U.S. Royalty Plan to Give Windfall to Oil Companies

From The New York Times:

The federal government is on the verge of one of the biggest giveaways of oil and gas in American history, worth an estimated $7 billion over five years.

New projections, buried in the Interior Department’s just-published budget plan, anticipate that the government will let companies pump about $65 billion worth of oil and natural gas from federal territory over the next five years without paying any royalties to the government.Based on the administration figures, the government will give up more than $7 billion in payments between now and 2011. The companies are expected to get the largess, known as royalty relief, even though the administration assumes that oil prices will remain above $50 a barrel throughout that period.

The royalty relief stems from a time 10 years ago when oil was $10 a barrel (it was a mis-guided effort to encourage production and consumption if you ask me). But do you think Congress will react to the changing times? I doubt it. Providing “relief” to that poor Exxon Mobil company is more important, I guess.

One thought on “U.S. Royalty Plan to Give Windfall to Oil Companies”

  1. We can give up over $7 billion in payments from oil companies, but we can’t afford to fund rural schools and roads without selling off thousands of acres of our public lands….

    I can’t help but wonder just who it is who’s waiting to purchase those lands; and what specific resources lay in wait, surely to be exploited once the greedy buzzards get their hands on it, with no holds barred.

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