I decided to devote one entire blog segment on the supposed "easy" drilling on those 60 million acres the Democrats keep saying are available. Once you know the facts about this property (OUR PROPERTY)-- please call and complain loudly to your local Congressional representative. Here goes-
Revenue sharing- the link below describes the government "revenue sharing" for certain land and ocean leases-- with 37.5% of the oil revenue profits going to the states and another portion going to the EPA, and another portion going to the Federal Government. Once all these folks have taken their CUT-- no sensible oil company would ever consider drilling in these OPEN to drilling areas. The normal royalty payments vary from 1/6 to 1/8th of revenues.... or about 15%. So this is a BIG jump in government "fees" -- Ha. FEE!-- just another word for a TAX!
http://www.gomr.mms.gov/homepg/whatsnew/newsreal/2008/080527.pdf
http://www.loga.la/AM/Template.cfm?Section=Ad_Valorem_Tax&Template=/CM/HTMLDisplay.cfm&ContentID=2799
http://www.loga.la/AM/Template.cfm?Section=Severance_Tax&Template=/CM/HTMLDisplay.cfm&ContentID=2728
Virtually every state has these types of taxes imposed on oil exploration and oil profits..... they are in effect ACTIVE partners in the business -- sucking the life out of the oil and natural gas industry.
The current leases have many problems associated with them; least of which there is very little oil in those areas -- or they present almost insurmountable obstacles to exploration and recovery. Here is an article describing some Alaska oil leases.
http://www.iht.com/articles/ap/2008/07/16/business/NA-US-Petroleum-Reserve-Alaska.php
Here is a typical application to be able to bid on a state oil land lease-- I love the first paragraph! This happens to be Florida.
http://www.dep.state.fl.us/lands/publicland/surplus/Applications/Ap-ogm.doc
And even after you have paid your money and filled out the form &$&$# happens. http://articles.latimes.com/2006/sep/27/nation/na-briefs27.3
PLUS-- dumb landowners and environmentalists get right into the middle of the lease process. Just in case you don't know, when you buy property you may or may not have mineral rights. If you don't have mineral rights then the "owner" my sell or lease these rights to a third party. It's the LAW-- and has served us very well for decades. Gee I wish they would do this on my land-- the oil companies put in improved roads-- clean up anything that happens-- and maintain the drilling site. They will pay a FEE to the landowner to enter the property and extract the oil or natural gas. Nice easy cash if you can get it!
Read this environmentalist - landowner article to get an idea of how really stupid some folks happen to be. Notice that the lease parcels are NEAR a park but not actually ON park land. You might not be able to tell from the wonderful scenic pictures on this website-- this is really really absurd and crazy.
http://www.lpfw.org/news/0606oilprotest.htm
This blogger has the Democrats pegged pretty well on their Lease Lands lie!
http://sayanythingblog.com/entry/80_of_government_oil_natural_gas_leases_not_being_used
Read this article for the typical political response to no drilling-- and an industry response. The oil companies PAY to lease these lands and are required to give them back and absorb all exploration costs if the land is unproductive for oil or natural gas. This is a big cash cow for the government.
http://www.businessandmedia.org/printer/2008/20080616124454.aspx
So --- do you think that you can be another T Boone Pickens? Then start reading the government regulations surrounding this critical Industry. It would be a great help if you were: a tax lawyer, a geologist, a petroleum engineer, an electrical engineer, an architect, a great businessman, a oil field roughneck, and a Las Vegas gambler!--- and you need to be a landscaper to put everything back like it was when you are finished drilling; before the EPA shows up!
http://www.eia.doe.gov/pub/oil_gas/natural_gas/feature_articles/2005/offshore/offshore.pdf 20 page document on regulations and examples of drilling areas
http://www.colleyville.com/files/Ch.%2003.1%20Gas%20and%20Oil%20Well%20Drilling%20and%20Production.pdf a local exploration code
http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&tpl=/ecfrbrowse/Title40/40cfr112_main_02.tpl This is so big I cannot suggest where to start!
http://www.epa.gov/OEM/content/lawsregs/opprover.htm
http://www.fortcollinsnow.com/article/20080626/NEWS/729989435/1008&parentprofile=1054 And since we don't have enough laws surrounding oil exploration -- here is just what we need more regulations-- proposed by guess who-- THE ENVIRONMENTALISTS.
What I find interesting about my research for this short article-- is that we are doing just about everything necessary to PREVENT oil and energy independence. I know of no other Industry (other than the oil and gas industry) where an Act of God is needed to start doing business.
Think about this blog the next time you pay your electric bill or fill your car with gasoline. Then pickup the phone and tell Congress to GET OUT OF THE WAY and STOP adding more taxes to our cost of energy!
Joe Lalumia
Rockwall, Texas
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