Data Shows Obama Policies Choking Energy Economy on Federal Lands

July 27, 2012
By

RUNNING ON EMPTY: The report showed that the BLM issued 97% fewer leases in Colorado. Only four parcels were offered up for lease in Fiscal Year 2011

DENVER–The Obama administration has stifled energy production on public land even as development of oil and gas resources has surged on state and private land, according to a report released Thursday.

Figures compiled by the Western Energy Alliance in Denver support what many Colorado industry officials have long suspected: That tighter regulations are suppressing the production of oil and natural gas despite the advent of new technologies that have created a fossil-fuel boom on non-federal land.

“Operating on federal lands has always been longer, more bureaucratic, more costly,” said Kathleen Sgamma, WEA vice-president of government and public affairs. “But what we’ve seen from the Obama administration is additional layers of regulation that have slowed things down and a lack of political will to move forward with oil and gas projects.”

Using government data, the alliance found that natural gas production on federal lands in the West declined 4% between Fiscal Year 2008 and Fiscal Year 2011. Meanwhile, production on state and private lands increased 29%.

Domestic oil production has risen, thanks largely to the plentiful reserves from North Dakota’s Bakken formation. But production on private and state land has risen by 54%, far outperforming the 26% increase on lands managed by the federal government.

The alliance attributes the substantial gap between production on federal and non-federal property to policies that reduce access to Western lands. During the same three-year period, the Bureau of Land Management offered 81% less acreage, resulting in a 44% drop in leasing revenue from $356 million to $201 million, according to the data.

Nationally, royalty and leasing revenue fell 12%, from $4.2 billion to $3.7 billion.

The figures were particularly stark for Colorado. The report showed that the BLM issued 97% fewer leases in Colorado. Only four parcels were offered up for lease in Fiscal Year 2011, which represents a 98% decrease.

Interior spokesman Blake Androff pointed to figures showing that energy production has climbed during the Obama administration.

“Nationwide, domestic oil and natural gas production has increased every year President Obama has been in office,” said Interior Secretary Ken Salazar in a July 18 statement. “In 2011, American oil production reached the highest level in nearly a decade and natural gas production reached an all-time high.”

Critics argue that the increases can be attributed almost entirely to production on state and private land, primarily from the development of the Bakken formation. They also say that much of the production on federal land began with leases approved by the Bush administration.

Access to federal land has also been restricted by the increase in challenges to proposed leases, largely by environmental groups. The alliance found that 70% of the leases offered for development on federal land in the West were protested, resulting in delays and higher costs for energy companies.

In Colorado, challenges were issued to 71% of the leases offered, while in Montana, 100% of the leases offered were protested, according to WEA figures.

“Western oil and natural gas development and production generates $51 billion in revenue and employs 229,150 workers across America,” said Sgamma. “Unfortunately, the federal government is standing in the way of increasing production of valuable energy resources that could spur further job creation, economic growth and energy security.”

The full report is available on the alliance’s website under its “Western Oil and Natural Gas Dashboard” at http://westernenergyalliance.org/resources/dashboard/.

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