US Interior nominee Jewell resists some drilling proposals, calls for 'balance'

Washington (Platts)--15Mar2013/326 pm EDT/1926 GMT

US President Barack Obama's pick to head the Department of the Interior made vague pledges to expand US energy production, but resisted attempts in written questioning by Republican senators for further commitments.

Her responses indicated she would back away from proposals to open new federal lands or waters to drilling, alter the current royalty revenue sharing system, speed up the federal permitting process or give states jurisdiction over fracking regulation.

In answers to 205 separate questions submitted by senators on the Senate Energy and Natural Resources Committee, Interior nominee Sally Jewell mainly toed the administration line on "safe and environmentally responsible" production. The committee release the questions and answers Friday.
In her answers, Jewell made repeated references to Obama's "all-of-the-above" energy strategy to expand domestic energy production and reduce foreign oil dependence and the need for a "balanced" approach to production.

"I will seek to increase safe and responsible development of both conventional and non-conventional domestic energy resources, including through exploration of new frontiers, both onshore and offshore, and through the use of new technology," Jewell wrote.

And while Jewell stressed the need for "transparent decision-making processes" by the Interior and providing "regulatory certainty and clarity" to industry, but wrote that the department's efforts could be slowed by budget constraints, such as the federal sequester.

"I will work with the bureaus to examine the impacts of operations under the continuing resolution and the sequester, but I understand that severe budget cuts will likely slow the core operations, like review of plans and permits," she wrote.

Jewell largely resisted efforts by Alaska Senator Lisa Murkowski, the top Republican on the committee, to commit to speeding up the federal permitting process for energy projects, expedite approval of an Alaska natural gas pipeline project or allow drilling in the Arctic National Wildlife Refuge's coastal plain.

"I am advised the Administration believes that development of the coastal plain is not appropriate and opposes the effort to do so, and if confirmed I will implement that position," Jewell wrote.

Murkowski has expressed concern that Jewell, the CEO of Seattle-based hiking and camping outfitter Recreational Equipment Inc., will push a federal land and water policy for recreation and conservation rather than for energy production. Murkowski has threatened to block Jewell's nomination over a Fish and Wildlife Service decision to prevent construction of an emergency road in southwest Alaska.

In response to a question from Senator Tim Scott, a South Carolina Republican, Jewell indicated she will not work to alter Obama's 2012-2017 leasing plan which blocks drilling in federal Atlantic and Pacific waters, but indicated the 2018-2023 plan could depending on the outcome of environmental reviews and seismic surveys.

In response to a question from Senator John Barrasso, a Wyoming Republican, on her views on hydraulic fracturing, Jewell said that natural gas plays a "crucial role in America's energy economy and independence," but said it was essential "that the public has full confidence that the proper safety and environmental protections are in place."

When Barrasso asked if she would defer to states to regulate fracking, she said instead she would push the Bureau of Land Management to focus on "reasonable requirements" for the process.

"I would encourage knowledge-sharing between the BLM and states to assure that the best available science is used to support safe and responsible resource development, whether on private, state, or federal land," she wrote.

Senators on the committee are working on legislation to alter the current system of sharing 37.5% of revenues from Outer Continental Shelf leases in the Gulf of Mexico with Louisiana, Alabama, Texas and Mississippi. The legislation, Murkowski wrote in one question, would expand revenue sharing to any coastal state with offshore oil and gas development and extend revenue sharing programs to develop alternative and renewable energy production both onshore and offshore.

Jewell declined to detail her thoughts on this proposal, instead saying Interior "must strike the right balance" between communities, resource owners and the administration energy policy.

"I have heard from a number of Senators about this issue," she wrote. "Should I be confirmed, I look forward to better understanding the intricacies of the issues involved."

Murkowski submitted 75 written questions to Jewell, many of them energy related and the most of any senator. By comparison, Oregon Senator Ron Wyden, a Democrat and the committee's chairman, submitted three questions, none energy related.

Robert Dillon, a Murkowski spokesman, said Jewell's answers were "all somewhat formulaic," which he said is typical for answers for the record. He said Murkowski may ask some follow-up questions for the record.

--Brian Scheid, brian_scheid@platts.com
--Edited by Carla Bass, carla_bass@platts.com

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