Millions of acres may be opened for offshore drilling after the House and Senate succumbed to a White House veto threat and agreed to lift a decades-old congressional moratorium.

the ban on offshore drilling is typically included in annual spending bills or continuing resolutions, but this year lawmakers agreed to let it expire on Oct. 1, House Appropriations Committee Chairman David Obey (D-Wis.) announced Tuesday night.

Obey announced an agreement on a continuing resolution (CR) to keep the government funded through March 6, which he said he expects the Senate and White House to agree to.

“I wouldn’t be here if I didn’t think we had an agreement with the Senate,” Obey said. Asked if he believed the White House would sign the bill, Obey said: “I wouldn’t expect them to endorse it, but I have every reason [to believe] they will accept it.”

The $600 billion bill will keep fiscal year 2008 funding levels in place until months into the next president’s first term. Obey said he “reluctantly” agreed to include the 2009 military construction bill, the Department of Defense spending bill and the Homeland Security spending bill to ease concerns on both sides of the aisle of not adequately funding the Pentagon.

The CR will also include $23 billion in disaster relief funding and $5.2 billion for home heating assistance and fund $25 billion in already approved loans to the domestic auto industry, Obey said.

Obey said he wanted the inclusion of billions more in unemployment insurance and for food stamps and aid to states, but relented to White House veto threats on those provisions as well.

As a result, a separate stimulus bill will carry those items, and Democrats “will let the stimulus rise or fall on its own merits,” he said.“We’re not looking for a bill that the White House will veto,” Obey said.

But perhaps the biggest concession Democrats made was on the drilling moratorium, which House Speaker Nancy Pelosi (D-Calif.) was once adamant about keeping in place.

Obey said he and Pelosi wanted to include language similar to that which the House just passed, replacing the 125-mile moratorium with a 50-mile ban and a 50-to-100-mile “opt-in” provision for individual states.
“The White House made it clear that that was an absolute non-starter,” Obey said. “So that will mean, quite frankly, that the next administration will determine what the nation’s offshore drilling policy is … and, at least temporarily, the moratorium is lifted.”

House Minority Leader John Boehner (R-Ohio) called the news a “victory.”
“If true, this capitulation by Democrats following months of Republican pressure is a big victory for Americans struggling with record gasoline prices,” Boehner said in a statement.

House Republicans on Monday obtained a draft Democratic CR that contained the recently House-passed language and blasted Democrats for demanding further restrictions on offshore drilling.
Drew Hammill, a spokesman for Pelosi, praised the agreement Obey reached even without any provisions preventing the opening of all lands outside of three miles off the coasts.