They also dropped from the budget document plans to allow states to authorize oil and gas drilling off the Atlantic and Pacific coasts - regions currently under a drilling moratorium.
GOP leaders acted after a rough day on Capitol Hill for the oil industry - as CEOs of the nation's largest oil companies testified at a, soaring energy prices, and ways to protect consumers from price-gouging and unaffordable transporation and heating oil costs.
The House move to give up for now on the Alaska energy exploration proposal is a setback for those who have tried for years to open a coastal strip of the Arctic National Wildlife Refuge, or ANWR, to oil development, and a victory for environmentalists including the Natural Resource Defense Council, which has lobbied hard against the drilling and argues that improving fuel efficiency in cars and trucks would do far more to reduce U.S. dependence on foreign oil.
President Bush has made drilling in the Alaska refuge his top energy priority. Supporters of the idea argue there is a good chance of a major oil field discovery and with the drilling area accounting for 8 percent of the total acreage of the refuge, the "long term ability of the habitat to support wildlife would not be affected."
The House Rules Committee formalized the change late Wednesday by issuing the terms of the debate when the House takes up the budget package on Thursday.
The decision to drop the ANWR drilling language came after GOP moderates said they would oppose the budget if it was kept in the bill. The offshore drilling provision was also viewed as too contentious and a threat to the bill, especially in the Senate.
Last week, the Senate included ANWR drilling in its version of the budget, so the matter will have to be thrashed out in negotiations between the Senate and House if the budget is approved by the House.
Protection of the Alaska refuge from oil companies has been championed by environmentalists for years. The House repeatedly has approved drilling in the refuge as part of broad energy legislation, only to see their effort blocked each time by the threat of a filibuster in the Senate.
The move in the House is another disappointment for President Bush, whose Social Security overhaul also has stalled in Congress. At the same time, his presidency has been troubled by mounting U.S. casualties in Iraq, the withdrawal of Supreme Court nominee Harriet Miers and the investigation over the leak of a CIA operative's identity.
Twenty-five Republicans, led by Rep. Charles Bass of New Hampshire, signed a letter asking GOP leaders to strike the Alaskan drilling provision from the broader $54 billion budget cut bill.
"Rather then reversing decades of protection for this publicly held land, focusing greater attention on renewable energy sources, alternate fuels, and more efficient systems and appliances would yield more net energy savings than could come from ANWR and would have a higher benefit on the nation's long-term economic leadership and security," they said.
"If we reverse the protection for ANWR, then the protection of the White Mountains in New Hampshire, Yellowstone National Park, the Grand Canyon and all other public spaces becomes meaningless," Bass said.
The moderates knew they had leverage, given the narrow margin of GOP control of the House. It only takes 14 Republican defections to scuttle a bill, assuming every Democrat opposes it.
Still, removing the Arctic oil drilling provision could incite a backlash from lawmakers who strongly favor it, which is a big majority of Republicans. House and Senate GOP leaders are likely to push hard to get the ANWR proposal back into the bill in negotiations on a final document.
Marnie Funk, a spokeswoman for Sen. Pete Domenici, R-N.M., said that Domenici considers the ANWR provision, which the Senate approved, "one of the most critical components" in the budget package. "He is committed to coming back to the Senate from the conference with ANWR intact," she said.
GOP leaders, led by House Speaker Dennis Hastert, R-Ill., also agreed to drop a plan to allow states to waive a 24-year ban on drilling along the Atlantic and Pacific coasts and open a contested tract off the Florida Gulf coast to oil drilling. Several Florida Republicans opposed the plan.
The overall bill is a Republican priority. The Senate passed a milder version of the bill last week that would curb the automatic growth of federal spending by $35 billion through the end of the decade. The House plan cuts more deeply across a broader range of social programs.
In a concession to lawmakers upset with a spate of cuts to social programs, GOP leaders bowed to pressure from Cuban-American lawmakers from the Miami area to loosen new restrictions on food stamps benefits for legal immigrants.
Immigrants who are disabled, over the age of 60 or applying for citizenship would be exempt from proposed rules extending the eligibility period for food stamps from five to seven years.