January 27, 2022
Biden Interior Department calls to raise prices for oil and gas companies to drill on public lands

Biden Interior Department calls to raise prices for oil and gas companies to drill on public lands

The Department of the Interior launched a report Friday that proposed “modernizing” the federal oil and gas program, partly by charging fossil gasoline companies extra money to drill on public lands and waters.

The division’s review discovered that the fiscal elements of the present onshore federal oil and gas program are “particularly outdated, with royalty rates that have not been raised for 100 years,” referring to the 12.5% fee the federal authorities fees fossil gasoline companies for oil and gas extracted from public lands and public offshore waters.

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“States with leading oil and gas production apply royalty rates on state lands that are significantly higher than those assessed on Federal lands,” the report states. “The Texas royalty fee, for instance, could be double the federal fee.

“Likewise, bonding levels have not been raised for 50 years,” it continued. “Federal minimum bids and rents have been the same for over 30 years. These antiquated approaches hurt not only the federal taxpayer but also state budgets because states receive a significant share of Federal oil and gas revenues.”

The division mentioned that as well as to elevating royalty and bonding charges, the federal authorities ought to prioritize leasing in areas with identified useful resource potential and keep away from leasing that “conflicts with recreation, wildlife habitat, conservation, and historical and cultural resources.”

The report concluded that the present program fails to present “a fair return to taxpayers, even before factoring in the resulting climate-related costs that must be borne by taxpayers,” and that it “inadequately accounts for environmental harms to lands, waters, and other resources.”

“Our nation faces a profound climate crisis that is impacting every American,” Interior Secretary Deb Haaland mentioned in a statement. “The Interior Department has an obligation to responsibly handle our public lands and waters – offering a good return to the taxpayer and mitigating worsening local weather impacts – whereas staying steadfast within the pursuit of environmental justice.

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“This review outlines significant deficiencies in the federal oil and gas programs, and identifies important and urgent fiscal and programmatic reforms that will benefit the American people,” she added.

The report comes after President Biden on Tuesday ordered a record-setting 50 million barrels of oil launched from the nation’s Strategic Petroleum Reserve in hopes of decreasing gas prices.

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