Markey: Bush Administration Gives Til It Hurts…the American Consumer: $10 Billion Dollar Holiday Present Mailed to Big Oil in Time for Christmas

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Contact: Select Committee, 202-225-4033 office, 202-494-1568

Markey: Bush Administration Gives Til It Hurts…the American Consumer

$10 Billion Dollar Holiday Present Mailed to Big Oil in Time for Christmas

Proposed Interior Department Rule Change Could Massively Expand Royalty-Free Drilling

WASHINGTON (December 21, 2007) –Rep. Edward J. Markey (D-Mass.), criticized a proposed Interior Department rule change that could lead to the loss of billions of dollars rightfully owed to American taxpayers by oil companies. The proposed Interior Department rule change, issued today, would massively expand the volumes of oil that companies could produce without having to pay royalties to the federal government for the privilege of drilling on public land. The Bush Administration’s own estimates are that taxpayers could lose up to $10.3 billion over the next 26 years as a result of this rule change.

“The Bush Administration couldn’t leave town for the holidays without giving one last taxpayer-funded gift to big oil,” said Rep. Edward J. Markey, Chairman of the Select Committee on Energy Independence and Global Warming. “Rather than joining Democrats in Congress in fighting to make sure that Big Oil pays its fair share to drill on public land at these times of high prices, the Bush Administration is attempting to hand billions of dollars in additional giveaways to big oil.”

This Interior Department’s proposed rule change would at minimum result in $3 billion in lost revenues to the federal government. Should Big Oil prevail in the Kerr-McGee lawsuit, the Interior Department projects that this rule change could lead to $10.3 billion in total losses to the American taxpayer. The Bush Administration has not yet appealed a recent decision in Kerr-McGee’s favor made in the Western District Court of Louisiana. The Department of Justice has until December 30 to appeal the ruling.

“Rather than fighting to protect the American people by appealing the Kerr-McGee decision, the Bush Administration appears to have been working to further expand Big Oil’s windfall should it prevail in this case,” continued Rep. Markey. “Today’s proposed rule change raises the stakes involved in legislatively fixing these faulty leases by an additional $7 billion. The Bush Administration must immediately appeal the Kerr-McGee ruling and drop its opposition to legislative language that would ensure that oil companies pay their fair share even if they prevail in this lawsuit.”

The Bush Administration had threatened to veto the recently-passed energy bill over this legislative royalty-fix that had been included in the House-passed bill. The language was not included in the final bill as a result of this veto threat.   Rep. Markey vowed to renew the effort to enact such legislation next year, saying “We need to keep forcing the White House and Republican Leaders in the Congress to deal with this egregious rip-off of the American taxpayer by Big Oil.”

Analysis released by the nonpartisan Congressional Research Service (CRS) found that legislative language authored by Rep. Markey that has passed the House on numerous occasions would ensure that billions rightfully owed in oil royalties will be paid to American taxpayers regardless of the outcome of lawsuits by big oil.

The memo can be found on the Select Committee website HERE.

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