Democrats urge DOI not to cut offshore oil royalty rates

Democrats urge DOI not to cut offshore oil royalty rates

Politicians of the Democratic Party are urging the US Department of the Interior (DOI) to not proceed with a proposed cut to federal royalties payable on deep-water oil and gas projects, according to Reuters.

The Democratic members of the Senate and House of Representatives natural resources committees wrote a letter that expressed concern that the plan to cut the royalty rate from 18.75% to 12.5% would deprive taxpayers of billions of dollars in revenue while being a bonanza for the oil companies involved.

Reducing the royalty rate, which has already been done for shallow water projects, is being pushed by the administration of President Donald Trump as a way to increase America’s energy production.

Democrats fear that the output boost will not be commensurate with the cut in the rate, leading to a shortfall in the coffers.

DOI’s Royalty Policy Committee is set to evaluate the rate cut idea.

Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.

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