Trump Administration’s Billionaire Oil and Gas Bailout, Another Blow to Taxpayers, Already in the Works
This press release was originally posted through Western Values Project. Western Values Project is now Accountable.US.
While Virus Rapidly Spreads, Trump More Interested In Sending Tax Dollars to Billionaire Oil Barons
The Trump administration is reportedly preparing to push for an all-out bailout for oil and gas corporations and billionaire oil tycoons that could cost American taxpayers’ a hefty price amid the sharp decline in oil prices around the globe.
“Trump’s unchecked energy dominance agenda certainly assisted in the glut that was part of the dramatic oil price drop as a result of COVID-19. To continue to blindly go into the night with oil and gas lease sales that are going for less than a cup of coffee isn’t going to be helpful either. Trump’s billionaire bailout bottom-line: taxpayers could be fleeced on both ends,” said Jayson O’Neill, Western Values Project Director.
Already, Rep. Raul Grijalva pressed the Bureau of Land Management (BLM) Acting Director William Pendley for answers on why the administration is planning to prioritize oil industry bailouts over the public’s immediate needs arising from the COVID-19 pandemic – and received none.
Ongoing, long-term subsidies enjoyed by the oil industry such as low royalty rates have been celebrated and continued within the Trump administration, unabated. Under the already grossly outdated royalty rate, taxpayers have lost $12.4 billion in revenue from oil and gas drilling on federal lands over the last decade according to a recent study by Taxpayers for Common Sense. This new bailout revelation comes after requests from oil industry billionaires like Harold Hamm, who is a known contributor to Senator Cory Gardner’s (R-CO) reelection campaign.
News out of Utah this week shows that oil and gas corporations are already increasingly exploiting the oil and gas leasing system to abuse taxpayer resources amid the current price decline. Yesterday, President Trump’s BLM held a planned oil and gas lease sale in Utah spanning almost 33,000 acres – 25 parcels – in the northeastern part of the state, threatening public lands like McCoy Flats mountain biking trail system as well as the air quality in the surrounding area. Far from needing a bailout, the oil and gas industry purports to have ample resources available to devote to speculative, ill-advised, wildly unpopular fracking and drilling projects on land sold to them for rock bottom prices by the Trump administration at taxpayers’ expense.
The parcel sales plowed ahead, even as the global oil market experiences a steep decline. While oil lease sales normally see only one-third of acreage sold for the minimum two dollars per acre, yesterday, nearly 90 percent sold at that price – less than a cup of coffee
- Acres offered over sold: 32,714 acres / 28,492 (87%)
- Leases offered over sold: 25 leases / 22 (88%)
- Sold for minimum bid ($2 per acre): 18 leases or 24,836 acres (87% of acres)
“Oil and gas corporations and billionaire oil barons are hoarding more public lands at rock-bottom prices even as oil prices plummet,” continued O’Neill. “This isn’t what’s best for our outdoor heritage, public lands economy, or taxpayers. This proposal would be another sweetheart deal for oil and gas corporations who are looking to drill and develop even more of our public lands for mere pennies on the dollar, while taxpayers are often left on the hook for the inevitable cleanup costs. This is what losing looks like.”
In addition to the oil and gas industry already rapidly scooping up public lands at rock-bottom prices, the Trump administration reportedly is considering altering other policies that already cost the public significantly:
- Reducing royalty rates: Outdated fiscal policies have allowed the administration to subsidize the oil and gas industry for years and current bailout plans could further reduce already rock-bottom barrel royalty rates on public lands. Under the already grossly outdated royalty rate, taxpayers have lost $12.4 billion in revenue from oil and gas drilling on federal lands over the last decade. Revenue from drilling on these leases has instead gone into the pockets of the oil and gas companies. Just last month, Senator Udall (D-NM) and Senator Grassley (R-IA) introduced the bipartisan Fair Returns for Public Lands Act of 2020 to reform federal onshore oil and gas fiscal rates.
- Expediting Drilling Permits: Speeding up permitting will give more public land to oil companies at lower prices while doing nothing to spur demand for low-priced oil. Instead, it’ll likely make the Trump administration’s pattern of ignoring public input an even larger crisis. Any effort to expedite permitting will likely leave local voices concerned about what drilling means for their air, water, outdoor recreation economy, and health out of the conversation.