BOEM and the Bureau of Land Management (BLM) are committed to ensuring that the public receives a fair return on publicly managed energy resources. Over the last decade, BOEM and BLM have completed two comprehensive assessments that review the Federal oil and gas fiscal system with that of peer jurisdictions. The reports, linked below, provide useful analysis and tools that will support both agencies in achieving this goal.
BOEM and BLM commissioned these reports in response to Government Accountability Office (GAO) recommendations outlined in the following publications:
- Oil and Gas Royalties: The Federal System for Collecting Oil and Gas Revenues Needs Comprehensive Reassessment (GAO-08-691). In 2008, the GAO recommended that the Department of the Interior periodically collect data and information and conduct “analyses to determine how the federal government take and the attractiveness for oil and gas investors in each federal oil and gas region compare to those of other resource owners.”
- Oil and Gas Resources: Actions Needed for Interior to Better Ensure a Fair Return (GAO-14-50). In 2014, the GAO recommended that Interior “establish documented procedures for determining when to conduct periodic assessments of the overall fiscal system.”
BOEM and BLM first conducted the assessment in 2011 and later established procedures to procure a comprehensive comparative study every ten years or sooner given significant changes in market conditions. Given several significant changes, Interior opted to undertake the next report in 2018.
When reviewing these reports, it is important to note that governments have multiple, diverse objectives. These objectives include receipt of fair market value for lands leased and rights conveyed; promoting responsible resource and energy development, private investment and employment; energy security; and environmental protection, among other goals. Each government and regulatory regime identifies and balances its objectives based on a complex set of laws, circumstances, and policies, and this balance may change as conditions and policies change over time. These factors must all be weighed when determining appropriate terms for oil and gas leases.