NOIA president responds to interior budget request

Offshore staff

WASHINGTON, D.C. – National Ocean Industries Association President Randall Luthi has issued a statement on the Obama administration’s budget request for the Department of the Interior.    

Luthi said: “The administration’s budget request for an additional fee on yet to be producing leases shows a remarkable lack of understanding about geology and the oil and natural gas industry. If the administration’s goal is to produce more home grown energy, this is not the way to go.

“Using this logic, charging more for a fishing license means you will catch more fish, or charging more for a driver’s license means you will get better gas mileage.  Neither is true.  What is true is the offshore oil and gas industry uses the most modern, sophisticated geological and geophysical methods to predict where valuable deposits of oil and natural gas might be found. Once they pay top price for the lease, they pay a rental fee until the lease is producing. If the lease is not developed within the lease terms – usually three, five or 10 years – that lease is returned to the federal government to be sold again.

“Given today’s economy and  today’s prices, exploration companies are not sitting on leases, because  they don’t have a chance of making a profit, nor can they supply more American jobs or produce more American energy, until they actually drill. This old, tired ‘use it or lose it’ philosophy should be lost for good.”


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