....................... The depletion allowance is an unjustifiable tax break for oil that gives it a cost advantage over other energy sources..................
The depletion allowance allows the companies to write off, tax free, the huge lease cost that the oil companies had to pay the US government for the company to explore for oil.
In many cases the depletion allowance benefit is applicable decades after the oil company paid - cash - for the ability to look for oil.
I’m not sure what you’re saying there. Lease costs should be depreciated completely over their lifetime just like any other capital investment. There’s nothing usual about that. The depletion allowance is a separate tax break, as far as I know.