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BLM Puts Hold on Proposed Processing Fees for Oil, Gas Permits

In response to the newly enacted energy bill, Interior Department's Bureau of Land Management (BLM) plans to put on hold portions of proposed regulations that would have allowed it to implement fees to recover costs associated with oil, natural gas and geothermal leasing, including the processing of oil and gas applications for permits to drill (APDs) and geothermal permits to drill (GPDs).

The new energy law bars BLM from collecting fees for processing permits related to drilling for fluid minerals until a pilot project to improve the coordination of oil and natural gas permitting among federal agencies is completed. BLM is required to submit a report to Congress on the success of the pilot in three years, at which time lawmakers will decide whether the agency can begin recovering fees for APDs and GPDs, said BLM spokeswoman Celia Boddington.

The BLM will not include any provisions related to APDs and GPDs in the final cost recovery rule that it expects to issue later this year. When the rule is fully implemented, BLM said it would recover about $2.8 million more annually in fixed fees for oil and gas, geothermal and solid minerals applications.

Recovery of proposed fees for geophysical exploration permits will not be prohibited by the energy legislation. The new fee for this type of permit would be phased in over five years, with the first-year fee being $500. Proposed processing fees for coal, non-energy leasable minerals and mineral materials also will be unaffected by the energy bill, BLM said.

The energy bill directed the secretary of Interior to establish a pilot project with the Department of Agriculture, Environmental Protection Agency and the U.S. Army Corps of Engineers to streamline the federal permit process. BLM's offices in Rawlins and Buffalo, WY; Miles City, MT; Farmington and Carlsbad, NM; Grand Junction/Glenwood Springs, CO; and Vernal, UT will be part of the pilot project, according to the agency.

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