02.26.13

Markey Report: Oil Companies Pocketing Billions of Dollars in Free Drilling

Taxpayers, Congress Squandering up to $40 Billion as Nation Stares Down Sequester, Gas Prices Hit Highs; Report Details Company-by-company Windfalls

WASHINGTON (February 26, 2013) – A new report, released today by Rep. Ed Markey (D-Mass.), shows how more than 100 oil and gas companies are drilling in U.S. waters in the Gulf of Mexico without paying royalties to the American people. Nearly 40 percent of these active royalty-free leases are fully or partially owned by foreign governments. The report shows for the first time how much each of these companies is making in free drilling from the U.S. taxpayers.

The royalty breaks enjoyed by these companies have already cost $11 billion in forgone revenue, and are expected to cost more than $15.5 billion over the next decade – exceeding previous estimates by the Interior Department -- and may ultimately reach a total of $40 billion as oil and gas production rises, according to previously undisclosed Interior Department data obtained by the Democratic staff of the Natural Resources Committee.

The report released by Rep. Markey, “Oil for Nothing…And Gas for Free: Royalty Breaks for Big Oil Cost America Billions,” shows the cost of royalty-free drilling, the value of breaks for specific companies, and the amount of oil and gas being taken without compensation to the American people.

“Gas prices are hitting record highs for this time of the year. Our nation is staring down the ‘sequester’ that will slash programs for the middle class and working poor. And yet this report shows that we are still squandering tens of billions of dollars in free drilling to companies like BP, Exxon and more than 100 other oil and gas companies,” said Rep. Markey, the top Democrat on the House Natural Resources Committee. “Oil companies and their allies in Congress can no longer defend these oil company windfalls that cheat our taxpayers, pollute our budget negotiations, and deprive Americans of real services.”

Among the findings of the report, which can be found HERE, include: