This will have the effect of shifting more drilling onshore on private lands. The effect will be nominal, but we are likely to see a slight increase in onshore drilling.
http://www.reuters.com/article/2009/03/24/us-salazar-oil-royalties-sb-idUSTRE52N6RW20090324
“(Reuters) – The Obama administration will decide later this year whether to raise the royalty rates energy companies would pay on the oil and natural gas produced on federal leases, U.S. Interior Secretary Ken Salazar said on Tuesday.
Companies now pay a royalty rate ranging from 12.5 percent to 18.75 percent of the value of the oil and gas they drill. However, Salazar said other countries charge higher royalties and the Obama administration wants to make sure U.S. taxpayers are treated fairly.
“We are looking at royalty rates and compensation paid for both onshore and offshore oil and gas development,” Salazar told Reuters in a wide-ranging interview. “We will make sure the American citizen is getting its fair return.”
Salazar refused to speculate on how much the royalties rates might be changed, but said the Interior Department will decide before the end of the year….”