House panel approves oil export legislation, more work ahead

WASHINGTON - A House subcommittee approved legislation authorizing widespread oil exports on Thursday by sidestepping fights over opening crude trade while protecting U.S. consumers and refiners.

In approving the bill by a voice vote, the Energy and Power Subcommittee kicked off a process that could lead to full House votes later this month.

But the meeting revealed that oil export advocates still have much work do if they want to secure a big, bipartisan show of support. Lawmakers still have to deal with some thorny issues, including whether to craft safeguards for refiners who worry exports would eliminate a discount that has made U.S. oil cheaper than the European benchmark.

Thursday's session also highlighted stark divisions between Democrats and Republicans on the issue, with Rep. Kathy Castor, D-Fla., insisting that promised consumer benefits from oil exports are "entirely unsupported" and Rep. Frank Pallone, D-N.J., decrying the whole idea as a "payday for producers."

Republicans broadly supported the bill, saying exports would give the U.S. valuable political leverage around the world and bring economic benefits to oil producers as well as American consumers who could see modest gasoline savings, as predicted by several studies.

At least two Democrats - Bobby Rush of Illinois and Gene Green of Houston - said changes are needed before they can support the bill. They said they want an approach that combines protections for consumers and domestic refiners with any move to unleash oil exports.

Rush said he was willing to work on compromise language with the bill sponsor, Rep. Joe Barton, R-Ennis.

Green, who has constituents from both upstream oil producers and downstream refining interests in his Houston Ship Channel district, said he was open to exports, but described his fear that if U.S. companies can widely sell crude to refiners around the world, it could undermine domestic refiners.

"I don't want to become just a resource nation and lose the downstream and processing jobs we have," Green said.

Possible deals could include language already in a Senate bill that would specifically let the president impose restrictions on oil exports in some instances, including during national security threats, emergencies or price spikes.

Green said he is interested in preserving some role for the Department of Commerce to restrict exports if they are not in the U.S. national interest in a wide range of scenarios.

Although the 40-year-old trade restrictions block most crude exports, some oil extracted in Alaska and California can be sold to foreign buyers. Shipments to Canada are allowed under licenses, and the Commerce Department just OK'd transactions to swap light U.S. oil for heavier Mexican crude. Gasoline and other refined petroleum products are un-affected by the oil export restrictions; they can be freely sold overseas.

Barton's bill would bar any federal government official from imposing restrictions on oil exports.

Barton said he is willing to negotiate in the hopes of drawing more Democratic support.

The bill already has 14 Democratic cosponsors, and Wednesday, the Blue Dog Coalition of fiscally conservative Democrats endorsed it following presentations from co-sponsor Rep. Henry Cuellar, D-Laredo, and Continental Resources CEO Harold Hamm.

But Barton insisted that he won't cut a deal that flouts "the underlying principle of the bill."

http://www.houstonchronicle.com/business/energy/article/House-panel-approves-oil-export-legislation-more-6497062.php