Interior Dept. Report on Drilling Is Mostly Silent on Climate Change

The fees that oil and gas companies pay to drill on public lands should be raised for the first time in a century, according to the Interior Department.

The report was silent about the impacts of the public drilling program. According to the United States Geological Survey, drilling on public land and in federal waters is responsible for 25% of the greenhouse gases that are warming the planet.

Some environmentalists want the federal government to consider the climate impact of drilling when approving new leases. When he ran for office, President Biden promised to end new oil and gas drilling on public lands.

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As rising gas prices have created political headaches for the Biden administration, calls from Republicans for increased domestic gas and oil production have arisen.

Environmentalists were concerned that the Biden administration was backpedaling on a central climate pledge.

The director of government affairs said that they expected the agency to do a programmatic review of the entire fossil fuel leasing program that takes into account not only the environmental harms of drilling at the local and landscape level, but also the impact on the global climate crisis. That had never been done before. The agency never looked at the cumulative harm that would come from burning fossil fuels. This was the best way to accomplish what the president had promised.

Mr. Biden promised to stop issuing new leases for drilling. No more drilling on federal lands is allowed. In New Hampshire, Mr. Biden told voters.

He urged other world leaders to take bold action to cut emissions from oil, gas and coal at a global climate summit in Glasgow this month. Mr. Biden wants the United States to cut greenhouse gas emissions by half by the end of the decade. A quote from Deb Haaland, the Interior Secretary, was included on her campaign website, saying that we need to act fast to counteract climate change and keep fossil fuels in the ground.

The Biden administration offered up to 80 million acres in the Gulf of Mexico for drilling leases last week, the largest sale since last year. Republican attorneys general from 13 states successfully overturned a suspension of lease sales that Mr. Biden had tried to impose. The rights to drill in the area offered by the government were offered by five companies.

Private companies can lease public lands to extract oil and gas under the Mineral Leasing Act of 1920. Companies pay rent until the lease starts to produce gas or oil and then pay royalties based on the amount of fossil fuel they extract. For a century, royalthave remained the same. The Outer Continental Shelf Lands Act was passed in 1953. Both laws require the government to auction leases at regular intervals.

Mr. Biden issued an executive order banning new oil and gas leasing on public lands while the Interior Department produced a report on the state of the federal oil and gas drilling programs.

The report was sent to the White House by Ms. Haaland.

Several environmentalists who have spoken to Ms. Haaland and her staff said that they had expected the June report to include two recommendations: an increase in the fees that oil and gas companies are charged to drill on public lands and the creation of a system to account for the environmental damage caused

The report was issued during a long holiday weekend, when many Americans wouldn't pay attention. The Trump administration tried to bury a major climate change report by issuing it the day after Thanksgiving.

A spokeswoman for the Interior Department wouldn't comment on the report's timing.

Legislation currently making its way through Congress is in line with the report's recommendations regarding raising drilling fees. The social policy and climate bill that passed the House of Representatives last week includes provisions that would increase federal royalty rates for oil and gas companies.

The federal government underestimates the value of the oil and gas resources on public lands, according to multiple studies. The federal government's management of oil and gas resources is vulnerable to waste, fraud and abuse, according to the Government Accountability Office.

The federal government has collected more money from drilling on public land and in federal waters this year than it did last year.

The Democrats included provisions in the spending bill that would raise the royalty rates on oil and gas drilling in the US from 12.5 percent to 18.75 percent and set offshore rates at not less than 14 percent. The minimum bid would increase from $2 an acre to $10 an acre at federal oil and gas lease auctions. The annual rents that companies have to pay to the federal government would increase. According to the Congressional Budget Office, those changes will bring in about $2.5 billion in new revenue by the end of the decade.

Climate policy advocates said they supported raising those fees and royalties, but that the increase wouldn't slow drilling or climate change.

A former Interior Department official who resigned in protest during the Trump administration is now a senior fellow at the Harvard Kennedy School. It is not a home run or double. At this point, we need to lease on public lands. One of the immediate climate levers can bring real change. Climate emissions must be accounted for in the leasing program. That is how you get to a permanent ban on drilling.

The 1970 National Environmental Policy Act requires the Interior Department to consider ecological damage when deciding whether to permit drilling and construction projects.

The legal groundwork for the government to stop issuing new drilling leases would be created if all assessments of the impacts of drilling on public lands were required to include the potential warming impact of burning the fuels within the leases.

Republicans, the oil industry and Democrats in oil and gas states would likely be angry if such a policy were to be moved forward. That could make it difficult for the administration to steer its broader spending bill through Congress.

Mr. Clement said that we have to end oil and gas leasing on public lands. Doing so would change the global conversation on the energy transition.

Lisa Friedman was involved in reporting.