Feds Stalling On 3,500 Federal Oil And Gas Drilling Permits
July 2, 2014 by Sam Rolley
A report from the Interior Department‚Äôs inspector general reveals that the Bureau of Land Management is holding back U.S. domestic energy production by stalling on a backlog of at least 3,500 applications to drill oil and gas wells on Federal lands.
‚ÄúOil and gas production is a major activity on Federal and Indian lands, with annual royalty revenues averaging $3 billion since fiscal year 2011,‚ÄĚ the report explains. ‚ÄúAbout 92,000 oil and gas wells currently exist on Federal lands, and industry drills over 3,000 new wells annually.‚ÄĚ
BLM officials usually shuffle about 5,000 new drilling permits through a multiple-agency bureaucratic approval process each year. Each of the permits, according to the report, takes an average of 7.5 months to go through the process.
Because BLM lacks an efficient system for tracking the progress of the applications, some of the backlogged oil and gas permits are in danger of being delayed indefinitely.
‚ÄúWe found that neither BLM nor the operator can predict when the permit will be approved. Target dates for completion of individual [applications for a permit to drill] are rarely set and enforced, and consequently, the review may continue indefinitely,‚ÄĚ the IG report states.
‚ÄúThis adversely affects developing the Nation‚Äôs domestic energy resources,‚ÄĚ the IG continues. ‚ÄúSpecifically, the Federal Government and Indian mineral owners risk losing royalties from delayed oil and gas production. Industry officials informed us that delays cause some wells not to be drilled, resulting in additional lost production and royalties.‚ÄĚ
The report offers that permit approval times have improved slightly in recent years but production of coal, oil and natural gas has been falling since President Barack Obama took office in 2009. A report issued last month found that production on Federal lands is down 15 percent under Obama‚Äôs watch and a total of 21 percent since 2003.
‚ÄúThe Obama Administration is restricting American energy production wherever and whenever possible and these new numbers from EIA are further proof of that,‚ÄĚ Representative Doc Hastings said in a statement about the report. ‚ÄúPresident Obama has imposed a defacto [sic] drilling moratorium on new offshore drilling, canceled both onshore and offshore lease sales, and imposed layer upon layer of red-tape to make it harder to develop our energy resources.‚ÄĚ
A lack of Federal motivation to streamline the drilling permit process is likely a facet of that ‚Äúdefacto [sic] drilling moratorium.‚ÄĚ While the BLM permit process takes an average of 228 days, GOP lawmakers have noted that most States issue drilling permits in less than 80 days. In Texas, for instance, it takes only five days for most permits to be approved; and a permit in North Dakota can be completed in 25 days. Those States account for roughly half of the United States‚Äô total domestic oil production.
The IG reports that there is definitely room for improvement at the Federal level.
‚ÄúBased on many factors such as available staff, natural resource issues unique to each region, and the complexities of the drilling and surface use plans, the length will likely vary among field offices and individual wells within the same office,‚ÄĚ the new report says. ‚ÄúNevertheless, we concluded that BLM has opportunities to improve the efficiency and speed of the Federal and Indian [drilling application approvals].‚ÄĚ