quote:
As pressure increases on the Biden administration to lower the price of fuel, the Interior Department announced on Friday plans to hold its first onshore oil and gas lease sales since President Biden took office.

The department said it plans open roughly 144,000 acres up for lease next week and will charge oil and gas companies higher royalties to drill on federal land, raising the fees for the first time. Under the plans unveiled Friday, royalty rates would increase to 18.75 percent from 12.5 percent for oil and gas lease sales.

The long-awaited announcement follows a report the department issued last fall, which called for royalty fees to be more in line with the higher rates charged by most private landowners and major oil- and gas-producing states.

The Biden administration’s willingness to move forward with oil and gas leasing angered climate activists, who called the department’s plans a betrayal of the president’s pledge to ban new drilling on public lands.

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“This is pure climate denial,” Jeremy Nichols, climate and energy program director for WildEarth Guardians, said in a statement. “While the Biden administration talks a good talk on climate action, the reality is, they’re in bed with the oil and gas industry.”

Interior officials portrayed the pending lease sales as a significantly scaled-back version of what might have been, describing it as a pragmatic approach. In a news release, they noted that the acreage offered for auction is 80 percent less than the 733,000 acres of land in nine states that oil and gas companies had nominated.

“For too long, the federal oil and gas leasing programs have prioritized the wants of extractive industries above local communities, the natural environment, the impact on our air and water, the needs of Tribal Nations, and, moreover, other uses of our shared public lands,” said Secretary Deb Haaland. “Today, we begin to reset how and what we consider to be the highest and best use of Americans’ resources for the benefit of all current and future generations.”

The department’s plans are the latest example of the political tightrope the president is trying to walk.

quote:
As a presidential candidate, Biden vowed to ban new oil and gas drilling on federal lands. But in January of 2021, U.S. District Judge Terry A. Doughty in Louisiana struck down the executive order temporarily suspending drilling, dealing a major blow to the president’s plans to cut greenhouse gas emissions from fossil fuels. The authority to suspend oil and gas leasing lies “solely with Congress,” Doughty wrote.

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A few takeaways for me here:

1- The DOI/BLM should have raised those royalty rates several years ago. 18.75% in the Permian and Powder River is still a no-brainer for operators to go after. You don't want the government trying to gouge operators to discourage development of minerals, but when operators are drilling on private and state lands at 20-25% royalty, to be accepting half of that is bad management of public lands.

2- There has to be interesting conversations being had amongst the real brain trust within the White House. They already know Democrats are going to lose ground in the midterms, and extremely high gas prices (which also will affect grocery store prices) will lead to a slaughter. There's a reason the Biden Department of Interior approved Federal Drill Permits at a higher rate last year than even during three out of four of Trump's years. They know we need the production, and they know the Federal Government needs the revenue to subsidize all the national parks that lose money every year. But now his enviro-commie base has caught on to the "don't watch what I'm really doing" games, so Democrats have to choose.

3- The Secretary of the Department of Interior is extremely anti-oil & gas, yet her state would go completely bankrupt if it wasn't for oil & gas production and the tax generated benefits of that activity in Eddy, Lea, Roosevelt and Chavez Counties. The K-12 schools in New Mexico would crumble without oil & gas activity on State-owned lands.

This post was edited on 4/15/22 at 5:51 pm