[Congressional Record Volume 152, Number 130 (Thursday, November 16, 2006)]
[Senate]
[Page S11037]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             ROYALTY RELIEF

  Ms. LANDRIEU. Mr. President, I rise to speak about amendment No. 5189 
that is pending to the Agriculture Appropriations bill.
  According to the unanimous consent agreement entered into a few 
moments ago, when we return in December we will take up an amendment by 
Senator Conrad and I will have time after that amendment to speak again 
about this issue. It is an issue that I believe we have an opportunity 
to resolve before this Congress comes to an end. According to the 
schedule we are operating under, we only have a few more weeks to get 
our work done. There is a great deal of work that has to be done and a 
few things that can in fact be done on a bipartisan basis. This is one 
of them.
  Both leaders have expressed their commitment to helping the Senate 
resolve the issue of expanded offshore drilling so we can provide more 
oil and gas for a country that is running short.
  Four States--Louisiana, Texas, Mississippi, and Alabama, America's 
energy coast--have been proudly hosting this industry for over 60 
years. We have contributed literally billions of barrels of oil, 
trillions of cubic feet of gas, and much money from the royalties paid 
has gone to the Treasury. But this is a problem we have to solve. It 
goes back to the 1998-1999 lease arrangements entered into by Minerals 
Management. This has been widely reported. It has also been the subject 
of several hearings in the Senate and the House.
  Very simply, the Department made a series of mistakes. Those mistakes 
are being looked at to determine how and when and under what 
circumstances. But the fact is, although all the facts are not out yet, 
we do know that a serious mistake was made. When these contracts were 
entered into, there was no price threshold in them. When my predecessor 
Bennett Johnston wrote the Royalty Relief Act, which he did with some 
of his colleagues, it was always intended to be an incentive if the 
price of oil was low. At the time the bill was written, the price of 
oil was $17 a barrel. We wish that were true today. But it was true 
back in the early to mid-1980s, when this bill was written.
  As the process went on and these leases were entered into, the price 
threshold was left out. So now the price of oil is $70 a barrel, or it 
has been recently, and what happened was, because the thresholds were 
not in there, the companies didn't have to pay royalties. The bottom 
line is, we have lost to date $1.3 billion. It is estimated that we 
could lose as much as $10 to $12 billion; that is, the Federal 
Treasury.
  My amendment has already been filed. If the Senate agrees to the 
amendment, it will fix that situation without violating contracts. We 
have established a way for Minerals Management to basically renegotiate 
the contracts. The taxpayers could then recover that money, and a 
portion of the money would then be used for the coastal restoration 
efforts so desperately needed in Texas, Louisiana, Mississippi, and 
Alabama in the next few years. If this amendment is passed, coupled 
with the bill we have already passed, we will have some immediate 
funding to begin the project of saving our wetlands and securing the 
energy infrastructure that is a tremendous asset to the Nation. This 
isn't just about helping Louisiana, Texas, Mississippi, and Alabama. 
This is about protecting a great coastal wetland that came under 
tremendous challenge with Katrina and Rita and will come under 
challenges again. We most certainly can recover this money, $11 
billion, that does belong to the taxpayer. It was a mistake, a very bad 
mistake that was made. We can recover some of that money and most of it 
can go to deficit reduction. If anyone hasn't noticed lately, we have 
quite a deficit to tackle. Some of this money could go to deficit 
reduction, and some of it could go to the States under a program 
already authorized, already supported in a bipartisan way, already in 
the law, called the OCS Program where this money would be directed.
  I thank my colleagues for allowing me to speak tonight. I have filed 
the amendment so Members could consider it on our break through the 
holiday and come back and try to restore this money to the Treasury, 
help take the deficit down, and let's get started saving these wetlands 
and protecting the coast which is so vital to the economic future of 
the Nation.
  I thank my colleagues for their patience.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Illinois.
  Mr. DURBIN. Mr. President, I ask unanimous consent to be recognized 
as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DURBIN. I thank the Senator from Louisiana. I hope the people of 
her home State are watching carefully. Senator Landrieu, even before 
Hurricanes Katrina and Rita, worked very hard for her State. But since 
then, it has been nonstop. She is not the only one. There are many 
elected officials who are doing everything they can to help the 
families and businesses and others who were devastated. But I commend 
her to be here so late at night speaking up for her State again. I hope 
she is successful with her amendment which would bring resources to her 
State that are badly needed as post-Katrina construction continues.

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