FOR IMMEDIATE RELEASE, Contact: (202) 225-7601
February 17, 1999
No. OV-2
Congressman Amo Houghton (R-NY), Chairman, Subcommittee on
Oversight of the Committee on Ways and Means, today announced that the
Subcommittee will hold a hearing on current law incentives for
domestic production of oil and gas, and the status of that industry in
light of current economic conditions. The hearing will take
place on Thursday, February 25, 1999, in the
main Committee hearing room, 1100 Longworth House Office Building,
beginning at
9:00 a.m.
In view of the limited time available to hear witnesses, oral testimony at this hearing will be from invited witnesses only. Invited witnesses include officials from the U.S. Department of the Treasury and the U.S. Department of Energy, economists with insights on the industry, and independent producers from across the country. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing.
BACKGROUND:
Current tax law provides several incentives for the domestic production of oil and gas including: (1) expensing of exploration and development costs, (2) a deduction for excess of percentage over cost depletion, and (3) a tax credit for enhanced oil recovery costs.
Over the past year, crude oil prices have fallen from about $20 per barrel to less than $10. According to independent, domestic producers, the cost for them to produce each barrel has remained constant in the mid-teens. As a result, producers must consider whether to cap marginal wells. Because of the difficulties inherent in reopening capped wells at a later time, many are concerned about the potential for worsening domestic economic impacts and increasing U.S. dependency on foreign supplies of oil and gas.
In announcing the hearing, Chairman Houghton stated: "It appears that current tax incentives may be ill-suited to stem the current problems faced by the domestic oil and gas industry, especially small, independent producers. I am concerned about the hardships they are facing in light of falling prices over the past year. The time is ripe to review our laws to ensure that they are adequate to meet the needs of an important national industry."
FOCUS OF THE HEARING:
The hearing will focus on how current law affects the domestic production of oil and gas, the status of the industry in light of current economic conditions, the long-term ramifications for the economy and national security, and possible policy options.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Any person or organization wishing to submit a written statement for the printed record of the hearing should submit six (6) single-spaced copies of their statement, along with an IBM compatible 3.5-inch diskette in WordPerfect 5.1 format, with their name, address, and hearing date noted on a label, by the close of business, Thursday, March 11, 1999, to A.L. Singleton, Chief of Staff, Committee on Ways and Means, U.S. House of Representatives, 1102 Longworth House Office Building, Washington, D.C. 20515. If those filing written statements wish to have their statements distributed to the press and interested public at the hearing, they may deliver 200 additional copies for this purpose to the Subcommittee on Oversight office, room 1136 Longworth House Office Building, by close of business the day before the hearing.
FORMATTING REQUIREMENTS:
Each statement presented for printing to the Committee by a witness, any written statement or exhibit submitted for the printed record or any written comments in response to a request for written comments must conform to the guidelines listed below. Any statement or exhibit not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee.
1. All statements and any accompanying exhibits for printing must be submitted on an IBM compatible 3.5-inch diskette in WordPerfect 5.1 format, typed in single space and may not exceed a total of 10 pages including attachments. Witnesses are advised that the Committee will rely on electronic submissions for printing the official hearing record.
2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee.
3. A witness appearing at a public hearing, or submitting a statement for the record of a public hearing, or submitting written comments in response to a published request for comments by the Committee, must include on his statement or submission a list of all clients, persons, or organizations on whose behalf the witness appears.
4. A supplemental sheet must accompany each statement listing the name, company, address, telephone and fax numbers where the witness or the designated representative may be reached. This supplemental sheet will not be included in the printed record.
The above restrictions and limitations apply only to material being submitted for printing. Statements and exhibits or supplementary material submitted solely for distribution to the Members, the press, and the public during the course of a public hearing may be submitted in other forms.
The
Committee seeks to make its facilities accessible to persons with
disabilities. If you are in need of special accommodations, please
call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event
(four business days notice is requested). Questions with regard to
special accommodation needs in general (including availability of
Committee materials in alternative formats) may be directed to the
Committee as noted above.