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Senate Bill Would Extend Funding for BLM Permitting Pilot Program

A bill that would extend a pilot program that streamlines the permitting process at the U.S. Interior Department's Bureau of Land Management (BLM) for oil and natural gas drilling was introduced in the Senate last week and has bipartisan support.

SB 2440 was introduced by Sens. John Barrasso (R-WY) and Tom Udall (D-NM) on Thursday. It was read twice and referred to the Senate Committee on Energy and Natural Resources.

In a joint statement, Barrasso and Udall said SB 2440 would continue funding for the pilot program -- also known as the Permit Processing Improvement Fund (PPIF) -- that was set up to help regulators handle a backlog of permit applications. PPIF was created by the Energy Policy Act of 2005, which was signed into law by then-President George W. Bush (see Daily GPI, Aug. 4, 2005).

Funding for the PPIF -- which was funded through 50% of rents from non-geothermal onshore mineral leases -- was set to expire in 2015. Under SB 2440, a fee of $9,500 for applications for permits to drill would take effect in 2016. The funding would be locked through the year 2026. The BLM would retain the funding to support its oil and gas permitting operations.

SB 2440 would also bar the BLM secretary from raising the fee through a rulemaking, although the fee is indexed for inflation. The bill would also require that at least 75% of PPIF funds be distributed to the state offices where they were collected. The BLM would have flexibility in allocating the remaining funds.

Udall said BLM offices in Farmington and Carlsbad, NM -- situated in the San Juan and Permian basins, respectively -- were among the busiest in the country (see Daily GPI, April 4, 2012). He said funding through the PPIF has made them more effective.

"Oil and natural gas are critical and active industries in New Mexico, supporting jobs and providing revenue for our kids' education and other important state functions," Udall said. "Our bipartisan bill will make this successful program permanent, providing certainty for industry and giving the BLM the flexibility it needs to balance the complex demands of oil and gas permitting and environmental management."

Barrasso said delays have plagued the permitting process at the BLM for years. SB 2440, he said, "will ensure Wyoming and other BLM offices can process permits in a timely manner."

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