Press Releases

Crenshaw, Bipartisan Lawmakers Call on DOI to Cut Gulf Oil and Gas Royalties

Washington, March 20, 2020

(Washington, DC) – Congressman Dan Crenshaw (TX-02), joined by a bipartisan group of 13 lawmakers, today called on the Department of the Interior (DOI) to cut royalties on offshore oil and gas. In a letter to Interior Secretary David Bernhardt, the lawmakers pressed DOI to temporarily reduce or eliminate royalties for leases in the Gulf of Mexico.

“We do not believe the American energy sector needs a bailout from Congress. However, the Department of the Interior has existing authority to temporarily reduce or eliminate royalties set forth in the leases in the Western and Central Planning Areas of the Gulf of Mexico and other lease areas. In the past, the Department has used this authority to increase development and production,” the lawmakers wrote in the letter.

“Given this, we urge you to examine the viability of a temporary reduction in royalties as domestic energy producers weather this combination of an OPEC-driven price war and an epidemic that is driving millions of people around the world into quarantines of one kind or another. Such an action in the short term will help mitigate a price war that is sinking prices and decreasing production.”

Recent actions on the world stage have added to volatility in the U.S. and global energy markets. Russia and Organization of the Petroleum Exporting Countries (OPEC) have recently announced plans to increase output. Combined with the demand shock induced by the evolving coronavirus (COVID-19) situation, these two factors have disrupted the global oil market and caused a dramatic drop in oil prices. 

This letter comes as Rep. Crenshaw has called for additional measures to support the energy industry and its workforce during a period of global volatility. Rep. Crenshaw recently sent a letter with Reps. Liz Cheney (R-WY) and Garrett Graves (R-LA) to Energy Secretary Dan Brouillette, asking the Department to delay sales from the Strategic Petroleum Reserve (SPR), which they did the next day.

This call for royalty relief on offshore oil and gas will help ensure that the cost of production isn’t more than the price of the commodities. This is especially important for America’s smaller producers – many of whom are based in Texas – who feel the burden of these royalties the most.

Joining the letter were Reps. Randy K. Weber (R-TX), Clay Higgins (R-LA), Mike Johnson (R-LA), Bill Flores (R-TX), Chip Roy (R-TX), Bruce Westerman (R-AR), Ralph Abraham, M.D (R-LA), Lizzie Fletcher (D-TX), Kevin Hern (R-OK), Jeff Duncan (R-SC), Brian Babin (R-TX), Michael C. Burgess, M.D. (R-TX), and Michael Cloud (R-TX)

To read Rep. Crenshaw’s letter, please click here.