Given the enormous oil and gas activity that occurs
in Louisiana’s wetlands and offshore environs, the question has
been posed as to why the oil and gas companies don’t pick up the
estimated $14 billion tab it will take to create a sustainable coastline.
In fact, they’re handing over big bucks to the federal
government. How the money is then doled out leaves much to be desired,
in the opinion of certain recipients.
"The oil companies are paying $5 billion a year for
the right to operate offshore Louisiana, and they’re paying their
taxes and doing everything else," said Ted Falgout, director of
Port Fourchon, which serves as a critical link to the immense offshore
oil and gas industry and itself faces the imminent threat of being
cut-off from land ([PFItemLinkShortcode|id:46972|type:standard|anchorText:see related story|cssClass:|title:|PFItemLinkShortcode]). "It’s the federal government not using that money
in an appropriate manner.
"The oil producing states are at a disadvantage because
this money goes to the federal treasury, and everyone is getting
to use it," Falgout said. "It’s not being put back into the business
that allows them to have that money.
"What would be a normal business plan is missing
here," he noted.
There’s reason to be optimistic that may change.
U.S. Sen. Mary Landrieu, D-La., crafted a "fair share"
federal oil revenue proposal, which was included in the Senate’s
version of the energy bill being drafted recently. In a surprise
move early in August, the Senate threw in the towel on the effort
and opted to resurrect the energy legislation it adopted last year.
Because that bill faces re-writing, the fate of the Landrieu proposal
is not known at this time.
According to the LA 1 Coalition, which was formed
to preserve land access to Port Fourchon via LA Highway 1, the proposal
would allocate 12.5 percent of federal severance taxes (estimated
at $3.7 billion over the next six years) to coastal states that
support the oil industry. Landrieu anticipates Louisiana will receive
the heftiest portion of the redistributed revenue, given its sizeable
investments directed toward energy production.
The increased funds would go far to help Louisiana
come up with its matching dollars for the planned $14 billion coastal
restoration effort and to address infrastructure needs in the parishes
that bear the brunt of the impact of offshore drilling.
U.S. Rep. Billy Tauzin, R-La., chairman of the House
Energy and Commerce Committee, included language similar to Landrieu’s
proposal in that chamber’s version of the energy bill.
This proposed legislation is in stark contrast to
2001, when Louisiana received less than 0.5 percent of the $7.5
billion oil and gas royalties generated in the OCS, despite the
fact that $5 billion of that total originated from drilling off
its coast, according to the Minerals Management Service.