Trump’s Interior Dept. Has Opportunity to Turn Around Dismal Leasing Policies

Last week, the Senate held a confirmation hearing on Rep. Zinke’s nomination to be the next Secretary of the Interior. One of President Trump’s biggest energy-related campaign promises was to open up onshore and offshore oil and gas leasing. For Rep. Zinke, it will be a real challenge to get oil and gas leasing back to where it was during the Clinton or Bush administrations.

The following chart shows the average of the total number of acres leased during the year by presidential term. The Bureau of Land Management has not released the FY 2016 data yet, so the most recent data is FY 2015. In FY 2015, the Obama administration leased a mere 810,068 acres and all indications are that FY 2016 is going to be even worse.

Source: Bureau of Land Management The data is fiscal year data so Obama’s first term is FY2009 through FY2012.

Some people might think that it’s unfair to compare leasing during the Bush administration to the Obama administration because Bush was involved in the oil industry prior to becoming president. But if we compare the acreage leased during the Clinton administration to the Obama administration, we see that the Obama administration leased only 42 percent as many acres as the Clinton administration. In fact the best year of the Obama administration in terms of acreage leased (FY 2011 with 2.0 million acres leased) was still worse than the worst year of the Clinton administration (FY 1996 with 2.5 million acres leased).

Source: Bureau of Land Management The data is fiscal year data so Obama’s first term is FY2009 through FY2012.

We also see the antagonism to oil and gas leasing on federal lands during the Obama administration if we look at the new leases issued during the year. Here is the last ten years’ worth of leasing data.

Source: Bureau of Land Management The data is fiscal year data so Obama’s first term is FY2009 through FY2012.

As bad as FY 2015 was, it’s rumored that the FY 2016 numbers are even worse and that’s why the administration has not released the numbers yet.

Withdrawing vs. Allowing Multiple Use

Instead of allowing for multiple uses of federal lands, as required by law, the Obama administration vigorously worked to take lands and waters off the table. The following chart shows the numbers of acres the administration withdrew from multiple use compared to acres in production.

 

President Obama withdrew 11 times as many acres as are currently leased and he withdrew 32 times as many acres as are currently producing oil and gas.

U.S. Oil and gas production is booming—but not on federal lands

One explanation of the Obama administration’s poor record on leasing is that oil and gas prices have been low, but this ignores the fact that oil and gas prices were high just a few years ago. Because oil and gas prices were high a few years it, it stimulated a boom in oil and gas production on private and state lands, but because of the Obama administration’s antagonism toward oil and gas leasing, production on federal lands has lagged as we previously explained here.

The chart below shows the percent change in oil and gas production on federal vs. private and state lands since 2010. Private production is booming, but federal production is struggling.

 

 

Conclusion

Rep. Zinke has his work cut out for him to reverse these troubling trends. The law requires federal lands to be managed for multiple uses including energy production, not just to be designated as national monuments. We wish Rep. Zinke luck on making good on President Trump’s promises to lease more areas for oil and gas production.

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