Oil royalties may go to Louisiana

Governor Blanco re-asserted her pledge to hold up any new oil leases in the Gulf of Mexico while speaking on Thursday in New Orleans to a conference of business, government and industry leaders considering how to protect coastal Louisiana and its energy infrastructure.

As far as I can recall, the entire Louisiana congressional delegation is now wholeheartedly endorsing Blanco's threat. Previously, only Senator Mary Landrieu was making the issue of offshore oil revenue sharing a priority.

Under the current revenue sharing plan proposed by Governor Blanco, Louisiana could receive an estimated $3 billion a year from as much as $7 billion in offshore revenues that now go to the federal government.

What The Times-Picayune missed in its story was the followup discussion Blanco had with Garland Robinette on WWL. In a recent conversation Blanco had with Donald Powell, President Bush's hurricane recovery czar, Powell said the administration was taking a look at the royalty issue. Blanco admitted that, while the statement was nowhere near a solid commitment, the door had finally cracked open a bit.

Last summer, before Hurricane Katrina, President Bush strongly objected to a provision Congress added to the president's energy bill to grant $1 billion for oil-producing Gulf Coast states to fight coastal erosion.

Last July, local blogger oyster asked "Why does George Bush hate Louisiana?," inauspiciously foreshadowing the disaster to come:

So, a state melting into the ocean is not a priority when the budget's tight? Remember, this is a $14 billion problem which, if ignored, could become a $100 billion catastrophe. Our CEO-in-chief, the first prez with an MBA, has decided to put LA's urgent needs on the backburner, and let some future president or congress pay the geometrically higher restoration expenses. Meanwhile, Louisianans are burdened with enormous risks while they must attempt to fix a national security problem (largely) on their own.

Congress ignored Bush's objection, and passed the energy bill along with the coastal restoration provision. $540 million of that provision was allocated to Louisiana -- still far short of the estimated $14 billion required to restore Louisiana's coastal marshes in a comprehensive manner.

Post-Katrina, on one of Bush's photo opportunity visits to New Orleans, he pleaded ignorance of the Outer Continental Shelf royalty-sharing issue:

Rep. Charlie Melancon, D-Napoleonville, also is concerned about the White House -- simply because Bush may not be aware of the revenue-sharing proposals.

During a recent meeting business leaders and politicians had with Bush in New Orleans, Melancon asked Bush to support the state's push for the royalties.

"I said, 'If you would help us get OCS revenue sharing, we could take care of our own problems,' " Melancon said.

Melancon said Bush responded by asking, "What's OCS?"

Blanco's authority to stop the oil lease sales in August:

Under a federal law that governs offshore drilling, governors in adjacent states are required to agree that federal lease sales are consistent with their states' coastal management plans. Louisiana governors have traditionally signed off on such lease sales.

The America's Wetland Web site has a copy of an extremely exhaustive Times-Picayune article by Pam Radtke Russell on the subject of offshore revenue sharing, including the story about how Plaquemines Parish boss Leander Perez screwed a deal with President Truman to get a share of the offshore revenues allocated to Louisiana.