US Senate leaders indicate they’ll support a vote later this year on legislation supported by industry groups changing how states share revenue from oil and gas produced on federal land.
A revenue-sharing bill was proposed at the end of June by Sens. Bill Cassidy (R-La), Energy and Natural Resources Chairman Lisa Murkowski (R-Alas.), Tim Scott (R-SC), Dan Sullivan (R-Alas.), Thom Tillis (R-NC), and David Vitter (R-La.).
It covers onshore and offshore production of oil and natural gas as well as of renewable energy.
The legislation aims to correct imbalances of a system under which coastal states now receive 0.07% of federal royalties while onshore states receive 50%.
“This legislation protects onshore energy-producing states’ royalties and increases offshore states’ share,” according to a fact sheet.
The bill establishes 37.5% revenue-sharing for Alaska and Middle Atlantic states, beginning in 2027, subject caps that increase with time and disappear after 2067.
It maintains 37.5% revenue-sharing for states on the Gulf Coast but adjusts current limits, removing caps after 2055.
The bill also directs 12.5% of federal OCS revenue to specific uses in coastal states.
For onshore oil and gas production on federal land the bill restores 50% in revenue-sharing.
Cassidy said Senate Majority Leader Mitch McConnell tweeted, “Thanks to the Louisiana delegation, Senate is primed to take up the critical issue of resource production revenue sharing later this year.”
Presidents of eight oil and gas industry groups wrote Cassidy a letter supporting the legislation.