Oil and Gas
Hydraulic Fracturing Rule
The Department of the Interior released the final rule for hydraulic fracturing (HF) on public and Indian lands. The HF rule was published in the Federal Register on March 26, 2015. The HF rule provides a strong framework for the environmentally safe and economically viable development of onshore oil and gas that addresses such issues as water protection, public disclosure of chemicals, and well-bore integrity. Until now, there have been no federal rules in place that specifically address the increased complexities of hydraulic fracturing. The new rule replaces regulations that are more than three decades old. The rule was scheduled take effect on June 24, 2015. However, due to litigation the effective date of the rule is stayed.
To view the HF rule click here.
The BLM Oil and Gas Management program is one of the most important mineral leasing programs in the Federal government. Domestic production from over 63,000 Federal onshore oil and gas wells accounts for 11 percent of the Nation’s natural gas supply and five percent of its oil.
Trespass Case Resolution
Wells drilled without approval have been an increasing problem across the BLM with many of these incidents originating on privately owned surface. Drilling Without Approval on leased land is a violation under 43 CFR 3162.3-1. The BLM has authority under 43 CFR 3163.1 to assess fines and shut down operations until a permit has been received, reviewed, and a decision issued. However, drilling on unleased lands without approval does not fall under the 43 CFR 3100 regulations and is considered “mineral trespass” with no clear statutory or policy guidance other than criminal prosecution. BLM turns over these cases to the Department of Justice for resolution.
Settlement of Trespass Claims Against Statoil Oil & Gas LP and Statoil Oil & Gas Services, Inc. - Statoil agrees to pay nearly $2,000,000 to resolve claims related to mineral trespass.
United States Settles Mineral Trespass Claims Against SWN n (Arkansas), LLC f/k/a SEECO, Inc. - SEECO forced to pay $950,000 for producing and selling federally owned natural gas from wells in unleased federally lands.
Oil and Gas Leasing Reform, June 2010--Background Information
Oil and Gas Leasing Reform--Overview of land use planning, master leasing plans, and lease parcel review (12 pages, PDF)
Comparison of Process Changes--2 page side-by-side comparison of current and proposed leasing reform policy
A significant portion of funding in the BLM Oil and Gas program is used to fulfill the Federal government's trust responsibilities to American Indian Tribes and individual Indian mineral owners. The BLM supervises operational activities on 3,700 Indian oil and gas leases, and provides advice on leasing and operational matters to the Bureau of Indian Affairs, Indian Tribes, and Indian mineral owners.
The Oil and Gas program also processes applications for the permits required to develop leased resources. The most common of these is the Application for Permit to Drill (APD). Operators or permit agents can use the BLM's electronic permitting system (a form of E-Commerce, or EC), to submit oil and gas permit applicaitons and reports via the Internet.
Documents that may be submitted electronically include:
Notice of Staking (NOS)
Application for Permit to Drill (APD)
Well Completion Report
Attachments (documents, maps, drawings, etc.) for a permit or report.
For more information about this program, click here.
Federal Permit Improvement Pilot Project
Under the direction of the Energy Policy Act of 2005, the BLM has also established seven Federal Permit Processing Pilot Offices, where improvements in coordinating permit processing among Federal agencies and inspection & enforcement can be tested.
Pilot Offices have been established in these BLM Field Offices, which together receive more than 70 percent of the APDs each year:
The Pilot Project is a vehicle for fostering innovation, creating efficient management processes, and testing new and emerging technologies.
A report summarizing interim results from the first two years of the project is available here.
Fair Market Return
In April 2010, the Bureau of Land Management and BOEM jointly commissioned a study, Comparative Assessment of the Federal Oil and Gas Fiscal System
, to provide an important analysis and model that will provide both agencies with an additional tool in making future assessments of fair return and decisions regarding fiscal terms for Federal oil and gas leases.