US Bureau of Land Management state offices generated more than $1.1 billion of revenue from onshore oil and gas lease sales during 2018, a record amount nearly triple the previous record of $408 million for the comparable period in 2008, Acting Interior Sec. David Bernhardt announced on Feb. 6.
Bonus bids from the 28 oil and gas lease sales during calendar 2018 came to a preliminary $1,151,109,064 for 1,412 parcels, covering almost 1.5 million acres, he said in Hobbs, NM.
“Responsible production of domestic energy keeps energy prices low for American families and businesses, reduces our dependence on foreign oil, creates American jobs, and generates billions of dollars in revenue to the Federal Treasury,” Bernhardt said.
“With a bold, new approach to energy development, and a president who recognizes that conventional wisdom is meant to be challenged, we are starting to see what a great America looks like,” he said. BLM has scheduled 28 online oil and gas lease sales during calendar year 2019, Bernhardt said.
States where BLM-managed lands with oil and gas activity are located receive 48% of lease sale revenue, and consequently are due to receive to receive some $500 million to support schools, hospitals, and other institutions, the US Department of the Interior agency separately indicated. A state receives half of the revenue from royalties if oil and gas is developed on a lease, it added.
‘An historic year’
“This was an historic year for oil and gas, and clearly illustrates what is possible when public lands are put to work using innovation, best science, and best practices,” added Brian Steed, BLM deputy director for policy and programs.
“Our sound energy policy continues to ensure reliable, safe, abundant, and affordable energy for all Americans, without putting unnecessary burdens on industry,” he said. “In fact, this policy generated nearly as much revenue as BLM’s $1.1 billion budget for fiscal 2018”, which ended on Sept. 30.
BLM’s New Mexico state office held calendar 2018’s biggest lease sale in September, generating approximately $972 million in bonus bids for 142 parcels (OGJ Online, Sept. 10, 2018). The two-day lease sale, held in September, brought in more revenue than all BLM oil and gas lease sales in 2017 combined and broke all previous records, the DOI agency said.
A bonus bid is a one-time payment in exchange for exclusive access to explore for hydrocarbons on a parcel and grants an exclusive lease for a set period, it noted.
Global energy superpower
Responding to the announcement, Karen A. Harbert, president of the US Chamber of Commerce’s Global Energy Institute, said on Feb. 6 that BLM’s record-breaking oil and gas lease sale revenue during 2018 was further evidence that the US now is a global energy superpower.
“Last year’s sales set a new record, tripling the previous year—a remarkable accomplishment from a department that is determined to put America’s bountiful natural energy resources to work for all Americans. This accomplishment undoubtedly makes America stronger by generating new jobs and new revenue to fund priority programs,” she said.
In 2018, oil and gas lease sales generated $358 million of revenue, BLM said. Oil and gas development on BLM-managed lands supported 284,000 jobs in fiscal 2017 and contributed $59.6 billion in output to the US economy, it added.
Contact Nick Snow at firstname.lastname@example.org.