Federal taxpayers own mineral resources across the United States, including a 700-million-acre onshore subsurface mineral estate. The Bureau of Land Management (BLM), within the Department of the Interior (DOI), oversees the subsurface mineral estate and is charged with managing the development of those resources. Yet, despite the massive value of taxpayer-owned resources extracted from federal lands by oil and gas developers every year, taxpayers continue to receive pennies on the dollar due to outdated and below-market federal onshore leasing terms.
Issues within the onshore federal oil and gas leasing system have been long recognized – including by DOI itself – and are long in need of reform. Outdated leasing fees, including below market rental and royalty rates, have cost taxpayers billions of dollars over the last decade. Bonding policies meant to ensure industry is responsible for restoring federal lands after drilling ends have instead burdened taxpayers with the long-term fiscal and environmental liabilities of orphaned oil and gas wells. In North Dakota, these policies have cost taxpayers $1.3 billion over the past decade and left taxpayers with as much as $433 million in potential future reclamation costs from abandoned oil and gas wells.
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