Department of Interior Takes A New Direction – Backward

On October 25, the U.S. Department of the Interior released the “Review of the Department of the Interior Actions that Potentially Burden Domestic Energy” report which was produced in response to Executive Order 13783 “Promoting Energy Independence and Economic Growth”. The report identified agency actions that potentially burden the development or use of domestically produced energy resources.

Announcing the change of direction, U.S. Secretary of the Interior Ryan Zinke said, “Our public lands are meant to be managed for the benefit of the people. That means a multiple-use approach where appropriate and making sure that multiple-use includes energy development under reasonable regulations. Following President Trump’s leadership, Interior is fostering domestic energy production by streamlining permitting and revising and repealing Obama-era job killing regulations – all while doing so in an environmentally responsible way.”

Read the October 25 Interior Department press release here:

The report identifies a number of “burdens” the Administration claims impede the production and transportation of energy resources. Many of these “burdens” are the environmental protections that thousands of Americans participated in developing through scientific research, participation in committees and policy boards, as well as through citizen activism. It is disheartening to see the clock turned back on protections including, but not limited to:

  • Obama-Era 5-Year Program Under the last Administration, 94% of the Outer Continental Shelf (OCS) was put off-limits from leasing, having an adverse effect on jobs and energy dominance, while drastically reducing access to future revenue.
  • Federal Coal Leasing Moratorium (Secretarial Order 3338, Discretionary Programmatic Environmental Impact Statement to Modernize the Federal Coal Program​)​ Nearly 40% of our nation’s coal comes from public lands.​ The 2016 coal moratorium undermines American energy security, inhibits job creation, and reduces revenues to state and local governments.
  • Hydraulic Fracturing on Federal and Indian Lands Rule​ ​The compliance costs of the existing 2015 rule on hydraulic fracturing are not justified. All 32 states with federal oil and gas leases and some tribes currently have laws or regulations that address hydraulic fracturing operations.
  • Waste Prevention, Production Subject to Royalties, and Resource Conservation AKA the Venting and Flaring Rule The rule imposes a substantial burden on industry, especially for marginal well production in energy-rich states like New Mexico, particularly the requirements that are set to become effective on January 17, 2018.
    • Action: Secretarial Order 3349: American Energy Independence put the rules under review for subsequent action by the Department. On October 5, 2017, the BLM issued a proposed rule to temporarily suspend certain requirements of the rule. The BLM is also actively reviewing the underlying regulation for potential revision.
  • Unnecessarily lengthy NEPA reviews delay projects The NEPA process has added extra time and analysis to project completion, which adds to uncertainty for industry and higher costs for taxpayers. This is particularly true for Departmental actions that impact energy and infrastructure projects, such as resource management planning, permitting, and issuance of rights-of-way for pipeline projects and electricity transmission.
    • Actions: The Department has identified a number of rules and regulations to revise or rescind such as the Master Leasing Plans, the NEPA Compliance for Oil and Gas Lease Reinstatement Petitions, and the Sage-Grouse Resource Management Plans. In addition, the Deputy Secretary issued an August memo setting a deadline of one year and limiting EIS statements to 150 pages or 300 pages for unusually complex projects.
  • Holding energy producers hostage via Compensatory Mitigation (Secretarial Order 3330​)​ Current compensatory mitigation policies have reduced predictability, created conflicts, and unnecessarily increased permitting/authorization timelines. Additionally, industry stakeholders believe the mitigation planning goal exceeds statutory authority. Currently, Interior and its bureaus lack a consistent terminology and framework for mitigation.
    • Action: Secretarial Order 3349: American Energy Independence reexamined the use of mitigation policies and practices in order to better balance conservation strategies and job creation. Bureaus at the Interior will review various handbooks and manuals on the use of mitigation for energy and infrastructure projects.
  • Systematic delays in the leasing program and permitting process The long period from when acreage is first nominated to when those acres are offered at a lease sale, as well as delays between the lease sale date and when leases are awarded reduces industry certainty and hinders states from receiving their share of lease sale revenues.​  These delays have rendered industry less able to plan for and execute exploration and production strategies in a timely fashion, and less able to respond effectively to changing market conditions.
  • Endangered Species Act ​​The Endangered Species Act (ESA) is taken into consideration for both on- and offshore energy and infrastructure projects. It has far-reaching negative impacts on energy production and transmission as well as on critical infrastructure projects. ESA abuses have led to increased costs and delays on projects.

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