The Democratic-led Senate Energy and Natural Resource Committee supported legislation today that would allow for oil and gas exploration off the coast of Florida. In an ironic twist, this includes an area that Republican President George W. Bush took off limits in 2002. Far more Congressional action is needed before the legislation is past, but today’s action is a sign of a changing political landscape.

Seven years ago, at the behest of his brother, Republican Governor of Florida Jed Bush, President George W. Bush spent over $100 million to curtail drilling near Florida’s coast by buying back seven of nine federal leases from oil companies in a resource rich area called Destin Dome. The government secured a ten-year nonproduction agreement from Murphy Oil, which decided not to sell back its two leases in a calculated decision to wait till the government reversed course.

The decision helped bolster the governor’s standing in his state while the Bush Administration heralded the deal – which also included buying back leases near the everglades — on environmental grounds. He said, “Florida is known worldwide for its beautiful coastal waters and the Everglades. Today we are acting to preserve both.” But it was a costly way to prolong the inevitable: more offshore drilling.

Now Byron Dorgan (D-ND) is leading the charge. His amendment is a bit more pragmatic. It is an attempt to get more Republican senators on board with a larger climate bill, by opening up for exploration a proven, hydrocarbon-rich area that could be developed quickly due to its proximity to existing infrastructure. The legislation does not open up all of the water near Florida as it codifies a moratorium elsewhere.

But even those areas may be eventually under threat, …..click here to read more

In a move that went widely unreported last week, California Governor Arnold Schwarzenegger unveiled a plan that would allow additional drilling within state waters in an attempt to help ease California’s fiscal troubles. California had banned new exploration activity within state waters (an area that roughly extends nine miles from the coast) since the 1969 spill in Santa Barbara — although there has been ongoing production in existing sites within state boundaries.

This proposal, like the previous one in Florida, is all about money as the states grapple with budget shortfalls. California expects the legislation could bring in over $1.8 billion over time. The proposals also show how quickly two states which were adamant against lifting the drilling moratorium in federal waters less than a year ago could change their opinion.

California’s decision to allow offshore drilling would be a boon to the exploration industry, especially if the state supported opening up federal areas beyond state waters. Those regions have substantial proven reserves: roughly 2/3 of all proven supplies on the US’s outer continental shelf.

Florida’s Republican-controlled House of Representatives supported a measure yesterday to allow drilling in state waters. It is a major change in policy as supporting such legislation even just a few years ago would have almost been political suicide as so many citizens in the state feared for the cleanliness of the their beaches. The likelihood that the bill will pass this session, as the Senate has not considered similar legislation, remains remote. But with Florida facing fiscal shortfalls and the opportunity of a windfall estimated at $31 billion over 20 years from offshore revenue, politicians are facing a new reality.

Florida has been the linchpin to maintaining the moratorium on federal offshore drilling in the Atlantic, Pacific and certain areas of the Gulf of Mexico due to the size of its poltical clout, its coastline and the abundance of oil and gas off its shore. While Jeb Bush was governor, his brother supported his anti-drilling stance and ensured no new oil and gas activity would begin in federal waters off the coast of Florida (Federal waters on the outer continental shelf begin roughly ten miles from the coast, while the states control the sea floor until that point). In fact, the federal government bought back leases in federal waters in 2002 to placate Florida’s political leadership.

Now, the winds now appear to be shifting in Florida, and odds are they will eventually blow across the rest of the federal outer continental shelf.

The reality is that expanded offshore drilling will not be decided on after an exhaustive environmental or energy policy debate, but whether or not the government needs the proceeds from drilling and how it plans to spend them.