Oil belongs to you

Do you know who owns all that oil that the petroleum companies extract from American territory? It surprises a lot of American to learn that such resources are actually owned by the public. Every citizen in this country owns a share of those resources because, for the most part, they sit on Federal lands. When a company like Shell wants to start drilling in Alaskan waters or the Gulf of Mexico, they lease the land from Government agencies in exchange for payments. Those payments are then distributed to local governments and the Federal government, to be used for public services. It is a good system – the government doesn’t have to work the wells themselves, but the people still benefit financially from what are technically their resources.

Sometimes, though, there is a hitch in this plan. Oil companies sometimes misreport what they owe to our governments and underpay what they agreed to pay for these leases. In the real world, if a tenant doesn’t pay their rent on time in full, they’re liable to get kicked out. But the Federal Government doesn’t have the resources to audit all of these transactions, meaning that the oil companies can continually underpay without fear of reprisal.

The Office of Natural Resources Revenue, under the Department of the Interior, is in charge of curbing this practice. The organization collects and distributes over 10 billion dollars a year, yet even they admit that their ability to audit these organizations is strained by a lack of transparency. Each month the ONRR discovers millions of dollars of unreported money, but with their current system they estimate they can only examine 50% of the transactions they are in charge of.

That is why the ONRR is a supporter of 1504 and mandatory disclosures for these extractive companies. They believe that with this new information, they can more easily crosscheck this data and uncover millions of dollars that have been lost by faulty reporting. Millions of dollars that citizens are owed.

“It is imperative that companies report accurately and promptly pay all royalties due from energy production on Federal leases,” said Greg Gould, Acting Deputy Assistant Secretary for Natural Resources Revenue in the DOI’s Office of Policy, Management and Budget in a press release. “We intend to collect every dollar due,” he added.

1504 is just another way to help the American government collect the money that it is already owed. And when we’re all pinching pennies, we need them to collect on our debts and make sure we get what we are owed. It’s only fair.