Pelosi and Reid: Oil Companies Must Pay Fair Share to Drill on Public Land

[Omaha Steve]

Pelosi and Reid: Oil Companies Must Pay Fair Share to Drill on Public Lands

9/15/2006 5:58:00 PM

To: National Desk

Contact: Brendan Daly or Jennifer Crider, 202-226-7616; both for House Democratic Leader Nancy Pelosi; Jim Manley or Rebecca Kirszner, 202-224-2939; both for Senate Democratic Leader Harry Reid

WASHINGTON, Sept. 15 /U.S. Newswire/ -- House Democratic Leader Nancy Pelosi and Senate Democratic Leader Harry Reid wrote today to the Congressional Republican leaders urging them to act on Democratic legislation that would encourage oil companies to renegotiate royalty-free leases on public off-shore lands. Currently, many oil and gas leases in the Gulf of Mexico do not include price thresholds, an oversight that could result in a $20 billion revenue loss over the next 25 years. In stating their case for congressional action, the Democratic leaders expressed their concerns over the pace of the Interior Department's effort to renegotiate leases given the department's known ethical troubles and the Bush administration's close ties to big oil.

The text of the letter follows:

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September 15, 2006

The Honorable Bill Frist, Majority Leader, U.S. Senate

The Honorable J. Dennis Hastert, Speaker, U.S. House of Representatives

H-232 U.S. Capitol, Washington, D.C. 20510

Dear Majority Leader Frist and Speaker Hastert:

We are writing to urge you to act immediately to ensure that American taxpayers are fairly compensated for oil and gas leases in publicly owned waters. With oil companies reaping record profits and consumers paying record prices at the pump, it is critical that Congress act to ensure that the American people receive appropriate payment for oil and gas development on public lands.

As you know, in 1998 and 1999, the Department of Interior failed to include price thresholds in Minerals Management Service oil and gas leases in the Gulf of Mexico. This lapse in royalty collections has cost American taxpayers $2 billion and could result in a $20 billion revenue loss over the next 25 years, according to the Government Accountability Office (GAO).

FULL story at link above.

[The Backlash Cometh]

1. YEEEEEEEAAAAAAAAHHHHH!

Let's give this one the "So Damn Obvious it Should have been Done Decades Ago" Award.

[Omaha Steve]

2. OOPS here is the link

http://releases.usnewswire.com/GetRelease.asp?id=72567

[stepnw1f]

3. That Land They Want to Drill on Belongs to the Commons

Who are the Commons?

Andswer: Every Fucking Tax Payer! So I guess the oil is going to be free, right?

[brentspeak]

4. What I don't understand is how these oil companies got the People's land

in the first place.

[Dover]

5. How about the mining companies too?

They've done the same thing for a very long time under Dem and Rep administrations.

[bhikkhu]

6. Fine in principle, but in this case not so...

If you look at the massive investment in research and technology involved in the deep-water Jack #2 and all the risks, there would very possibly have been no discovery without the potential adavantage of a royalty free production. If you are concerned about the dire predictions of peak oil, this is not the sort of project that should be discouraged or penalized.

For an impressive bit about Jack #2:

http://www.energybulletin.net/20455.html

[theophilus]

9. Boofreakin'hoo

I'm more concerned about massive catastrophic climate change. We need to "peak" oil ourselves.....years ago. And having all of these subsidies and corporate welfare just keeps the price artificially low encouraging more poisoning of our ecosystem while the oil "barons" get immorally wealthy. Bad business.Corporate welfare costs this nation trillions.

If the land is public, we need to all get a cut. The miniscule, relatively, prices that drilling, mining, timber companies pay has always been a crime----against nature and against the people of this nation who this land is supposed to belong to. This is the Republican way....use taxpayer money to get incredibly wealthy. Throw all the bums out!

[recidivist]

7. The companies are entitled to the terms of their contracts.

I don't know the intricacies of this issue, but if the linked story is correct, the Reid-Pelosi letter takes aim at the failure of "the Department of the Interior ... to include price thresholds in Minerals Managment Service oil and gas leases in the Gulf of Mexico" in 1998 and 1999.

Just so the discussion doesn't go crazy off the bat, let's remember that Bill Clinton was in the White House in 98 and 99, so our guys were running DOI. Maybe the Clinton-era Interior Department screwed the pooch on something -- again, I'm not familiar with the issue. If, however, something was done wrong at that time, it's got Democratic fingerprints on it, so let's get the facts before hustling up a firing squad.

Bottom line, however, is that oil and gas leases are put out to bid on terms defined by the government. Companies that won those auctions are entitled to the enforcement of their contracts. It is not legitimate, years after the fact, to demand that the leases be renegotiated simply because there is money to be had.

The government deserves to be paid every penny in lease payments and royalties called for under the contracts it signed. No more and no less.

[sofa king]

8. I hope that includes our Native American friends.

Because right now, they're getting skee-rewed.

http://www.projectcensored.org/censored_2006/index.htm#20