'Broken' Oil Program Under Review

(Bloomberg) -- The U.S. government program for selling drilling rights on federal land is so “fundamentally broken” that changes could be needed to address climate change and ensure taxpayers get a greater value from extracted oil and gas, Interior Secretary Deb Haaland said Friday.
“The American taxpayers deserve to have a return on their investment,” Haaland said, stressing that the public lands managed by Interior are a shared asset.
“They don’t just belong to one sector or one industry. They belong to the outdoor economy, they belong to the kids who take their first breath, on a hike out on a trail,” Haaland told reporters. “They belong to everyone, and it’s our job to make sure that every voice is heard with respect to how we manage those lands.”
A week after taking office, President Joe Biden ordered the Interior Department to pause selling new oil and gas leases on federal lands and waters while the agency studies possible requirements on any future sales -- such as higher royalty payments, location restrictions and even limits on the number of tracts held by individual companies.
Although Haaland has repeatedly stressed the leasing pause is temporary, it could take months or years to implement substantive changes -- and the overhaul could have profound impacts on the future of energy development on public lands and waters now responsible for 22% of U.S. oil production and 12% of the country’s natural gas.
The Interior Department is taking public comment on how to proceed through April 15, with plans to issue an interim analysis outlining recommended changes this summer.
That report “will wrestle with some fundamental questions about the oil and gas program, including whether it’s delivering a fair return to American taxpayers, whether it fairly accounts for the impacts of climate, whether there’s adequate opportunity for public input, including from Indian tribes, and whether we have the right mechanisms in place to avoid irreparable harm to wildlife, water, sacred sites and beyond,” Haaland said.
Some environmentalists have urged a permanent halt to the sale of drilling rights on federal land and waters, arguing the territory should be enlisted in the fight against climate change, rather than used to produce the fossil fuels that drive the phenomenon. That dovetails with views that Haaland espoused long before she became Interior secretary, when she encouraged the end of fracking on federal lands.
But the oil industry has warned that an extended moratorium or a sharp crackdown on future leasing opportunities would curtail domestic energy supplies, harming U.S. national security interests while depriving federal coffers of revenue tied to the activity.
While oil leasing is paused, Interior is seeking to advance renewable energy development, including new coastal wind farms along the East Coast.
Haaland also emphasized her plans to boost conservation of federal lands, with a focus on stemming the decline of biodiversity, fighting climate and addressing inequities in the public’s access to nature.
Haaland, a former Democratic lawmaker from New Mexico who was sworn in as secretary last month, is also examining the boundaries of the Bears Ears National Monument in Utah, which was shrunk under former President Donald Trump. Haaland’s review, which will include meetings with local leaders and other stakeholders next week, could result in enlarging boundaries for the protected site.
© 2021 Bloomberg L.P.
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Fed Will Be One Of The Leading Oil Price Drivers in 2023
- Turkey Halts Oil Flows to Mediterranean Port After Quake
- Signs of Progress at Freeport LNG
- Next Steps Following US Pacific Wind Leasing Round
- US Oilfield Services Firms Money Policy Could Hinder Industry Growth
- Australian Budget Must Focus On New Gas Supply, Industry Says
- Modi Says India Can Add Oil and Gas While It Chases Green Goal
- Woodside To Pick Development Concept For Timor-Leste Gas Project
- New SPR Bill Passes House
- Biden To Support ConocoPhillips Alaska Oil Project, Defying Greens
- Shell CEO Says World 'Desperately In Need' Of Natural Gas
- Energy Services Sector Will Grow To $1 trillion In 2025
- USA Oil and Gas Employs Almost 1 Million in 2022
- Fate Of $8Bn Alaska Oil Project To Be Resolved In Next 30 Days
- Winter Storm Mara Update
- New Discoveries Make 2022 Highest Value Year In Over A Decade
- European Union Debuts First-Ever Carbon Border Tax
- Exxon Beats Earnings Record With With Massive $56 Billion
- Valaris Employee Reported Missing from Rig
- Gasoline and Diesel Prices Expected to Fall
- Is the USA Shale Boom Over?
- New SPR Bill Passes House
- Higher Oil Prices Have Not Led to More Exploration
- Shell Finds Gas In Pensacola High-Impact Well Off UK
- Iran Oil Gushes Into Global Market
- Will Oil Hit $100 Per Barrel in 2023?
- Eni, Chevron Make Significant Gas Discovery Off Egypt
- What Bad Habits Should Oil and Gas Jobseekers Avoid?