Public lands see increase in oil and gas leasing during Trump administration

Vegas News

Friday, Sept. 13, 2019 | 2 a.m.

In 2018, a proposal that would have opened up the Ruby Mountain range to oil and gas leases was brought to the U.S. Forest Service. Pushback from state and federal lawmakers, along with the state’s environmental community, prefaced the Service’s refusal of the Bureau of Land Management’s request.

The ability to lease federal land for oil and gas drilling, however, has been around for decades, and while environmentalists cheered their win in the Ruby Mountains, many see leasing offers around the state as a growing symptom of a presidential administration comfortable with increasing fossil fuel production on public lands.

“Oil and gas leasing increased significantly beginning with the Trump administration,” said Brian Beffort, the director of the Toiyabe Chapter of the Sierra Club. Patrick Donnelly, the state director for the Center for Biological Diversity, echoed his statement.

William Perry Pendley, the BLM’s acting director, is a longtime proponent of selling off federal land, and the secretary of the interior, David Bernhardt, previously worked as a lobbyist for powerful oil interests.

The leadership overseeing the bureau, along with near-constant, mostly anonymous requests for leasing, have the state’s environmental community concerned.

How does it work?

The bureau is required through statute to hold the lease sales every quarter, but the process is generally triggered only if someone files an expression of interest.

These expressions of interest can be filed anonymously. They do not lock in the petitioner to bid on the leases.

No lease tract in the lower 48 states can be more than 2,560 acres (Alaskan leases can be up to 5,760 acres). Once the expressions of interests have come in, the bureau does an environmental assessment and then opens up public comment if the land passes the assessment.

After comment, the bureau starts the competitive bidding process. If there are no bidders, then the bureau can put the lease up for a noncompetitive bid.

“All it is, is kind of an option … or a future to develop a piece of land for oil and gas drilling,” said Rudy Evenson, a BLM spokesperson.

The leases last for 10 years, and the prospective developers have to go through a separate environmental assessment if a drilling plan is developed.

The lease can be extended by two years if the developer has begun drilling, and if the lease has a well that can produce oil or gas in an amount that is profitable, then the lease will continue. The developer can be made to begin production within 60 days by a letter sent from the bureau.

This is all contingent, however, on whether there was an expression of interest. If no expressions of interest are filed, then the lease sales don’t occur that quarter.

The quarterly lease requirement has been in place since the Federal Onshore Oil and Gas Leasing Reform Act of 1987, an amendment to the federal Mineral Leasing Act of 1920. Just how often expressions of interest come in, though, have changed over time, Evenson said.

“It does definitely rise and fall, and it has risen and fallen a lot in Nevada,” Evenson said.

What are the concerns?

Environmentalists in Nevada say the amount of land put up in these public leases has increased under the Trump administration, and they expressed concerns that this is a continuation of the administration’s strategy of increasing fuel permits and decreasing regulation.

Beffort said that Nevada is not a state that lends itself to fossil fuel production.

“The geology does not support energy development, and yet they continue to do it anyway,” Beffort said. Donnelly said that the difficulty of extracting oil in Nevada, which is not generally in readily accessible areas, can make any leases a long-term investment. If fuel prices remain as they are, the effort to extract oil in Nevada wouldn’t be worth it, but if oil prices shoot up, the cost to get the oil out of the ground might be worth it, Donnelly said.

Attempts to strike oil in Nevada began in the early 20th century. According to UNR, the first oil well drilled in Nevada was a near-1,900-foot-deep hole in Washoe County. The well was dry, and records of wells up until the 1950s were poorly maintained.

The university says the first commercially producing well in the state—located in Railroad Valley in Nye County—was drilled by Shell in 1954. The field containing this well had 14 producing wells active by 1968 with an average yield of 20,000 barrels per well.

As it stands, Nevada’s oil production is near the bottom of the barrel. In 2018, Nevada produced 255,000 barrels of oil, according to state estimates provided to the U.S. Energy Information Administration. Texas, on the opposite end of the list, produced 1.6 billion barrels.

Beffort sees efforts to increase drilling in Nevada as antithetical to both changing global views of renewable energy and what he sees as Nevadans’ political will to pull back on fossil fuel production.

Nevada has made moves toward enacting renewable energy changes. This past legislative session, a bill sponsored by state Sen. Chris Brooks, D-Las Vegas, passed into law requiring the state’s renewable portfolio standard—the amount of electricity made by renewable sources—to reach 50% by 2030. According to the Solar Energy Industries Association, 12.72% of Nevada’s energy comes from solar power. The association ranks Nevada fourth in overall solar ranking.

“There’s a disconnect between the federal agency’s priority and the on-the-ground reality and the political mandate from the people of Nevada to pursue renewable energy,” Beffort said.

Donnelly said that while the Center for Biological Diversity is not demanding all fossil fuel productions stop immediately, the long-term goal will require that.

“When emissions need to reach zero, all fossil fuels will have to go,” he said.

Right now, though, production needs to be, at the very least, kept static, he added.

“We are opposed to any expansion of fossil fuel leasing, production or transport in the state of Nevada and across the country,” he said.

This story originally appeared in the Las Vegas Weekly.

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