FOR IMMEDIATE RELEASE
Tuesday, April 1, 2014
MORE INFORMATION:
Mike Berkowitz
248-345-9808
Mike.berkowitz@sierraclub.org
Mike Berkowitz
248-345-9808
Mike.berkowitz@sierraclub.org
Snyder Administration
Approves Handout to Oil Drilling Corporations Right After BP Spills in Lake
Michigan
New Law Flies in the
Face of Taxpayers and Landowners
LANSING—Michigan property owners and taxpayers have lost ground
today as Governor Snyder’s administration today signed into law a controversial
bill package that gives oil and gas companies new powers to site pipelines
on private property, while reducing the taxes the industry pays. HB
4885 (Nesbitt), HB 5254 (Outman), HB 5255 (Stallworth), and HB 5274 (Pettalia)
are designed to encourage so-called enhanced oil recovery operations, which
entail pumping carbon dioxide (CO2) into closed oil wells to extract previously
unattainable oil. Under the new law, oil and gas companies will
receive a 40% reduction in the oil severance tax as well as a 20% reduction for
natural gas, essentially handing money to the industry.
“This law hurts taxpayers, landowners, and threatens water
supplies while giving taxpayer handouts to the oil and gas industry,”
said Mike Berkowitz, Legislative Director for the Sierra Club
Michigan Chapter. “Giving tax breaks to the oil industry that is
putting our water at risk while they make record profits is just plain wrong.
Especially considering that BP just spilled 1600 gallons of oil into Lake
Michigan last week. Michiganders deserve better from Governor Snyder
and the Michigan Legislature than this harmful law.
Supporters of the industry-backed proposals say there might be
environmental benefits from carbon sequestration during the oil recovery
process that is included as part of the bill package. Those claims,
however, ignore the damage that will likely result from expanded drilling in
environmentally sensitive areas. Moreover, any benefits from carbon
sequestration must be weighed against disruptive new pipeline construction,
well conversions required to accommodate the process, additional air pollution
as well as costs and environmental impacts of increased transport of
oil. These impacts combined with the increased combustion of oil extracted
mean the bill package will likely result in the release of more greenhouse
gases.
“This law poses an alarming new threat for all Michigan residents who are facing aggressive
oil, gas and related pipeline construction in their communities. The
Sierra Club strongly opposes the expansion of eminent domain authority to
private oil and gas companies at the expense of the rights of private property
owners and the public” said Anne Woiwode, Director of the
Sierra Club Michigan Chapter. “The rapid expansion of oil
and tar sands being pumped through Michigan pipelines is raising
legitimate concerns from private landowners about the safety of these pipelines
near their homes and businesses. Giving oil and gas companies more
ability to take lands for the transportation of fossil fuels and carbon dioxide
pipeline development is the wrong decision for Michigan, for clean water, and
for property owners.”
Sierra Club applauds Senator Hoon-Yung Hopgood for sponsoring an
amendment to HB 4885, which was adopted, that prevents companies who
have been convicted of an anti-trust violation from getting a break on their
severance tax for Enhanced Oil Recovery operations. This comes in light
of Encana Oil and Gas USA and Chesapeake Energy Corporation recently being
charged with collusion for conspiring to hold bid prices down in an
October 2010 auction of oil and gas leases.
Michiganders are continuing to face increased risks to their
water supplies, and now will have fewer rights over their property, while the
oil and gas industry reaps the benefits of a corporate tax handout.
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The Sierra Club
is the nation’s largest grassroots environmental organization, with over
150,000 members and supporters in Michigan .