Washington, DC — Today, government watchdog Accountable.US released a report showing that while President Biden’s conservation agenda stalls, his administration has continued giving wealthy oil and gas companies a “sweetheart deal” to drill on public lands across the United States. As a result, states like Utah are missing out on millions in additional revenue, which funds government services including public schools.
According to the Accountable.US report, Utah could have seen as much as $52 million in additional revenue in 2019 alone if the Biden administration had finally updated the U.S. public lands leasing program to charge wealthy oil and gas companies royalty rates in line with what states charge rather than the current federal rates that have not changed in 100 years.
As Politico PRO reported, “the Biden Interior Department approved nearly 900 more permits to drill on public land in 2021 than the Trump administration had in its first year in office, according to an analysis from progressive group Center for Biological Diversity.” New analysis from Accountable.US shows 191 of those permits were in Utah.
The Biden administration is allowing critical land conservation efforts to languish while they are busy handing out drilling permits on public lands to wealthy oil and gas companies. The fact that they approved nearly 900 more permits in their first year in office than Trump did in his first year is incredibly disappointing. For too long, the oil and gas industry has refused to pay a fair price for drilling on leased public lands. Utah’s public schools are being cheated out of potentially millions in additional funding. It is time for the Biden administration to put the interests of Utah families first by reforming the public lands leasing program without further delay.”
Jordan Schreiber, a spokesperson from Accountable.US
The Accountable.US report also identifies the major oil and gas companies that benefit most from the outdated federal leasing program. Utah has 2,902 oil and gas leases totaling 2.9 million acres of federal land. The 17 biggest land lease holding corporations in the United States hold 582,734 acres of public land in Utah – 20% of the state’s federal acres – across 1,013 leases, where they benefit from outdated federal leasing terms. Top lessees in the state include:
- Caerus Oil & Gas: A private company spending millions to buy assets from big oil companies and locking away 182 leases worth of Utah’s public lands.
- Ovintiv: The “poster child” for everything wrong with the oil and gas industry that has been sued for bid-rigging and millions worth of dodged royalties.
- Anschutz Exploration: The billionaire-owned oil and gas company whose CEO called the outdated federal leasing program “generous.”
The 100-year-old royalty rate has long made federal oil and gas leasing a sweetheart deal for Big Oil at the expense of taxpayers. When oil and gas corporations drill on public lands, they compensate the American people with royalty payments, an important revenue that funds important state and local government services, especially public schools.
The Mineral Leasing Act of 1920 set the current public lands oil and gas royalty rate at 12.5 percent, a number that is substantially lower than what western states charge on state public lands. For example, Utah’s royalty rate is 16.67 percent. If the federal rate were more in line with what states charge, Utah might have seen $52 million more in revenue in 2019 alone.
For all of the details, read the full report from Accountable.US here.
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