Mr. Erik Milito - The House Committee on Natural Resources ...

Lease sales in the West, which has been a very important region for U.S. oil
and gas development, are down 70 percent in 2011 as compared to 2008. Some
of the state-level examples are striking, with Interior offering a mere four parcels
in Colorado in 2011 as compared to 241 in 2008, a mere 17 in Utah in 2011 as
compared to 124 in 2008, and only 213 in Wyoming in 2011 as compared to 1,186
in 2008. Interior has not consistently met its statutory requirement of issuing
leases within sixty days of the lease sale. On top of that, Interior has canceled or
suspended numerous leases in Utah and Montana.
Permitting is also delayed and down on BLM-managed lands. Companies
simply do not get permits to drill in a timely fashion. Permitting times have
averaged more than 200 days in recent years, and depending on the field office, it
can actually take more than two years to obtain a permit. <strong>The</strong> Energy Policy Act
of 2005 mandated a thirty day deadline for processing applications for permits to
drill and this deadline is largely ignored. <strong>The</strong> number of permits being issued by
Interior dropped by 39 percent when comparing the total permits issued in 2009
and 2010 to the total permits issued in 2007 and 2008. <strong>The</strong> Administration is
quick to point out that there are about 7,000 outstanding approved permits, but
it conveniently neglects to explain that there are stipulation periods, lands that
are now subjected to new planning requirements where development is
prevented, lawsuits and other reasons that may prevent companies to utilize
many permits. In addition, the uncertainty about when permits are approved
means that companies may need to submit multiple applications in the hopes
that some permits may actually get approved in a timely fashion. A copy of a
January 2012 report by Grand Junction based EIS Solutions on the impact of
current federal lands policies lays out the declining leasing and permitting trends
on BLM-managed lands and is provided for the subcommittee.
Interior is also holding operations at bay through extremely long delays in
completing the environmental analysis to support a project approval. This
environmental analysis must occur before companies can apply for drilling
permits. <strong>The</strong> Council on Environmental Quality’s NEPA guidance states that
Environmental Assessments (EA) should take three months to complete and
Environmental Impact Statements (EIS) should take 12 months to complete.
However, Interior routinely takes years to complete both EAs and EISs. A May
2011 report by SWCA Environmental Consultants, entitled “Economic Impacts of
Oil and Gas Development on BLM Lands in Wyoming”, demonstrated that six EISs
were delayed in a range of one to five years. <strong>The</strong> impact of these delays is quite
4