I 
109TH CONGRESS 
2D SESSION 
H. R. 5300 
To restore fairness in the provision of incentives for oil and gas production, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 4, 2006 
Mr. HINCHEY (for himself, Mr. HASTINGS of Florida, Mr. MARKEY, Mr. INS-
LEE, Mr. MORAN of Virginia, Mr. BLUMENAUER, Mr. SANDERS, Mr. 
MCDERMOTT, Mr. STARK, Mrs. MALONEY, Mr. MCGOVERN, Mr. LARSON 
of Connecticut, Mr. SCHIFF, Mr. GRIJALVA, Mrs. CAPPS, Mr. OBERSTAR, 
Mr. RAHALL, Mrs. MCCARTHY, Mr. RANGEL, Mr. GEORGE MILLER of 
California, Mr. DEFAZIO, Mr. MEEHAN, Mr. WEXLER, Ms. DELAURO, 
Ms. WOOLSEY, Mr. TOWNS, Mrs. LOWEY, and Mr. STUPAK) introduced 
the following bill; which was referred to the Committee on Ways and 
Means, and in addition to the Committees on Resources and Science, for 
a period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned 
A BILL 
To restore fairness in the provision of incentives for oil 
and gas production, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; ETC. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Energy Fairness for America Act’’. 
VerDate Aug 31 2005 
18:18 May 07, 2006
Jkt 049200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H5300.IH
H5300
cchase on PROD1PC60 with BILLS
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; etc. 
Sec. 2. Termination of deduction for intangible drilling and development costs. 
Sec. 3. Termination of percentage depletion allowance for oil and gas wells. 
Sec. 4. Termination of enhanced oil recovery credit. 
Sec. 5. Termination of certain provisions of the Energy Policy Act of 2005. 
Sec. 6. Termination of certain tax provisions of the Energy Policy Act of 2005. 
Sec. 7. Revaluation of LIFO inventories of large integrated oil companies. 
Sec. 8. Modifications of foreign tax credit rules applicable to dual capacity tax-
payers. 
Sec. 9. Rules relating to foreign oil and gas income. 
Sec. 10. Elimination of deferral for foreign oil and gas extraction income. 
SEC. 2. TERMINATION OF DEDUCTION FOR INTANGIBLE 
DRILLING AND DEVELOPMENT COSTS. 
(a) IN GENERAL.—Section 263(c) is amended by 
adding at the end the following new sentence: ‘‘This sub-
section shall not apply to any taxable year beginning after 
the date of the enactment of this sentence.’’. 
(b) CONFORMING AMENDMENTS.—Paragraphs (2) 
and (3) of section 291(b) are each amended by striking 
‘‘section 263(c), 616(a),’’ and inserting ‘‘section 616(a)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
VerDate Aug 31 2005 
18:18 May 07, 2006
Jkt 049200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H5300.IH
H5300
cchase on PROD1PC60 with BILLS
SEC. 3. TERMINATION OF PERCENTAGE DEPLETION AL-
LOWANCE FOR OIL AND GAS WELLS. 
(a) IN GENERAL.—Section 613A is amended by add-
ing at the end the following new subsection: 
‘‘(f) TERMINATION.—For purposes of any taxable 
year beginning after the date of the enactment of this sub-
section, the allowance for percentage depletion shall be 
zero.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 4. TERMINATION OF ENHANCED OIL RECOVERY CRED-
IT. 
(a) IN GENERAL.—Section 43 is amended by adding 
at the end the following new subsection: 
‘‘(f) TERMINATION.—This section shall not apply to 
any taxable year beginning after the date of the enactment 
of this subsection.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 5. TERMINATION OF CERTAIN PROVISIONS OF THE 
ENERGY POLICY ACT OF 2005. 
(a) IN GENERAL.—The following provisions of the 
Energy Policy Act of 2005 are repealed on and after the 
date of the enactment of this Act: 
VerDate Aug 31 2005 
18:18 May 07, 2006
Jkt 049200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H5300.IH
H5300
cchase on PROD1PC60 with BILLS
(1) Section 342 (relating to program on oil and 
gas royalties in-kind). 
(2) Section 343 (relating to marginal property 
production incentives). 
(3) Section 344 (relating to incentives for nat-
ural gas production from deep wells in the shallow 
waters of the Gulf of Mexico). 
(4) Section 345 (relating to royalty relief for 
deep water production). 
(5) Section 357 (relating to comprehensive in-
ventory of OCS oil and natural gas resources). 
(6) Subtitle J of title IX (relating to ultra-deep-
water and unconventional natural gas and other pe-
troleum resources). 
(b) TERMINATION OF ALASKA OFFSHORE ROYALTY 
SUSPENSION.— 
(1) IN
GENERAL.—Section 8(a)(3)(B) of the 
Outer Continental Shelf Lands Act (43 U.S.C. 
1337(a)(3)(B)) is amended by striking ‘‘and in the 
Planning Areas offshore Alaska’’. 
(2) EFFECTIVE DATE.—The amendment made 
by this subsection shall take effect on and after the 
date of the enactment of this Act. 
VerDate Aug 31 2005 
18:18 May 07, 2006
Jkt 049200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H5300.IH
H5300
cchase on PROD1PC60 with BILLS