Tester Announces Bill to End Wasteful Non-Competitive Oil and Gas Leasing, Increase Government Efficiency

1.4 million acres—or 67 percent—of all Montana public lands leased for oil and gas development are sitting idle

U.S. Senator Jon Tester today announced that he will introduce legislation requiring the Bureau of Land Management (BLM) to issue all oil and gas leases through competitive auction, ending noncompetitive leasing and cutting bureaucratic red tape and government inefficiency.

“BLM’s noncompetitive leasing program is about as efficient as a steering wheel on a blindfolded mule at night, and taxpayers are left pulling the plow,” said Tester. “My legislation will cut down on government waste by increasing transparency, growing revenues, and—most importantly—saving taxpayer dollars. It’s time to end this broken system, which is spending critical resources on bureaucratic red tape that doesn’t benefit the public or our public lands.”

Tester’s Leasing Market Efficiency Act will ensure taxpayer dollars are being spent responsibly and efficiently by reducing the amount of BLM staff time and energy spent on non-producing leases; increasing transparency in the leasing process; growing revenues; and shifting land management priorities on low potential lands away from oil and gas development.

Noncompetitive leases are lands that the market has determined have little or no potential for oil and gas development. They are commonly purchased by speculators and rarely developed. In Montana, 1.4 million acres—or 67 percent—of all public lands leased for oil and gas development are sitting idle. 32 percent of all Montana lands leased through BLM since 1987 that remain under lease were sold noncompetitively at the no-bid price of $1.50 per acre. The combination of the low no-bid price and lack of annual royalty payments from production wells provides very little revenue or jobs for Montana.

Yet, while noncompetitive leased lands provide only small amounts of revenue, BLM staff time and resources are tied up implementing the noncompetitive leasing system, which includes awarding leases, managing the annual rental agreements, cancelling leases for failure to pay rent, and terminating or extending leases at the end of the 10-year term. Tester’s legislation will help ensure taxpayer dollars can be spent on effective and efficient public lands management instead of tied up in an outdated bureaucratic system.

“Everyone wants government to work more efficiently,” said Tracy Stone-Manning, associate vice president for public lands at the National Wildlife Federation. “Senator Tester’s common-sense bill will allow federal land managers to rightfully return to getting to work on the ground, improving wildlife habitat, maintaining clean water, improving trails and recreation sites, and other necessary public lands work.”

“We commend Senator Tester on working to address such a wasteful and outdated practice in the oil and gas leasing system,” said Alec Underwood, Federal Conservation Campaigns Director for the Montana Wildlife Federation. “Non-competitive leasing is an affront to the taxpayer as well as our cherished fish, wildlife and sporting opportunities. Montana hunters will benefit greatly from increased transparency and the assurance that our public lands will be managed for multiple use.”

“We can’t thank Sen. Tester enough for introducing legislation that will put an end to this horribly outdated practice that is siphoning time, resources, and taxpayer money away from what the BLM is supposed to be doing – taking care of our public lands,” said Aubrey Bertram, Eastern Montana Field Director at Montana Wilderness Association. “That means taking care of trails, improving habitat, creating and maintaining river access, and making sure there’s enough law enforcement to protect Montana’s cultural and natural treasures. It’s past time we put an end to this practice that is hurting public lands.”

“Montana Trout Unlimited applauds the introduction of this common-sense legislation that is a win-win for government transparency and efficiency, the taxpayer, and our coldwater fisheries in Montana,” said Clayton Elliott, Conservation and Government Affairs Director for Montana Trout Unlimited. “Thank you, Senator Tester, for your leadership in bringing this long overdue fix to a broken part of the oil and gas leasing process to the U.S. Senate.”

“Montana Audubon has had a long-established interest in conservation of our public land and while the problem is widespread in the west, Montana has been particularly plagued in recent years by an increase in noncompetitive leasing,” said Larry Berrin, Executive Director, Montana Audubon.

“It’s time to stop putting the interests of the fossil fuel industry ahead of the health and survival of our communities and the environment,” said Maria Handley, Director of Campaigns, The Wilderness Society. “Our public lands need to transition away from a fossil fuel only approach, to one driven by conservation and sustainable energy solutions that confront the climate crisis. We are grateful to Senator Tester for his leadership on this important work.”

“This commonsense bill closes an expensive loophole which the oil and gas industry exploits to lock up public land without giving the American taxpayer a fair share,” said Matt Kirby, Energy and Landscape Conservation Program Director for the National Parks Conservation Association. “Non-competitive leases amount to one more subsidy for an already heavily subsidized industry. By ending this wasteful practice, this bill would put much needed money back into the federal treasury that could be redirected toward actually protecting our public lands and national parks.”

“This long-overdue proposal will end the deceitful practice of allowing energy speculators to scoop up leases on our public lands for rock bottom prices. Noncompetitive leasing wastes government resources and deprives communities of much-needed tax revenue,” said Camilla Simon, Executive Director of Hispanics Enjoying Camping, Hunting, and the Outdoors (HECHO). “Senator Tester’s bill is a giant step forward in making sure our public lands are managed for multiple uses for all Americans to enjoy.”

“Right now, ranchers have to work harder to get access to federal lands than oil and gas companies,” said Deborah Hanson, member of Northern Plains Resource Council and resident of Miles City. “That doesn’t seem fair. We commend Senator Tester for introducing the Leasing Market Efficiency Act and working to eliminate a broken system that doesn’t benefit Montanans.”

“I applaud Senator Tester for his leadership in introducing legislation to eliminate noncompetitive leasing on America’s public lands,” said Brian Sybert, Executive Director, Conservation Lands Foundation. “This practice has robbed taxpayers of a fair return for the use of our public lands, as well as the management of these lands for conservation, recreation, wildlife, and wilderness. We must move towards protecting landscapes in order to mitigate the climate crisis, and ending noncompetitive leasing is an essential part of that effort.”

“Thank you to Senator Tester for taking an important common sense step forward in remedying our broken oil and gas leasing system,” said Steve Ellis, President of Taxpayers for Common Sense. “For too long, oil and gas companies and other speculators have exploited a loophole in the law to gobble up thousands of acres of federal land without bidding for them. They simply wait out the sale and pick the land up at a steep discount after a lease sale yields no bids. While these day-after giveaways may pad the bottom line of industry, they deprive state and federal coffers of valuable revenue and tie up our public land from other uses.”

“Noncompetitive oil and gas leasing invites abuse, ties up agency resources, and gets in the way of the people and communities getting the full benefit from our public lands,” said Amy McNamara, Northern Rockies Director, Natural Resources Defense Council. “BLM’s oil and gas leasing program has been broken for too long and we are grateful that Senator Tester is working to fix it.”

“The Trump administration is taking advantage of our country’s broken leasing system, allowing oil and gas companies to lease some of America’s most iconic landscapes behind closed doors, including lands on the doorstep of our national parks,” said Phil Francis, Chairman, Coalition to Protect America’s National Parks. “We should not have to worry that our parks will be threatened by nearby oil and gas leasing and drilling, but the decades-old noncompetitive leasing process is not transparent, meaning that oil companies abuse the system and nominate lease after lease, regardless of the potential impact to nearby national parks. In just the last three and half years, the administration has made nearly 3.5 million acres of public lands across the country available for leasing through a noncompetitive process. Senator Tester’s bill will bring badly needed reform and ensure that our public lands are no longer leased through a backdoor process.”

“Communities across the West rely on our country’s public lands to support local economies and provide opportunities for outdoor recreation,” said Ashley Korenblat, Managing Director, Public Land Solutions. “What many Americans don’t realize is that our outdated and broken oil and gas leasing system is allowing the Trump administration to prioritize oil and gas over all other uses—many of which create more jobs and better lifestyles. The quality of life that outdoor access brings to western states is under threat, and Senator Tester’s new bill will put an end to the practice of noncompetitive leasing and require that all oil and gas lease sales on public lands are issued through a transparent and competitive process. This bill is needed to support future economic prosperity for public land communities across the West.”

“Many veterans turn to the beauty and serenity of our nation’s public lands to help ease the transition from the military to civilian life,” said Kate Hoit, Western States Director, Vet Voice Foundation. “Like so many Americans, veterans have a strong connection to our public lands and believe protecting them is our patriotic duty. Unfortunately, the Trump administration fails to recognize the importance of these special places and is allowing oil and gas companies to lease our most precious landscapes through backroom deals. This is why we support U.S. Senator Jon Tester’s Leasing Market Efficiency Act, a good government bill that will protect the public’s access to our public lands and stop oil and gas CEOs from getting sweetheart deals to drill on the lands our nation’s veterans fought to protect.”

“There is absolutely no good reason to keep this wasteful and unnecessary oil and gas leasing program,” said Kate Kelly, Public Lands Director at the Center for American Progress. “Handing out oil and gas leases for pennies on the dollar bilks taxpayers, drains limited agency resources, and allows oil speculators and wildcatters to stockpile public lands. We applaud Senator Tester for his proposal to end this opaque, antiquated leasing program.”

Tester has led the charge in Congress to cut down on government waste and inefficiency. He recently backed bipartisan legislation to bolster protections for Inspectors General in the face of Trump Administration attempts to curtail their oversight of taxpayer dollars. He has pushed aggressively for more information on how pandemic relief funding is being allocated, grilling Secretary Mnuchin during a Senate Banking hearing on the Administration’s lack of transparency earlier this year.

Tester also fought to include an independent Special Inspector General for Pandemic Recovery in the Coronavirus Aid, Recovery, and Economic Security (CARES) Act, and teamed up with Senator Mitt Romney in urging President Trump to provide Congress with details about its plans for rigorous oversight after Trump signaled, when signing the bill, that he would not allow the position to report to Congress without Presidential supervision.

Full bill text available HERE.