Oil and Gas Leasing – Land Use Planning and Lease Parcel Reviews

IM 2023-010
Instruction Memorandum
Expires:

09/30/2026

To:

All Field Officials

From:

Principal Deputy Director

Subject:

Oil and Gas Leasing – Land Use Planning and Lease Parcel Reviews

Program Area:

Oil and Gas, Planning, and National Environmental Policy Act (NEPA)

Purpose:

This Instruction Memorandum (IM) sets out the policy of the Bureau of Land Management (BLM) to ensure that oil and gas lease sales are held in accordance with the Mineral Leasing Act (MLA) (30 U.S.C.  226), Inflation Reduction Act of 2022 (IRA) (Pub. L. No. 117-169), and other applicable laws. This IM updates and supersedes policy announced in IM No. 2021-027, Oil and Gas Leasing – Land Use Planning and Lease Parcel Reviews, and supersedes any conflicting guidance or directive found in Handbooks H-1790-1, National Environmental Policy Act (Rel. 1-1710, 1/30/2008); H-1624-1, Planning for Fluid Mineral Resources (Rel. 1-1749, 1/28/2013); H-3101-1, Issuance of Leases (Rel. 3-308, 2/2/1996); H-3120-1, Competitive Leases (Rel. 3-338, 2/18/2013); and Manual MS-3120, Competitive Leases (Rel. 3-337, 2/18/2013).

Administrative or Mission Related:

Mission Related

Policy/Action:

The following policy applies to the leasing of Federal oil and gas under the BLM administered surface,[1] state-owned surface, and private surface estates.[2] The BLM does not manage leasing on Indian lands; therefore, this policy does not apply to Indian lands.

This policy addresses land use planning, lease parcel review, lease sales, lease issuance, and IM implementation and directs the BLM to incorporate the revised policy, as appropriate, into the affected BLM handbooks and manuals. 

  1. Land Use Planning

As outlined in the BLM Handbook H-1601-1, Land Use Planning, Resource Management Plans (RMPs) underlie oil and gas leasing decisions. Through effective monitoring and periodic RMP evaluations, state and field offices will examine resource management decisions to determine whether the RMPs adequately protect important resource values in light of changing circumstances, updated policies, and new information (H-1601-1, sections V.A and B). The results of such reviews and evaluations may require a state/field office to update resource information through land use plan maintenance, amendment, or revision. In the interim, the BLM will exercise its discretion regarding whether to defer any oil and gas leasing parcels from lease sales. When necessary, state/field offices will maintain or amend RMPs to accommodate changes in lease stipulations in accordance with guidance found in H-1610-1, Land Use Planning, sections VI.H and VII.B.

  1. Lease Parcel Review

The purpose of a lease parcel review by the state and field offices is to determine the conditions under which leasing may be allowed to proceed and to ensure conformance with the approved RMP.  Lease parcel reviews will be conducted and documented simultaneously with the NEPA compliance process for oil and gas lease sales. 

    • A. Expressions of Interest Subject to Lease Parcel Review

The BLM will evaluate and consider expressions of interest (EOIs) in accordance with IM 2023-006, Implementation of Section 50265 in the Inflation Reduction Act for Expressions of Interest for Oil and Gas Lease Sales. Under that IM and consistent with longstanding practice, the BLM will conduct an initial screening of all timely submitted EOIs, including to determine whether they address lands that the BLM has the authority to lease.  The BLM will ensure EOIs are consistent with the criteria and direction set forth in IM 2023-006.

    • B. Parcel Review Timeframes

State offices will hold lease sales, as required by Section 226(b)(1)(A) of the MLA; Section 50265 of the IRA; and 43 CFR. 3120.1-2(a), when eligible lands are determined by the BLM state office to be available for oil and gas leasing and through exercise of their discretion via the process described below. When eligible lands are available, BLM will develop a quarterly sale schedule, which should consider, among other factors, rotating lease parcel review responsibilities among state and field offices to allow those BLM offices to most efficiently manage agency workload. The BLM will balance the workload and allow each office to devote sufficient time and resources to implement the parcel review policy established in this IM. State offices will extend field office review timeframes, as necessary, to ensure there is adequate time for the field offices to conduct comprehensive parcel reviews.

    • C. Review of Lease Sale Parcels

State and field offices will form an Interdisciplinary Parcel Review (IDPR) Team of resource specialists to review lease sale parcels as part of compliance with NEPA and other legal and policy requirements for adequate review of parcels. 

Lease sale parcel review will, at a minimum, include the following steps:

  1. Gather and Assess Existing Information

State and field offices will gather and evaluate existing environmental resource information and compile documentation of compliance with applicable laws, regulations, and executive orders (e.g., NEPA analysis, Endangered Species Act (ESA) (16 U.S.C. 1531 et seq.), and National Historic Preservation Act (NHPA) (54 U.S.C. 300101 et seq.) resource data and consultation, and socioeconomic data pursuant to Executive Order 12989). The BLM will determine the need for additional information and develop strategies to obtain any data that may be required to support a leasing decision. 

  1. Site Visits

Site visits are not required in all instances but may be deemed necessary by the authorized officer on a case-by-case basis, such as for Tribal or stakeholder considerations or when existing data is not adequate.

  1. Public Participation/Coordination

State and field offices will provide for public participation as part of the review of parcels identified for potential leasing through the NEPA compliance documentation process (see section III.D). State and field offices will identify groups and individuals with an interest in the local BLM oil and gas leasing, including surface owners of split estate lands where Federal minerals are being considered for leasing. Interested groups, individuals, and potentially affected split estate surface owners[3] will be kept informed of field office leasing and NEPA activities through updated websites and email lists and will be invited to comment during the NEPA compliance process.  The BLM will also undertake formal Tribal consultation and communication as outlined in D.

  1. Identification of Potential Lease Sale Parcels

The BLM will identify parcels for consideration during the lease sale review process based on:

  • EOIs that are submitted pursuant to Section III.A, above, including EOIs that were deferred from consideration for prior sales where the BLM determines that the issue(s) underlying the deferral(s) have been fully resolved; and
  • Nominations developed by the BLM after applying applicable screening criteria and determining that offering the certain lands for leasing would further the purposes of the MLA, the IRA, and other applicable laws, rules, and policies.

Further, the BLM may consider parcels that were previously offered at competitive lease sales, but which did not result in the issuance of a lease. When considering such parcels, the BLM will evaluate whether the underlying NEPA documentation is adequate and whether further consultation under the ESA, NHPA, and other legal authorities is required. If the previously offered parcels require further NEPA analysis and/or consultation, then the BLM will complete those steps before reoffering the parcels for sale.

    • D. ESA, NHPA, and Tribal Consultation Compliance Documentation

State and field offices will meet all requirements related to the ESA and the NHPA, as well as fulfill all Tribal consultation requirements (see the BLM Manual 1780, Tribal Relations, and the BLM Handbook H-1780-1, Improving and Sustaining BLM-Tribal Relations), and will attach the standard ESA and NHPA lease stipulations or appropriate stipulations consistent with the applicable RMP to any lease that is offered.

    • E. NEPA Compliance Documentation

The IDPR Team[4] will complete site-specific NEPA compliance documentation for all the BLM surface and split estate[5] lease sale parcels. In accordance with this IM, the NEPA compliance documentation for oil and gas leasing will include the following opportunities for public participation: (1) scoping period (minimum 30 days); (2) draft NEPA document review and comment period (minimum 30 days); and (3) protest period (30 days).

If the authorizing official confirms that the proposed leasing action is adequately analyzed in an existing NEPA document and is in conformance with the approved RMP, a Determination of NEPA Adequacy (DNA) may be used to document NEPA compliance for the leasing decision (H-1790-1, National Environmental Policy Act Handbook, section 5.1).[6] It is expected that the DNA process will only be appropriate in cases where the existing NEPA documentation is consistent with the most current program-specific guidance. If a DNA is not appropriate, then the field office will determine the appropriate NEPA compliance documentation (e.g., environmental assessment (EA) or environmental impact statement (EIS)) to be prepared.

The EA or EIS will analyze a no action alternative (no leasing) and a proposed leasing action (leasing the parcel(s) in conformance with the land use plan and the criteria set forth in IM-2023-007, Evaluating Competitive Oil and Gas Lease Sale Parcels for Future Lease Sales). If the BLM includes both low and high preference parcels in the lease sale upon application of the criteria set forth in IM-2023-007, the BLM should include additional alternatives to the proposed action reflecting various options for including or deferring those parcels. The BLM may include other alternatives based upon any other factor bearing on the eligibility and/or availability of lands for leasing. In cases where the BLM determines that the necessary terms and conditions under which leasing would be appropriate are not in conformance with the RMP, it will be necessary to amend the RMP before potentially offering the parcels for leasing. If it is necessary to amend the RMP, the leasing EA (or EIS) must either meet the standards for NEPA documentation to support a plan amendment (see 43 CFR 1600), or the affected lease parcels must be deferred from leasing until a plan amendment or revision can be completed at a later date.

The IDPR Team will finalize the EA and FONSI considering any public comment received on those documents. If a FONSI is not warranted, the IDPR Team may recommend that the parcel be withheld from leasing or that an EIS be prepared to address the site-specific issues in compliance with NEPA.

  1. Lease Sales and Lease Issuance
    • A. Public Notification of Lease Sale

The state office must post the Notice of Competitive Lease Sale (sale notice) at least 45 days prior to the start of the lease sale, consistent with the Mineral Leasing Act, 30 U.S.C. 226(f), and the BLM regulations, 43 CFR 3120.4-2. The BLM should post the sale notice on the National Fluid Lease Sale System (NFLSS) and make it available in the public room. Also, the BLM should display the NFLSS website link on the state office website and the ePlanning project page for the sale to reduce duplicate postings and minimize the BLM’s workload. Field or state offices will post the NEPA compliance documentation on the BLM ePlanning website and in the public room at least 45 days prior to the start of the sale.

For online lease sales, the NFLSS will communicate directly with the internet auction provider.  The provider may contact the state office as needed, and the state office may contact the provider as needed. No parcels will be removed from a lease sale during the active bidding period.

    • B. Lease Sale Parcel Protests

A 30-day protest period will begin the day the sale notice is posted.  The process outlined in this IM—which includes site-specific parcel analysis and increased public participation—will help identify, address, and resolve many issues before the lease sale. State offices should attempt to resolve protests before the sale of the protested parcels. Protests that are not resolved do not prevent bidding on protested parcels at the auction. Protest decisions should advise the protesting parties of their right to appeal denied protests to the Interior Board of Land Appeals, but that appeals will not automatically halt the auction or issuance of leases. State Offices will post all received protests documents on the NFLSS website.

    • C. Lease Issuance

The BLM cannot issue a lease for a protested parcel until the protest is resolved. The BLM will generally resolve protests prior to holding lease sales. If a state office is unable to resolve all protests before the date of a sale, the sale may proceed, and the state office should resolve the protests and decide whether to issue the affected leases within 60 days after the BLM receives full payment from the successful bidder for the bonus bid, first year rental, and administrative fees. See 30 U.S.C. 226(b) (1) (A). If the BLM grants a protest after the date of sale (and before lease issuance), the BLM should reject the bid and refund the bonus bids and rentals paid. State offices will post all protest resolution documents on the NFLSS. 

If the BLM cannot resolve the protests and issue the lease within 60 days from the date that the BLM receives full payment from the successful bidder for the bonus bid, first year rental, and administrative fees, the BLM should issue a notice to the successful bidder (see Notice for Delay in Lease Issuance Template (Attachment 1)) and provide the successful bidder an opportunity to decline the lease. If the successful bidder so declines, the BLM will not issue the lease and will refund the bonus bid and advanced rental paid to the remitter. The BLM may reoffer the lands at a future competitive sale.

    • D. Formal Nomination Process

The BLM reserves the right to employ the formal nomination process set forth in 43 CFR 3120.3-1 through 3120.3-7; the BLM Handbook H-3120-1, Competitive Leases; and the BLM Manual MS-3120, Competitive Leases. Before using this process, the BLM will publish a notice in the Federal Register and accept comments for a period of 30 days, as required by 43 CFR 3120.3, Handbook H-3120-1, and Manual MS-3120.

    • E. Prohibition on Noncompetitive Leasing

Under the Inflation Reduction Act of 2022, the BLM no longer has the authority to issue noncompetitive oil and gas leases. Accordingly, the BLM will reject any application for a noncompetitive oil and gas lease that it receives. Further, any and all provisions of the BLM’s Handbook, Manual, and other policy documents that concern the authorization of noncompetitive oil and gas leases are hereby rescinded.

  1. Application

This IM governs the BLM procedure and organization and is not a substantive rule, regulation, or other legally binding instrument, and the recommendations it contains may not apply to a particular situation based upon the individual facts and circumstances. Nothing in this IM is intended to modify or amend any Federal laws or regulations, nor create any rights or cause of action or trust obligation that any person or party may enforce through litigation or otherwise against the United States Government or any of its employees or officers. This IM is not legally enforceable. To the extent that there is any inconsistency between the provisions of this IM and any Federal regulations or laws, the regulations or laws will control.

 

[1] This policy will be implemented across the BLM as described herein.  Certain provisions in this policy will not apply in some contexts, including to elements of leasing within the National Petroleum Reserve in Alaska (NPR-A), because the BLM manages that area under statutory authorities, such as the Naval Petroleum Reserves Production Act of 1976, 42 U.S.C. 6501 et seq., that apply only to that area. 

[2] This policy does not apply to the leasing of Federal oil and gas under lands managed by other Federal Surface Management Agencies.  The policy, however, does apply to split estate lands within National Forest System (NFS) units (i.e., lands with Federal subsurface ownership and non-Federal surface ownership).

[3] For split estate lands within National Forest System units, the necessary NEPA analysis for a leasing decision may be done through documentation prepared jointly by the Forest Service (FS) and the BLM or prepared by the FS and adopted by the BLM.

[4] This requirement does not apply to split estate lands within National Forest System units if leasing decisions for such lands are analyzed in documentation prepared jointly by the FS and the BLM for lands within the external boundaries of National Forest System units. 

[5] For split estate lands within National Forest System units, the necessary NEPA analysis for a leasing decision may be done through documentation prepared jointly by the FS and the BLM or prepared by the FS and adopted by the BLM.

[6] The NEPA document to which the DNA refers must contain sufficient detail to address the potential direct, indirect, and cumulative effects of the proposed action(s). Consideration must be given to new information, new or revised program-specific guidance, and new or revised lease stipulations contemplated for the lease parcel that may or may not be analyzed in the existing NEPA document.

Budget Impact:

This policy will result in a minimal impact to the BLM’s budget.

Background:

On April 30, 2021, the BLM issued an updated leasing policy, IM No. 2021-027. After the Inflation Reduction Act of 2022 became law, the BLM identified aspects of the previous policy that needed improvement. This IM aims to streamline the leasing process and to provide consistency for the public participation periods in the leasing process.

Manual/Handbook Sections Affected:

This IM transmits policy that will be incorporated into Handbooks H-1790-1, National Environmental Policy Act (Rel. 1-1710, 1/30/2008); H-1624-1, Planning for Fluid Mineral Resources (Rel. 1-1749, 1/28/2013); H-3101-1, Issuance of Leases (Rel. 3-308, 2/2/1996); H-3120-1, Competitive Leases (Rel. 3-338, 2/18/2013); and ManualMS-3120, Competitive Leases (Rel. 3-337, 2/18/2013).

 

Contact:

If you have questions or concerns regarding this IM, please contact Nada Culver, at (202) 255-6979. For program questions, your staff may contact Lonny Bagley, Acting Chief, Division of Fluid Minerals, (HQ-310) at lbagley@blm.gov or (307) 622-6956; or Peter Cowan, Senior Mineral Leasing Specialist (HQ-310) at picowan@blm.gov or (720) 838-1641. 

Coordination:

This policy was coordinated with the U.S. Department of the Interior’s Office of the Solicitor and the BLM Headquarters, Energy, Minerals, and Realty Management (HQ-300).

Signed By

Nada Culver
Principal Deputy Director

Authenticated By

Ambyr Fowler
Division of Regulatory Affairs and Directives (HQ-630)