Commonsense reforms would create efficiencies while benefitting fish and wildlife
Last week, the Department of the Interior released a report on its oil and gas leasing program in response to a February 2021 executive order aimed at addressing the challenges of climate change. The DOI report has been met with heated rhetoric from both sides of the political spectrum, but the TRCP believes that several commonsense recommendations in the report should be implemented to reduce the negative consequences of oil and gas development on public lands.
In light of the reality that Americans rely heavily on fossil fuels to drive our cars and heat our homes, combined with the value of public lands to hunters and anglers, we feel this is a topic we should share with our community. First, we’ll provide some background on why the TRCP has been working for years to help balance responsible energy development with the needs of fish, wildlife, and outdoor recreation. We’ll also explain everything you need to know about practices recommended in the report that would affect your hunting and fishing opportunities.
Why Hunters and Anglers Should Care
The Theodore Roosevelt Conservation Partnership first became involved in public lands energy leasing and development in 2006, as an overwhelming body of scientific knowledge demonstrated that an energy boom on Bureau of Land Management public lands was significantly affecting mule deer in many areas of the West. In places like the Pinedale Anticline in Wyoming, the severity of these impacts forced state agency officials to reduce hunter tag allocations and shorten season dates.
As a result, the TRCP began to engage with the policies and processes that govern how oil and gas resources are sold by federal agencies to private entities and then developed on public ground. TRCP’s approach has been to propose solutions that reduce the impacts of oil and gas development on fish and wildlife resources, while supporting responsible and necessary development of these resources. The TRCP additionally supports infrastructure investments that build a clean energy economy and transition to reliable renewable energy alternatives, while also ensuring a consistent and affordable supply of energy for all Americans.
The DOI report highlights some practices that align with what the TRCP has been calling for and can be implemented while still allowing responsible energy development to take place. Below are some of the recommendations we support and why.
Recommendation: Stop Leasing Low-Potential Lands
Presently, the vast majority of BLM lands are open to oil and gas leasing. This includes areas that are identified as having low potential for development, because the mineral resources don’t exist. While it may not seem like a big deal to offer areas where the development expectation is low, energy companies often nominate and lease these lands, both because the leasing rates can be practically free at just $2 an acre and because this practice makes it appear as though companies own more resources than they do, thereby making them more attractive to outside investors. For example, 2.7 million acres were proposed for lease in Nevada between 2013 and 2020, and many of these areas have low potential for development.
Even though the bulk of these areas will not see on-the-ground development, their leasing by the agency still has real-world consequences. When important fish and wildlife habitat, like big game winter range or riparian zones, are leased for development, that use-right is often prioritized over other uses, like the conservation of an area deemed important for hunters and anglers. Therefore, the BLM may be reluctant to put in place measures that could benefit fish and wildlife or outdoor recreation once the lease is sold.
Further, while the agency does collect some revenue from the sale of low-potential lands, they are wasting millions of dollars processing lease nominations in places without development potential. Those scarce public resources could be better spent on other management needs, including leasing areas with actual development potential, particularly where impacts to fish and wildlife are fewer. To make efficient use of taxpayer resources and allow the agency to prioritize conservation and recreation in areas with little potential for development, the TRCP believes that such areas should not be available for lease at all.
Recommendation: Charge More for Bonus Bids
“Bonus bids” refer to the $2-an-acre fee that the winning bidder pays for an oil and gas lease if the price is not increased through competitive bidding at auction. At this low minimum rate, energy companies are incentivized to buy up large swaths of minerals on public land, prioritizing lands for energy production over other uses, like wildlife and hunting, even when these companies are unable to or uninterested in developing these areas.
These low rates add to the problem of speculators nominating tens of thousands of acres of low potential lands for lease, as has occurred in Nevada and other Western states. Increasing the minimum bonus bid price would incentivize energy companies to only nominate and purchase lease parcels that are of actual interest for development and would ensure the American public receives a fair rate of return on the sale of minerals.
Recommendation: Increase Rental Rates
Energy companies often purchase large swaths of public minerals and then sit on them, without any short-term intention of developing those resources. While this practice of not using leases might help the company secure investors—by demonstrating a large portfolio of assets—it can also be used to essentially reserve lands for development over decades at a time.
Right now, companies pay a rental rate of just $1.50 per acre per year for the first five years of the lease and $2 per year thereafter until the lease expires or when royalty payments begin to exceed their price. The TRCP supports efforts by the BLM to encourage leaseholders to develop their oil and gas leases, versus sitting on them for as long as possible. We believe a rental rate increase could help address this problem.
Recommendation: Bonding Updates That Restore Habitat
It is estimated that there are tens of thousands of “orphaned” oil and gas wells across the nation, abandoned by energy developers without any cleanup, and the Government Accountability Office estimates that 84 percent of Bureau of Land Management bonds are inadequate to ensure proper remediation of a drilling site when a well has been abandoned. These wells often leak methane into the atmosphere and pollute fish and wildlife habitat. Disturbed sites further serve as a source of invasive noxious weeds, the spread of which greatly diminishes the habitat values of winter range and the sagebrush ecosystem in the West. The TRCP supports an increase in minimum bond amounts that take into account recent changes in technology, the complexity and depth of modern wells, inflation, and the risk of abandonment.
Next Steps for Healthier Public Lands
It doesn’t take a lot of attention to realize that debates over oil and gas development are heated and passionate in America. And while some people are calling for an end to fossil fuel production, that’s not what the DOI leasing report is proposing. The TRCP is hopeful that some of the report’s commonsense provisions are implemented by the BLM and DOI. Even better, we encourage Congress to adopt some of these measures through the Build Back Better legislation. These steps would help to provide more certainty for fish and wildlife habitat and outdoor recreation, while still allowing for responsible energy development on appropriate federal lands.