Scalise, Louisiana Colleagues Urge DOI to Expedite Royalty Relief Process

May 21, 2020
Press Release

WASHINGTON, D.C.—House Republican Whip Steve Scalise (R-La.) and members of the Louisiana Congressional Delegation sent a joint letter to the U.S. Department of the Interior (DOI) Secretary David Bernhardt requesting DOI to expedite the royalty relief process to protect jobs, keep businesses afloat, and ensure America is still the dominant energy producer once we emerge from the Coronavirus pandemic:

“In 2019, energy production in the Gulf of Mexico supported nearly 500,000 jobs, over $5 billion in government revenues, and $155 million in coastal restoration funding in Louisiana alone," said Whip Scalise. "Energy producers in the Gulf of Mexico, and the companies who service them, not only support the communities and businesses in Southeast Louisiana, but our nation’s economy and overall energy and national security. Moreover, for Louisiana, revenues from offshore production have provided lifesaving investments to restore our state’s coastline. We must ensure Gulf of Mexico energy producers survive this challenging time, and I will continue fighting to protect the jobs, communities, and coastal restoration projects supported by Louisiana’s offshore energy producers.”

“Expedited royalty relief is necessary to mitigate further oilfield job losses and disruptions to U.S. energy production," said Congressman Clay Higgins. "We should pursue every available measure at the federal and state level to protect American energy jobs and position the oil and gas industry for a solid recovery.”

“Louisiana’s oil and gas industry is in a state of unprecedented turmoil,"
 said Congressman Mike Johnson. "I am pleased and thankful that Secretary Bernhardt is committed to providing much needed royalty relief to our producers, and, as a member of the Natural Resources Committee, I will continue to work with the Department of the Interior to ensure this process is as streamlined as possible so these companies can continue operating and employing thousands of people in our state.”

“The real ‘all of the above’ energy strategy carried out by the Trump Administration has placed America as a global energy leader,"
 said Congressman Garret Graves. "It has resulted in more American jobs versus overseas jobs, lower costs to heat and cool our homes, we can fuel our vehicles at affordable prices, we have lower emissions and funding to restore our coast and protect our state from hurricanes and flooding. Delayed action by the Department of the Interior puts all of this in jeopardy and plays into the hands of China, Saudi Arabia, Russia and others. We need quick action.”

"President Trump and his administration have stepped up to help America's oil and gas industry through some of the most difficult times in history," 
said Congressman Ralph Abraham. "Oil prices have hit historic lows in recent weeks due to decreased demand from the Coronavirus pandemic and supply pressures from Russia and Saudi Arabia. There is still work to be done to protect American energy producers and help stabilize the markets, and I'm confident that we can work with President Trump and Secretary Bernhardt to accomplish this."

Read what key stakeholders are saying about the letter:

“LMOGA applauds the HEAT coalition for their support to streamline and expedite royalty relief for the industry and ultimately save American jobs. The Gulf of Mexico is a critical piece of our nation’s energy portfolio; however, the recent downturn has resulted in at least $40 billion in capex spending reductions offshore.  Ten years ago there were about 110 operators in the Gulf and today there are about 50 and the number will continue to dwindle if serious measures are not taken. Continued investment in the Gulf is being hampered by policy implementation that is not right-sized to the current problem and any pause or backsliding in investment now will affect the long term viability of investment in the Gulf of Mexico,” said Tyler Gray, President & General Counsel of the Louisiana Mid-Continent Oil and Gas Association (LMOGA).

“Producing American energy in the Gulf of Mexico is the heartbeat of Gulf Coast communities. Today we need immediate and bold action to revitalize these communities as small and mid-size companies in the offshore service sector are swiftly implementing furloughs and layoffs. The Gulf Economic Survival Team and our partner organizations support the HEAT Coalition in asking the Department of Interior to expedite royalty relief as well as consider other policies to stimulate investment in the Gulf of Mexico to get our American energy workers back to work and ensure our nation’s long-term economic viability,” said Lori LeBlanc, Executive Director of the Gulf Economic Survival Team (GEST).

“We applaud Congressman Scalise and his colleagues for requesting President Trump take action to assist American Energy Production and the Service Industry that supports it. Just like all other sectors of our economy, the Energy Industry has already suffered considerably due to the devastating economic impact of COVID-19. This assistance would support American jobs, energy, and security, all of which we desperately need,” said Chett Chiasson, Executive Director, Port Fourchon.

“We are grateful for the sixty members of the House of Representatives’ House Energy Action Team who signed a letter addressed to Interior Secretary David Bernhardt urging Interior to issue much needed meaningful royalty relief. Royalty relief is urgently needed to help ensure that struggling offshore oil and gas companies survive the twin crises of the oil price war and the global coronavirus pandemic. The existing royalty relief is fundamentally flawed and the improvements raised in the House Energy Action Team letter must be implemented to avoid the existential threat to independent offshore oil and gas companies, which would costs tens of thousands of jobs and irretrievably strand millions of gallons of oil, likely forever,” said Kevin Bruce, Executive Director of the Gulf Energy Alliance (GEA).

“The Gulf of Mexico is a major source of energy and economic security for the U.S., but the region has been hit hard by the one-two punch of COVID-19 and the Saudi Arabia-Russia oil price war. Offshore energy companies – and the hundreds of thousands of workers they support – need policy action. Interior should take the action outlined by HEAT to streamline and expedite the special case royalty relief process as quickly as possible. We thank the members who signed this letter for advocating for jobs and domestic energy security,” said Erik Milito, President of the National Ocean Industries Association.

The letter is being sent to Interior Secretary Bernhardt to emphasize the unprecedented scenario facing domestic energy producers due to COVID-19 and the recent global oil price war, and the impact that these dire circumstances have on the thousands of small businesses and suppliers who rely on America’s oil, natural gas, and coal sectors. The Trump Administration has helped America achieve energy dominance, resulting in cheaper energy for American families, high-paying jobs, a resurgence in domestic manufacturing and a strengthened geo-political position. Expediting the royalty relief process will help America remain energy dominant and will limit the negative impacts the COVID-19 pandemic has on American energy producers.
Read the full letter here.
The letter was signed by 60 Members including Republican Whip and HEAT Co-Chair Steve Scalise (R-La.), House Republican Leader Kevin McCarthy (R-Calif.), HEAT Co-Chairs Markwayne Mullin (R-Okla.) and Jeff Duncan (R-S.C.), Clay Higgins (R-La.), Rick Crawford (R-Ark.), Bruce Westerman (R-Ark.), Scott Tipton (R-Colo.), Fred Keller (R-Pa.), David Rouzer (R-N.C.), Roger Marshall, M.D. (R-Kan.), Randy K. Weber (R-Texas), Paul A. Gosar, D.D.S. (R-Ariz.), Greg Pence (R-Ind.), David P. Roe, M.D. (R-Tenn.), Jody Hice (R-Ga.), Carol D. Miller (R-W. Va.), Bill Flores (R-Texas), Troy Balderson (R-Ohio), Kevin Hern (R-Okla.), Kelly Armstrong (R-N.D.), H. Morgan Griffith (R-Va.), Larry Bucshon, M.D. (R-Ind.), Pete Olson (R-Texas), Liz Cheney (R-Wyo.), Debbie Lesko (R-Ariz.), Doug Lamborn (R-Colo.), Chris Stewart (R-Utah), Doug LaMalfa (R-Calif.), K. Michael Conaway (R-Texas), Rob Bishop (R-Utah), Chip Roy (R-Texas), Garret Graves (R-La.), Rick W. Allen (R-Ga.), Kevin Brady (R-Texas), French Hill (R-Ark.), Paul Cook (R-Calif.), John Joyce, M.D. (R-Pa.), Richard Hudson (R-N.C.), Dan Newhouse (R-Wash.), Ralph Abraham, M.D. (R-La.), Russ Fulcher (R-Idaho), Lance Gooden (R-Texas), Michael T. McCaul (R-Texas), Tom Cole (R-Okla.), Mike Johnson (R-La.), Michael C. Burgess (R-Texas), Steven M. Palazzo (R-Miss.), Roger Williams (R-Texas), Tim Burchett (R-Tenn.), Michael Cloud (R-Texas), Guy Reschenthaler (R-Pa.), Pete Stauber (R-Minn.), Dan Crenshaw (R-Texas), Ron Estes (R-Kan.), Jim Banks (R-Ind.), Jim Hagedorn (R-Minn.), Andy Biggs (R-Ariz.), Alex X. Mooney (R-W. Va.), and David B. McKinley, P.E. (W. Va.).


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