Markey: SCOTUS Silence on Kerr-McGee Could Mean $54 Billion in Taxpayer Losses
WASHINGTON (October 5, 2009) -- Rep. Edward J. Markey (D-Mass.), who chairs key energy panels and is a senior member of the House Natural Resources Committee, today expressed disappointment that the Supreme Court will not hear a case involving tens of billions of dollars in unclaimed oil drilling royalties. Rep. Markey -- who has introduced and passed legislation in the U.S. House of Representatives to protect taxpayers from royalty-free drilling -- reiterated his long-standing call for legislation.
The so-called "Kerr-McGee" case involves faulty lease agreements with the federal government that have allowed oil companies to drill for free on public lands. The case, originally brought by oil company Kerr-McGee -- now Anadarko – has served as a test case for every other oil company holding a deepwater Gulf of Mexico lease issued by the Interior Department in 1996, 1997 and 2000. The result of this case could now mean that the federal government could lose between $20 and $54 billion, according to a study by the Government Accountability Office.
"The Supreme Court’s refusal to hear Kerr-McGee’s brazen lawsuit means that the oil industry now stands to see a geyser of tens of billions of dollars in windfall profits at the expense of American taxpayers," said Rep. Markey. "At a time when the federal budget is already in the red, this lawsuit means that oil companies can drill here, drill now, and pay never."
The House-passed legislation authored by Rep. Markey would provide a strong incentive for companies holding faulty leases to renegotiate by preventing them from signing new lease agreements unless they renegotiate the old, free-drilling proposals. The Congressional Research Service has concluded that Rep. Markey’s legislation would protect the federal government from losses relating to royalty-free drilling.
"The minerals below our public lands belong to the American people and no company should be allowed to exploit them for free," continued Rep. Markey. "I have been working to ensure that the American people receive a proper return on these public resources since former Secretary of the Interior James Watt tried to give away the rights to mine the Powder River Basin for a fraction of their value, and I will continue to defend the public interest and the American taxpayer."
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