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For Immediate Release
June 18, 2010

WASHINGTON – Many elected leaders in Washington continue to work to leverage the tragic accident in the Gulf to springboard legislative agendas and policies aimed at undercutting American oil and natural gas production.

But by nearly a 2-1 margin, the Senate rejected an amendment earlier this week offered by U.S. Sen. Bernie Sanders (I-VT) -- a self-described socialist who caucuses with the Senate Democrats -- which would have levied nearly $40 billion in new taxes on the backs of America’s independent oil and natural gas producers.

The Oklahoman reports this about the Senate’s overwhelming rejection this enormous, job-killing tax hike sought be the Obama Administration:

A strong Senate vote against raising taxes on the oil and gas industry was a bipartisan message that lawmakers don't want to punish all companies for the BP oil spill, Sen. Jim Inhofe said Wednesday.

The proposal, which mirrors one made by President Barack Obama the last two years, would also have excluded energy exploration companies from the deduction available to U.S. manufacturers.

Sanders' proposal was defeated by a vote of 61 to 35 on Tuesday, as Democrats from all over the country joined Republicans in opposition.

"With the vote on the Sanders amendment, the Senate has clearly spoken with a strong bipartisan message that the entire oil and gas industry as a whole — especially small independent producers like many of those in Oklahoma — should not be penalized for BP's catastrophe in the Gulf,” Inhofe said Wednesday.

While this decisive, bipartisan vote to reject these punitive tax increases on American energy production -- which would kill jobs and increase our dependence on unstable regions of the world -- represents a major victory for U.S. energy security and for independent oil and natural gas producers who drill 90 percent of the nation’s wells, other misguided actions in Washington continue to restrict energy production, costing thousands of jobs.

The New York Times reports this about the Obama Administration’s ongoing moratorium on offshore energy development under the headline “Drill Ban Means Hard Times for Rig Workers”:

The full economic impact of the drilling moratorium is still unclear, since many of the layoffs are just beginning and no one knows how long the ban will last.

Louisiana Mid-Continent Oil and Gas Association has warned that many of the affected rigs will seek to drill in other countries, imperiling roughly 800 to 1,400 jobs per rig, including third-party support personnel.

The securities firm Raymond James & Associates predicts that the moratorium could last well into 2011, directly jeopardizing 50,000 jobs and potentially gutting blue-collar communities that rely heavily on the economic activity that comes with deepwater work. “Just as the demise of auto plants and steel mills in the Upper Midwest devastated entire towns, an extended drilling ban could eventually have a similar effect in the Gulf Coast,” the company said in a report Monday.

While the president’s actions to ban offshore energy development may placate some opponents of responsible domestic energy production, this far-reaching decision is devastating the Gulf’s struggling economy. In a video segment entitled “The Roughneck's Lament”, the New York Times reports this:

If President Obama's drilling moratorium lasts six months, many oil rigs will leave the Gulf of Mexico, probably for years, leaving workers in the local oil industry scared and frustrated.

Members of Congress from the region continue to fight for American oil and natural gas jobs, too. This from yesterday’s Washington Examiner:

An estimated 40,000 people in the Gulf states currently work in the oil industry or oil-related jobs. Gulf of Mexico drilling accounts for 30 percent of the nation’s oil production, and is roughly on par with the amount the U.S. imports from Saudi Arabia and Iraq combined.

“Those oil rigs cost $500,000 a day to operate. If they are shut down, the companies will go to Brazil or Indonesia,” [Congressman Ted] Poe said. “When these jobs leave, they’re lost forever.”

And in an editorial yesterday, the Orange County Register writes this about the job-killing Obama moratorium:

The administration also is inflicting unintended consequences by imposing a six-month moratorium on deep-water drilling, resulting in the loss of tens of thousands of jobs. Unintended consequences go hand in hand with clumsy government "solutions." Hazardous deep-sea drilling is conducted largely because government prohibits much safer, easier to manage shallow-water drilling closer to shore.

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IPAA represents the companies that drill 90 percent of America's
onshore and offshore oil and natural gas wells.