us and natural ressources | 13 comments (13 topical, 0 hidden)
Where does it go? (none / 0)
Do you happen to know what happens to the bulk of the actual oil and gas (rather than the financial proceeds) extracted from public land? Logic would suggest it gets refined and used within the US. It's my understanding that the US exports a fairly small amount of oil, but I don't know its origin.

Also, do you know whether the lease/royalty system is fixed in law, or could the government, at least in principle, retain (or regain) possession of the oil and gas under public land and pay companies to extract it?

by Landbeyond on 09/07/2010 12:52:58 PM EST

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Depends (none / 0)

For the most part oil and gas pretty much go to the nearest refinery of processing facility and is then piped around the country wherever it is needed.  The basic idea is to minimize the transportation costs.  For the most part all oil and gas produced in the US is used here, although there are some export flows, mainly of processed fuels (gasoline or diesel) since we generally have larger refining capacity than we need and there are certain locations say in Canada or Mexico that may be closer to a US refinery than a Mexican or Canadian refinery so we "export" to them, but on net we import more from both countries. 

As for royalties and taxes, those things can and are changed like any other law.  I also know many states charge "severance taxes" on natural resources extracted within their state, even if it's on private land. 

by alphasigmookie on 09/07/2010 02:08:04 PM EST

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That all makes sense (none / 0)
Thanks a lot.

So when Cenk says, "It's not our oil!" he's technically correct, but it's not as though the country has no further benefit once the lease has been signed.

by Landbeyond on 09/07/2010 05:32:59 PM EST

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us and natural ressources | 13 comments (13 topical, 0 hidden)