Shortly before adjourning, Congress passed legislation that would open up an additional 8.3 million acres to oil and gas exploration leases on the Outer Continental Shelf in the Gulf of Mexico off the Florida panhandle with states sharing in that direct revenue for the first time. The Minerals Management Service (MMS) estimates that this area contains at least 1.26 billion barrels of oil and 5.8 trillion cubic feet of natural gas.

H.R. 6111, allows offshore oil and gas exploration leases to an area commonly referred to as the 181 area, which was previously off limits due to moratorium. I have long advocated for increased offshore drilling to help the U.S. grow more energy independent and not subject to foreign sources of oil which threatens our national security. I believe we can drill more and protect the environment at the same time. America now is 60% dependent on foreign sources of oil for its domestic energy needs. I voted in favor of this legislation, which is similar to legislation I introduced on March 8, 2006, H.R. 4908. I encourage the president to sign this legislation quickly into law.

I was disappointed to see Congress pass a much smaller offshore drilling bill than the ones I sponsored in H.R. 3811 and Amendment 842 to the Department of the Interior, Environment, and Related Agencies Appropriations Act for 2007, which would have opened up all coasts off the United States to oil and gas exploration. However, I think this legislation is a step in the right direction as it creates a precedent in Congress to consider future legislation which will open up other areas in moratorium.

Specifically, this bill provides that revenue from leases signed in the 181 area be applied as follows:

  • 50% to the general fund of the U.S. Treasury.
  • 37.5% to a special fund in the U.S. Treasury shared by the gulf states of Texas, Louisiana, Mississippi, Alabama, and Florida, and 12.5% to provide financial assistance to states for land and water conservation programs. Total revenue sharing to states is capped at $500 million annually.
  • Requires that funds be spent for coastal protection and conservation; such as coastal restoration and hurricane protection, and mitigation of habitat and environmental damage, although states can petition the federal government to use the revenue for other purposes.

How this bill benefits Texas:


While states such as Florida and Alabama will receive most of the 37.5% right away, due to formulas established that provide greater revenue sharing in relation to the proximity of the drilling location, Texas is guaranteed at least 10% of total revenue. According to estimates by the White Houses Office of Management and Budget, these funds will total $44 million over 10 years.


Gulf states will still receive 37.5% of royalty revenue but the formula shifts to one that distributes revenues based upon a states historic offshore production, which is particularly important to Texas given our states long history of being an energy leader for the nation. It is estimated that Texas would share roughly between 21% and 28% of these funds.