Minerals industry may face fee hikes

Under pressure to shore up federal budgets, the Obama administration has proposed several measures to speed up payments and increase processing fees on the minerals industry. For example, a $4,000-per-well processing fee that originated in the Energy Policy Act of 2005 would swell to $6,500 per well. Another proposal would strip away the industry's ability to deduct drilling and other "intangible" expenses. On the coal front, there's a push to require that federal coal "bonus bids" be paid in lump-sum at the time of lease rather than the usual five-year payment plan. In a letter to Congress this week, Independent Petroleum Association of Mountain States executive director Marc Smith said the measures are sold as an elimination of unnecessary subsidies. If enacted, the measures would severely cut available capital needed to continue to develop domestic energy resources, he said. "That means less capital available to be put back into drilling more wells, developing American energy, creating jobs and generating revenue for federal, state and local governments," Smith wrote to Congress...BillingsGazette