×

Subscribe

SIGN UP! Save Time, keep up with important news that you don't want to miss.
No, I want to miss out.
×

Thank you

Check your inbox for a confirmation email!

‘That wasn’t our intent’: Big Oil exploited $18-billion government mistake

10/25/2019 3:49 pm ET Molly Taft
Socialism for Big Oil? Industry got away with $18 billion break 1

YouTube Screenshot

Sloppily-written language in a decades-old law has allowed oil and gas drillers to take $18 billion in tax breaks tied to production in the Gulf of Mexico since 1996, federal investigators concluded this week.

A 1995 law intended to encourage drilling in the area inadvertently created a loophole that has allowed some leases held in the Gulf by major companies, including Chevron, ExxonMobil and BP, to operate royalty-free for decades—a consequence that was not intended in the original legislation—the politicians behind the law have told the Government Accountability Organization and the New York Times.

“That wasn’t our intent,” former Sen. J. Bennett Johnston (D-LA) told the Times. Johnston, an advocate for the original royalty reprieve. “There should have been a provision that said it didn’t apply above a certain threshold” for oil prices.

“These leases sold 20 years ago might keep producing for decades,” GAO director Frank Rusco, who wrote an investigative report on the leases, told the Times. “The amount of forgone royalties is going to continue to increase.”

For 2018, Chevron reported “annual earnings of 14.8 billion,” ExxonMobile earned 20.8 billion, BP reported 12.7 billion in profit for the year.

Perhaps if the government closed up loopholes such as these, they wouldn’t have to cut SNAP programs, limit the funds that are budgeted for our veterans, or cut the budget for school lunch and head start programs. It is quite obvious the oil companies can afford to pay.

 

Back To Front Page