Fracking Yields Revenue Bonanza for Federal Government

December 7, 2012
By

WINDFALL: States that saw the biggest increases in federal energy production revenues were those that promoted hydraulic fracturing

WASHINGTON — With an assist from Western states that permit hydraulic fracturing, the federal government has generated $1 billion more from domestic energy production on public lands and offshore areas this year than last year.

The federal government paid out $12.15 billion to federal environmental and conservation efforts as well as state and tribal governments from the domestic energy production on public lands.

It handed out $11.16 billion the year before and $9 billion in fiscal year 2010.

Secretary of the Interior Ken Salazar indicated that greater domestic energy production and sales of new oil, gas, and coal leases on public lands drove the revenue increase.

“These revenues reflect significant domestic energy production under President Obama’s all-of-the-above energy strategy and provide a vital revenue stream for federal and state governments and American Indian communities, particularly as the economy continues to gain strength,” he said in a statement.

Colorado received $157.8 million in disbursements. The amount represented the fifth highest of the 37 states that received federal energy production revenue.

But the federal government itself was the largest recipient of revenues from domestic energy production on public lands and offshore areas. It gave $6.6 billion to Indian tribes as well as federal programs to buy land and water for recreational use and to protect natural treasures.

State governments received $2.1 billion for their coffers, the same dollar figure as last fiscal year.

But Rep. Cory Gardner (R-Yuma), a critic of the Obama administration’s energy and environmental policies, charged Secretary Salazar with deceiving the public by claiming that domestic energy production on public lands had increased.

“These latest numbers are typical of the deception we’ve seen from the Interior Department. It is true that revenue is up because of bonus bids from new leases, but that doesn’t immediately translate into production, not especially in the first year,” he wrote in an email. “Secretary Salazar is trying to make it seem like increased revenue is from increased production; that is just not the case.”

A Salazar spokesman did not respond to an email about Gardner’s statement.

The Interior Department’s press release might confuse some readers about the source of the extra federal revenue.  In the first paragraph, it states that the federal revenue was generated from “energy production on public lands and offshore areas.”  Lower down, in the third paragraph, the release attributes the increase in disbursements primarily to “bonus bids received for new oil, gas, and coal lease sales …”

Also, the release’s sub-headline said that the Obama administration’s “all-of-the-above energy strategy yields $1 billion more than last year.”

Yet the states that saw the biggest increases in federal energy production revenue were those that promoted hydraulic fracturing, a drilling process that the Obama Administration and green lobby groups have sought to regulate more tightly.

New Mexico received $54 million more than last year; North Dakota, $35 million; and Wyoming, $24 million.

Colorado received $1 million more than last year.

Comments made by visitors are not representative of The Colorado Observer staff.

2 Responses to Fracking Yields Revenue Bonanza for Federal Government

  1. December 31, 2013 at 6:37 pm

    Dear Sir or ma’am, I was wondering if you could tell me what the revenue from public (domestic) lands are for crude oil, natural gas, and minerals in the U.S.? I have found conflicting numbers and I need to pin it down. Thank you so very much in advance for any info. Very Respectfully, S. Cavitt.

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