NEW ORLEANS (WGNO) — A new tax has been proposed for those working offshore oil and on gas infrastructure projects.
In early August, The Bureau of Ocean Energy Management announced a new drilling tax proposed by the Biden Administration that could put more than 36,000 Louisiana jobs at risk.
The tax accounts for one-third of the oil and natural gas production in the U.S. Gulf of Mexico that requires $9.2 billion in funding to be footed by smaller companies, exempting major oil and gas companies.
Gulf Energy Alliance Executive Director Kevin Bruce represents independent producers in the Gulf of Mexico. He believed the impact could be greater than just job loss.
“We’re not talking about just the companies that are drilling wells safely and responsibly offshore,” Bruce said. “We’re talking about mom and pop shops and service companies that have been in existence for generations to support what we do. That supply chain is vast and largely rural and what the Biden Administration would consider areas of the country where we need to be focused on creating more opportunities and not less.”
Since 2004, offshore royalties have added $125 billion to the US treasury to fund coastal conservation efforts. According to Bruce, the new tax is expected to reduce funding for coastal restoration and national parks.
“The production in the US Gulf of Mexico is the cleanest in the world, the most environmentally advanced and we should be encouraging and not discouraging production from that basin,” Bruce said.
A 60-day public comment period will end Aug. 28.
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