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The
bill, authored by Senators Jacky Rosen, a Democrat from Nevada,
and Chuck Grassley, a senior Republican from Iowa, would
increase the minimum bid price per acre during lease auctions
and raise the royalty rate companies must pay on oil and gas
produced from the leases.
The Biden administration said on Tuesday it would launch a
review of federal oil and gas leasing later this month to
address widespread criticism that the program is not yielding
adequate public revenue as well as contributing to climate
change.
While the bill proposed on Wednesday would not deliver on
President Joe Biden’s campaign promise to stop issuing new
leases to fight global warming, it could be applied to existing
leaseholders if passed into law.
The legislation's backing by Grassley could be critical to
winning support for the reforms in the closely-divided Senate.
Similar bills introduced in the House last week did not include
any Republican sponsors.
Like the House bills, the Senate bill would increase royalty
rates for onshore development for the first time in a century to
18.75% from 12.5%, bringing them in line with those paid by
offshore drillers. It would also raise the minimum bid for
federal acreage to $5 an acre from $2 and lift other fees and
costs.
"Big Oil continues to take advantage of low royalty rates on
federal lands," Grassley said in a statement. "Congress has not
addressed this issue for over 100 years and since then, these
oil companies have deprived the Treasury and the American people
of billions of dollars."
Oil and gas production on public lands accounts for nearly a
quarter of all U.S. greenhouse gas emissions.
(Reporting by Nichola Groom; Editing by Sonya Hepinstall)
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