While the Interior Department’s Bureau of Land Management (BLM) has taken steps to collect agencywide data related to protests of oil and natural gas lease sales, the protest data it maintains and makes publicly available still are limited and of poor quality, according to a report that was publicly released by the Government Accountability Office (GAO) Monday.
The report also found that despite the concerns of the oil and gas industry, bid prices for federal leases have been largely unaffected by delays caused by lease protests.
“Although in 2007 BLM required its staff to begin using a module, added to its lease record-keeping system, to capture information related to lease sale protests, GAO found that the information BLM collected was incomplete and inconsistent across the four reviewed BLM state offices and thus of limited utility,” the GAO told House Natural Resources Committee Chairman Nick J. Rahall II, who requested the report.
In the report, the GAO reviewed the records for 53 lease sales held in the four BLM state offices of Colorado, New Mexico, Utah and Wyoming during fiscal years 2007 through 2009. In 2009 these states accounted for 70% of the oil produced on federal lands and 93% of the natural gas, the agency said.
The GAO cited another aggravating factor — the lack of a BLM policy on what types of protest information should be made public during the leasing process. “In the absence of a written BLM policy on protest-related information the agency is to make publicly available during the leasing process, each state office developed its own practices, resulting in state-by-state variation in what protest-related information was made available,” the GAO report said.
The GAO said it found that 74% of parcels whose leases were sold competitively during this period [2007-2009] by BLM state offices in Colorado, New Mexico, Utah and Wyoming were protested. It further found that 91% of the time BLM was unable to issue leases on protested parcels within the 60-day window specified in the Minerals Leasing Act.
“The percentage varied by state office: in New Mexico the percentage was about 52%, while in the other three state offices it was more than 91%, ranging up to almost 100% in Wyoming,” GAO said.
Oil and gas industry groups expressed concern that the protests and delays would increase the cost and risk associated with leasing on federal lands, according to the GAO report. But in the end, “protest activity and delayed leasing have not significantly affected bid prices for leases.
“In addition, because federal lands account for a small fraction of the total onshore and offshore nationwide oil and gas output, the effects of protests to BLM leasing decisions on U.S. oil and gas production are likely to be relatively modest.”
The GAO recommended that the BLM revisit the way its tracks protest information to ensure that complete and consistent information is collected and made publicly available, improve the transparency of leasing decisions and the timeliness of lease issuance.
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