Pelosi offers deal on offshore drilling bill

With public opinion shifting toward offshore drilling, Democrats are looking to defuse the volatile election issue by allowing oil companies for the first time to explore off the Atlantic and Gulf coasts from Virginia to Florida — but only if they foot the bill for new alternative energy programs.

House Speaker Nancy Pelosi, who not long ago staunchly opposed lifting any of the offshore drilling bans, said Tuesday she now supports an energy package that would including drilling in federal waters off the southeastern coast. She is planning a vote that could come as early as Friday.

“If they (the oil companies) want to drill offshore, we'll say OK,” Pelosi said. But she said the bill also will require oil companies to give up $13 billion in tax breaks and agree to pay billions of dollars in back royalties that were avoided because of an Interior Department contracting error in deep-water drilling leases in the late 1990s.

The money would be used to subsidize investments in solar, wind and other renewable energy.

“If you oppose that, what are you saying. I'm for drilling and I want to subsidize Big Oil and I want all of the profits to go to Big Oil,” said Pelosi.

Pelosi's proposal mirrors ones being pushed in the Senate — one by the Democratic leadership and another by a bipartisan group known as the “Gang of Ten” that calls for limited offshore drilling from Virginia to Georgia and off Florida's Gulf coast, areas that have been off limits to energy companies for decades because of environmental concerns.

The proposals would open federal waters beyond a 50-mile coastal buffer.

Senate Majority Leader Harry Reid reiterated Tuesday his intention to take up the drilling measures next week.

Republicans in both the Senate and House, meanwhile, are pushing for broader drilling.

House Republican leader John Boehner of Ohio called Pelosi's proposal “just more of the same. … It leaves most American energy under lock and key when we should be doing everything possible to expand energy production.”

Off-limits areas of the Outer Continental Shelf on both coasts are believed to have at least 18 billion barrels of oil, but more than half of the reserve is off the West Coast, according to the Interior Department. Mid-Atlantic waters, however, are believed to have large reserves of natural gas as well as some oil.