Carney: Oil Companies Need to Use it or Lose it

Statement

CARNEY: OIL COMPANIES NEED TO USE IT OR LOSE IT

Responsible Ownership of Public Lands Act will compel oil companies to begin producing oil and gas

Legislation expected on the House floor next week

Congressman Christopher P. Carney is taking action to lower gas prices by pushing House Leadership to enact the Responsible Ownership of Public Lands Act, which compels oil companies to begin producing oil and gas on the roughly 68 million acres of public land they currently hold but are not using.

"Gas is over $4 a gallon in Pennsylvania, and Americans are looking for long term solutions to high oil prices. We need to make sure that oil companies are producing on the land they currently lease. They need to either use it or lose it," said Carney.

This legislation will also invest in programs to develop renewable energy technologies to reduce our overall dependence on oil and help low-income consumers. Carney is an original cosponsor of the legislation and is urging House Leadership to take action to pass meaningful reform for American families.

"Upon close examination, we see that oil companies are not producing oil or gas on the vast majority of federal land onshore and offshore already under their control. Offshore, Big Oil is producing on only about 23 percent of the land they hold, while onshore, companies are producing on roughly 27 percent of the acres to which they hold the drilling rights. This isn't fair to American families who are paying artificially high prices. If our public land is being leased to oil companies, we need to make sure it's being used to benefit our families," said Carney.

Current law allows leaseholders 10 years to develop oil or gas - the Responsible Federal Oil and Gas Lease Act cuts that down to 5 years. While existing leases can be cancelled if leaseholders fail to comply with lease provisions, laws, or regulations such as public safety and environmental requirements, there is no law or regulation that requires diligent development of federal oil and gas leases. As long as leaseholders pay the required annual rental fee, the government cannot compel diligent development of the leased lands.

The Responsible Federal Oil and Gas Lease Act requires oil and gas operators to diligently develop federal oil and gas leases, as is currently required of coal leaseholders. This requirement was enacted in the 1970's to prevent coal operators from using federal resources for speculation that would drive up prices. No such requirement is placed on oil and gas operators and H.R. 6251 corrects that situation.

The Responsible Ownership of Public Lands Act will assess an escalating fee on land that oil companies have leased but are not using for production. This fee would be a mere $5 per acre for the first 3 years that a lease is not producing, but increase to $25 per acre in the fourth year and $50 per acre in subsequent years, providing a strong incentive for oil companies to stop stockpiling these leases and begin using them. The revenue raised from these fees will go toward renewable energy and energy efficiency investments that will reduce our dependence on oil, as well as the Low Income Home Energy Assistance Program (LIHEAP).

"Its time now that Big Oil take a backseat to the American family. For too long, Big Oil has been the darling of the Bush Administration and with this legislation those days are over. This legislation responsibly uses the land that belongs to all Americans," said Carney.

House Leadership has announced the energy bills will be coming to the floor next week, including legislation to address speculation and the futures market, use-it-or-lose it, anti-price gouging legislation, and assistance for mass transit fares.

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