Interior Secretary Ken Salazar's proposal to increase royalty rates on public lands from the 12.5% rate to 18.75% drew criticism from the oil and natural gas industry. "Increasing royalty rates when the industry already contributes $86 million to the federal government every day will only create disincentives for the domestic production President Obama claims to support," said Erik Milito, the American Petroleum Institute's director of upstream and industry operations. The current rate "reflects the added cost government imposes on federal-lands development" via bureaucratic rules, said Kathleen Sgamma, the Western Energy Alliance's vice president for government and public affairs.

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