Bush Drops California Oil Challenge

The Bush Administration is dropping its challenge to a court ruling that halted oil and natural gas exploration off the California coast. California officials say the move is a victory in their fight to retain control over development off the state´s shoreline.

Interior Secretary Gale Norton says the administration wants to resolve the dispute over 36 offshore leases held by oil companies through negotiations, not lawsuits. California officials and several environmental groups sued the federal government to allow the state to have some say in the future of the 36 leases. The proposed development would be in waters off Ventura, Santa Barbara and San Luis Obispo counties.

2 federal courts had ruled that the area can´t be drilled or explored until the California Coastal Commission approves the plan. The Bush adminstration had until Tuesday to ask the U.S. Supreme Court to hear their appeal.

State officials are urging the administration to buy back the leases, which run until 2009. Interior officials say they want the state to bear some of that cost.