On. Sept. 22, Rep. Grijalva -- as the ranking member of the House Subcommittee on National Parks, Forests and Public Lands -- publicly released a letter he and Sen. Tom Udall sent the Government Accountability Office (GAO) requesting an investigation of corporate profits and public financial benefits from mineral and oil extraction on federal lands. The agency has informed Rep. Grijalva and Sen. Udall that it will act on the request. Select news coverage of the issue is available below.

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Lawmakers seek details on oil royalties, hardrock mining payments

http://bit.ly/p8HHSB

Posted on September 22, 2011 at 11:45 am by Jennifer A. Dlouhy, Hearst Newspapers

Western lawmakers are asking congressional investigators for a detailed accounting of the oil, gas and minerals recently extracted from public lands and waters, as part of what they described as a bid to make sure taxpayers are getting a “fair return” from the development.

The push by Rep. Raul Grijalva, D-Ariz., and Sen. Tom Udall, D-N.M., comes as a special 12-member congressional committee searches for ways to pare at least $1.2 trillion from the federal deficit over the next 10 years.

“We’re talking about radical cuts and reductions in Medicare and Social Security,” Grijalva said. But “here we have public lands and the Outer Continental Shelf owned by the American people in which significant activity is going on.”

Grijalva and Udall have asked the Government Accounting Office to outline the amount of minerals extracted from federal land and the OCS in fiscal 2010, as well as the estimated dollar value of those materials. The pair also asked the GAO, Congress’ investigative arm, to detail how much the federal government collected for the minerals in royalties, rents and bonus payments.

Although the U.S. government collects royalties for oil and gas extracted from public lands and federal waters, the same isn’t true for hard rock mining of silver, gold, copper and other minerals on federal land. The federal government currently does not collect royalties for mineral development on public land.

President Barack Obama proposed changing that practice in his fiscal 2012 budget request earlier this year, and the idea has been debated sporadically on Capitol Hill.

Udall said that “an objective analysis of the business of mining and mineral leasing on federal lands” would pave the way for an informed debate about federal royalties.

“America’s abundance of natural resources belong to the public and should benefit the nation as a whole, especially at times of large budget deficits,” Udall added.

Grijalva said the government analysis would add “perspective.” He complained that there has been a “rush to judgment over the last few months,” with drilling and mining advocates insisting that more development will lead to energy independence and new jobs.

“That has been the mantra now for eight months,” Grijalva said, but “we’re having this discussion in a vacuum.”

“Everything is built on assumptions . . . that as we create a less regulatory environment, as we undo NEPA (the National Environmental Policy Act), and as we undo other protections, that there is going to be a massive blossoming of jobs and exploration activities.”

Any new data about revenue from oil and gas development — and the lack of royalties from hardrock mining — could pave the way for changes on Capitol Hill. Interior Secretary Ken Salazar also has been examining royalty rates charged for oil and gas extracted from public lands and waters and raised the possibility that some of those charges could be hiked.

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Grijalva, Udall demand accounting of mining and drilling

http://bit.ly/nmKr2G

Manuel Quinones, E&E reporter

Published: Thursday, September 22, 2011

Rep. Raúl Grijalva (D-Ariz.) and Sen. Tom Udall (D-N.M) have asked the Government Accountability Office for an accounting of resources taken from federal land and the outer continental shelf, and how much taxpayers got in return.

"It is vitally important that the American taxpayer receives a fair return for the mineral resources extracted from federal land," Grijalva and Udall wrote GAO Comptroller General Gene Dodaro in a letter earlier this month.

In a briefing this morning, Grijalva described the request as a response to the drumbeat over the past several months, particularly from House Republicans, for more resource extraction from public land -- including oil, natural gas and hardrock minerals like uranium. He said that in many cases taxpayers may be losing out and doubted there will be a "miraculous blossoming of jobs" from encouraging more production.

"We're hearing these discussions in a vacuum. Let's put this into perspective," Grijalva said.

Grijalva said staffers have been in talks with GAO, which may produce the report by the middle of next year. The news thrilled advocates calling for greater accountability for energy and mining companies.

Matt Garrington, deputy director of the Checks and Balances Project, called the report "an important step to stop the giveaway of our public lands to Big Oil."

Lauren Pagel, policy director for Earthworks, called for reforms to institute a royalty on hardrock mining. "When it comes to our public lands," she said in a statement, "we need sound fiscal policies, not an outdated mining law that lets mining companies fleece taxpayers out of millions."

The mining industry says it is not opposed to reform but wants to make sure changes are crafted in a way to foster competitiveness. And they say government policies, including restrictions on mining on public land, are leading the United States to fall behind other mining economies.

The oil and gas industry is also fighting back attempts at increased oversight and President Obama's call for closing what he calls tax loopholes.

"Such a tax increase would reduce capital investment and further impair the growth for new development," John Felmy, chief economist of the American Petroleum Institute, said in a conference call today. He added that by holding off on new government restrictions and increasing access, "We could by 2030 create as many as 1.4 million new U.S. jobs."

"As we all know," said Kathleen Sgamma, the Western Energy Alliance's government and public affairs director, "when you tax something more, you get less of it."

Activists, however, believe industry is not paying its fair share. Both sides offer statistics, although previous studies have not eased the debate.

In calling for the GAO probe, Grijalva said he and Udall wanted a "balanced approach. We're not either, or." The goal, he said, is for GAO to find out "how much activity is going on and the return on the dollar."

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Grijalva demands accounting of private profits reaped from public lands

http://www.azcentral.com/members/Blog/azdc/142926

Erin Kelly of The Arizona Republic's Washington bureau contributed this blog post