Consolidated Federal Oil & Gas and Federal & Indian Coal Valuation Reform Rule

Introduced by Rep. Scott Tipton (R-CO) and Rep. Steve Scalise (R-LA), H.J. Res. 71 is a joint resolution of disapproval of the “Consolidated Federal Oil & Gas and Federal & Indian Coal Valuation Reform” rule under the Congressional Review Act. Finalized by the Office of Natural Resources Revenue (ONRR) on July 1, 2016, the rule drastically alters the accounting rules relied upon by producers of the nation’s natural resources on federal lands – both offshore and onshore. The rule does nothing to protect taxpayers, but rather it launches a costly attack on energy development to keep our natural resources stuck in the ground. In seeking clarity, ONRR promulgated a more complicated rule to do the exact opposite of ensuring greater certainty and consistency in product valuation on Federal and tribal leases.

What is the Congressional Review Act?

The Congressional Review Act is a powerful Congressional resolution of disapproval to overturn last minute regulations from the previous Administration under an expedited legislative process. Passage of the CRA ensures that no substantially similar rule can be issued in the future. 

Past Action

December 15, 2015: Subcommittee on Energy and Mineral Resources Oversight Hearing on "Ensuring Certainty for Royalty Payments on Federal Resource Production"

• Proposed rule makes sweeping revisions to the methodologies behind royalty valuation
• ONRR’s proposed valuation reform rule ignores the realities and economics of natural resource production and would grant absolute discretion to ONRR auditors
• ONRR’s net-back provision within the valuation rule for non-arm’s-length coal transactions is an unwarranted expansion of ONRR’s jurisdiction and presents companies with an unworkable means of calculating the value of their products
• Learn More HERE.

June 30, 2016: Chairman Rob Bishop (R-UT) issued the following statement on the ONRR's finalized rule on valuating royalties from oil, natural gas and coal produced on federal and tribal lands.

• "Don't be fooled. This rule is not about 'protecting taxpayers'. It’s a costly attack on energy development. It trades market certainty for the Administration’s political agenda. These changes will decrease revenues for state and local governments that use royalties to support education. This decision is purely to shut down energy production on federal and tribal lands and increase the cost of energy for Americans."

July 13, 2016: H.R. 5538, the "Department of the Interior, Environment and Related Agencies Appropriations Act of 2017"

• In an overwhelmingly bipartisan fashion, the House voted to keep language in the Interior appropriations bill that prohibited ONRR from enforcing this rule