Since offshore drilling began in the 1940's , energy production has been moving farther and farther offshore. Once drilling moved past the three mile statutory limit the federal goverment took control. Over 30,000 wells have been drilled from 4000 platforms. A massive support industry has developed to move men and materials to the rigs and transport oil and gas back to the refineries.

The 1953 Submerged Lands Act established federal authority over the Outer Continental Shelf (OCS) and stripped adjacent states of any revenue from production outside their statutory limits.  Read about the Tidelands case to understand the history. Take a look at Bobby Jindal's efforts in the House of Representatives to pass an energy bill that includes OCS royalties for adjacent states. The Senate version of the energy bill is much less generous to Louisiana but has Mary Landrieu's support as a bill that might actually pass.

Gov. Blanco's tried to regain control of the offshore assets by opposing oil leases in 2006. MMS prevailed initially and was allowed to lease properties in August 2006, but the court suggested Blanco might have a point since environmental studies were not updated post K. Lousiana agreed to drop the case in October when the feds promised to update the environmental studies. Doing it this way really helps no one out and was just an attempt to gain some leverage for the revenue sharing bills.

The lame duck Congress passed the weaker, Senate supported version of OCS revenue sharing on December 8, 2006. It provides Louisiana and three other states with a share of 37.5% of royalties collected on 8.3 million acres of federal land in the eastern Gulf more than 100 miles off the Florida coast. This is expected to produce $20 million per year until 2017 and $650 million per year thereafter. All of Louisiana's other hopes seem to have evaporated with the emergence of the new Democratic Congress.

Not a giant windfall, this money can get coastal restoration started if used wisely. The citizens of Louisiana have already passed a Constitutional Amendment dedicating any offshore oil money to wetlands restoration. Financiers are looking at the possibility of using earnings to support a bond package to get the ball rolling.