what will happen.
  This is an incentive to try to get our remaining oil, domestic 
industry, further off, further into the Gulf of Mexico, and if it is 
profitable, it gives us the oil we should have.
  So I am going to suggest the motion to instruct, if you really want 
drilling off your shores, which I have heard that no one wants, then 
you vote for the gentleman's motion to instruct the conferees. If you 
want to give the incentives that the administration wants, the 
Secretary of the Interior wants, those people are the ones that 

[[Page H 7585]]
suggested this, then I suggest that you vote against that motion and 
you vote with the committee and do not instruct.
  Mr. HAYES. Mr. Speaker, will the gentleman yield?
  Mr. YOUNG of Alaska. I yield to the gentleman from Louisiana.
  Mr. HAYES. Was this not the measure that passed the Senate by the 
vote of 74 to 25?
  Mr. YOUNG of Alaska. Absolutely. What concerns me, we heard there 
were no hearings. There were hearings on this side of the aisle in 1994 
under the committee on which the gentleman from California [Mr. Miller] 
was chairman at that time. I can tell you there is a difference in the 
makeup of the Congress today, but I want to get back, this is not 
Democrat and Republican, as the gentleman from Louisiana [Mr. Hayes] 
will tell you, the gentleman from Louisiana [Mr. Tauzin] will tell you, 
other people who have spoken, including myself. This is whether we are 
going to retain any type of domestic oil production in those areas that 
are very questionable in development.
  So I am asking my colleagues to vote ``no'' on the motion offered by 
the gentleman from California to instruct conferees.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MILLER of California. Mr. Speaker, I yield 2 minutes to the 
gentleman from Florida [Mr. Scarborough].
  Mr. SCARBOROUGH. Mr. Speaker, I would like to give some very 
Republican reasons for supporting this Democratic motion, and I 
respectfully disagree with the chairman of the committee.
  I have got to tell you the first reason is talking about fiscal 
sanity, we do not have this money to give up.
  We continue to talk about getting tough with welfare recipients. That 
also includes corporate welfare recipients. This is corporate welfare 
any way you cut it.
  Second, for many Republicans, I think the fact that the President and 
Secretary Babbitt support it is a good enough reason except for the 
fact that they do not know what they support. We have Secretary Babbitt 
coming to my district in the Gulf of Mexico one day saying that he is 
against any drilling in the Gulf of Mexico. The next day he is throwing 
out leases. That is fine, if that is the administration's position, if 
the administration supports this type of drilling, that is their 
prerogative, but I do not believe in forgiveness of this sort of debt.
  The New York Times has reported, ``The great oil rush of the mid-
1990's is on and in a most unexpected setting, in the Gulf of Mexico. 
It will be the biggest thing in some time.'' Business Week has also 
reported that a ``feverish black gold rush in the Gulf of Mexico has 
begun which new players are rushing to get in while the old ones are 
scrambling to return.''
  Let me tell you something, there is nothing questionable about what 
big oil wants to do in the Gulf of Mexico. I do not think we need to 
give them any more incentives.
  If you believe in free enterprise, if you believe in the free market, 
then let the market prevail. Let the invisible hand prevail. We do not 
need any more Federal handouts.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield myself such time as I may 
consume.
  I am terribly surprised the gentleman from Florida would speak as he 
just spoke. There is no loss to taxpayers. CBO says this. I agree with 
him, President Clinton, and Secretary Babbitt, as I mentioned before, 
but these are not true facts as far as loss of money. This is budget 
neutral. It also probably will increase moneys as we go forth and 
create new jobs.
  Mr. Speaker, I yield such time as he may consume to my good friend, 
the gentleman from Alabama [Mr. Callahan], a great leader and fine 
Congressman, one of the new cardinals in the U.S. Congress.
  Mr. CALLAHAN. I thank the gentleman for yielding me this time, and I 
thank him for the very fine comments.
  I sat here and listened to the debate that is taking place, and all 
of you make good points. All of us, though, are listening to the attack 
on big oil and all of us are talking about the loss of revenue to the 
Federal Government.
  But in the State of Alabama, where we do have offshore drilling, let 
me tell you there are many more things that are so beneficial to the 
State than just the Federal taxation of it. That is the revenue that 
goes to the States.
  The States participate in the AG sections. We receive royalties. Part 
of the royalties from that, in Alabama, we very wisely, in 1984, set up 
a trust fund, a perpetual trust fund. Gov. Edwin Edwards told me had 
Louisiana done what we did a few years ago, there would be no need for 
any taxation in Louisiana.
  We set up a perpetual trust fund; all the royalties, all the taxes go 
into that perpetual trust fund. Now it has more than a billion dollars 
in that fund.
  So what is that billion dollars doing? It is generating revenue for 
education, generating revenue for roads and other things in Alabama.
  While we are talking about the Federal portion of it, let us not lose 
sight of the fact the States are the ones reaping a great deal of the 
monetary benefits of this.
  I recognize the environmental concerns. We do not have those severe 
problems in Alabama. We have not had major oil spills. We have done it 
right, and the oil companies have done their job right.
  But most importantly, let us not lose sight of the fact the States 
have been big beneficiaries of this money, and we want to increase this 
trust fund in Alabama, this constitutionally protected perpetual trust 
fund that someday, hopefully, will generate enough money to provide all 
the educational needs in the State of Alabama.
  I urge you to vote against this motion to instruct.
  Mr. MILLER of California. Mr. Speaker, for purposes of debate only, I 
yield 2 minutes to the gentleman from New York [Mr. Hinchey].
  Mr. HINCHEY. Mr. Speaker, there currently resides in the deep water 
reserves of the Gulf of Mexico an estimated 15 billion barrels of oil. 
That is a large amount of petroleum. It is estimated to be probably 
twice the size of the celebrated Prudhoe Bay reserves.
  These 15 billion barrels of oil are the property of the people of the 
United States of America. This Government has the responsibility to 
husband that resource and to make sure that the people get at least a 
fair return should that resource be developed, and it is in the process 
of being so developed.
  That is the real question before us today. These resources will be 
developed. They are being developed, and, as a matter of fact, when the 
May 10 leases were up for bid, 88 companies submitted almost 900 bids 
for those leases which were let in May.
  If the provisions of this bill were in effect, the Senate version of 
the bill were in effect when those leases were let, the taxpayers of 
the United States would have lost an estimated $2.3 billion.
  If the motion offered by the gentleman from California [Mr. Miller] 
is not passed, it is estimated that the taxpayers of the United States 
will lose an estimated $12 billion over the period of time that these 
resources are exploited by the petroleum companies who will 
successfully bid on those leases. That is the issue here.
  This resource will be developed. It is only a matter of time. It is 
finite, as all of the petroleum resources of this planet are finite. It 
will be developed. The technology exists now to develop them. It is 
only a matter of time.
  Will the people of our country benefit at all from this activity? We 
must pass the motion offered by the gentleman from California [Mr. 
Miller] to instruct. Otherwise the taxpayers of this country will lose 
$12 billion.
  Again, I want to stress the gentleman speaks with little knowledge of 
what he speaks of.
  Fifteen billion barrels, we have already produced 13 billion barrels 
in Alaska. We expect to produce about 4 or 5 billion barrels out of 
Prudhoe Bay. That is the largest single American domestic field we have 
ever had.
  All I am asking for is the opportunity to develop those other 
domestic fields offshore and onshore.
  I want to stress this very strongly, that this, without this 
amendment as proposed in the Senate side, there will be chances where 
there will be areas that would be developed, will not be developed, as 
we develop them; as I said before, get the wells drilled, get the 
people working, employ those 400,000 Louisianans that were lost. Let 
them 

[[Page H 7586]]
have the jobs that are needed and they will pay taxes. Our taxpayers 
will come out much further ahead.
  If we adopt this motion to recommit, we, in fact, will lose the 
opportunity that we need for these frontier areas.
                              {time}  1315

  I will be very up-front with everybody. I even think this will be 
good in the State of Alaska outside of sale 92. We have some other 
areas that should be developed in very deep, deep water. Unfortunately 
the administration does not support that, we are not going to attempt 
to do that, but I do think, if we want to have a steady supply of oil 
for the United States, we have to look at these areas. We cannot 
balance the budget, we cannot have a sound economy, we cannot have 
people working, when we are importing over 52 percent of our oil today 
from overseas countries, and it is odd to me that every time we try to 
help our own domestic companies in some way, we are accused of helping 
big oil, or it is a rip-off, or it is a taxpayer's rip-off.
  May I suggest, Mr. Speaker, the biggest rip-off is our buying foreign 
oil, and it is a policy that was set forth by some of the gentlemen 
that were speaking previously. The policy is to destroy the domestic 
oil-producing companies in this country, and they have done a good job 
of doing that. This motion to recommit will be a further attempt to 
destroy any of our domestic companies.
  So again I urge a ``no'' vote on the gentleman from California's 
motion to instruct conferees.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MILLER of California. Mr. Speaker, I yield 1 minute to the 
gentleman from West Virginia [Mr. Rahall].
  Mr. RAHALL. Mr. Speaker, for the average American, perhaps the 
biggest financial break we get is in December when many credit 
companies inform us that in light of the holiday season, the minimum 
payment due for the month is waived.
  That's the extent of it for the average, hard-working American.
  Yet, under what the other body is proposing, it would be Christmas 
every day, all year, for some of the largest, multinational, oil 
conglomerates in the world.
  They would get a holiday from having to pay royalties for drilling 
oil in federally owned waters.
  A multibillion-dollar royalty holiday, at the taxpayers' expense, as 
an alleged incentive for these companies to do what they are already 
doing in the first place.
  Now, whatever your position is on H.R. 70, the nongermane royalty 
holiday provision added by the other body to its version of this 
legislation simply has no business being accepted by House conferees as 
a middle-of-the-night deal.
  That is why it is so important that the Miller motion to instruct be 
passed, so that, in effect, we remove any temptation on behalf of some 
of our colleagues to fall prey to the wiles of the other body on this 
matter.
  The bottom line: If my colleagues voted for the Klug-Rahall mining 
claim patent moratorium to the Interior appropriation bill last week, a 
vote for the pending motion would be consistent. It would be a 
consistent vote against the giveaway of America's natural resource 
wealth.
  Mr. YOUNG of Alaska. Mr. Speaker, I yield myself the balance of my 
time.
  Mr. Speaker, I can only urge my colleagues again, as I mentioned 
before, let us leave the conferees work with the conferees. This is a 
Senate provision, not a House provision. I have said all the arguments, 
that this, in fact, was suggested, it was supported, it was promoted by 
Secretary Babbitt, Mr. Armstrong, President Clinton, and is also not a 
ripoff to the taxpayers. This, in fact, would increase moneys to the 
Treasury of the United States and mean that it will make us less 
dependent on those fossil fuels we are importing today.
  Again the biggest ripoff to the taxpayers today is that oil we are 
buying from the sheiks, and that oil we are buying from the Qadhafis, 
and that oil is we are buying from the Saddam Husseins. That is a 
ripoff because the policy of those that were speaking in the well in 
the previous years that have driven our domestic industry off our 
shores overseas and not hiring our American workers. We have lost those 
jobs. We have got to try to get them back. We will have further 
legislation to bring more workers back to our shores. We will start 
developing our oil onshore, as it should be developed onshore, and we 
will have development in the gulf if we pass the amendment that was 
promoted by the Senate, or at least discussed by the Senate. But to 
have us reinstructed, or be instructed, by this motion by the gentleman 
from California is wrong for this Nation, it is wrong for the taxpayer, 
it is wrong for this conference chairman, it is wrong for this Congress 
to do.
  So, Mr. Speaker, at this time I urge a large ``no'' vote on this 
motion.
  Mr. Speaker, I yield back the balance of my time.
  Mr. MILLER of California. Mr. Speaker, I yield myself the balance of 
my time.
  The SPEAKER pro tempore (Mr. McInnis). The gentleman from California 
has 4 minutes remaining.
  Mr. MILLER of California. Mr. Speaker, let me say that I represent as 
much, if not more, oil than anyone else in this Congress. I represent 
four of the seven major oil companies in this country and worldwide, 
and I represent many other oil companies in my district. We are a 
major, major economy dependent upon oil, and, when I talked to the 
executives of those oil companies, they made one thing very clear. They 
no longer make decisions based upon governmental policy because it is 
too transitory. They make decisions based upon going to the bank, and 
showing them what they can do, and borrowing the money, and making the 
investment, and going to work, and they have decided now that the Gulf 
of Mexico is where they should go. They are going on their own hook. 
They are going in the private capital markets because that is where 
they can make the profit. They do not need this. They do not even want 
it, but we are going to give it to them.
  Let me say to the freshmen in this Congress, Mr. Speaker, this is the 
process that they ran against. This is the process whereby a 
controversial provision is not considered in the House. There are no 
hearings. There is no debate. When we go to the
 Senate, where this was slipped into a bill with no vote, no debate, 
last year the Senate debated it, and it was killed overwhelmingly.

  Now they managed to get it back in, as they can do in the Senate. It 
will be brought back to my colleagues, and they will have to vote up or 
down on whether or not to kill Alaskan oil, a provision that my 
colleagues overwhelmingly support. That is why Senator Johnston is 
going to take this controversial provision, attack it to that bill in 
Congress, and my colleagues are going to get a choice on whether or not 
to vote to export Alaskan oil. My colleagues have already made that 
decision. They are going to make the second decision for my colleagues. 
They are going to put a giveaway of over $15 million of taxpayer money 
to the major oil companies when they do not need it.
  I say to my colleagues, you ought not to go along with that process 
because that's not the open government, that's not the debate, that you 
pledged to your constituents.
  This is now tax loopholes get created in the dark of the night in the 
depth of the Senate. This is how corporate welfare gets created in the 
dark of the night in the depth of the Senate, and the House is told to 
take it or leave it.
  Mr. Speaker, unless my colleagues vote for this motion to instruct, 
they will not get an independent vote, a separate vote, on the issue of 
a royalty holiday for some of the wealthiest, the least taxpaying, 
corporate entities in this country, and my colleagues are entitled to 
more, their constituents are entitled to more. But that is the game 
that is going on here. They are stacking the deck, they are rigging the 
game, so my colleagues will never get to confront directly this issue.
  I say to my colleagues, this is your one chance. You vote for a 
motion to instruct, you vote to preserve your rights down the road to 
make a decision on whether or not you think this is good or bad, but 
let me tell you. All of the economic journals, all of the industry 
journals, tell you there is no need for this. Don't take my word for 
it. Look at Forbes, look at the Wall Street Journal, look at the oil 
press, 

[[Page H 7587]]
and they'll tell you this is the hottest property in the world. No tax 
incentives needed. Now, if you want to give that away in the middle of 
the night when you're trying to balance the budget,
 when you're out here hacking and hewing away at programs that it is 
tough to go home and explain if you're going to do that, then I think 
you're not playing fair with your constituents because what you say is 
the big guys with the lobbyists, the big guys with the lawyers, they 
can slide in under the process, they don't have to work in the 
daylight, they don't have to work out on the open floor. They can work 
inside of one Senator's mind about a problem that existed, a problem 
that existed 5 years ago, a problem that has been overwhelmed by world 
oil economics, a problem that has been overwhelmed by technology.

  Mr. Speaker, the reason they are going there today is because they 
could not see the oil 5 years ago. This has no impact on State revenues 
because the States do not get any share of these revenues. They are not 
the A.G. revenues. This is simply a gift from the American taxpayers to 
foreign oil companies and domestic oil companies that do not need it. 
Vote for the motion to instruct.
  The SPEAKER pro tempore. Without objection, the previous question is 
ordered on the motion to instruct.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to instruct 
offered by the gentleman from California [Mr. Miller].
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. YOUNG of Alaska. Mr. Speaker, I object to the vote on the ground 
that a quorum is not present and make the point of order that a quorum 
is not present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  This will be a 15-minute vote.
  The vote was taken by electronic device, and there were--yeas 261, 
nays 161, not voting 12, as follows:

                             [Roll No. 565]

                               YEAS--261

     Abercrombie
     Ackerman
     Andrews
     Baesler
     Baker (CA)
     Baldacci
     Barcia
     Barr
     Barrett (WI)
     Bass
     Becerra
     Beilenson
     Bereuter
     Berman
     Bevill
     Bilirakis
     Bishop
     Blute
     Boehlert
     Bonior
     Borski
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Brownback
     Bryant (TX)
     Bunn
     Camp
     Canady
     Cardin
     Castle
     Chabot
     Chenoweth
     Clay
     Clayton
     Clement
     Clyburn
     Coble
     Coburn
     Collins (IL)
     Condit
     Conyers
     Costello
     Coyne
     Cramer
     Crane
     Crapo
     Cremeans
     Danner
     Deal
     DeFazio
     DeLauro
     Dellums
     Deutsch
     Dicks
     Dingell
     Dixon
     Doggett
     Doyle
     Dunn
     Durbin
     Ehlers
     Ehrlich
     Engel
     Ensign
     Eshoo
     Evans
     Ewing
     Farr
     Fattah
     Fawell
     Fazio
     Filner
     Flanagan
     Foglietta
     Foley
     Forbes
     Ford
     Fowler
     Fox
     Frank (MA)
     Franks (NJ)
     Frelinghuysen
     Frisa
     Funderburk
     Furse
     Ganske
     Gejdenson
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Gutierrez
     Hall (OH)
     Hamilton
     Harman
     Hastert
     Hastings (FL)
     Hefner
     Hilleary
     Hinchey
     Hobson
     Hoekstra
     Holden
     Horn
     Hoyer
     Hutchinson
     Hyde
     Inglis
     Jacobs
     Johnson (CT)
     Johnson (SD)
     Johnston
     Jones
     Kanjorski
     Kaptur
     Kasich
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     King
     Kleczka
     Klink
     Klug
     LaFalce
     LaHood
     Lantos
     Lazio
     Leach
     Levin
     Lewis (GA)
     Lincoln
     Lipinski
     LoBiondo
     Lofgren
     Longley
     Lowey
     Luther
     Maloney
     Manton
     Markey
     Martini
     Mascara
     Matsui
     McCarthy
     McCollum
     McDermott
     McHale
     McHugh
     McInnis
     McIntosh
     McKinney
     McNulty
     Meehan
     Meek
     Menendez
     Metcalf
     Mfume
     Mica
     Miller (CA)
     Mineta
     Minge
     Mink
     Moran
     Morella
     Murtha
     Nadler
     Neal
     Neumann
     Ney
     Oberstar
     Obey
     Olver
     Owens
     Pallone
     Pastor
     Payne (NJ)
     Payne (VA)
     Pelosi
     Peterson (FL)
     Peterson (MN)
     Petri
     Pickett
     Pomeroy
     Porter
     Portman
     Rahall
     Ramstad
     Rangel
     Reed
     Regula
     Riggs
     Rivers
     Roemer
     Rohrabacher
     Ros-Lehtinen
     Rose
     Roybal-Allard
     Royce
     Rush
     Sabo
     Sanford
     Sawyer
     Scarborough
     Schroeder
     Schumer
     Scott
     Sensenbrenner
     Serrano
     Shaw
     Shays
     Sisisky
     Skaggs
     Slaughter
     Smith (MI)
     Smith (NJ)
     Souder
     Spratt
     Stark
     Stearns
     Stokes
     Studds
     Stupak
     Talent
     Tanner
     Tate
     Thompson
     Thornton
     Thurman
     Torkildsen
     Torricelli
     Towns
     Tucker
     Upton
     Velazquez
     Vento
     Visclosky
     Ward
     Waters
     Watt (NC)
     Waxman
     Weldon (PA)
     Weller
     White
     Williams
     Wise
     Wolf
     Woolsey
     Wyden
     Wynn
     Yates
     Young (FL)
     Zimmer

                               NAYS--161

     Allard
     Archer
     Armey
     Bachus
     Baker (LA)
     Ballenger
     Barrett (NE)
     Bartlett
     Barton
     Bentsen
     Bilbray
     Bliley
     Boehner
     Bonilla
     Bono
     Brewster
     Browder
     Bryant (TN)
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Chambliss
     Chapman
     Christensen
     Chrysler
     Clinger
     Coleman
     Collins (GA)
     Combest
     Cooley
     Cubin
     Cunningham
     Davis
     de la Garza
     DeLay
     Diaz-Balart
     Dickey
     Dooley
     Doolittle
     Dornan
     Dreier
     Duncan
     Emerson
     English
     Everett
     Fields (LA)
     Fields (TX)
     Flake
     Franks (CT)
     Frost
     Gallegly
     Gekas
     Geren
     Gonzalez
     Green
     Greenwood
     Gunderson
     Gutknecht
     Hall (TX)
     Hancock
     Hansen
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Heineman
     Herger
     Hoke
     Hostettler
     Houghton
     Hunter
     Istook
     Jackson-Lee
     Jefferson
     Johnson, E.B.
     Johnson, Sam
     Kim
     Kingston
     Knollenberg
     Kolbe
     Largent
     Latham
     LaTourette
     Laughlin
     Lewis (CA)
     Lewis (KY)
     Lightfoot
     Linder
     Livingston
     Lucas
     Manzullo
     Martinez
     McCrery
     McDade
     McKeon
     Meyers
     Miller (FL)
     Molinari
     Mollohan
     Montgomery
     Moorhead
     Myrick
     Nethercutt
     Norwood
     Nussle
     Ortiz
     Orton
     Oxley
     Packard
     Parker
     Paxon
     Pombo
     Poshard
     Pryce
     Quillen
     Quinn
     Radanovich
     Richardson
     Roberts
     Rogers
     Roth
     Salmon
     Saxton
     Schaefer
     Schiff
     Seastrand
     Shadegg
     Shuster
     Skeen
     Skelton
     Smith (TX)
     Smith (WA)
     Solomon
     Spence
     Stenholm
     Stockman
     Stump
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Tejeda
     Thomas
     Thornberry
     Tiahrt
     Torres
     Traficant
     Vucanovich
     Waldholtz
     Walker
     Walsh
     Wamp
     Watts (OK)
     Weldon (FL)
     Whitfield
     Wicker
     Wilson
     Young (AK)
     Zeliff

                             NOT VOTING--12

     Bateman
     Boucher
     Collins (MI)
     Cox
     Edwards
     Hilliard
     Moakley
     Myers
     Reynolds
     Roukema
     Sanders
     Volkmer

                              {time}  1346

  Messrs. FIELDS of Louisiana, TAYLOR of Mississippi, WHITFIELD, and 
SALMON changed their vote from ``yea'' to ``nay.''
  Messrs. DICKS, BARCIA, WELLER, BAESLER, LONGLEY, FAWELL, GRAHAM, 
POMEROY, ENSIGN, CREMEANS, McINNIS, HILLEARY, CRAPO, WELDON of 
Pennsylvania, CASTLE, FRELINGHUYSEN, BLUTE, McCOLLUM, and HORN, and 
Mrs. CHENOWETH changed their vote from ``nay'' to ``yea.''
  So the motion to instruct was agreed to.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
                          personal explanation
  Mrs. ROUKEMA. Mr. Speaker, on rollcall No. 565, a motion to instruct 
conferees on the Senate provision regarding deep water oil drilling on 
the Alaskan North Slope oil, I was unavoidably detained in my office.
  Had I been present, I would have voted ``yes.''
  The SPEAKER pro tempore (Mr. McInnis). Without objection, the Chair 
appoints the following conferees on S. 395: On House amendment No. 1: 
Messrs. Young of Alaska, Calvert, Bliley, Miller of California, and 
Dingell.
  On House amendment No. 2: Messrs. Young of Alaska, Calvert, Thomas, 
Roth, Bliley, Coble, Miller of California, Hamilton, Dingell, and 
Mineta.
  On House amendment No. 3: Messrs. Spence, Kasich, and Dellums.
  On House amendment No. 4: Mr. Coble, Mrs. Fowler, and Mr. Mineta.
  On House amendment No. 5: Messrs. Young of Alaska, Calvert, and 
Miller of California.
  There was no objection.

                          ____________________