Biden administration’s new rule: Oil, gas companies must pay more to drill on public lands

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The new rule does not prohibit new oil and gas leasing on public lands, as many environmental groups have urged. But officials say it would lead to a process that provides a better return to taxpay…

FILE – Pump jacks work in a field near Lovington, N.M., April 24, 2015. Oil and gas companies will have to pay more to drill on public lands and satisfy stronger requirements to clean up old or abandoned wells under a final rule issued Friday, April 12, 2024, by the Biden administration. The Interior Department rule does not go so far as to prohibit new oil and gas leasing on public lands, as many environmental groups have urged and as President Joe Biden promised during the 2020 campaign.

The new rule does not go so far as to prohibit new oil and gas leasing on public lands, as many environmental groups have urged and as Democratic President Joe Bidencampaign. But officials said the proposal would lead to a more responsible leasing process that provides a better return to U.S. taxpayers.

Along with efforts to clean up so-called orphaned, or abandoned, wells, “these reforms will help safeguard the health of our public lands and nearby communities for generations to come,” Haaland said. The rule also would increase the minimum leasing bond paid by energy companies to $150,000, compared with the previous $10,000 established in 1960. The higher bonding requirement is intended to ensure that companies meet their obligations to clean up drilling sites after they are done or cap wells that are abandoned.

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Biden Administration Implements New Rule Increasing Costs for Oil and Gas Companies on Federal LandsOil and gas companies will face a significant increase in costs to drill on federal lands under a new rule implemented by the Biden administration. The rule aims to generate more revenue for taxpayers and protect them from cleanup costs. This is the first comprehensive update to the federal oil and gas leasing program in over 30 years.
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