US Senator proposes solution to recover lost royalties

Offshore staff

WASHINGTON, D.C. --US Senator Pete Domenici, the ranking member of the Senate Energy and Natural Resources Committee, plans to propose a three-year extension for leases in the Gulf of Mexico enacted in 1998 and 1999, as a way to address lease contract issues that could cost the federal government up to $10 billion in royalties, according to a statement from the Senate Energy and Natural Resources Committee.

"I am committed to addressing the 1998/1999 lease situation in a fair, reasonable manner that will withstand legal challenges," said Domenici.

"It will be my proposal to provide the Secretary of Interior the authority to extend leases for a period of three years in exchange for the application of price thresholds on the 1998/1999 leases effective on the date of enactment," he said.

According to the Committee, Secretary Kempthorne pledged to work with Domenici and other senators on a solution, and also pledged that the mistake would not be repeated by the Bush Administration.

3/22/2007