The Bureau of Land Management (BLM) last week finalized reforms to its natural gas and oil program to improve environmental protection of natural resources on U.S. public lands while aiding in the "orderly leasing and balanced development" of energy supplies.

But the reforms will not come without a fight, Republican legislators said.

Interior Secretary Ken Salazar launched the reform process early this year, which led to criticism by industry officials, as well as stakeholders (see NGI, Jan. 18; Jan. 11). Many of the reforms followed the recommendations of an interdisciplinary review team following a controversial 2008 lease sale in Utah (see NGI, Oct. 12, 2009; May 18, 2009; Feb. 9, 2009; Dec. 22, 2008).

"We must continue to move forward quickly and responsibly on our agenda to reform the management of our nation's onshore and offshore energy resources and our oversight of the companies that develop them," said Interior Secretary Ken Salazar. "The BLM reforms we are finalizing...establish a more orderly, open and environmentally sound process for developing oil and gas resources on public lands. The BP oil spill is a stark reminder of how we must continue to push ahead with the reforms we have been working on and which we know are needed" (see related story).

The reforms "take a fresh look -- from inside the federal government and from outside -- at how we can better manage American's energy sources," said BLM Director Bob Abbey. "They will improve protections for land, water and wildlife, and reduce potential conflicts that can lead to costly and time-consuming protests and litigation of leases. The reforms will also move control of the leasing process from Washington, DC, to the field."

Under the BLM's revised leasing policy, the agency plans to:

Categorical exclusions, which the U.S. Minerals Management Service also has used for offshore leasing, are categories of actions that are considered to not have a "significant effect" on the quality of the human environment, and for which the BLM generally is not required to prepare extensive environmental reviews (see NGI, Jan. 4).

A review for extraordinary circumstances had been required for all administratively established categorical exclusions, but it now will apply to gas and oil categorical exclusions established by the EPAct as well.

The increased opportunity for public participation and a more thorough environmental review process and documentation may help reduce the number of leasing protests filed and enhance BLM's ability to resolve protests before the lease sales are conducted, said Abbey.

"The consequence of not following this front-loaded process in the past has been significant protests and appeals, coupled with judicial restraints on development, job loss and diminished access to energy resources," Abbey said. "Instead of the BLM investing vast amounts of staff time and attention to defending lawsuits and revisiting the leasing process after receiving direction from the courts, our goal is to undertake important reviews in advance."

Utah Republican Sen. Bob Bennett called BLM's rules revisions "exactly the wrong thing to do and exactly the wrong time." Bennett said he was "surprised and disappointed that while the [Obama] administration appears to be pulling back the reins on its offshore policy, they would simultaneously be pulling the plug on onshore oil and natural gas development by drowning it in new red tape."

Bennett and Sen. John Barrasso (R-WY), who are members of the Senate Energy and Natural Resources Committee, on Wednesday introduced legislation to overturn the natural gas and oil reforms.

Bennett and Barrasso said the American Energy and Western Jobs Act would eliminate the "bureaucratic red tape and increased delays" that would result from the reforms. Sens. Orrin Hatch (R-UT) and Mike Enzi (R-WY) cosponsored the legislation.

"[W]e are raising a red flag that this administration is blindly driving our nation's federal onshore oil and natural gas program into a ditch," said Bennett.

Under the bill, Interior would be required to conduct an economic impact assessment for any proposed changes to onshore oil and natural gas leasing and development policies before they are implemented. The assessment would have to include certification that the policy changes would not result in the loss of jobs, increase dependence on foreign oil and gas or decrease revenues for federal and state governments.

The legislation also requires public notice and comment on the proposed changes.

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