Fw: [environment] Taxpayers Will Lose Millions of Dollars to Big Oil Under Energy Bill
- -----Original Message-----
From: Agent Smiley <smileyundaunted@...>
To: wyyrdo@... <wyyrdo@...>
Date: Wednesday, October 31, 2001 12:56 PM
Subject: [environment] Taxpayers Will Lose Millions of Dollars to Big Oil
Under Energy Bill
>For Immediate Release July 10, 2001
>Contact: Beth Daley 202-347-1122 beth@...
>Taxpayers Will Lose Millions of Dollars to Big Oil
>Under Energy Bill
>Language in the House Resources Committee energy bill
>to be proposed this week will cause millions of
>taxpayer dollars to be lost to major oil and gas
>companies, according to the Project On Government
>Oversight. The provision concerns royalty-in-kind
>programs where drilling fees are paid in barrels of
>oil or units of gas rather than in cash.
>ÒAfter decades of shortchanging the taxpayers, new
>rules were implemented in 2000 that prevent oil and
>gas companies from underpaying their fees for drilling
>on federal and Indian lands. Royalty-in-kind programs
>have been promoted by industry as a way to circumvent
>the new rules,Ó according to the organizationÕs
>Executive Director Danielle Brian.
>According to a written statement from Ms. Brian: ÒThe
>Department of Interior has completed two pilot
>programs to date in order the test whether
>royalty-in-kind programs will work. The two programs
>have failed, losing significant revenues in comparison
>to dollars received from programs that collect cash.
>According to the Department of InteriorÕs Inspector
>General, the first pilot program to collect gas
>royalties-in-kind lost 6.5%. Earlier this year a
>second pilot program to collect oil royalties-in-kind
>lost $3 million....Section 232 ÔProgram on Oil and Gas
>Royalties in KindÕ of the House Resources Committee
>energy bill proposes giving the Secretary of Interior
>authority to further expand collections of
>royalties-in-kind...Section 232 would institutionalize
>the further loss of millions of taxpayer dollars to
>major oil and gas companies.Ó
>In 1998, the General Accounting Office analyzed the
>prospect of royalty-in-kind and determined that there
>were significant barriers to ensuring that the federal
>government receives its fair share: ÒAccording to
>information from studies and the programs themselves,
>royalty-in-kind programs seem to be feasible if
>certain conditions are present. However, these
>conditions do not exist for the federal government or
>for most federal leases," (Federal Oil Valuation:
>Efforts to Revise Regulations and an Analysis of
>Royalties in Kind GAO/RCED-98-242).
>To receive a copy of the full written statement,
>contact POGO. Founded in 1981, POGOÕs mission is to
>investigate, expose, and remedy abuses of power,
>mismanagement, and subservience by the federal
>government to powerful special interests.
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