Dec 1, 2021 Trade Association Letter to Chairman Manchin on Reconciliation Provisions
Dear Chairman Manchin,
…
The reconciliation text that passed the House of Representatives includes provisions of significant concern. These provisions would serve to place millions of dollars annually in new fees on energy companies that require financial flexibility to continue to produce domestic energy. Moreover, such impacts on domestic production threaten to result in greater reliance on foreign production from nations with weaker environmental standards as compared to production from U.S. federal waters and comparable regions onshore, thus contributing to carbon leakage and damaging U.S. competitiveness Measures such as these could serve to stifle U.S. production and result in further inflationary pressures on those U.S. citizens that can least afford it. These harmful provisions include but are not limited to:
- New per-barrel tax on domestic energy production (Sec. 70804(o))
- New per-acre lease fees on onshore and offshore leases (Sec. 70804(i) and (l))
- Royalties on extracted methane used or consumed (Sec. 70804(r))
- Creation of new annual pipeline fees of at least $10,000 per mile in deepwater and $1,000 per mile in shallower water (Sec. 70804(q))
- Increasing minimum offshore and onshore royalty rates (Sec. 70804(c))
- Ban on Eastern Gulf, Atlantic and Pacific leasing; (Sec. 70804(b))
- New and increased offshore inspection fees (Sec. 70804(m) and (n))
- Shortened onshore lease term lengths (Sec. 70804(h))
- New idled well fees (Sec. 70804(p))
- Repealing royalty relief authority (Sec. 70804(s))
- Unrestrained authority for the Secretary to withdraw lands without due process or any public input (Section 70709)
- Imprecisely drafted provisions to update bonding requirements and duplicative bonding provisions for idle wells (Section 71409)
- Multiple, duplicative per acre fees for onshore leases (71407, 71411-71414) …
