III 

109TH CONGRESS 

2D SESSION S. RES. 372 

Expressing the sense of the Senate that oil and gas companies should not 

be provided outer Continental Shelf royalty relief when energy prices 

are at historic highs. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 14, 2006 

Mr. KERRY submitted the following resolution; which was referred to the 

Committee on Energy and Natural Resources 

RESOLUTION 

Expressing the sense of the Senate that oil and gas companies should not be provided outer Continental Shelf royalty relief when energy prices are at historic highs. 

Whereas the Federal Government is on the verge of one of 

the biggest oil and gas giveaways in American history, 

costing American taxpayers at least $7,000,000,000 in 

lost revenue over the next 5 years; 

Whereas according to the budget plan of the Department of 

the Interior, it is projected that the Government will 

allow companies to pump approximately $65,000,000,000 

worth of oil and natural gas from Federal territory over 

the next 5 years without paying any royalties to the Government; 
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•SRES 372 IS

Whereas the Minerals Management Service of the Department of the Interior, which oversees the leases and collects the royalties, estimates that the amount of royaltyfree oil will quadruple by 2011, to 112,000,000 barrels; 

Whereas the volume of royalty-free natural gas is expected to 

climb by almost half, to about 1,200,000,000,000 cubic 

feet by 2011; 

Whereas approximately 30 percent of all oil and over 20 percent of all gas produced in the United States comes from 

the outer Continental Shelf; 

Whereas it was the intent of Congress to provide royalty relief to promote exploration and production in deep waters 

of the outer Continental Shelf only at a time when oil 

and gas prices were comparatively low; 

Whereas the Department of the Interior has always insisted 

that companies should not be entitled to royalty relief if 

market prices for oil and gas climbed above certain trigger points; 

Whereas the 12 United States oil companies in the Standard 

& Poor’s 500 that have reported fourth-quarter results 

have seen an average 48 percent rise in earnings and are 

expected to see full-year earnings of $96,500,000,000; 

Whereas the profit growth for oil companies is not nearing 

an end, with energy analysts expecting 15 percent growth 

in earnings at those companies in 2006; 

Whereas, at the same time oil and gas companies are posting 

record profits, families in the United States are struggling with record energy costs including a 48 percent increase in the cost of natural gas for this heating season 

and a projected 7.3 percent increase in gasoline price 

from the previous year; 
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•SRES 372 IS

Whereas the Energy Information Administration projects 

that these prices will hold steady or increase over the 

course of the next 2 years; and 

Whereas royalty revenues benefit 38 States, 41 Indian tribes, 

and fund the National Historic Preservation Fund, and 

the Land and Water Conservation Fund: Now, therefore, 

be it 

1 Resolved, That it is the sense of the Senate that— 

2 (1) the Minerals Management Service should 

3 suspend all future royalty relief until the Secretary 

4 can ensure that the citizens of the United States re5 ceive a fair return from oil and gas resources from 

6 the outer Continental Shelf; and 

7 (2) Congress must take steps to ensure that the 

8 oil and gas industry does not receive a windfall and 

9 is not unjustly enriched at the expense of the citi10 zens of the United States. 

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