CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. US Increases Royalty Rate For New Offshore Oil And Gas Leases

US Increases Royalty Rate For New Offshore Oil And Gas Leases

by Leroy Baker, Tax-News.com, New York

12 January 2007


Interior Secretary Dirk Kempthorne has announced that the royalty rate for most new offshore deepwater federal oil and gas leases has been increased to 16.7%.

The new rate, which excludes Alaska, will take effect with the first 2007 Gulf of Mexico lease sale scheduled for late August.

Most federal oil and gas is leased at a 12.5% royalty rate both onshore and offshore. The Outer Continental Shelf Lands Act (OCSLA) grants the Secretary of the Interior discretion to establish a higher royalty rate.

The Interior department's Minerals Management Service (MMS) estimates that the increased royalty rate of 16.7% for new deepwater offshore Gulf of Mexico leases will increase revenue from royalty payments by $4.5 billion over 20 years.

MMS predicts that, by 2017, this increased revenue would offset any decline in bonus and rental revenues and any revenue losses from a decline in production. It also estimates a decline of bonus and rental revenues at $820 million over 20 years and decline in production at 5%, or 110 million barrels of oil equivalent, over 20 years.

http://www.doi.gov/news/07_News_Releases/070109.html

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »