Markey Introduces Legislation to Protect Taxpayers, Ensure Oil and Gas Companies Pay Their Fair Share

Press Release

Senator Edward J. Markey (D-Mass.) continued his legislative push on energy today with the introduction of two bills that would hold gas and oil companies accountable for their drilling operations. The Deficit Reduction through Fair Oil Royalties Act would close a loophole that allows dozens of oil companies to drill for free in the Gulf of Mexico. The second bill, the Oil Spill Deterrent Act, increases the fines that can be levied against oil companies who violate the law or regulation. Currently, these fines are capped in statute.

"When oil and gas companies drill on public lands, they should pay royalties to the American people. If they violate drilling safety requirements, the fine should be more than a slap on the wrist so that it is a real financial deterrent," said Senator Markey, a member of the Environment and Public Works Committee. "We need to close this Big Oil welfare loophole that is costing taxpayers billions and adding to our deficit. And we need to update fines for oil and gas spills so they deter the speed-over-safety mentality that led to the Deepwater Horizon tragedy."

Because of an oil company court challenge to a 1995 law, oil companies are now drilling on some leases in the Gulf of Mexico without paying any royalties to the American people for the oil and gas that belongs to them. Senator Markey's legislation seeks to recover funds from faulty drilling leases in the Gulf of Mexico and direct the lost revenue back to the U.S. Treasury to help reduce the deficit. It is estimated that the loophole will cost American taxpayers $15.5 billion over the next ten years.

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