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Matthew McFeeley’s Blog

BLM speeds drilling permits as inspections suffer

Matthew McFeeley

Posted July 11, 2014

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Last week, the Department of the Interior’s Inspector General (IG) released a report which stated that approval times for drilling permits on public lands are “often very long.”  The oil and gas industry seized on this report, arguing that we should therefore funnel more tax dollars into permitting.  (Energy Tomorrow, an oil and gas industry PR site, tweeted about the report no less than seven times.) But a closer look at the IG’s report reveals that it’s not that simple; the Department is struggling to cope with chronic underfunding across programs and often prioritizes drilling approvals over protecting public lands, water, and the health of nearby communities. They have it backwards. The agency shouldn’t expand permitting when it can’t properly oversee existing oil and gas sites.

The Bureau of Land Management (BLM) is the part of the Interior Department that manages oil and gas drilling and fracking on federal public lands, including national forests and wildlife refuges.  Today, the BLM is responsible for oversight of more than 92,000 oil and gas wells.  The BLM is tasked with ensuring that drilling and fracking does not jeopardize “historical, ecological, environmental, air and atmospheric, and water” resources.  Yet, a recent investigation by the Associated Press found that about 40% of the wells considered high risks for environmental and/or safety problems were never inspected by BLM, despite the agency’s determination that it should inspect each and every one. 

Even though the BLM is unable to adequately oversee existing wells, the BLM has redirected resources toward permitting additional drilling.  The IG’s report acknowledges that BLM approves thousands of new drilling permits each year and has brought down processing times by more than one third.  And, the report reveals that the agency approves 99% of all applications for permits to drill.

For years, the BLM has asked Congress for the authority to charge companies a small fee to fund well inspections. This would allow more inspections to be done and is the right thing for Congress to do.  As the Western Values Project points out, Congress already allows permit fees for offshore oil and gas operators to cover the expense of inspecting their wells (not to mention higher royalty rates and rental fees).  Yet onshore, the American taxpayer foots the bill for oil and gas well inspections. 

The BLM’s requests for additional funding to ensure it can properly manage existing wells have been repeatedly opposed by the oil and gas industry and rebuffed by its allies in Congress.  For at least the past five years, the BLM has asked Congress for the authority to charge inspection fees.  But every year, industry allies have managed to prevent the BLM from doing so.  And just Wednesday, House Republicans reported a budget bill for the Interior Department out of subcommittee that doesn’t allow for inspection fees. 

Recently, however, some in the oil and gas industry, including the American Petroleum Institute, industry’s biggest lobbying arm, have reportedly signaled a willingness to consider inspection fees.  That’s only reasonable.  The companies who operate these wells should pay the cost of inspections, which can catch problems in advance and help to protect against water contamination and other problems due to faulty wells.  That’s one commonsense solution to provide a boost to an agency that is stretched beyond capacity by dwindling budgets.  Certainly, until the BLM can properly oversee existing wells, new permitting is not the best use of scarce tax dollars.

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