War, sanctions, political strife to drive oil prices higher
Congress, require BLM to respect the rights of private landowners
America's oil and natural gas development has provided an incredible lift for our nation's economy. For the past decade in particular, production in shale formations across the country has moved the nation from its reliance on foreign energy, allowed the United States to become a net exporter for the first time since the Eisenhower administration, and continues to bring prosperity to regions of the country that otherwise would still be in recession.
Development of private and state lands has been the driving force behind this energy resurgence. The economic windfall has been enormous for local communities, governments (state and local), schools and private landowners who receive royalty payments in addition to money earned during the land-leasing process.
However, the land-permitting process for oil and natural gas resources, in many cases, continues to be hindered by the bureaucratic processes at the Bureau of Land Management (BLM). As a result, applications for federal lands - and more importantly, federal lands intermittently intertwined with private lands - have lagged behind. Slow processing times, duplicative red tape and regulatory hurdles imposed at the federal level have limited the ability of rural communities in the Western and Appalachian regions to share in the job creation, economic growth and financial gains benefitting the rest of the developing areas.
The House Committee on Natural Resources has introduced a series of bills designed to encourage American onshore energy development and reduce bureaucratic entanglement in the permitting process, specifically in areas where environmental impacts have been identified and abated.
By passing this legislation, Congress would provide private landowners access to the prosperity gained by the leasing of their own land. This effectively removes the heavy hand of the bureaucracy stifling their rights. The Ending Duplicative Permitting Act (HR 6107), introduced by Rep. Steve Pearce (R-N.M.) clarifies that BLM shall not require permits for oil and gas activities conducted on non-federal surface estate to access subsurface mineral estate that is less than 50 percent federally owned, and for other purposes.
This is a vital protection for private landowners' rights.
The National Association of Royalty Owners (NARO) and its Appalachian chapter recently met with members of Congress from both sides of the aisle to discuss how passage of this bill would impact American property owners. In this case, the discussion revolved around a group of landowners who have been blocked from development of private minerals in what could be one of the best-producing shale fields in Ohio.
For seven years, landowners in areas adjacent to the Wayne National Forest have been prevented from making their own choices about whether to utilize their mineral rights for development. Ninety percent of the mineral rights in the region are owned by private landowners. Yet, despite multiple executive orders and permanent instruction from the Department of the Interior to move federal leasing and permitting forward and stop ongoing obstruction (a de-facto moratorium on the development of private minerals), BLM has refused to issue a single application for a permit to drill.
Notably, the proposed drilling units would have no surface disruption to the Wayne National Forest, since well pads would be constructed on adjacent private lands. After years of environmental review, and initial agreement from BLM, these minerals were leased and set to be developed. Unfortunately, at the whim of a nuisance lawsuit brought by an anti-fossil fuel group, BLM now is requiring additional environmental assessments on adjacent private lands - an action we believe to be gross federal overreach.
This type of obstruction from BLM is not limited to Ohio. A pervasive effort preventing private landowners from exercising their rights is taking place across the country.
Oil and natural gas operators developing on federal lands need regulatory and permitting certainty in order to commit the resources needed to access private minerals. State agencies can issue permits in a fraction of the more than 260-day average it takes for a federal permit. It is a costly, duplicative process that BLM is imposing in requiring additional National Environmental Policy Act (NEPA) environmental assessments. This new legislation would help to clarify when NEPA review is needed and when the rights of private landowners must be respected, which should be the default for government.
Private property, and the pursuit of prosperity gained from its utilization, has been an inherent right since our nation's founding. Above all, this bill respects the rights of private landowners who ultimately will decide how best to utilize their land. This should be a bedrock principle in the relationship between the federal government and private owners.
Jerry Simmons is executive director of the National Association of Royalty Owners (NARO), which represents oil and gas royalty owners' interests.