As President Joe Biden’s policies continue to generate poor outcomes for Americans, an announcement from the Department of the Interior Friday heading into a holiday weekend suggested an attempt at course correction that appears only to be drawing more ire from both sides of the domestic oil production debate.
At the onset of his presidency, Biden introduced a moratorium on drilling leases for oil and gas on federal lands. While the legality of that action makes its way through the courts and following the decision for an ongoing release of oil from the Strategic Petroleum Reserve, the Bureau of Land Management (BLM) quietly announced the beginning of a “reset” on the “use of Americans’ resources” in an effort to address high fuel costs.
Secretary of the Interior Deb Haaland released a statement Friday to announce the resumption of drilling leases on select federal lands, declaring, “How we manage our public lands and waters says everything about what we value as a nation. For too long, the federal oil and gas leasing programs have prioritized the wants of extractive industries above local communities, the natural environment, the impact of our air and water, the needs of Tribal Nations, and, moreover, other uses of our shared public lands.”
“Today,” she noted, “we begin to reset how and what we consider to be the highest and best use of Americans’ resources for the benefit of all current and future generations.”
For too long, the federal oil and gas leasing programs have prioritized the wants of extractive industries above local communities, the natural environment, the impact on our air and water, the needs of Tribal Nations, and other uses of our shared public lands.
— Secretary Deb Haaland (@SecDebHaaland) April 16, 2022
After analyzing 646 parcels from nearly 733,000 acres of federal land in states like Alabama, Montana, North Dakota, and Wyoming, the BLM concluded that they would offer about 173 parcels on around 144,000 acres. This, they say is “an 80 percent reduction from the acreage originally nominated.”
As would be expected, climate activists were none too pleased with the decision as The Wall Street Journal reported that Jeremy Nichols, WildEarth Guardians climate and energy program director, stated, “This is pure climate denial. While the Biden administration talks a good talk on climate action, the reality is, they’re in bed with the oil and gas industry.”
However, that argument negates the decision by the BLM to increase the royalty rate on the leases to 18.75 percent from the current 12.5 percent on the value of extracted resources. This decision, along with the administration’s continued hesitancy to unleash American energy production, is leaving the industry leery of the long-term impact of these policies.
Chief Operating Officer C. Jeffery Eshelman from the Independent Petroleum Association of America noted that the announcement timed with Passover and Easter didn’t help and stated, “This administration has begged for more oil from foreign nations, blames American energy producers for gouging and sitting on leases. Now, on a late holiday announcement, under pressure, it announces a lease sale with major royalty increases that will add uncertainty to drilling plans for years.”
Likewise, Frank Macchiarola, senior vice president with the American Petroleum Institute, told Fox News, that while the move is a step in the right direction, and is in line with what the law dictates, “we are concerned that this action adds new barriers to increasing energy productions, including removing some of the most significant parcels.”
“At a time of high energy costs, these changes to long-standing fair and reasonable lease terms may further discourage oil and natural gas investment on federal lands,” Macchiarola added. “We look forward to seeing the additional details of the leasing proposal.”
Anne Bradbury, chief executive for the American Exploration and Production Council echoed Macchiarola’s statement.
“While today’s announcement is a step in the right direction, to really unleash American energy the Biden administration should continue to hold ongoing lease sales pursuant to the Mineral Leasing Act, issue permits more expeditiously and provide consistent regulatory certainty,” she said, according to the Wall Street Journal.
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