The number of oil and natural gas leases on US and tribal lands continued to fall in fiscal 2015, while the number of approved yet unused drilling permits reaching a record high, Bureau of Land Management data showed Monday.
The data, updated to include statistics through fiscal 2015, seems to back up frequent arguments from US producers that the Obama administration is doing little to promote drilling on federal lands amid the ongoing shale renaissance. But it also bolsters claims often made by administration that these same producers are often letting leases on federal lands remain idle or simply not interested in drilling on lands the government has opened for oil and gas development.
Production from federal and tribal onshore leases accounted for 7% of total US oil production and 11% of total US natural gas production in fiscal 2015, BLM said.
In fiscal 2015 industry bid on just 15% of the over 4 million acres of federal land BLM offered for lease and continued to produce on only 40% of the federal acres currently under lease, the agency said in a statement.
"At the end of the last fiscal year, there were 32.1 million acres of public land under lease -- an area the size of Alabama -- yet only 12.8 million acres were producing, an increase of 70,000 acres from the prior year," the BLM said.
More precisely, the total number of producing leases on federal lands has fallen from 14.54 million in fiscal 2008 to 12.76 million in fiscal 2015 while the total number of wells spud each year on federal lands has fallen from 5,044 in fiscal 2008 to 1,621 in fiscal 2015.
And, since fiscal 2008, the total number of leases in effect has fallen steadily each year, down nearly 20% from 54,359 leases to 44,213 leases in fiscal 2015, the BLM data shows.
Over that eight-year period, the total number of federal and tribal acres leased has also fallen by nearly 32%, from 47.24 million acres in fiscal 2008 to 32.19 million acres in fiscal 2015.
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Nearly all of BLM's new data shows significant declines since the US oil and gas renaissance began, as credit for the domestic supply boom has often been given to production on state and private lands.
The total number of applications for permits to drill on federal lands has dropped to 3,508 in fiscal 2015 from 6,617 in fiscal 2008, the number of new leases issued fell to 852 from 2,416 and the total number of acres leased has fallen to 810,068 from over 2.6 million.
BLM pinned some of this decline in oil and gas prices from fiscal 2014 to 2015.
But Kathleen Sgamma, vice president of government and public affairs with the Western Energy Alliance, an industry group, said part of the blame falls to the Obama administration which continues to offer leases about which producers are not interested.
"BLM offered millions of acres in very remote, unproven areas of Alaska that there continues to be little interest in, while offering very little in the Rocky Mountain states where there remains a huge backlog of nominations," Sgamma said in a statement.
In addition, the BLM continues to approve permits more slowly than states, hindering producers' plans, Sgamma said.
"When it takes BLM a long time to process permits, sometimes years, companies? plans change, especially when the economic environment changes significantly as it has," she said. "If BLM could process a permit in a timely manner like the states do, then companies wouldn't have to request permits so far in advance, and permits would more closely match actual drilling activity."
The BLM said in fiscal 2015 it generated more than $2.1 billion in royalties, $30 million in rental payments and $112 million in bonus bids.
