Biden Management to Building up Charges for Drilling on Federal Land

By qaxio

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The Biden administration is working on modernizing the country’s oil and gas leasing program. Companies that want to drill on public lands will have to pay higher fees and will have to meet stricter requirements on where they can operate, according to a rule proposed by Department of the Interior on Thursday.

Since 1960, the price of lease bonds has been $10,000. The new rule proposes an increase of the minimum lease bond to $150,000, and the minimum statewide bond to $500,000. The new rule also increased the bid for leasing federal parcels from $2 to $10 per acre, which has codified a provision of the Inflation Reduction Act, the announcement said. Royalty rates will also increase. Current federal royalty rates are 12.5%. That rate hasn’t increased for about a century, and is lower than what private landowners and states charged companies for drilling, the Associated Press reported. The new rule proposes rate of 16.67%.

“Outdated bond requirement increases the risk that taxpayers will end up covering the cost of reclaiming wells in the event the operator refuses to do so or declares bankruptcy,” the Interior’s announcement explained.

The new rule will give the government more authority to keep energy development away from fragile ecosystems and important cultural sites found on public lands, the announcement said. “This proposed rule aims to prevent that burden from falling on the taxpayer in future years.”

“This proposal to update BLM’s oil and gas program aims to ensure fairness to the taxpayer and balanced, responsible development as we continue to transition to a clean energy economy,” Tracy Stone-Manning, director of the Bureau of Land Management, said via the announcement. “It includes common sense and needed fiscal revisions to BLM’s program, many directed by Congress.”

Sadly, this rule does not prohibit drilling on public lands despite that being a major talking point during Biden’s 2020 presidential campaign. But the hope is that the stricter rules and higher fees would create a more responsible leasing program.

Environmental groups throughout the country haven’t been exactly thrilled that the rule only improves the nation’s current leasing system, but doesn’t outright ban drilling on public lands. Advocacy groups are especially upset that drilling will continue, despite this being a summer of widespread wildfire smoke and dangerous heat for the U.S.

“Even as record heatwaves bake the country and floods ravage eastern states, the Biden Administration continues to cozy up to Big Oil,” Nicole Ghio, the senior fossil fuels program manager at Friends of the Earth, said in a statement. “President Biden can’t be a climate leader unless he addresses the root cause of the climate crisis: fossil fuels.”

Want more climate and environment stories? Check out Earther’s guides to decarbonizing your home, divesting from fossil fuels, packing a disaster go bag, and overcoming climate dread. And don’t miss our coverage of the latest IPCC climate report, the future of carbon dioxide removal, and the un-greenwashed facts on bioplastics and plastic recycling.


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