Report: Backlog in drill requests hurts industry


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Associated Press

 

SALT LAKE CITY (AP) — The federal agency tasked with approving mines and drills on public lands is handicapping development in Utah and across the U.S. because it takes too long to review oil and gas proposals, a federal report finds.

In Utah, the Bureau of Land Management’s Vernal office is now handling applications amounting to half the yearly federal workload, reports the Department of the Interior’s Inspector General.

Reviewing such applications has not been high on the agency’s to-do list, and supervisors don’t track progress on the applications, the report finds.

But it also acknowledges that the agency grapples with outdated resources and too little staff. In Vernal, it concedes, a high cost of living means the agency has difficulty attracting workers.

Agency staffers could streamline the process by digitizing and assigning the applications to specific managers, the review finds.

“Specifically,” the report says, “the federal government and Indian lands mineral owners risk losing royalties from delayed oil and gas production.”

Such delays for about 1,000 proposals on the federal land covering 90 percent of Uintah County chase away industry, Commissioner Mike Mckee tells the Deseret News.

“I will take my hat off to the Vernal office because I believe they are doing a good job, as much as they can, but with that said, there has been a backlog for a number of years,” McKee said.

Nationally, oil and gas production on federal and Indian lands has brought in $3 billion since fiscal year 2011.

Utah comes behind Wyoming and New Mexico for its share of drilling on federal lands.

In 2012, reviewing the proposed drills took 7½ months on average, the report finds. Companies applying for drills and other operations cause some delays, it found, but others stem from agency offices’ lack of oversight, accountability and staffing.

It’s not the first review to point to a backlog:

The Office of Inspector General in 2003 found long delays. In August of 2013, the General Accountability Office criticized the agency for long processing times that persisted. The BLM at that time said it would implement a list of recommendations by the end of this year.

Kathleen Sgamma, vice president of governmental affairs for Western Energy Alliance, a group of independent oil and gas producers, said she welcomes the recommendations but says hefty constraints likely mean that very little will change.

The alliance, she said, supports a bipartisan bill that would funnel more money to offices handling more applications.

The report stressed a need to continue federal funding for a half-dozen temporary offices around the country, including one in Vernal.

The BLM counters that if industry bore more of the cost for processing the applications to drill, the agency’s efficiency would improve in that area.

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