The Bureau of Land Management (BLM) has proposed a new rule that would hold oil and gas companies accountable for cleaning up their drill sites by increasing bonding rates. Currently, the lease bond amount set in 1960 is a mere $10,000, but the proposed rule aims to raise it to $150,000. This move is in line with provisions made by Congress in the Inflation Reduction Act and Bipartisan Infrastructure Law.
Russell Kuhlman, executive director of the Nevada Wildlife Federation, emphasized the need for oil and gas companies to take responsibility for reclaiming abandoned well sites. He highlighted that these companies often walk away from these sites, leaving taxpayers to foot the bill for cleanup. By increasing bonding rates, the rule aims to ensure that developers meet their obligations.
In addition to raising bonding rates, the proposed rule would eliminate “noncompetitive leasing,” a practice that allows companies to secure land with low potential for production at minimal costs. Kuhlman noted that this practice allows companies to tie up public lands without actually drilling, impacting wildlife habitat and cultural sites.
The BLM expects to issue a final oil and gas leasing rule this spring, with the aim of steering leasing activities towards lands with high production potential and existing infrastructure. This move could potentially shift focus away from wildlife habitat and recreation trails towards more suitable areas for oil and gas development.
This development comes as part of ongoing efforts to reform the leasing process on public lands, ensuring that oil and gas companies bear the responsibility for environmental cleanup and conservation efforts.
