Tag: DOI

BLM Poised to Expand Renewable Energy Development on Federal Lands Despite Revoking Amendments to Desert Renewable Energy Plan

The Biden administration recently issued a decision walking back proposed amendments to the Bureau of Land Management’s (BLM) Desert Renewable Energy Conservation Plan (DRECP)[i] which, if adopted, would have opened 800,000 acres of land in the California desert for renewable energy development.[ii] Conservation advocates praised the decision while renewable energy developers lamented the loss of an opportunity to expand solar and wind generation in the region.[iii]

Developed during the Obama Administration, the DRECP sets aside nearly 11 million acres of public lands in the California desert for renewable energy development and conservation projects.[iv] Billed as a collaboration between federal and state partners including the California Energy Commission, California Department of Fish and Wildlife, BLM, and U.S. Fish and Wildlife Service, the DRECP seeks to capitalize on the region’s abundant sun, wind, and geothermal resources while also preserving the area’s ecological diversity.[v]

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Oil and Gas Royalty Rates on Public Lands Under Review by Biden Administration

President Biden’s climate plans include a review of federal and state royalty rates paid by private companies for access to fossil fuel reserves underneath public lands.[i] On January 27, Biden issued Executive Order 14008, “Tackling the Climate Crisis at Home and Abroad,” urging aggressive domestic policy directives.[ii]

The Order directed the Secretary of the Interior to pause the issuance of new oil and gas leases for drilling rights on federal lands until the Secretary completes a “comprehensive review” of oil and gas permitting requirements.[iii] The Secretary subsequently issued Order No. 3395 (“the Order”), which directed the pause on approving new leases for fossil fuel extraction on federal lands and ordered the comprehensive review of federal royalty rates.[iv]

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Biden’s Moratorium on Public Lands Drilling Leases will have a Muted Impact–at Least in the Short-term

One week after his inauguration, President Biden issued Executive Order 14008, “Tackling the Climate Crisis at Home and Abroad” (the Order), a move consistent with the progressive environmental platform he championed during his campaign.[i] The Order lays out aggressive domestic policy mandates and reaffirms the Biden Administration’s commitment to leading the global effort to combat the climate crisis.[ii]

As part of the sweeping domestic policies set forth in the Order, President Biden directed the Secretary of Interior (the Secretary) to pause new oil and gas leases on public lands and offshore waters.[iii] The Order does not specify the length of the moratorium, but does prohibit the issuance of any new leases until the Secretary conducts a “comprehensive review” of the current oil and gas permitting requirements under law.[iv]

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Bureau of Land Management Reduces Royalty Rates for Onshore Drilling Operators

In April, the U.S. Department of Interior’s Bureau of Land Management (“BLM”) issued guidance reducing the royalty rate for energy companies that drill for oil and gas on public land.[1] The announcement came as analysts began to understand the dire financial consequences of the COVID-19 pandemic on the oil and gas industry. BLM’s guidance aimed to provide a lifeline to the already struggling industry.[2]

The Mine Leasing Act of 1920 (“MLA”) governs the development of oil and gas on federal land.[3]  It authorizes the Secretary of the Interior to hold auctions for the subsurface rights of federal lands that contain fossil fuel deposits.[4] Under this arrangement, an energy company submits a bid for the lease, and, if successful, pays the federal government rent and royalties for its use.[5]

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