Apr 28, 2020 Letter to Treasury and Energy Depts. on Oil and Natural Gas Producer Access to CARES Act Lending
The Independent Petroleum Association of America (IPAA) wants to commend your efforts to implement existing financial assistance authority under prior laws and the new authorities under the Coronavirus Aid, Relief and Economic Security Act (CARES Act) to assist distressed businesses through the country. IPAA represents the thousands of American independent producers and the service industries that support them. These industries are confronting the harsh implications of demand destruction as a result of the worldwide shutdown of economies compounded by the crude oil price war between Saudi Arabia and Russia. These events have created economic chaos that bears little resemblance to the traditional marketplace for energy.
Over the past several weeks, your organizations have begun the process of evaluating approaches to assure that the distressed companies in the energy industry have fair access to the resources created by the CARES Act. Some press reports have questioned whether support exists within the oil and natural gas production industry for these actions. IPAA wants to assure you that it supports efforts that will allow for the recovery of America’s oil and natural gas industry – a recovery that is essential for the effective recovery of the American and world economies. These American independent producers develop 91 percent of the nation’s oil and natural gas wells. These companies account for 83 percent of America’s oil production, 90 percent of its natural gas and natural gas liquids (NGL) production, and support over 4.5 million American jobs.
IPAA requests that your organizations continue your actions to allow these companies access to the financial resources created by your prior efforts and the CARES Act. Early information indicates that over 50,000 jobs have already been lost and hundreds of thousands more are at risk…