North Columbus News

Washington, DC – On July 28, Reps. Mike Carey (R-OH) and Vicente Gonzalez (D-TX) introduced bipartisan legislation to unleash America’s energy independence. The Promoting Domestic Energy Production Act allows energy companies to deduct costs, including labor and safety, associated with oil and gas exploration.  

“American energy independence is neither a right nor left issue, but one that should unite us all,” said Rep. Carey. “Our bipartisan legislation fixes a provision within the Inflation Reduction Act that unfairly penalizes America’s energy producers. At a time of sky-high inflation, the American people need any help they can get when it comes to lowering the cost of energy.”  

“Our country must be ready to face the energy challenges of the next few decades,” said Rep. Gonzalez.  “This commonsense bipartisan bill promotes our nation’s domestic energy production capabilities – ensuring we keep and create American jobs, lower energy prices, and decrease our dependence on foreign energy sources.”  

Tax deductions for energy exploration, known as intangible drilling costs, have been included within the U.S. tax code since its inception.  

Oil and natural gas exploration is a time and resource-intensive process with significant financial risks. For instance, 85% of all costs associated with oil exploration and well development are in the form of labor and safety standards.   

Unfortunately, the Inflation Reduction Act limited the ability of energy companies to deduct intangible costs and depreciating assets. The Promoting Domestic Energy Production Act allows companies to consider intangible drilling costs when calculating their income for tax purposes. These are the same deductions that every other industry is allowed to utilize.  

Overall, 24 House lawmakers have co-sponsored the legislation. Among others, the legislation is backed by Reps. Ryan Zinke (R-MT), Henry Cuellar (D-TX), Alex Mooney (R-WV), Carol Miller (R-WV), Ron Estes (R-KS), Beth Van Duyne (R-TX, Wesley Hunt (R-TX), and August Pfluger (R-TX). Also backing the bill are House Rules Committee Chairman Tom Cole, Republican Study Committee Chairman Kevin Hern (R-OK,) and Western Caucus Chairman Dan Newhouse (R-WA).  

A copy of the bill can be viewed here.  

Original source can be found here.