Today, the Senate Energy Committee held a hearing on the Department of Interior’s onshore leasing program. Three of the witnesses who testified used their time to parrot American Petroleum Institute (API) talking points and spread false rhetoric that the Biden administration’s temporary pause on new leases will hurt state and school budgets.
Just last year during the Trump administration, the witnesses — Wyoming Governor Mark Gordon, Occidental Petroleum CEO and API board member Vicki Hollub, and Western Energy Alliance Director Kathleen Sgamma. — favored slashing federal royalty rates to almost zero, which would have cost public schools millions. The Government Accountability Office (GAO) criticized the program for mismanagement and inequitable application.
“It is impossible to take these witnesses at their word or trust that their concerns about school funding are sincere. Just last year they supported a Trump administration rule that slashed royalty rates — costing local public schools untold millions while lining the pockets of wealthy oil and gas executives. These witnesses did little more today than pump out the American Petroleum Institute’s misleading and inaccurate talking points,” said Kyle Herrig, president of Accountable.US.
- Occidental Petroleum Executive Vicki Hollub Pushed API Talking Points On Oil And Gas Wages And Contributions To Education During Her Testimony. “Onshore development remains an important generator of jobs and revenue as well. The oil and gas sector has one of the highest average wages of any sector in the US, normally more than 50% higher than the national average. Median total compensation for Domestic Occidental employees, not including o/t or benefits is over $125,000 per year. In 2019, the oil and gas industry contributed $740M in funding for K-12 education in Wyoming, and 40% of the money in New Mexico’s general fund comes from oil and gas revenues.” [Senate Committee On Energy & Natural Resources, Full Committee Hearing On The Department Of The Interior’s Onshore Oil And Gas Leasing Program, 04/27/21]
- At The Hearing, Kathleen Sgamma Stated Opposition To Increase Royalty Rates. “When some of these reports look at just increasing the royalty rates they forget that when you tax something you get less of it. the federal government has chosen to extract more in process and regulatory costs than it can command in royalty rates. now if we had a stable environment on federal lands like we do in the state of Texas or in North Dakota off of federal lands, then sure, maybe the federal gov could command a higher royalty rate. but with all of the extra cost on federal lands, raising the royalty rate would just continue to transfer jobs from small and rural communities in the west to other areas of the country.” [Senate Committee On Energy & Natural Resources, Full Committee Hearing On The Department Of The Interior’s Onshore Oil And Gas Leasing Program, 04/27/21]
- Gordon Said That Lost Revenue From The Federal Onshore Leasing Program Could Hurt His State’s Economy, Explicitly Highlighting Funding For Schools.. “This revenue funds our schools, health care, public safety, and other essential services. In a study conducted at the University of Wyoming, it was predicted that the eight Western states with Federal oil and gas leasing programs will have investment losses of $2.3 billion, production value losses of $872 million and tax revenue losses of $345 million in the first year of the moratorium/review.” Senate Committee On Energy & Natural Resources, Full Committee Hearing On The Department Of The Interior’s Onshore Oil And Gas Leasing Program, 04/27/21]