Some Members of Congress have asked DOI to expand royalty relief for oil and gas producers during the pandemic. What programs already exist, and what are the arguments for and against expansion?
In this May report, the Congressional Research Service summarizes the current situation with oil and gas royalty relief during the COVID-19 pandemic. Some Members of Congress, citing financial challenges for oil and gas producers during the pandemic, have asked the Department of the Interior (DOI) to offer royalty relief on federal oil and gas leases—a temporary reduction or waiver of the royalties that companies pay the federal government on production from these leases. Some other Members have opposed a comprehensive royalty relief program for federal oil and gas producers.
While DOI does not plan to pursue a new program of blanket royalty relief at this time, the report details existing options for royalty relief. In addition, the report summarizes the arguments advanced on both sides of the debate on expanding royalty relief for oil and gas.
The Congressional Research Service is a nonpartisan legislative branch agency that works exclusively for the United States Congress, providing policy and legal analysis to committees and Members of both the House and Senate, regardless of party affiliation.