Gulf oil spill: U.S. government to collect royalties on recovered oil

Oil trapped by BP from the Deepwater Horizon spill in the Gulf of Mexico will generate revenue for the U.S. government, according to the Minerals Management Service spokesman Nicholas Pardi.

The service will collect royalties on any petroleum BP recovers with skimmers, insertion tools or the cap now funneling oil from the leaking well, he said. BP has been collecting and processing this oil and has said it will donate the proceeds to a fund to restore wildlife.

According to BP, the company has collected about 149,000 barrels of oil since the cap was lowered over the well. U.S. government and independent scientists have estimated that the well may be spewing more than two to four times the captured amount into the sea.

It remains unclear whether BP will also pay royalties on the oil spilled into the Gulf of Mexico since the April 20 Deepwater Horizon oil-rig accident. A government panel Tuesday upped its estimate of the flow to 35,000 to 60,000 barrels per day.

By law, BP only owes royalties on spilled oil if the company is found to have been negligent or operating in violation of laws or regulations, Pardi said. MMS and several congressional panels are investigating the cause of the accident.

-- Jill Leovy

Comments

[RANDY TANGARO]

WERE MY MONEY I NEVER GOT ANY FROM THE GULF

KNOW HOW TO STOP THIS THING JUST DON'T KNOW WHO TO TELL PLZ. HELP ME FIND THE RIGHT PERSON HIGH ON THE CHAIN

Posted by: RANDY J TANGARO | June 17, 2010 at 10:13 AM

[Johnathan Jones]

Changingworldtech.com has a setup that could turn the collected spilled oil and its cleanup materials into clean crude that could be set to a stanard setup refinery. This would eliminate landfill with its potential groundwater contamination. All the oil pulled out of the Gulf should be at least processed into asphault, better yet gasoline.

[RANDY J TANGARO]

I KNOW HOW TO STOP THIS THING JUST DON'T KNOW WHO TO TELL PLZ. HELP ME FIND THE RIGHT PERSON HIGH ON THE CHAIN

[Freddie]

Is this some kind of a joke?

"BP only owes royalties on spilled oil if the company is found to have been negligent or operating in violation of laws or regulations..." what else does one conclude from all the information gathered so far?

It is ironic that there's still a discussion on "who is at fault", when recent emails prove more of a 'willful negligence', not just 'negligence' - repeat 'willful negligence' that should have been specifically considered by the law and made into a 'criminal offense' within the code.

I don't care who ran the rig, who maintained it, and who inspected it... if BP is the initial entity making an application to drill (not to mention negligent documentation, insufficient analysis, and willful misrepresentation of capabilities) and the final entity to collect the final profits, it is BP's fault!

While the MMS may have been negligent in its own work, which should not go unpunished, that doesn't absolve BP of its core responsibility of running its operations in an environmentally and socially responsible way.

[ed365 -- earth day 365 days a year]

I think it is good that the government is going to collect royalties on the oil collected, but shouldn't BP be paying royalties on all of the oil coming from their leased well? Think about it. If you were to walk in a china shop and knock over a shelf of fine china and the pieces lay broken all over the floor, wouldn't you be responsible for all of the broken china? You wouldn't be responsible for just the pieces the owner chose to pick up, would you. Likewise, if they had purchased that china and as they walked out the door with it, dropped it. Wouldn't that china be theirs? The loss would be theirs. They would still pay the same sales tax on the purchase they just lost, wouldn't they? Again, that is their well, their hole in the ocean floor and they are responsible for everything that comes out of it. They would have profited from it all and they would have paid royalties on it all, had there been no disaster. They should pay royalties on all of the oil they have caused to come from their leased area.

[Just ME in TJust ME in T]

This toxic gusher is certainly frighteneing for us all.

Did You Know?
BP engineers alerted federal regulators at the Minerals Management Service that they were having difficulty controlling the Macondo well (Deepwater Horizon) six weeks before the disaster, according to e- mails released by the Energy and Commerce Committee.

“I don’t think this would have happened on Exxon’s watch,” Tom Bower, author of “The Squeeze: Oil, Money and Greed in the 21st Century,” said in a June 11 Bloomberg Television interview. “They’d be much more careful and much more conscious of the need to supervise subcontractors.”

WELL excuse me your sainted Exxon....... and Chevron and ConocoPhillips.

Let’s just take a look at a few of your past misdemeanours, and then we can consider again – if the moratorium on deepwater drilling should be lifted, and place it all firmly back into your nice clean hands!

http://just-me-in-t.blogspot.com/2010/06/fairy-stories-about-oil-companies.html

[Bob Bobo]

It is a false assumption that life will return to normal for those people concerned for the Gulf oil spill. Those people immediately affected will return to their normal jobs while the great leak in the oil well will be only partially plugged so to speak. I heard today on the radio news that in Avondale, Louisiana there is a landfill waiting to be filled with the sludge from the oil spill in the Gulf. This news after we were recently educated by the media about the delicate ecosystems such as swamps and bayous around the shores that are being threatened by the oil spill. How difficult it must be to clean a swamp that is infested with oil compared to a sandy beach that has been fouled by the same oil. Are we going to let the horrible cycle of oil well disasters and cleanups continue, or are we going to seek alternative energy sources. It would be so much cleaner to grow corn as an alternative source for automotive fuel.a