FOR IMMEDIATE RELEASE
APRIL 20, 2016
DENVER—The nonpartisan Congressional Budget Office this week released an analysis that found higher royalty rates for oil and gas drilling on public lands and a revamped leasing process could bring in more than $1.2 billion over the next decade.
The Center for Western Priorities, which has long advocated for federal royalty rate reform, released the following statement from deputy director Greg Zimmerman:
“The CBO analysis confirms what we’ve been saying for years—taxpayers deserve their fair share when oil and gas is extracted from land that’s owned by the American people. But the current system is benefitting oil companies at the expense of American taxpayers, costing all of us hundreds of millions of dollars each year. This money could help pay down the national debt, fund education programs, and address the maintenance backlog in our national parks.”
Currently, the government only charges $1.50 per year when oil and gas companies purchase a lease but leave the land idle. The CBO report says the Department of the Interior could raise $200 million in ten years by simply charging a $6 per acre fee on non-producing leases.
Zimmerman added, “When oil and gas companies lease American lands, they should be paying a reasonable rental, whether they’re drilling on it or not. Right now an oil company can sit on lands for less than a cup of coffee costs. If they don’t intend to produce oil or gas, that land should stay open for the American people to use.”
Arizona Rep. Ra√∫l Grijalva, the ranking member of the House Natural Resources Committee,said in a statement that he supports “commonsense reforms that would end the sweetheart deal the oil and gas industry is getting to drill in some of our most treasured places.”
Grijalva and California Rep. Alan Lowenthal are sponsors of H.R. 4389, which would raise minimum bids for oil and gas leases, and raise onshore royalty rates to 18.75 percent, in line with royalty rates for offshore oil production.
Greg Zimmerman is available for video and audio interviews. To schedule an interview, contact media director Aaron Weiss at 720-279-0019 or aaron@westernpriorities.org.