AXPC Submits Comments Supporting ONRR’s Proposed Oil and Natural Gas Valuation Reforms

August 31, 2026

WASHINGTON – The American Exploration & Production Council (AXPC) today submitted comments to the Office of Natural Resources Revenue (ONRR) on its proposed rule, Federal Oil, Gas, and Coal Amendments, which modernizes valuation methods for determining royalties on federal oil and gas production. The proposal would allow companies to use published market prices to determine royalty payments, replacing complex formulas that have triggered costly audits and years-long disputes over what are otherwise good-faith reporting efforts.

“Clear, market-based rules mean companies know what they owe upfront instead of facing reevaluation years later. That’s good for taxpayers, good for energy investment, and good for keeping American energy affordable,” said Wendy Kirchoff, AXPC Senior Vice President of Policy. “By moving toward transparent standards that better reflect ordinary commercial practices, ONRR can significantly reduce costly audits, administrative burdens, and uncertainty for both industry and the agency.”

AXPC has long advocated for regulatory certainty in federal royalty valuation, emphasizing that clear rules benefit both taxpayers and industry by ensuring accurate payments up front rather than costly disputes years later. For example, between FY 2021-2023, the Office of Inspector General found 88 percent of ONRR enforcement referrals involved curable reporting errors – not deliberate underpayment – taking an average of 3.6 years to resolve. 

Read AXPC’s full comment letter here.