Oil and Gas Leasing on Public Lands

Oil and gas leasing on public lands contributes one-quarter of the country’s greenhouse gas emissions. The current leasing system favors the companies that extract the natural resources while shortchanging the taxpayers and marginalizes the concerns of the communities who experience the negative impacts of the drilling.

Shortly after taking office, President Biden signed an executive order that temporarily paused new oil and gas leasing on federal public lands to give the administration time to reassess how the public lands drilling program impacts climate change, our communities, and the taxpayers.  

Bonding Requirements for Oil and Gas Companies

The oil and gas bonding requirement is designed to ensure that the companies extracting the natural resource cover the clean up and reclamation costs when wells stop producing or are no longer in use. Unfortunately, current bonding requirements are often inadequate and don’t fully cover the costs to adequately plug and restore wells, leaving local taxpayers on the hook for cleanup costs. In the United States, there are almost 57,000 documented and approximately 746,000 undocumented orphan wells. In 2019, the Government Accountability Office identified nearly 2,300 “at risk” wells on federal lands warning that taxpayers could be on the hook for a large chunk of the costs to clean them up, which could reach $333 million. The Bonding Reform and Taxpayer Protection Act would address this problem by increasing the bonding requirements and requiring oil and gas companies to present a reclamation plan to the Bureau of Land Management (BLM) before they can drill on public land.

Over 93% of people in the West say that oil and gas companies should be required to clean up the public lands from which they extract resources.

Royalty Rates for Energy Companies

Energy companies must pay the federal government a royalty for the oil and gas they extract from federal lands and waters  but the rates, at 12.5% of the total revenue earned on the oil and gas sold  for onshore tracts, have been frozen since the 1920s. Offshore, the rates have ranged recently from 12.5% to 18.75%.

The Oil and gas leasing system for drilling for oil and gas on our public lands is outdated, rigged, and broken and should be reformed.

Ensuring Adequate Funding for Fighting Wildfires

Over the past six decades, there has been a steady increase in the number of fires in the western U.S with 61 percent occurring since 2000. According to a Climate Central report on Western wildfires, today’s fire season is now 105 days longer than it was in the 1970s. The average annual amount of acres burned has been steadily increasing since 1950.

Historically, communities surrounded by public lands have suffered economically when funding for the U.S. Forest Service and Department of Interior fire prevention and recreation infrastructure maintenance budgets has been diverted for other purposes. Fortunately, on March 23, 2018, the Fiscal Year 2018 Consolidated Appropriations Act (2018 Omnibus) was passed, which included a Wildfire and Disaster Funding Adjustment provision that dedicated an appropriate level of funding for wildfire mitigation and forest management and ensured that funds appropriated for recreation programs, maintenance, and infrastructure would remain in those accounts.

Reforming the Coal Leasing Program

Burning coal is also a major contributor to climate change. When coal, which is primarily carbon, is burned it reacts with oxygen in the air to produce carbon dioxide, a heat-trapping gas, which causes the Earth to warm. 

Tax loopholes and outdated federal royalty policies have allowed the coal industry to avoid paying American taxpayers more than $1 billion a year in revenues — revenues that could have helped Western communities adapt to climate change, and supported schools, roads, and other essential services. 

Fortunately, in response to the calls from mountain communities across the West, in January 2016 President Obama’s Interior Department launched a comprehensive review of the coal leasing program with a Programmatic Environmental Impact Statement (PEIS). According to the Interior Department’s press release, the PEIS considers “how, when, and where to lease; how to account for the environmental and public health impacts of federal coal production; and how to ensure American taxpayers are earning a fair return for the use of their public resources." The PEIS included a moratorium on all new coal leases while the review took place.

Unfortunately, however, in March 2017 shortly after President Trump took office, he signed an executive order that lifted the Obama era moratorium and once again opened up federal lands to new coal development leases without an updated system to fairly compensate taxpayers for the resource. 

Regulating Methane Gas

In 2016, the Obama Administration’s Bureau of Land Management finalized the Methane Waste Prevention Rule that regulated methane leaks and flares from natural gas wells on BLM land to combat climate change and protect our air, public health, and communities. Former President Trump was defeated in court three times in his efforts to suspend, repeal, or delay the rule.

The Biden administration has ambitious plans to curb methane from the U.S. oil and gas industry as part of its goal to cut greenhouse gas emissions over the next decade.

The Mountain Pact and the communities we work with support efforts to modernize the federal coal program by ensuring that the federal government implement policies and strategies that help mitigate the social, economic, and environmental impacts of the boom and bust cycles of coal development.

The Mountain Pact ACTIONS

2017 & 2018

  • On March 23, 2018, Congress passed an Omnibus spending bill that included a legislative change to ensure a reliable stream of funding for fighting catastrophic wildfires to avoid the disruptive practice of “fire borrowing” and address the continued erosion of land management programs that results from the increasing suppression levels. Read more here.

2016

  • In fall 2016, the Mountain Pact release a new report, Healthy Forests, Healthy Communities: Protecting Western Forests in the Era of Climate Change and Wildfire.

  • On October 31, 2016, fourteen towns sent a letter to Congressional leadership pointing out the impact that shrinking Forest Service and Interior Department budgets have on our western mountain towns urging them to take this into account in the fall budget negotiations. Ten mountain communities sent a letter to Interior Secretary Jewell to submit public comment in support of the Interior Department's coal royalty reform proposal on July 27, 2016.

  • Mountain Pact delegations of town representatives testified before DOI leadership across the West. Representatives from the Town of Alta, Bend, Hood River, Leavenworth, and Telluride spoke about the need to better account for the climate, environmental and public health impacts of coal production, ensure a fair return for the use of taxpayer's resources, and transition our nation's infrastructure and workforce to better cope with climate change. The testimony was part of the DOI's second round of listening sessions inviting public feedback on the PEIS. The Mountain Pact attended the May 19th Salt Lake City, June 21 Seattle, and June 23 Grand Junction listening sessions.

  • In partnership with Sustainable Development Strategies Group, we published the 'Planning for the Economic Future of Colorado's Coal Communities' Report.

  • In 2016 The Mountain Pact released a report, How Federal Coal Reform Could Help Mountain Communities Mitigate the Costs of Climate Change. 

  • Taos Ski Valley Mayor Neal King published an op-ed in the Albuquerque Journal on April 13, 2016.

  • Two Mountain Pact delegations of town representatives testified before Bureau of Land Management (BLM) and DOI leadership - including BLM Director Neil Kornze and DOI Deputy Secretary Mike Connor - on the federal coal program. Representatives from the Town of Telluride, Village of Taos Ski Valley, Town of Buena Vista, and Town of Alta shared the impacts of climate change they are seeing in their communities and urged BLM to incorporate the costs of climate change into federal coal extraction leases. The testimony was part of the BLM's listening sessions inviting public feedback on the federal coal program. The Mountain Pact attended the August 18 Denver and August 20 Farmington, New Mexico listening sessions.

2014 & 2015

  • In 2015, we developed a report on the issue, Paying the Costs of Climate Change.

  • Ten mountain communities submitted written comments to the BLM urging the agency to incorporate the costs of climate change into coal leases on September 17, 2015.

  • In fall 2015, Park City and Lake Tahoe submitted individual letters to their Congressmen in support of action for funding reforms.

  • Leadville Mayor Jamie Stuever published an op-ed in the Colorado Springs Gazette on August 27, 2015.

  • Mountain Pact Executive Director published an op-ed in the Albuquerque Journal on August 27, 2015.

  • Telluride Mayor Stu Fraser published an op-ed in the Denver Post on May 6, 2015.

  • Eleven mountain communities submitted written comments to the DOI in support to close regulatory loopholes and stop the exploitation of taxpayer-owned federal lands on May 5, 2015.

  • Park City Mayor Jack Thomas published an op-ed in the Salt Lake Tribune on March 28, 2015.

  • A key goal of this policy campaign was to bring media attention to the issue and highlight mountain community support for the Interior Department's proposal. With coverage in U.S News and World Report, Associated Press, Colorado Public Radio, and the Denver Post (among others) plus ads in USA Today during the Western Governors Association annual meeting and the Denver Post during the BLM listening sessions, our efforts have been a success.

  • In fall of 2014, communities including Aspen, Vail, and Durango in Colorado, Park City, Utah, Ketchum, Idaho, Lake Tahoe, Nevada/California, and Bend, Oregon, sent individual letters to and met with their respective Congressional delegations in support of wildfire funding reforms. Together, we submitted a letter to Congressional leadership, which you can read here.

If you are interested in more information about this or The Mountain Pact in general, please email info@themountainpact.org.