Feds to lose at least $20 billion in oil-company royalties, report finds

Remember that outrageous story about how oil companies are going to gank U.S. taxpayers out of some $7 billion in royalties for drilling in the Gulf of Mexico? Well, time to crank up the outrage-o-meter: Turns out, based on a new report from the federal Government Accountability Office, taxpayers will actually be getting screwed out of $20 billion over the next 25 years. The report, presented in a private briefing Monday to congressional staffers and apparently leaked to The New York Times, cautions that the loss may quadruple to $80 billion if gas and oil firms win a lawsuit seeking further royalty reductions. Federal incentives designed to persuade petro-companies to drill in federally leased deepwater areas in the gulf were created about a decade ago, when energy prices were depressed. But oil prices hit $66 a barrel yesterday, oil companies are awash in record profits, a new estimate pegs the cost of the Iraq war at between $1 trillion and $2 trillion, the deficit has topped $8 trillion … you see what we’re saying.