MEMO: Biden Administration Proposes Long Overdue Reforms to Oil and Gas Leasing System

The Bureau of Land Management is taking important initial steps to better align its oil and gas decisions with a more holistic conservation, climate and community-centric approach to managing public lands – an effort that will loosen Big Oil’s decades-long grip on public lands. 

Currently, the federal oil and gas program is woefully outdated and riddled with de facto subsidies for fossil fuel companies. It lets oil and gas CEOs reap record profits while offloading the costs of pollution and ecosystem destruction from their operations onto communities and public lands themselves. 

Through several critical updates to this system, the BLM is using its existing legal authority to make fossil fuel companies pay a fairer share for extracting public resources, cover the cost of clean-up and restoration after drilling is finished, limit participation of bad actors, and putting guardrails on what lands are offered for oil and gas leasing. 

The proposed Oil and Gas Rule comes amidst several agency efforts to make public lands part of the solution to addressing conservation and climate needs – particularly, how to appropriately balance the development of rapid but responsible renewable energy development with climate resiliency, biodiversity and community health.   

Environmental groups, including The Wilderness Society, and elected policymakers in Western states have voiced support for the draft rule. 

Oil and Gas Rule makes long awaited reforms, but BLM could go further to apply climate lens to public lands 

Late last week, the Bureau announced a 60-day public comment period on the draft rule starting on July 24, which includes the following proposed reforms to the federal oil and gas program. 

• Enshrines several critical updates in the Inflation Reduction Act, including long overdue increases in the royalty and rental rates and terms for leasing and development on public lands. 

• Updates bonding rules and rates that oil and gas companies are required to pay to fund clean-up and restoration costs of their projects so communities don’t have to continue footing the bill for cleaning up the mess left behind when oil and gas companies abandon or orphan their wells.    

• Includes reforms that embrace the Interior Department’s authority to put guardrails on what lands are offered for leasing, as well as who’s allowed to be a part of the process.  

The proposed rule requests input on whether to address greenhouse gas emissions in the rule, including as part of screening criteria for leasing, and addresses problems that the Interior Department identified in its own 2021 review of the program. However, the BLM can make even more progress – especially through a climate lens – by making additional reforms to the leasing and nomination process and making equally crucial updates to the permitting side of the oil and gas program. To this end, and admirably, the rule’s preamble invites comment on how to better align leasing decision-making to account for greenhouse gas emissions’ adverse effects on public land resources.   

• By assessing lands through various lenses such as climate impacts, conservation values, community and habitat resilience, renewable energy potential, and recreation and cultural importance, the BLM can better ensure that lands with diverse and important environmental and community values aren’t just being handed over to oil and gas companies because they asked for them – whether it’s at the leasing or permitting stage.   

• The BLM can make updates to the oil and gas program that respond to the negative impacts that climate change has on public lands and public lands resources themselves. When the oil and gas from public lands is burned and turned into emissions that fuel climate change, climate impacts like extreme drought, wildfire, heat, flooding, and even species loss come back around to harm those very public lands and undermine the myriad important roles they play in supporting healthy, vibrant communities and ecosystems.  

The BLM not only has existing legal authority – but also an obligation – to align oil and gas decisions on public lands with the public interest, including safeguarding public wellbeing and preventing permanent degradation to the lands and ecosystems we all depend on in the face of climate change. 

Oil and Gas Rule part of series of policy updates that together could drive era of more comprehensive, holistic public lands management  

The Oil and Gas Rule is one of a set of necessary policy improvements the BLM is pursuing this year that should work as a package, putting public lands to work on the challenges of the 21st century – countering climate change and biodiversity loss while safeguarding cultural knowledge and resources, and expanding safe, healthy access to nature for all people. 

Current public lands management prioritizes profit for fossil fuel companies over communities’ wellbeing, clean air and water, healthy ecosystems and BLM public lands themselves. The BLM’s Oil and Gas Rule begins to rebalance the favoritism for oil and gas companies that’s been built into multiple facets of public lands management by focusing on the federal oil and gas program specifically. 

Public Lands Rule 

While the BLM’s Oil and Gas Rule updates how and where oil and gas companies claim stake on public lands, its proposed Public Lands Rule elevates the Bureau’s focus on conservation for public lands, for the first time placing land health and resilience of whole ecosystems on equal footing with other uses, like fossil fuel extraction. The Public Lands Rule does this through the use of additional tools (e.g., designations like Areas of Critical Environmental Concern) and priorities (e.g., managing for intact landscapes and land health standards) that allow local land managers to make decisions to best manage the areas under their care, with strong public and Tribal nations input. At the same time, the rule also creates an additional tool called conservation leasing, which can be a win-win for both responsible renewable energy deployment on public lands and protecting wildlife by enabling mitigation opportunities to offset development impacts on habitat or other values of public lands.     

Renewable Energy Rule and Western Solar Plan 

Paired with the Public Lands Rule’s conservation leasing, the BLM’s proposed Renewable Energy Rule and forthcoming updates to the Western Solar Plan – if implemented together thoughtfully – can incentivize responsible renewable energy development on public lands and help accelerate and continue momentum for the clean energy economy.  

• For the Renewable Energy Rule to effectively incentivize responsible renewable energy development on public lands, it requires a robust and well-designed revision to the Western Solar Plan that includes substantial community involvement, Tribal consultation, sound science and balancing deployment with minimized impacts on ecosystems and communities. 

• As part of this solar programmatic update, the BLM is considering adding more states, reviewing the process for new Designated Leasing Areas, variance areas and exclusion areas, adjusting exclusion criteria and seeking to identify new or expanded areas to prioritize solar deployment.  

The Biden administration simply can’t align public lands management with 21st century challenges by tackling any of these policies in isolation. Implementing this suite of BLM plans collectively can establish a more holistic vision for public lands management that addresses the challenges of climate change and the wildlife extinction crisis, alongside equitable decision-making with strong community input and robust Tribal consultation.  

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The Wilderness Society is here as a resource if you have questions or need assistance in reporting. We can connect you with community advocates, energy policy experts and scientists. For more information, contact Emily Denny of The Wilderness Society at edenny@tws.org.