Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise to join my colleague, Chairman Westerman, in support of H.R. 7377, the Royalty Resiliency Act, sponsored by my colleague, Representative Hunt. I have to say that…
Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise to join my colleague, Chairman Westerman, in support of H.R. 7377, the Royalty Resiliency Act, sponsored by my colleague, Representative Hunt.
I have to say that not many oil and gas bills can make it through the Natural Resources Committee by unanimous consent and to the floor on suspension, so I commend my colleague for working on this reasonable, technical fix that has the support of the Biden administration.
This represents how we should, in fact, get things done, where we come together, where we work things out, and where we include the BLM so that we understand how to get the technical fix done.
As noted, under current law, oil and gas lessees who are on land that is partially Federally owned and partially owned by the State or private owners need to get a communitization agreement, or CA, approved by the Department of the Interior, which outlines how much of the royalty payments should be paid to each landowner.
While a lessee is waiting for approval on that CA from the Department of the Interior, they pay 100 percent of the royalties to the Federal Government, even in cases where the Federal Government does not own 100 percent of the land.
When the CA is finally approved, then the State or private landowners get reimbursed for their share of the
royalty payments. However, some Bureau of Land Management field offices are so understaffed right now that they have reportedly taken 800 days, in some cases, to approve a CA, resulting in a delay or loss of royalties to States who rightfully deserve those funds.
For an example, in New Mexico, we have hundreds of oil and gas lessees on Federal lands and State lands. Many of those are in my district in the San Juan and Permian Basin. Indeed, 54 percent of production in New Mexico impacts Federal land. This bill represents a technical fix that would make sure that royalties flow to the State of New Mexico or the State of Colorado or the Dakotas or Texas or the many other places where we have these shared land ownership arrangements, because do you know what, Mr. Speaker?
Our schools and our schoolchildren need that money to flow to them as quickly as possible.
Under the bill, rather than paying 100 percent to the Federal Government while waiting approval, a lessee would pay royalties to each landowner in accordance with the lessee's proposal. If that proposal proves to be wrong, the lessee is then required to backpay any missing royalty revenue.
While I believe we need to work together to find an off-ramp for States and communities that are overly dependent on fossil fuel revenue and we need to work on diversifying our economies, this legislation is straightforward and commonsense.
Mr. Speaker, I support the bill. I urge my colleagues to support the bill, and I reserve the balance of my time.
Mr. Speaker, during the Biden administration, we have had historic oil and gas production with many more leases coming online, and so this kind of legislation is precisely needed to make sure that we get the royalty revenues to where they should go, especially with all of the new leases that have come on.
Mr. Speaker, I have no further requests for time, and I am prepared to close. I urge my colleagues to support the legislation, and I yield back the balance of my time.