NEW YORK (CNNMoney.com) -- With oil prices near record highs, the House is set to vote Thursday on whether to allow domestic oil drilling off the East and West coasts - a proposal that has bitterly divided the oil industry and most environmentalists.

"The outer continental shelf contains enormous amounts of energy that can keep jobs in America and lower energy prices," said Brian Kennedy, a spokesman for Republicans on the House Committee on Natural Resources.

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"This is a proactive approach to give states protection and increase energy at the same time."

The bill, which has bipartisan support and is sponsored by Rep. Richard Pombo (R-Calif.), would lift a long standing ban on drilling in most federal waters outside the Gulf of Mexico, which extend from three to 200 miles offshore.

The decision to drill in the first 100 miles from shore would be left up to the individual states, while 100-200 miles out would be open for business.

Royalties, which currently are all paid to Washington, would be split between the federal government and the states. Some legislators oppose the bill on these grounds alone.

"At a time when our nation is struggling under the weight of record deficits, this bill would throw open the doors to the Treasury," said Rep. Nick Rahall, (D-W.Va.).

The bill pits those who see offshore drilling as a source of secure domestic oil against those who say such drilling will do little to solve the nation's long-term energy needs - and could hurt industries like fishing and tourism.

Legislators whose states are heavily reliant on tourism, like Florida and California, are concerned unsightly rigs will blight the horizon or pollution will foul the beaches.

Environmentalists also say the focus on more drilling takes away from longer-term solutions that emphasize conservation.

"It continues our addiction to oil in general," said Karen Wayland, legislative director for the Natural Resources Defense Council. "What we need is a serious commitment to energy efficiency."

Wayland said stricter efficiency standards on appliances alone would yield savings amounting to three times the natural gas reserves found offshore.

But both sides in this debate are spinning the numbers to best suit their case.

Lisa Flavin, a spokeswoman for the American Petroleum Institute, said the outer continental shelf, including Alaska, contains 85 billion barrels of untapped oil.

The country's total energy consumption is equal to about 17.2 billion barrels of oil each year, according to the Energy Information Administration.

"It's enough to replace oil imports from the Persian Gulf for 59 years," said Flavin. "Obviously, this is a big deal."

According to Congressional staffers, the bill is expected to pass the House but run into more difficulty in the Senate, which is currently considering a much more modest proposal.

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