![]() In 2015, the DOJ entered a settlement with BP over the Deepwater Horizon Spill for $20.8 billion in damages. Natural resource damages are currently tax deductible. Ensure oil and gas companies pay government penalties.While most taxes are levied by Congress, the Biden Administration could take two actions through the executive branch to put further pressure on the industry: The Environmental and Energy Study Institute calculated that the federal government funds $20 billion every year in fossil fuel subsidies. Subsidies take various forms, ranging from tax breaks to regulatory advantages. Eliminating fossil fuel subsidiesĪs one of his first actions in the Oval Office, President Joe Biden signed an executive order directing federal agencies to eliminate subsidies for fossil fuels, stating “nlike previous administrations, I don’t think the federal government should give handouts to Big Oil.” While these changes primarily aim to reduce the nation’s carbon footprint, they will also add an additional layer of regulations for oil and gas operations and will sharpen public attention on oil and gas companies. These actions include: (1) an order directing federal agencies to eliminate subsidies for fossil fuels (2) reversing the Trump Administration’s rollback on methane regulations and (3) staffing the SEC in preparation to mandate ESG and climate disclosures. While the Biden Administration’s 60-day halt on new oil and gas leases on federal lands and the cancellation of the Keystone XL Pipeline have received the majority of press coverage, the Administration’s actions have also had both direct and indirect impacts on oil and gas companies. Having promised to prioritize climate change on the campaign trail, President Biden has taken swift action, signing executive orders aimed at everything from curbing emissions to environmental justice. ![]() After merely one month in office, the Biden Administration has already had a profound impact on the oil and gas industry. ![]()
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