Biden wants oil, gas lease reform
Washington, Nov. 27: The Biden administration has recommended an overhaul of the nation’s oil and gas leasing programme to limit areas available for energy development and raise costs for oil and gas companies to drill on public land and water.
The long-awaited report by the Interior Department stops short of recommending an end to oil and gas leasing on public lands, as many environmental groups have urged.
But officials said the report would lead to a more responsible leasing process that provides a better return to US taxpayers.
Our nation faces a profound climate crisis that is impacting every American? Interior Secretary Deb Haaland said in a statement Friday, adding that the new report’s recommendations will mitigate worsening climate change impacts while staying steadfast in the pursuit of environmental justice? The report completes a review ordered in January by President Joe Biden, who directed a pause in federal oil and gas lease sales in his first days in office, citing worries about climate change. The moratorium drew sharp criticism from congressional Republicans and the oil industry, even as many environmentalists and Democrats said Biden should make the leasing pause permanent.
The new report seeks a middle ground that would continue the multibilliondollar leasing program while reforming it to end what many officials consider overly favourable terms for the industry.
The report recommends hiking federal royalty rates for oil and gas drilling, which have not been raised for 100 years. The federal rate of 12.5 per cent that developers must pay to drill on public lands is significantly lower than many states and private landowners charge for drilling leases on state or private lands.
The report also said the government should consider raising bond payments that energy companies must set aside for future clean-up before they drill new wells. Bond rates have not been increased in decades, the report said.
The Bureau of Land Management, an Interior Department agency, should focus leasing offers on areas that have moderate to high potential for oil and gas resources and are close to existing oil and gas infrastructure, the report said. The White House declined to comment Friday, referring questions to Interior.
The leasing programme has drawn focus as gasoline prices have skyrocketed and Republicans complained that Biden policies contributed to the price spike.