Drilling Down: Big Oil’s Bidding

Number 28484
Subject Oil
Source Project on Government Oversight (Washington, DC)
State
Year 2018
Publication Date February 22, 2018
Summary When the government awards energy companies the rights to drill for offshore oil and gas, it’s supposed to make sure the American public, which owns the resources, doesn’t get screwed. The government is required by law to use “competitive bidding” and to ensure that taxpayers receive “fair market value.” However, decades of data suggest that the government has been falling down on the job, a Project On Government Oversight analysis found. Among POGO’s discoveries: Instead of taking the trouble to estimate the value of individual offshore tracts, the government has simply labeled many of them worthless and has awarded drilling rights on that basis. Energy companies have invested billions of dollars in tracts the Interior Department categorized as “non-viable”—in other words, worthless. Over the past 20 years, more than two-thirds of the leases that ultimately became energy-producing had been deemed worthless by the Interior Department.
Category Philip Meyer Contest entry
Pages
Keywords oil, drilling, offshore drilling, energy, business reporting, corporations, Interior Department, gas, government reporting
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