Congressional report: oil and gas development up, but not on federal lands

03 06, 2013 by The Times-Picayune

A new report by the Congressional Research Service (CRS) says that U.S. oil production is increasing, but that increases are a result of more development on privately held land. The federal share of total crude oil production fell by about seven percentage points between 2007 and 2012, the Congressional Research Service said.

CRS, a research arm of Congress, said production of natural gas on federal lands fell by about 33 percent since 2007, while production on non-federal lands grew by 40 percent.

The report's release comes as some oil-state lawmakers are complaining that the Obama administration isn't developing enough oil and gas production on government controlled land and water.

Some environmental groups, however, say, if anything, the administration is moving too quickly to approve new production after the 2010 Gulf oil spill and that some of the production shortfalls cited by CRS are a result of oil companies sitting on leases and not developing them.

The CRS said it is taking longer to process permit applications through the Bureau of Land Management, though the government is processing applications faster.

The report said it took an average of 307 days for all parties to process -- approve or deny -- an application for permits to drill, up from an average of 218 days in 2006.

"The difference, however, is that in 2006 it took the BLM an average of 127 days to process an application, but in 2011, it took BLM, 71 days. In 2006, the industry took an average of 127 days to complete an application, but in 2011, industry took 236 days."

The explanation: post-BP-oil-spill reforms increased the complexity of the application process, according to the CRS.

Rep. Steve Scalise, R-Jefferson, said Tuesday that the report shows the failure of the Obama administration's domestic energy policies.

"For the last four years, Americans have been handcuffed to a radical and failed energy policy which has resulted in skyrocketing energy prices and increased dependency on Middle Eastern oil," Scalise said.

But the CRS report said that for natural gas the big increases have been for gas developed from shale and that's primarily done on non federal lands.,

It also said that the "number of producing acres" (for oil and gas) may not be a function of how many acres are leased. It noted that some members of Congress believe that many permitted leases are "not being developed" by oil companies "in a timely fashion."

It said other members of Congress believe the Obama administration has left too many areas ineligible for permitting, including the Arctic National Wildlife Refuge in Alaska and off-shore the coasts of Florida and California where there's significant local opposition to new drilling.

At a hearing Thursday before the Energy and Mineral Resources Subcommittee, Republicans said increased production could increase government revenue without increasing taxes.

Chett Chiasson, executive director of the Greater Lafouche Port Commission, said that more than 250 companies use the port to service off-shore rigs in the Gulf of Mexico. His busy port, Chiasson said, is a good example of the economic benefits that can come to areas along Florida's coast, as well as the West Coast, if conventional and renewable energy development is created.