Feds: 2011 BLM drilling permits are on track to increase by 2,200

Interior Secretary Ken Salazar says the Bureau of Land Management expects to process 7,200 oil and gas drilling permits this year, up from about 5,000 the previous year.

Salazar touted the increase during a media teleconference in which BLM director Bob Abbey also participated Tuesday.  Salazar’s comments follow President Obama’s statement last week that, contrary to any notion that his administration is shutting down oil production, domestic production last year was the highest since 2003.

During the last fiscal year, natural gas production on federal lands totaled nearly 3 trillion cubic feet, more than twice what it was in 1992, according to BLM figures.

Said Salazar, “I think when you look at the amount of production that we have achieved both onshore and offshore, it speaks for itself.”

Salazar said the BLM has leased 41 million acres for oil and gas development, but only 12 million acres are being developed. Obama and Salazar say the government is looking at ways to encourage companies to develop that remaining acreage.

But the Western Energy Alliance industry group on Tuesday said increasing regulatory hurdles hamper companies’ abilities to act on their leases.

The group says usually about one-third of lease acreage won’t be produced because it turns out there isn’t an economically recoverable amount of oil and gas using today’s technology. But it said a lot of leases are plagued by delays in issuing the leases and drilling permits, failures to give environmental approvals to drilling projects, and legal challenges by environmental groups.

Additional regulations, including a new policy of reviewing lands for possible wild lands characteristics, also are reducing the amount of new leases being offered, the group says.

“It’s a paradoxical situation in which the government has created a cumbersome process that takes years to complete, environmental groups throw up legal roadblocks at every stage, and then the government and environmental lobby turn around and blame the industry for not ‘diligently developing,’” Kathleen Sgamma, the group’s director of government and public affairs, said in a news release.

Salazar and Abbey said the wild lands reviews are required by law. Abbey acknowledged that a new process of environmental analysis of potential parcels before they are made available for lease has reduced the number of parcels offered over the last six months. But he said the analysis means that lease protests, which used to occur for about 49 percent of leases, also have been reduced.

Since Jan. 1, 2009, the government has offered 8.3 million acres for lease, and leased 3.7 million, Abbey said. He said the market drives the industry, which is why the agency is anticipating increases in leasing and drilling permits.


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