WASHINGTON, (Reuters) - The House failed to approve legislation Thursday that would have pushed oil companies to drill on federal leases they already hold and required the government to lease tracts in an Alaskan oil reserve more often.
House Democrats, trying to show they favor more U.S. oil production in light of record gasoline prices, came up with the bill to counter White House and Republican lawmakers' calls to lift a congressional offshore drilling ban. The White House had threatened to veto the measure.
The bill had a "use it or lose" it provision that required oil companies to diligently develop their existing federal leases or turn them back to the government before they could obtain new acres.
The legislation would have also mandated that the Interior Department conduct yearly leases in the National Petroleum Reserve in Alaska, which holds an estimated 10.6 billion barrels of oil.
"Increasing domestic supply means facilitating drilling where it is allowed already in tens of millions of acres across our country," House Speaker Nancy Pelosi said.
Other measures in the act aimed to speed up development of oil and gas pipeline infrastructure in the Alaskan reserve, as well as the construction of a proposed pipeline that would transport natural gas from Alaska to the Midwest.
The bill would have also reinstated a ban on exporting Alaskan oil to other countries.
The House voted 244 to 173 in favor of the legislation, but the measure fell short of obtaining two thirds of the "yes" votes that was required when the chamber suspends its rules to quickly act on a bill.
Under the suspension of the rules, Republicans were blocked from amending the bill. Republicans say they had enough votes to pass the bill with an amendment lifting the ban on offshore drilling, which is opposed by the Democratic leadership.
A similar bill sponsored by Democrats also failed to pass the House last month.
Opponents of the Drill Responsibly in Leased Lands, or DRILL, Act said the "use it or lose it" measure ignored the many regulatory and legal obstacles oil companies face when they are trying develop leases.
"There are always reasons why production is not occurring. No one is withholding oil at $140 a barrel," said Rep. Steve Pearce, a New Mexico Republican.
The White House had threatened to veto the bill, opposing the "use it or lose it" component and the ban on exports of Alaskan crude oil.
"Such a ban would make virtually no additional oil available to U.S. consumers, and would not lower oil prices that are set in a world market," the White House said in a statement.
"At the same time, such export restrictions are detrimental to the efficient operation of global energy markets and would send the wrong signal to our trading partners who may face pressure to impose similar trade restrictions," the statement added.
The administration was also against the bill's requirement for annual oil and gas leasing sales, calling the mandate "misplaced" and blaming lawsuits against the lease sales for slowing production in the area.
With oil prices surging to record levels above $147, lawmakers have scrambled to produce legislation that addresses soaring energy costs with Republicans focusing on increasing domestic production by opening restricted areas for drilling.
Democrats have pushed for oil companies to use 68 million acres of public lands that are already available and called for the White House to release oil from the Strategic Petroleum Reserve. (Editing by Christian Wiessner)
