ADVANCED GEOTHERMAL INNOVATION LEADERSHIP ACT OF 2019

Floor Speech

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Mr. GRASSLEY. Madam President, the bill before us supports clean energy and emerging technologies, so this is the perfect opportunity to update an outdated aspect related to a legacy energy source.

I want my colleagues to know--and I think they do--of my long support for renewable and alternative sources of energy, and so I agree with the aims of the Murkowski-Manchin Energy bill.

The amendment Senator Udall and I have introduced is the same as the bipartisan bill we introduced last week. The title of that bill is the Fair Return for Public Lands Act. This bill was introduced 100 years to the date of the Mineral Leasing Act of 1920.

This amendment would increase the royalty rates on Federal lands from 12.5 percent to 18.75 percent. Everybody here knows that a royalty is what the oil company will pay to a mineral owner--in this case, the mineral owner is the American taxpayer--and that royalty is paid for the right to extract oil and natural gas from the lands of the United States. The legislation modernizes the public lands leasing system, and it does this for the first time since royalty rates were set in 1920.

The legislation increases both the share of royalties taxpayers receive from public lands leasing as well as the rental rates. The new rental rate we are offering in this amendment reflects the current fair market value, while the bill also establishes minimum bidding standards to lease public lands that will stay in line with inflation. This bill is a simple fix by making Federal leasing rates the same whether you are on land or offshore.

The royalty rate the bill offers is very comparable to what current leases are for oil-producing States on their State-owned land. We use the State of Texas as an example. Texas charges a 25-percent royalty on its State lands, while States in the Rocky Mountain West charge royalties that are somewhere between 16-\2/3\ percent and 18\3/4\ percent. The royalty rate on Federal public lands is more than one- third lower, at 12\1/2\ percent; hence our amendment--the same as our bill--updating this and bringing more parity between State rates and Federal rates and, of course, absolute parity with offshore drilling.

The current regulatory system allows companies to get a sweetheart deal on Federal public lands. Senator Udall and I are asking our colleagues to fix this for the American people.

According to studies done by the Congressional Budget Office and the Government Accountability Office, modernizing public lands royalty rates for oil and gas could increase Federal revenues by as much as $200 million over the next decade and do it with little to no impact on production.

It is time--hence our amendment--for my colleagues in Congress to end this oil company loophole and bring oil leasing into the 21st century.

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