Energy leases sit idle, Salazar says
Energy companies aren’t drilling enough on public lands, Interior Secretary Ken Salazar said Tuesday, releasing a report that showed nearly half of all leases to private companies are inactive.
The Interior Department, meanwhile, is looking for incentives to encourage more drilling on public lands from current and future leases, Salazar said.
Industry officials dismissed the report as disingenuous and politically motivated.
“We continue to support safe and responsible domestic energy production, and as this report shows, millions of acres that have already been leased to industry for oil and gas productions sit idle,” Salazar said in a statement. “These are resources that belong to the American people, and they expect those supplies to be developed in a timely and responsible manner and with a fair return to taxpayers.”
The Obama administration has been obstructing the development of domestic fuels, the American Petroleum Institute said. “This is an effort to distract the American people from rising gas prices and the fact that the administration has been delaying, deferring or denying access to our oil and natural gas resources here at home,” said Erik Milito, director of upstream and industry operations for the institute.
Oil and gas leases usually last for 10 years. Lands that might overlay reservoirs of oil or gas are auctioned by the Bureau of Land Management.
Energy companies pay fees to hold the leases and then pay federal severance and royalty taxes, the proceeds of which are split with states and local governments.
“Secretary Salazar and the Obama administration’s attempt to shift the blame for rising gas prices by resurrecting the old ‘use it or lose it’ myth is laughable,” said a spokesman for U.S. Rep. Scott Tipton, R-Colo. “What isn’t funny, however, is that their no-across-the-board energy policy has killed thousands of jobs and left our country vulnerable to a volatile foreign energy supply.”
A Denver-based environmental organization, checksand balances.org., welcomed the study, noting approval rates for drilling permits are up, “and industry lays idle hands on over 21 million acres of public lands,” group spokesman Matt Garrington said. “We should put an end to big oil’s speculation on our public lands and continue to move forward with responsible energy development.”
The report concluded about 57 percent of onshore acres leased for drilling are idle. That’s 21.6 million acres of public lands out of 38.2 million acres that have been leased.
U.S. Rep. Rob Bishop, R-Utah, chairman of the House Resources subcommittee on national parks, forests and public lands, said the administration doesn’t understand its own leasing process and “would have you believe that energy companies do not want to produce energy.”