Is Trump Good For Businesses? Exxon Mobil To Benefit From Elimination Of Environmental And Financial Regulations By Congress

Former ExxonMobil Corp. Chief Executive Rex Tillerson was sworn in only Wednesday, and already Congress is moving to benefit the new secretary of state’s former—and only—place of work by shredding two major oil industry regulations. Early Friday morning, the Republican-led Senate voted 52 to 47 on a House resolution scrapping a Securities and Exchange Commission rule requiring companies like Exxon and Chevron Corp. to disclose payments they make to foreign governments for the ability to extract oil, minerals and natural gas from their territory.

Known as the “extraction rule,” it was meant to curb corruption and boost transparency within the oil industry. Standing before the upper house Thursday night, Sen. Elizabeth Warren of Massachusetts railed against the effort to discard the rule.

“One of the Republican Party’s first orders of business is a giveaway to ExxonMobil that will help corrupt and repressive foreign regimes and make it easy to funnel money to terrorists around the world,” she said, adding that companies like Exxon “regularly pay millions” to “corrupt officials” for the rights to drill on their land, and highlighting the “years” necessary to garner bipartisan and even investor support for the law’s passage. “Republicans and Democrats agree that shining a light on these payments would help combat corruption and terrorism around the globe and would help citizens in some of the very poorest nations in the world hold their own governments accountable.”

Tillerson, she noted, “personally lobbied against” the rule in an attempt to bolster his business interests in Russia.

Next to go, according to a report released Friday by the international environmental organization network Friends of the Earth, is likely an Interior Department rule limiting tax relief for oil companies' losses for natural gas inadvertently burned away or sprayed into the air—a phenomenon known as flaring or venting—on government land.

Companies lost about $330 million worth of gas to venting on federal and tribal lands in 2013, according to a 2015 report by the nonprofit Environmental Defense Fund. In the absence of regulation to limit the practice, the government—in other words, taxpayers—stand to miss out on nearly $800 million in lost royalties as a result of the wasted natural gas over the next 10 years, a 2014 study by the Western Values Project found. Without the rule, companies like Exxon can file for exemption from royalties on what it deems “unavoidably lost” gas.

In a Freedom of Information Act Request filed in 2015, the results of which were released Friday, Friends of the Earth found that Exxon wasted $203 million worth of natural gas—the equivalent of burning 330,000 barrels of oil into the air.

“This is what kleptocracy looks like,” Lukas Ross, a Friends of the Earth climate and energy campaigner, said in the report. “If Congress and the GOP vote to stop this common sense regulation, some of the clearest winners will be the big oil cronies closest to Trump.”

The termination of both regulations can be attributed to the 1996 Congressional Review Act—rarely used until recently—which gives both chambers of Congress the ability to get rid of newly-finalized federal rules using a simple majority vote and concurrence from the president.