RIK Proponents Drawing Big Industry Contributions

Congressional proponents of royalty in-kind legislation are drawing large sums of political action committee donations, soft money and individual contributions from the oil and gas industry, according to a consumer action group which notes the bill could cost taxpayers $367 million more per year, according to the Minerals Management Service. The bill would force the government to assume the cost of transporting and marketing its royalty portion of oil and gas production.

Transportation costs have never been included in royalty calculations. Producers claim everyone will save court and auditing costs if the current royalty collection system which was outdated when the price of gas at the wellhead was deregulated 13 years ago is brought into conformance with the market.

Sen. Don Nickles (R-OK), chairman of the Senate subcommittee with oversight over the oil and gas industry and a strong proponent of RIK, replaced Sen. Kay Bailey Hutchison (R-TX) as the top Senate recipient last month, according to the report by the Center for Responsive Politics. Nickles received more than $173,000 in the 1997-98 election cycle for his re-election bid this fall, while Hutchinson fell to second place with $168,250.

Last month, Hutchinson was in the lead after she inserted a last-minute amendment in an emergency spending bill that prevented the Minerals Management Service from changing the benchmarks for calculating the value of oil. This week, Nickles' subcommittee is scheduled to hold oversight hearings on MMS regulations.

On June 18, a House Resources Subcommittee will debate royalty in-kind bill H.R. 3334. The legislation, introduced by Rep. Mac Thornberry (R-TX), received a boost last week when Rep. Wes Watkins (R-OK), who is the top House recipient of contributions from oil and gas interests backing the proposal, signed on as a co-sponsor. Watkins received nearly $57,000 in PAC and individual contributions from the industry, and Thornberry got $15,550.

Other congressmen topping the list include Sens. John B. Breaux (D-LA) - $128,471, Christopher S. Bond (R-MO) - $67,800, Frank H. Murkowski (R-AK) - $53,500, and Alphonse M. D'Amato (R-NY) - $51,520, and Reps. Joe L. Barton (R-TX) - $38,858, Dan Schaefer (R-CO) - $36,091, Todd Tiahrt (R-KS) - $31,750 and Kay Granger (R-TX) - $31,450.

In total, oil and gas companies lobbying to change the federal royalty system have contributed $7.4 million to federal candidates and political parties so far in the 1997-98 election cycle, 74% of which went to Republicans.

Rocco Canonica

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