Industry: BLM is withholding priority oil, gas tracts in Wyoming | Regional News

Federal officials are seeking public comment on the latest sale between now and Feb. 8. The sale is expected to take place sometime in March.

After the moratorium, a federal court ordered the Bureau of Land Management to resume quarterly lease sales, and the Biden administration has advanced reforms to the oil and gas leasing program, including higher royalty payments, a minimum bid for new parcels and numerous protections for wildlife and other natural resources.

Some industry officials say the BLM has become more selective in lands that it approves for potential development. It appears the agency might even intentionally ignore high-value mineral tracts that hopeful developers nominate for lease sales, Petroleum Association of Wyoming Vice President and Director of Communications Ryan McConnaughey told WyoFile.

“There is no ability to ascertain the BLM’s reasoning for offering parcels or not,” he said.

Some conservation groups, however, suggest that oil and gas developers have already secured access to more federal minerals in Wyoming than they actually have interest in drilling.

As of 2022, developers held federally approved access to some 3.8 million acres of oil and gas in the state that had not yet been drilled, according to analysis by the conservation group Center for Western Priorities. Further, developers appear to show increasingly “tepid interest” in picking up new federal leases offered by the BLM in Wyoming — a trend that revealed itself in 2023, according to the group.

“Almost 80 percent of the acres BLM offered didn’t sell at all or sold for the minimum bid,” Center for Western Priorities Deputy Director Aaron Weiss recently wrote in summarizing the organization’s analysis. “This shows how little overall interest there is in new competitive leasing in Wyoming.”

Of the 229,552 federal oil and gas leases offered in Wyoming last year, developers successfully bid on just over half: 126,345 acres, according to CWP’s analysis.

In addition to adding protective measures in line with the multiple-use mantra of federal public lands, the Biden administration’s recent reforms to the onshore oil and gas leasing program are designed to disincentivize speculative leasing, according to Katherine Stahl, organizer for the Sheridan-based landowner advocacy group Powder River Basin Resource Council.

“Companies had basically a free-for-all with leasing under the Trump administration,” Stahl said. “So at this point they likely have more land than what they would reasonably be able to develop. Having more land than they can develop can create obstacles to managing the land for other purposes.”

The BLM’s smaller lease sale offerings are a combination of both the industry already having access to plenty of federal minerals in the state and the agency’s renewed focus to avoid development in some areas, particularly Greater Sage-Grouse Priority Habitat Management Areas, Stahl said.

Still, the Petroleum Association of Wyoming contends the BLM, under the Biden administration, is hamstringing the industry by selecting among nominated parcels some of the least attractive areas to develop while excluding some high-value “doughnut hole” tracts inside already developed fields, according to the association.

“The reality is that the BLM has more than 1 million acres pending in Expressions of Interest from industry and over 1 million acres in deferral status with no clear path forward,” McConnaughey said. “Offering more acres in high potential areas would certainly result in higher interest.”