U.S. senators introduce bipartisan oil and gas leasing reform bill, March 10, 2021, by Reuters staff
(Reuters) – Two U.S. senators on Wednesday said they have introduced a bipartisan bill aimed at boosting taxpayer returns from federal oil and gas leasing, the latest in a string of moves in Washington seeking to reform drilling on public lands.
The bill, authored by Senators Jacky Rosen, a Democrat from Nevada, and Chuck Grassley, a senior Republican from Iowa, would increase the minimum bid price per acre during lease auctions and raise the royalty rate companies must pay on oil and gas produced from the leases.
The Biden administration said on Tuesday it would launch a review of federal oil and gas leasing later this month to address widespread criticism that the program is not yielding adequate public revenue as well as contributing to climate change.
While the bill proposed on Wednesday would not deliver on President Joe Biden’s campaign promise to stop issuing new leases to fight global warming, it could be applied to existing leaseholders if passed into law.
The legislation’s backing by Grassley could be critical to winning support for the reforms in the closely-divided Senate. Similar bills introduced in the House last week did not include any Republican sponsors.
Like the House bills, the Senate bill would increase royalty rates for onshore development for the first time in a century to 18.75% from 12.5%, bringing them in line with those paid by offshore drillers. It would also raise the minimum bid for federal acreage to $5 an acre from $2 and lift other fees and costs.
“Big Oil continues to take advantage of low royalty rates on federal lands,” Grassley said in a statement. “Congress has not addressed this issue for over 100 years and since then, these oil companies have deprived the Treasury and the American people of billions of dollars.”
Oil and gas production on public lands accounts for nearly a quarter of all U.S. greenhouse gas emissions.
Reporting by Nichola Groom; Editing by Sonya Hepinstall
MARCH 9, 20212:24 PMUPDATED 17 HOURS AGO
Senators float a price on methane to curb U.S. oil, gas emissions
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WASHINGTON (Reuters) – Three Democratic U.S. senators on Tuesday floated a bill that would take a new approach to curbing emissions from methane from oil and gas production – putting a price on it.
Senators Sheldon Whitehouse, Cory Booker and Brian Schatz introduced the Methane Emissions Reduction Act, which directs the Department of Treasury to assess a fee on the potent greenhouse gas beginning in 2023 – a move they say could end those emissions, help achieve climate change targets and improve air quality in communities near oil and gas facilities.
The bill also calls on Treasury to work with the Environmental Protection Agency and the National Oceanic and Atmospheric Administration to develop a program to monitor and measure methane emissions from each major oil producing basin.
“This bill will hold oil and gas companies financially responsible for their methane pollution and make methane emissions from fossil fuel production cost prohibitive, steps that will go a long way in the fight against climate change and to protect air quality in local communities,” Booker said.
National Climate Adviser Gina McCarthy said the Biden administration is working to propose new regulations here to curb methane emissions on federal and private land by September, replacing and strengthening regulations that the Trump administration had revoked.
Special Climate Envoy John Kerry has said the U.S. will work to align methane regulation with other countries here, such as Canada.
The fee the bill envisions would be assessed on a basin-by-basin basis and cover all companies that produce, gather, process, or transmit oil or natural gas, the senators said, and would be based on a formula factoring in the company’s gas production and methane rate.
Companies that already voluntarily reduce methane will be able to opt out of the fee by demonstrating their emissions intensity is below the average of the operating basin.
Funds raised from the fee go into the National Coastal Resilience Fund, a program administered by the National Fish and Wildlife Foundation and NOAA to prepare communities for climate change.
Reporting by Valerie Volcovici; Editing by Marguerita Choy