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Oil Drilling Bill to Bring Benefits to State and Nation

Column by Sen. Trent Lott   Filed 7/15/06 GCN

 Senator Thad Cochran and I have negotiated with Senate leaders an agreement on offshore energy production that could bring more than $1.5 billion to Mississippi during the next decade, and billions more after that.  The agreement will help protect Mississippi’s environment and provide our nation with more energy – a plus, plus, plus any way you slice it.

The money, generated from leasing tracts for oil and gas exploration more than 100 miles off our shores, otherwise would have gone into Washington coffers.  This new plan increases the Gulf energy producing states’ share of revenues to almost 40 percent.  That’s billions of new dollars available to the State of Mississippi, dedicated for land and water conservation, and positively impacting our hurricane recovery and rebuilding efforts.

You see, until just a few years ago, almost every dime generated from leasing Gulf of Mexico areas for oil and gas production was sent to Washington.  Mississippi, Louisiana, Texas and Alabama, the states permitting energy exploration off our coasts, received almost nothing from this activity, even though we provide the infrastructure, most of the work force and take any risks associated with drilling.

That’s all changing.  Senators from the states allowing offshore energy leasing successfully argued that our states deserve part of this revenue.  We have allocated some of that revenue to the Land and Water Conservation Fund, a dedicated account set up for states to use, to ensure our natural resources are protected.

This agreement pertains specifically to what’s called “Lease Sale 181.”  It’s an area of new production, located approximately 100 miles offshore of Alabama, directly south of Baldwin and Mobile counties. 

When combined with another potential tract even further south, the new 1.7 million acre lease is expected to contain more than 1.3 billion barrels of oil and at least six trillion cubic feet of natural gas.

As “Lease Sale 181" matures, Mississippi can expect to receive about $150 million annually over the next decade.  And payments will swell to $250 million annually after that, when agreements on future leasing there are expected to proceed.

Let me be clear.  This agreement has nothing to do with proposals advanced by some last year suggesting leases be sold within sight of our shores.   This agreement pertains only to energy production well offshore, similar to what we have now.  In fact, this agreement requires increased protection for areas closer to shore in exchange for opening up areas farther offshore for leasing.  In other words, protection for Mississippi’s coastline is part of the deal.

With revenues of this magnitude coming into Mississippi from Gulf  leases, this is an agreement that will impact our entire state.  Projects that could be funded include everything from environmental restoration to better hurricane evacuation routes – anything with a link to natural resources, anywhere in Mississippi.

I expect this agreement to come before the full Senate for a vote soon.  While the House has taken a different approach, we hope to resolve these differences to enact a final plan this year.

I’ll be watching this process very closely, and I’m confident that Congress and the President will agree to a fair revenue sharing plan.  Mississippi enables energy production off our shores, and we certainly are entitled to a fair share of that revenue.  Our revenue sharing plan will leave the nation less dependent on foreign oil, provide more money to protect natural resources and bring billions to Mississippi – truly a plus, plus, plus that Congress and the President should adopt. 

Senator Lott welcomes any questions or comments about this column. 

Write to: U.S. Senator Trent Lott, 487 Russell Senate Office Building, Washington, D.C. 20510 (Attn: Press Office) or Email

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