Center for American Progress

Modernizing the Federal Oil and Gas Leasing Process

Modernizing the Federal Oil and Gas Leasing Process

The upcoming rulemaking that addresses the federal oil and gas leasing process is a critical opportunity to reevaluate how public lands are leased and ensure that the public receives a fair and equitable share.

Part of a Series

idea_bulbWhen the federal government last changed its royalty rate for oil and gas production on America’s public lands, Standard Oil’s monopoly had only recently been broken, Ford’s Model A still had not rolled off the assembly line, the Teapot Dome scandal had yet to erupt and rock the U.S. Department of the Interior and the administration of President Warren G. Harding, and the 20s had just begun to roar. In the 95 years since the Mineral Leasing Act first set the federal royalty rate for oil and gas at 12.5 percent, the federal government’s oil and gas revenue policies have remained firmly fixed in the past while state governments and private landowners have, time and again, updated the terms for development on their lands.

As a result of the federal government’s failure to modernize its oil and gas program, U.S. taxpayers are losing out on more than $730 million in revenue every year. At the same time, oil and gas companies are stockpiling leases and sitting idle on the rights to drill on tens of millions of acres of public lands. When companies have drilled for oil and gas, the American public has often been left footing the bill to clean up the environmental damage that has been left behind.

For more on this idea, please see:

The positions of American Progress, and our policy experts, are independent, and the findings and conclusions presented are those of American Progress alone. A full list of supporters is available here. American Progress would like to acknowledge the many generous supporters who make our work possible.

Explore The Series