[Senate Hearing 117-123]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 117-123

                  ENERGY DEVELOPMENT ON FEDERAL LANDS,
                   FOCUSING ON THE CURRENT STATUS OF
                    THE DEPARTMENT OF THE INTERIOR'S
                  ONSHORE OIL AND GAS LEASING PROGRAM

=======================================================================

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 27, 2021

                               __________


                       Printed for the use of the
               Committee on Energy and Natural Resources

        Available via the World Wide Web: http://www.govinfo.gov        
        
                               __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
44-471                       WASHINGTON : 2023                    
          
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              COMMITTEE ON ENERGY AND NATURAL RESOURCES

                JOE MANCHIN III, West Virginia, Chairman
RON WYDEN, Oregon                    JOHN BARRASSO, Wyoming
MARIA CANTWELL, Washington           JAMES E. RISCH, Idaho
BERNARD SANDERS, Vermont             MIKE LEE, Utah
MARTIN HEINRICH, New Mexico          STEVE DAINES, Montana
MAZIE K. HIRONO, Hawaii              LISA MURKOWSKI, Alaska
ANGUS S. KING, JR., Maine            JOHN HOEVEN, North Dakota
CATHERINE CORTEZ MASTO, Nevada       JAMES LANKFORD, Oklahoma
MARK KELLY, Arizona                  BILL CASSIDY, Louisiana
JOHN W. HICKENLOOPER, Colorado       CINDY HYDE-SMITH, Mississippi
                                     ROGER MARSHALL, Kansas

                      Renae Black, Staff Director
                      Sam E. Fowler, Chief Counsel
                Peter Stahley, Professional Staff Member
             Richard M. Russell, Republican Staff Director
              Matthew H. Leggett, Republican Chief Counsel
                     Kate Farr, Republican Counsel
                            
                            
                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Manchin III, Hon. Joe, Chairman and a U.S. Senator from West 
  Virginia.......................................................     1
Barrasso, Hon. John, Ranking Member and a U.S. Senator from 
  Wyoming........................................................     3
Heinrich, Hon. Martin, a U.S. Senator from New Mexico............     5

                               WITNESSES

Culver, Nada Wolff, Deputy Director, Policy and Programs, Bureau 
  of Land Management, U.S. Department of the Interior............     5
Gordon, Hon. Mark, Governor, State of Wyoming....................    13
Vallo, Hon. Brian, Governor, Pueblo of Acoma.....................    99
Hollub, Vicki, President and Chief Executive Officer, Occidental 
  Petroleum......................................................   113
Sgamma, Kathleen, President, Western Energy Alliance.............   120

          ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Alaska AFL-CIO:
    Letter for the Record........................................   156
Alaska Maritime Agencies:
    Letter for the Record........................................   158
Alaska Oil & Gas Association et al.:
    Letter for the Record........................................   160
Alaska Petroleum Joint Crafts Council:
    Letter for the Record........................................   163
Alaska Port Services:
    Letter for the Record........................................   166
ANCSA Regional Association:
    Letter for the Record........................................   168
ANCSA Regional Association and Alaska Native Village Corporation 
  Association:
    Letter for the Record........................................   171
Backcountry Hunters & Anglers et al.:
    Letter for the Record........................................   243
    Comments for the Record......................................   245
Barrasso, Hon. John:
    Opening Statement............................................     3
Cities of Utqiagvik, Wainwright, and Atqasuk (AK):
    Letter for the Record........................................   173
    City of Utqiagvik Resolution #12-2021........................   181
    City of Wainwright Resolution 2021-26........................   184
    City of Atqasuk Resolution 2021-05...........................   187
Culver, Nada Wolff:
    Opening Statement............................................     5
    Written Testimony............................................     7
    Responses to Questions for the Record........................   217
General Steamship Agencies, Inc.:
    Letter for the Record........................................   190
Gordon, Hon. Mark:
    Opening Statement............................................    13
    Written Testimony............................................    15
    Letter to Secretary Haaland, dated April 15, 2021............    23
    Report entitled ``The Fiscal and Economic Impacts of Federal 
      Onshore Oil and Gas Lease Moratorium and Drilling Ban 
      Policies'' by Dr. Timothy J. Considine, University of 
      Wyoming, dated December 14, 2020...........................    33
    Responses to Questions for the Record........................   227
Heinrich, Hon. Martin:
    Opening Statement............................................     5
Hollub, Vicki:
    Opening Statement............................................   113
    Written Testimony............................................   115
    Responses to Questions for the Record........................   233
Inupiat Community of the Arctic Slope:
    Letter for the Record........................................   192
Lujan Grisham, Hon. Michelle:
    Letter to President Biden, dated March 15, 2021..............   135
Manchin III, Hon. Joe:
    Opening Statement............................................     1
North Slope Borough (AK):
    Letter for the Record........................................   195
North Star Equipment Services:
    Letter for the Record........................................   202
Port Accounting and Logistic Services:
    Letter for the Record........................................   204
Sgamma, Kathleen:
    Opening Statement............................................   120
    Written Testimony............................................   122
    Responses to Questions for the Record........................   237
Southeast Stevedoring Corporation:
    Letter for the Record........................................   206
United States Department of the Interior:
    Memo from Laura Daniel-Davis to Department Bureau Directors, 
      dated March 19, 2021.......................................   146
Vallo, Hon. Brian:
    Opening Statement............................................    99
    Photo of Pueblo of Acoma, New Mexico.........................   100
    Photo of Chaco Culture National Historical Park..............   102
    Written Testimony............................................   104
    Response to Question for the Record..........................   230
Western Ocean Services:
    Letter for the Record........................................   208
(The) Wilderness Society:
    Letter for the Record........................................   252
    Letter addressed to the U.S. Department of the Interior (with 
      appendices) providing recommendations for the comprehensive 
      review of the federal oil and gas program, dated April 15, 
      2021.......................................................   253
    Appendix A: Oil and Gas Reform Toolkit.......................   284
    Appendix B: APA Petition.....................................   296
    Appendix C.1: Report entitled ``A Fair Return for the 
      American People: Increasing Oil and Gas Royalties from 
      Federal Land'' by Dan R. Bucks, March 2019.................   326
    Appendix C.2: Report entitled ``Fiscal Responsibility in the 
      Management of Oil and Gas Leases on Federal Lands'' by Dan 
      R. Bucks, May 2020.........................................   342
    Appendix D.1: Net Zero Framework.............................   388
    Appendix D.2: Net Zero Framework Hypothetical................   422
    Appendix E: TWS Report on Land Hoarders......................   434
    Appendix F: Coal PEIS Comments...............................   443

 
ENERGY DEVELOPMENT ON FEDERAL LANDS, FOCUSING ON THE CURRENT STATUS OF 
  THE DEPARTMENT OF THE INTERIOR'S ONSHORE OIL AND GAS LEASING PROGRAM

                              ----------                              


                        TUESDAY, APRIL 27, 2021

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:00 a.m. in 
Room SD-366, Dirksen Senate Office Building, Hon. Joe Manchin 
III, Chairman of the Committee, presiding.

          OPENING STATEMENT OF HON. JOE MANCHIN III, 
                U.S. SENATOR FROM WEST VIRGINIA

    The Chairman. Good morning.
    I would like to thank everyone for being here today to 
discuss the status of energy development on our public lands 
and our federal oil and gas leasing program. In January, the 
Administration announced the pause on new leasing while they 
conducted a review of the onshore and offshore leasing 
programs. During this review, only new leases and sales have 
been paused, but oil and gas production has not been stopped. 
In fact, I understand the BLM approved over 500 new permits to 
drill in February and March. I would like to acknowledge that 
this is an issue that brings a lot of passion and has very real 
impacts on many of the states represented on this Committee. 
Just as the Administration is conducting an evaluation of the 
Department of the Interior's oil and gas leasing program, our 
Committee needs to have a fact-based discussion to set a 
baseline from which we can work to improve the federal energy 
programs for all Americans.
    I feel strongly that we need to maintain our energy 
independence, use our abundant natural resources in the 
cleanest way possible, and ensure a fair return for the 
taxpayer when it comes to the federal resources. Our public 
lands are used for multiple purposes, including energy 
development, recreation, hunting and fishing, and conservation. 
We absolutely need to be mindful of balancing these uses, and 
be aware that the decisions we make impact many people in the 
local communities surrounding our public lands. Onshore energy 
production on our federal lands also plays a significant role 
in our national energy portfolio, providing eight percent of 
our oil and natural gas, more than 40 percent of our coal and 
geothermal energy, and considerable wind and solar energy. This 
energy development produced an average of $3.25 billion 
annually in revenue for host states and the Federal Government 
over the last five years through royalties, rents, bonuses, and 
other fees. How and where that energy production takes place is 
a key part of our jurisdiction on this Committee.
    This energy development has wide-ranging impacts: from the 
revenue it provides for both states and the Federal Government 
and the jobs it provides, as well as its environmental impacts, 
and the way it interacts with other potential uses for these 
public lands. We need to take all of that into account as we 
take a hard look at how the oil and gas programs are 
functioning and what reforms might be appropriate, especially 
given that we will be relying on fossil energy in some fashion 
for the foreseeable future. I hope that the Administration will 
do the same and take some of the discussion we have today into 
account as they develop their report on this topic.
    One area where I believe more work needs to be done is to 
reduce damaging methane venting and flaring on federal lands. 
Limiting this wasteful practice will mitigate the environmental 
impact of this extremely potent greenhouse gas and also ensure 
the taxpayers receive a fair return on their resources. In 
2019, oil and gas operations on onshore federal lands vented or 
flared 74, and I will repeat, 74 billion cubic feet of methane, 
an 83 percent increase from 2015. I look forward to hearing 
about the steps responsible producers are taking to reduce 
venting and flaring, as well as what bottlenecks exist that 
keep this gas from getting to market.
    Now, as I have said before, I am all for innovation, not 
elimination, and an all-of-the-above energy policy. And while 
the focus of our hearing today is on the oil and gas leasing 
program, one thing I think makes all the sense in the world is 
increasing deployment of renewable energy on federally managed 
lands where it makes sense. Unfortunately, our agencies have 
not prioritized renewables or dedicated appropriate resources 
to their development. The permitting process is slow and there 
is not enough economic and regulatory certainty for the 
renewable energy industry operating on federal lands. The 
Energy Act of 2020 included several provisions to aid renewable 
development, geothermal innovation, and accelerate appropriate 
deployment on public lands. I look forward to hearing from the 
BLM about how we might work together to pursue renewable energy 
development on public lands.
    Let me close with my belief that we are all entitled to our 
own opinions, but we are just not entitled to create our own 
facts to support those opinions. It is not productive to be 
unrealistic when faced with these difficult issues. We are 
certain to have a wide range of views on what reforms might be 
appropriate for our public lands, but it is my hope that today 
we can have a robust discussion about the current state of play 
for energy development on our federal lands, and set a baseline 
of facts from which to discuss reforms that Congress and the 
Administration will consider going forward.
    With that, I am going to turn it over to Ranking Member 
Barrasso to give his opening remarks and to introduce one of 
today's witnesses, Governor Gordon of Wyoming.

           OPENING STATEMENT OF HON. JOHN BARRASSO, 
                   U.S. SENATOR FROM WYOMING

    Senator Barrasso. Well, thanks so much, Mr. Chairman. 
Thanks for holding this important meeting.
    And thank you, Governor Gordon, great to see you again. 
Thanks for being here because, as you and all those watching 
know, Wyoming is the energy capital of the United States. We 
have it all--oil, natural gas, coal, uranium, renewables--all 
of it. Wyoming's energy has powered this nation for decades. 
Today, Wyoming and the Rocky Mountain West are under attack. 
One of President Biden's first actions was to ban new oil and 
gas leasing on federal lands. Make no mistake, this is not a 
pause or a review. This is a ban, and currently there is no end 
in sight.
    So why did the President take this action? His 
Administration is intent on ending oil and gas leasing on 
federal lands. How do we know that? Well, President Biden 
picked a Secretary of the Interior that was on record opposing 
oil and gas production on federal lands. Since her 
confirmation, she has said that federal oil and gas leasing is 
``fundamentally broken.'' I completely disagree with her. Oil 
and gas production on federal lands is subject to some of the 
most stringent regulations in the world. That is the reason oil 
and gas companies have long favored investing in state and 
private lands instead of federal lands. Oil and gas leasing is 
not broken, but it is harmed by existing regulations that 
discourage investment in federal lands.
    For decades, oil and natural gas and coal production on 
federal lands has brought tremendous benefits to the people of 
Wyoming and other western states. It has provided rural 
communities tens of thousands of jobs at wages well above the 
national average. Oil, natural gas, and coal production has 
ended generational poverty for families in the West. It has 
enabled Wyoming, New Mexico, and other states to provide high 
quality K-12 public education and college degrees to tens of 
thousands of young people whose families would not have been 
able to afford it. These are benefits that solar and wind 
energy will never be able to replicate. In 2019, oil and 
natural gas leasing and production on federal lands generated 
about $4.2 billion. Half of that money went to the federal 
Treasury. Almost half of the money went back to western states. 
More than a quarter of all the money went to New Mexico alone. 
In contrast, wind and solar on federal lands have generated no 
more than $22 million in any given year. So President Biden's 
plan to end oil and gas leasing on federal lands will devastate 
the economies and communities of Wyoming and New Mexico and 
many other states.
    The Biden Administration is represented at today's 
hearings. I am afraid we are going to continue to hear the same 
misleading statements that we have heard from this 
Administration in the past. One of those statements is that 
federal lands account for 25 percent of the nation's greenhouse 
gas emissions. In fact, oil and gas operations on federal lands 
release less than one percent of our nation's greenhouse gases. 
Another misleading claim is that taxpayers are not getting 
their fair share. Administration officials say that royalty 
rates on state and private lands are higher than those on 
federal land. They fail to point out or explain that the 
permitting requirements and the restrictions on the use of 
federal land are far more stringent and expensive to comply 
with than those on state and private land. Increasing royalty 
rates will only further discourage oil and gas companies from 
investing in federal programs.
    Finally, Mr. Chairman, we may hear that oil and gas 
companies are stockpiling leases. Oil and gas companies cannot 
just sit on leases. They must actively work to develop oil and 
gas or return the leases to the Federal Government. That 
process takes years in getting the permitting and the rights-
of-way needed to actually explore for the energy. But it is 
well worth the time because energy production on federal lands 
is critical to local communities, to western states, and to the 
nation.
    So, Mr. Chairman, I do want to thank you for holding this 
important meeting and before we begin with the witnesses, I 
would like to take a second to introduce Governor Gordon. Mark 
Gordon has been serving as Wyoming's governor since January 
2019. He and his wife, Jennie, own and operate the Merlin 
Ranch, east of Buffalo. He has served as a member of the boards 
of the Wyoming Wildlife and Natural Resource Trust, The Nature 
Conservancy in Wyoming, and the Wyoming Environmental Quality 
Council. Governor Gordon knows the critical importance of both 
energy production and environmental protection. That is why 
Governor Gordon is leading a lawsuit to combat the Biden 
Administration's illegal ban on oil and gas lease sales on 
federal lands. The people of Wyoming were not consulted before 
President Biden signed his damaging Executive Order and 
Secretary Haaland implemented it. Now the Biden Administration 
will hear Wyoming's arguments both during this hearing and in 
court.
    Governor Gordon, it is a great honor to welcome you back as 
a witness before the Energy and Natural Resources Committee. I 
want to thank you for traveling from Wyoming to Washington to 
be part of this important hearing today.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    And moving to our witnesses, today's panel will be able to 
provide a variety of perspectives, and we really look forward 
and want to thank each and every one of you, especially for the 
efforts you made to be here, as we share all the concerns.
    I will go through the witnesses we have with us today and 
then I have Senator Heinrich, who is going to introduce 
Governor Brian Vallo.
    We have Nada Culver, Deputy Director of Programs with the 
Bureau of Land Management.
    We have Governor Mark Gordon, who has just been introduced 
by Senator Barrasso.
    And then we have Governor Brian Vallo, who Senator Heinrich 
is going to introduce in just a minute.
    We have Vicki Hollub, President and Chief Executive Officer 
of Occidental Petroleum.
    We have Kathleen Sgamma, President of the Western Energy 
Alliance.
    Senator Heinrich.

          OPENING STATEMENT OF HON. MARTIN HEINRICH, 
                  U.S. SENATOR FROM NEW MEXICO

    Senator Heinrich. Thank you, Chairman, and I am quite 
pleased to introduce my constituent, Governor Brian Vallo of 
the Pueblo of Acoma, to the Committee today.
    With over 30 years of working with tribal communities on 
issues of historic preservation, tourism, NAGPRA statutes, and 
museum development, Acoma Pueblo Governor Brian Vallo is 
currently serving his third term in tribal leadership. He was 
previously Director of the Indian Arts Research Center at the 
School for Advanced Research in Santa Fe, New Mexico. Governor 
Vallo was Founding Director of Acoma's Haak'u Museum and was 
Director of Historic Preservation at Acoma. He is currently 
consultant to the Metropolitan Museum of Art, the Field Museum, 
and the de Young Museum.
    Governor Vallo attended New Mexico State University, where 
he studied business administration and marketing and later 
studied anthropology at the University of New Mexico. Governor 
Vallo is a steadfast advocate for Acoma Pueblo's cultural 
heritage and has led efforts to protect pueblo sacred sites 
across the Southwest. I am grateful he is able to join us today 
and share his experiences with how the BLM manages oil and gas 
development on public lands where there are important sacred 
and cultural sites for tribal communities like Acoma.
    The Chairman. Thank you, Senator.
    Now we are going to turn to our witnesses' opening 
statements and we will first hear from Ms. Culver.

  STATEMENT OF NADA WOLFF CULVER, DEPUTY DIRECTOR, POLICY AND 
  PROGRAMS, BUREAU OF LAND MANAGEMENT, U.S. DEPARTMENT OF THE 
                            INTERIOR

    Ms. Culver. Thank you.
    Chairman Manchin, Ranking Member Barrasso, and members of 
the Committee, thank you for the opportunity to provide 
testimony on the development of energy from federal lands and 
the Bureau of Land Management's (BLM's) energy programs. I am 
Nada Wolff Culver, BLM's Deputy Director for Policy and 
Programs. This July, we will celebrate the 75th anniversary of 
the BLM, which was established in 1946 with the merger of the 
General Land Office and the U.S. Grazing Service. The BLM has 
evolved over the years and adapted its mission to meet the 
needs of our nation and serve as a steward of our public lands 
and resources. We look forward to celebrating this milestone 
and recognize that BLM-managed lands provide an opportunity to 
address some of the nation's most pressing challenges, 
including those related to energy development, climate change, 
and transitioning toward a clean energy economy. The BLM 
manages approximately 245 million surface acres located 
primarily in 12 Western states, as well as mineral resources 
across 700 million subsurface acres. Under our Multiple-use 
Sustained-Yield mandate directed by Congress, the BLM manages 
public lands for a broad range of uses, including renewable and 
conventional energy development, livestock grazing, timber 
production, hunting and fishing, recreation, and conservation, 
including protection of cultural and historic resources.
    President Biden issued Executive Order 14008, ``Tackling 
the Climate Crisis at Home and Abroad,'' to restore balance on 
public lands and waters, create jobs, and provide a path to 
align management of America's public lands and waters with our 
nation's climate, conservation, equity and clean energy goals. 
The Order includes important direction for BLM's renewable 
energy and oil and gas programs. For renewable energy, the 
Order, along with the Energy Act of 2020, sets ambitious goals 
to meet the urgent demands of the climate crisis and directs 
the Secretary to identify ways to increase renewable energy 
production on public lands. The BLM's initial efforts include a 
proposal for the establishment of renewable energy coordination 
offices as well as other ways to prioritize permitting energy, 
renewable energy development, and associated transmission. The 
EO also pauses oil and gas leasing on public lands and in 
offshore waters while the Department conducts a comprehensive 
review of federal oil and gas permitting and leasing practices, 
including looking at royalty rates and climate impacts.
    For years, the Government Accountability Office (GAO) has 
identified the federal oil and gas programs as ``high risk'' 
for fraud, waste, abuse, and mismanagement, and recommended a 
comprehensive review. GAO has consistently recommended program 
improvements, including for bonding, where rates were set in 
the 1950s and '60s, and royalty rates are currently set at 12.5 
percent, a rate set in 1920. GAO has also highlighted non-
competitive leasing, lease suspensions, and ensuring a fair 
return to taxpayers. As part of the ongoing review, we are 
considering how to remediate the problems identified by GAO as 
well as the legal shortcomings that have led courts to overturn 
numerous lease sales and BLM guidance. We are also receiving 
feedback from tribes, governors and local governments, and 
through outreach to stakeholders and recently held a forum that 
featured a diverse range of perspectives. To be clear, as we 
are conducting the review, industry continues to produce from 
existing operations while submitting new drilling permits. 
Since January, we have approved over 500 permits to drill. 
Today, less than half the federal acreage under lease is in 
producing status and operators currently possess nearly 8,000 
available and approved drilling permits, ready for use, with 
about 5,600 more submitted for consideration.
    It is worth reiterating that we manage the public lands and 
their multiple uses for all people. As Secretary Haaland has 
stated, ``Fossil fuels will continue to play a major role in 
America for years to come.'' However, this is just one of the 
multiple uses for which the BLM manages public lands. Too 
often, the extraction of resources has been rushed at the 
expense of people, wildlife, and other uses. While we look back 
with pride on the evolution of federal land management and the 
economic contributions from public lands over the last 75 
years, we simply cannot continue doing business as we have in 
the past. It is incumbent on us to look forward, adapting to 
the changing landscapes, climate, environment, and 
technologies. We have an opportunity to rebalance, bring 
meaning to the concept of sustained yield, and ensure that we 
manage our lands and resources not merely across fiscal years, 
but across generations. Together we can meet the challenges of 
our time.
    Thank you again for the opportunity to be here today and I 
look forward to your questions.
    [The prepared statement of Ms. Culver follows:]

    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. Thank you, Ms. Culver.
    Next we have Governor Gordon of Wyoming.
    Governor Gordon.

                STATEMENT OF HON. MARK GORDON, 
                   GOVERNOR, STATE OF WYOMING

    Mr. Gordon. Thank you, Chairman Manchin, Ranking Member 
Barrasso, and members of the Committee. Good morning and thanks 
for the opportunity to meet with you today. Greetings from the 
people of Wyoming.
    We can probably agree that last year sucked economically, 
socially, and emotionally. Wyoming never had to completely shut 
down, so our schools and businesses remained open but our 
overall economy took a hard hit, particularly in the oil and 
gas industry. I cannot talk about my state without mentioning 
coal. Mr. Chairman, you and Ranking Member Barrasso know coal 
well and how important it is to our states' economies. Thank 
you for remembering that burning fossil fuels is not the 
problem. It is concentration of CO2 in the 
atmosphere that is the most urgent and critical task of this 
generation. Thank you for last week's hearing on carbon capture 
to promote federal support for commercial deployment of CCUS. 
This technology is essential.
    I recently announced that Wyoming will work day and night 
to achieve negative net-zero carbon emissions across the whole 
spectrum of energy using wind, solar, nuclear, hydrogen, and 
fossil fuels. We are working hard to be home to the next 
commercial CCUS facility. Today I speak about Wyoming's oil and 
gas industry and how it has been challenged by this 
Administration's misguided policies. Last August, for what I 
understand to be the first time in our state's history, no rigs 
were operating in Wyoming. Today there are seven, down from 34 
in February 2019. In October of that year, our Department of 
Workforce Services reported 13,100 oil and gas related jobs. By 
October 2020, that number had dropped to 7,200. This leasing 
review is a crafty way of establishing a moratorium on federal 
lease sales, making continued progress ever more tenuous, more 
difficult, and making it more likely that good-paying, family-
supporting jobs will migrate somewhere else. That is bad for 
this country, for the climate, and especially for Wyoming.
    Wyoming ranks first in natural gas production on public 
lands and second in oil. That production from federal acreage 
is vital to our economy, generating $457 million last fiscal 
year. Approximately $5.7 million of that is from lease sales. 
How much has Wyoming received from lease revenues this year? 
None. The climate goals of the Biden Administration can best be 
achieved through more consultation with governors and that can 
be done without decimating our economies. The heart of 
enlightened, responsible policy lies in fully understanding all 
of its consequences. This moratorium discriminates against the 
people of Wyoming, against all western states with federal 
leases within our borders. Eight western states will stand to 
lose $2.3 billion in investment, $872 million in production 
value, and $345 million in tax revenue in this first year of 
the moratorium. In people terms, that is less funding for 
schools, healthcare, public safety, and other essential 
services. This moratorium is absolutely unnecessary. A 
comprehensive, thoughtful and meaningful review can certainly 
be done without halting an entire leasing program.
    Federal lands are not over-leased. Moreover, leases are not 
stockpiled in Wyoming. Developing a resource responsibly means 
leasing must be thoughtful, strategic, and forward-thinking. It 
may take a company several years and multiple sales to gather 
enough leases to allow the organized development of an entire 
field that minimizes subsurface disturbance and avoids waste 
and stranding assets. Conversely, a pause on leasing can set 
back and disrupt orderly development for years, to no one's 
benefit.
    Wyoming is known for its energy production and magnificent 
environment. We have the largest stable population of sage-
grouse, and that has not been without effort. We have 
implemented effective mechanisms to offset development of wind, 
solar, coal, oil, and gas resources--not without effort or 
expense--and my state boasts the longest mule deer and 
pronghorn migrations on the planet. We have implemented a 
policy that focuses on siting subsurface disturbances outside 
valuable migration corridors. This moratorium does nothing to 
advance these multi-use policies or the valuable wildlife 
protections that we all--NGO's, communities, landowners, and 
the state--have worked so hard to implement in partnership with 
industry.
    I close in citing Wyoming's stellar record regarding 
flaring methane emissions and plugging wells. Thank you.
    [The prepared statement of Mr. Gordon follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. Thank you, Governor Gordon.
    Now we are going to hear from Governor Brian Vallo, the 
Governor of the Pueblo of Acoma in New Mexico.
    Governor Vallo.

                STATEMENT OF HON. BRIAN VALLO, 
                   GOVERNOR, PUEBLO OF ACOMA

    Mr. Vallo [Speaking in Native language.]
    Good morning, Mr. Chairman and honorable members of the 
Committee. I appreciate this opportunity to provide this oral 
testimony this morning. My name is Brian Vallo and I am the 
Governor of the Pueblo of Acoma in New Mexico. Acoma is 
considered the oldest continuously inhabited settlement in 
North America.
    [Photo of Pueblo of Acoma follows:]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Vallo. Thank you for conducting today's hearing as part 
of Congress' ongoing oversight of Interior's onshore oil and 
gas leasing program and the President's call to review these 
practices under Executive Order 14008. Acoma Pueblo, along with 
the All Pueblo Council of Governors, on which I serve, has 
consistently expressed grave concerns about oil and gas 
development threatening our cultural resources, particularly 
those surrounding Chaco Culture National Park in New Mexico. My 
testimony shares Acoma's perspective on why Interior's policies 
need to be reformed, along with a vision for positively 
conducting these activities going forward, using a proven 
method of effective collaboration called the Acoma Rapid 
Ethnographic Assessment (AREA).
    Our pueblo has been involved in reformation efforts since 
2014. Interior's oil and gas leasing practices have contributed 
to the desecration of sacred sites and cultural resources 
outside pueblo land holdings, including the areas surrounding 
Chaco Canyon, a UNESCO site recognized for its remarkable 
density of archeological treasures and traditional cultural 
properties, or TCPs, that are formative to our pueblo identity.
    [Photo of Chaco Culture National Historical Park follows:]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
    
    Mr. Vallo. Energy development in the Greater Chaco region 
has accelerated to alarming speeds, with approximately 91 
percent of available federal land having been leased by BLM to 
date. It would be impossible to list the many instances in 
which BLM has routinely failed to fulfill its legal obligations 
under Section 106 of the National Historic Preservation Act, 
NEPA, and federal consultation requirements in the time 
allotted. Each instance, however, has direct and potentially 
irreversible negative impacts on the preservation of our 
cultural heritage. We simply cannot ensure the protection of 
our cultural and sacred sites on federal and public lands under 
current conditions. Something must change.
    Our pueblo believes that the start of any meaningful 
reformation of existing Interior practices must be informed by 
tribal consultation. To that end, my written testimony lays out 
several concrete recommendations for this Committee's 
consideration. I will briefly discuss our recommendation to 
adopt the Acoma Rapid Ethnographic Assessment, or AREA, model 
tier. The AREA model is a process for ensuring early and 
consistent tribal participation in private and federal agency 
review processes for proposed projects with tribal 
implications. It rests on proactivity. The acting entity works 
collaboratively with relevant tribes at the outset of a 
project, instead of mid-project when National Historic 
Preservation Act review usually takes place, as has happened in 
the Greater Chaco region.
    The result is significant cost savings and time savings for 
all parties involved. Our pueblo has successfully used this 
model in relation to a proposed uranium mine on our sacred 
Mount Taylor and for a CO2 pipeline with Kinder 
Morgan across tribal lands. Kinder Morgan and the BLM 
approached us at the beginning of planning the pipeline's 
route. Our tribal experts worked side-by-side with company 
personnel to design and implement cultural resource surveys and 
a routing study. Kinder Morgan covered our actual costs on a 
reimbursement basis and signed confidentiality agreements 
regarding our cultural properties. Ultimately, the entire 
process took only six weeks from start to plotted route, saving 
the company significant time on legal compliance and money on 
what may have otherwise been unworkable routes. We were also 
respected as a tribal sovereign with guaranteed protection for 
our cultural resources. A full 60 percent of the properties 
identified during the project would not have been recognized by 
archeologists untrained in Acoma traditions. We believe the 
AREA model is a viable, low-cost, mutually beneficial path 
forward in reforming Interior oil and gas leasing practices.
    We would welcome the opportunity to discuss the model 
further with you, your staff, and the Interior. Thank you for 
this opportunity to provide this testimony. Dawa'ee. Thank you.
    [The prepared statement of Mr. Vallo follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. Thank you, Governor Vallo.
    And next, we are going to hear from Ms. Vicki Hollub, 
President and Chief Executive Officer of Occidental Petroleum.
    Ms. Hollub.

   STATEMENT OF VICKI HOLLUB, PRESIDENT AND CHIEF EXECUTIVE 
                 OFFICER, OCCIDENTAL PETROLEUM

    Ms. Hollub. Chairman Manchin, Ranking Member Barrasso, 
members and staff of the Committee, thank you for the 
opportunity to be here today. I have worked in the oil and 
natural gas industry for all of my career, starting in 1981 
with Cities Service Company. I have had the privilege of 
working in oil and gas producing states in the United States--I 
think most of them --and worked in many around the globe. Since 
becoming CEO of Occidental, my focus has been on successfully 
positioning our company to transition into the low-carbon 
economy that's to come. We were the first U.S. oil and gas 
company to establish comprehensive net-zero greenhouse gas 
goals. And we have a pathway now to get to net zero for scopes 
1 and 2 by 2040 and an ambition to achieve net zero for scope 3 
emissions by 2050.
    We all know that the demand for energy and energy products 
will continue to rise globally and we take seriously the charge 
to provide for the needs of those demands while approaching net 
zero. I would like to share some of the things that we are 
doing to accomplish this. Last year, we announced our plan to 
build the world's largest commercial-scale direct air capture 
facility. That facility, to be located in the Permian Basin, 
will remove up to one million tons of CO2 from the 
atmosphere each year. Scaling this type of technology gets us a 
step closer--a big step closer--to the net-zero barrel of oil 
and provides balance for those industries that have 
traditionally difficult emissions to decarbonize, like maritime 
and aviation. And we know that our approach to climate change 
must be extensive, impactful, and immediate. So we have 
initiated numerous partnerships with those that are in ethanol, 
cement, natural gas, and other industries to capture and 
permanently store CO2. Also, advanced battery 
storage will require scale-up of critical minerals production 
capacity. So we have entered into a joint venture with 
TerraLithium to develop technology that extracts lithium from 
brine.
    In 2019, we also began operating a first-of-its-kind solar 
farm--120 acres of it in Texas--that directly powers some of 
our oil and gas operations, delivering for those operations a 
lower-carbon-
intensity oil. And we are excited about a pilot plant that we 
are starting with Cemvita. Cemvita has harnessed the science of 
ripening bananas to turn CO2 into bioethylene. And 
we were an early investor in NET Power, which just announced 
plans to build two zero-emission natural gas power plants in 
the U.S. These near-term, large-scale steps demonstrate our 
continued commitment to decrease emissions while providing 
essential energy and products that transition our society to a 
low-carbon future.
    Now, with respect to onshore development in the U.S., it 
provides the opportunity to generate a lower-carbon-intensity 
product that can be meaningful as a part of the energy 
transition. To that end, Administration action should provide 
regulatory certainty in the short- and long-term. Production of 
oil and natural gas on federal lands is highly regulated and 
subject to strict environmental protections. And as Senator 
Barrasso said, some have suggested that we stockpile acres, and 
this simply is not true. The Mineral Leasing Act already 
requires operators to expeditiously develop federal leases and 
prevents a company from locking up excessive federal acreage. 
Federal leases grant the right and impose the obligation to 
evaluate the potential to produce commercial quantities of 
hydrocarbons. In fact, ``use it or lose it'' is already the 
law. Permitting of these operations takes a significant amount 
of time and investment. Federal onshore drilling permits take 
up to a year to get approval, which requires companies like us 
to plan 18 months ahead of drilling operations. Lack of clarity 
or permitting guidance can extend these times, often increasing 
the cost and the surface disturbance.
    Onshore development remains an important generator of jobs 
and revenues as well. The oil and gas sector has one of the 
highest average wages of any sector in the U.S., normally more 
than 50 percent higher than the national average. Median total 
compensation for domestic Occidental employees, not including 
overtime or benefits, is over $125,000 per year. And in 2019, 
the oil and gas industry contributed $740 million in funding 
for K-12 education in Wyoming and 40 percent of the money in 
New Mexico's General Fund comes from oil and gas revenues. Last 
year, Congress passed the Great American Outdoors Act, which 
directs revenue from oil and gas development on federal lands 
to fund the Land and Water Conservation Fund (LWCF) and to pay 
for maintenance needs in our national parks. The LWCF has 
supported local parks and recreation projects in almost every 
county of the nation. So this means wherever you are, there is 
support for and benefits for your county. Now, we need to 
continue this onshore development because it means higher 
paying jobs, community reinvestment, and the energies and 
products needed to get us through the transition.
    So with that, I want to conclude just to thank you all for 
what you have done on CCUS and for the fact that without 45Q, 
we would not be able to do the projects that we do today. We 
wouldn't be advancing the technologies that the world needs to 
address our energy future.
    Thank you.
    [The prepared statement of Ms. Hollub follows:]
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    The Chairman. Thank you, Ms. Hollub, thank you very much.
    Finally, we have Ms. Kathleen Sgamma.
    Kathleen.

                 STATEMENT OF KATHLEEN SGAMMA, 
               PRESIDENT, WESTERN ENERGY ALLIANCE

    Ms. Sgamma. Thank you Mr. Chairman, Ranking Member 
Barrasso, and members of the Committee, it is my pleasure to be 
here today. Western Energy Alliance represents about 200 
companies engaged in all aspects of environmentally responsible 
oil and natural gas development in the West. We are 
independents. We are proud to operate on federal lands in a 
responsible manner and we have an average of 14 employees. So 
lots of small businesses, lots of employees.
    In the West, oil and natural gas resources are inextricably 
bound to federal public lands and therefore, to the men and 
women in the industry who work there. As much as we would like 
to avoid federal lands because of their extensive red tape and 
time-consuming process, it is nearly impossible to develop oil 
and natural gas in the West without touching some federal lands 
or minerals, even when you try to site your development off 
those federal public lands. And the interlocking land ownership 
of the West, with tribal/Indian allottee, private, state, and 
federal all kind of mixed together, it means that just about 
every project in the West has to get a federal lease, a federal 
right-of-way and/or a federal permit. But with that attachment 
to the land, we take our public land stewardship very 
seriously. We are proud that oil and natural gas on federal 
lands is done in a balanced manner and that we continually 
reduce our footprint on the land. We reduce our methane 
emissions. We reduce that impact so that we do take care of the 
land. In fact, development on federal lands, which represents 
federal lands and waters, which together represent about 22 
percent of oil and 12 percent of natural gas production, only 
produces about 0.6 percent of greenhouse gas emissions, not the 
``nearly a quarter'' that we constantly hear from the 
Administration as justification for this leasing ban. So there 
is quite a bit of difference between 0.6 percent and nearly a 
quarter.
    But we are not content with even that low emissions 
profile, and through the relentless pursuit of better and more 
efficient technologies, the industry has significantly reduced 
methane emissions. In fact, we have reduced them 23 percent 
since 1990, even as we have increased natural gas production by 
71 percent. Fuel switching to natural gas is the number one 
reason the United States has reduced more greenhouse gas 
emissions than any other country since 2000. We have reduced 
more emissions than wind and solar combined since 2005. And we 
have helped achieve that balance on federal lands. If you take 
the 700 million acres of mineral estate that BLM manages, we 
lease less than four percent of that, and when you look at 
actual surface disturbance, it is about 0.07 percent. So we 
think that is a very great balance between protecting the land 
and achieving a substantial energy resource. In fact, leased 
acreage is at near historic lows. It hit the lowest level since 
1985 during the Trump Administration at 2.5 million acres. It 
is up slightly, but that actual footprint on the land is less 
than 500,000 acres. And we are also very proud that we are 
almost exclusively the source of funding for conservation and 
infrastructure on federal lands under the Great American 
Outdoors Act. Along with coal, we provide that funding--the 
Land and Water Conservation Fund is funded exclusively from 
offshore oil and natural gas development, and I don't really 
think that President Biden knew when he signed that Executive 
Order that he was putting at risk $2.8 billion annually in 
conservation funding.
    So we see the Administration talk about this leasing ban as 
a pause. But when we look at the comprehensive review that 
they're planning to do, we don't see that as a pause, we see 
that as possibly years-long. And in just the first year of the 
Biden Administration, 32,700 jobs will be lost according to a 
study out of the Wyoming Energy Authority. By the end of the 
Biden Administration, if that ban continues, we would see those 
job losses rise to 58,000 annually and about $33.5 billion in 
economic activity in eight western states, where 97 percent of 
the federal oil and natural gas production is done. So that is 
why we are concerned about the ban. That is why we have joined 
the State of Wyoming in the Wyoming District Court. I look 
forward to your questions.
    Thank you very much.
    [The prepared statement of Ms. Sgamma follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    The Chairman. Thank you, Ms. Sgamma.
    We will begin our questions now and I will start. Ms. 
Hollub, both you and Ms. Sgamma mentioned that the perception 
that oil and gas companies are stockpiling leases is incorrect. 
I know the percentage of leases that are actually producing has 
increased steadily over the last 20 years, in part because of 
technological innovations like horizontal drilling. Despite 
that, there are still over 13,000 leases representing nearly 14 
million acres that are not producing oil and gas. To the 
average American that might seem like the industry has what it 
needs to continue production without too much interruption. On 
average, how many undeveloped leases does Occidental hold in a 
given year and has that varied over time? And maybe you can 
help us better understand what is going on with these leases 
that are not producing.
    Ms. Hollub. Yes, I would say the most federal acreage that 
we have is in New Mexico and Wyoming. And in New Mexico now, 80 
percent of our production in the State of New Mexico is from 
federal leases. What we do on our leases, and what the industry 
in general needs to do to ensure that we capture the value and 
maximize the value for both ourselves and for the Federal 
Government, is that we go through a process of evaluation that 
begins with scoping out a general area to lease. We then put 
that lease----
    The Chairman. How long does it take you to get from 
securing a lease to where it goes into production?
    Ms. Hollub. From the time we get a lease to the time that 
we can get it on production in a prudent way that maximizes 
values can be anywhere from three to four years. And the reason 
for that is the subsurface work that's required. We typically 
will shoot 
3-D seismic, which gives us a picture of the subsurface. We 
then have to validate that 3-D seismic with a few wells, do the 
calibration process, and get the model set to begin to maximize 
drilling. And the reason that it's so critically important that 
the industry does this is that without a good development plan 
for the entire area, not just piecemeal--and I think somebody 
mentioned that the industry went too fast in some cases to 
develop acreage. That is not the way that we should do our 
developments.
    Doing our developments on federal acreage the way I'm 
talking about will not only recover more of the subsurface 
hydrocarbons, but will recover it in a more efficient way that 
maximizes value, but also diminishes our footprint and gives us 
the opportunity to design a development with a lower number of 
vessels because what we really need to do is to minimize the 
leak points and make sure that we minimize emissions.
    The Chairman. Thank you so much. I am so sorry. We have 
limited time, but we will get back to this. It is a great, 
great panel here.
    Under the current system, it makes no sense to me at all 
when a lease sale is held, and this is for Ms. Culver, if 
nobody purchases a lease, anyone can come in and buy it for the 
next two years without paying a bonus bid. With so many parcels 
going unsold over the last few years, there are now 
approximately 1,500 parcels containing more than four million 
acres currently available under the non-competitive lease 
provisions. Particularly with annual rent of $1.50 an acre, 
forgoing the bonus bids can be a loss to the taxpayer and hurt 
the states that would receive these monies.
    So I don't know how that's done. We don't do that with the 
coal properties. Why is it done with gas and oil? And why do we 
continue that?
    Ms. Culver. Thank you, Senator.
    As you noted, right now under the Mineral Leasing Act, if 
leases are not sold at a competitive sale, they are available 
for two years at non-competitive sales. This is essentially an 
over-the-counter transaction, $1.50 an acre, and they do not 
come with a bonus bid or other----
    The Chairman. Why is that still allowed?
    Ms. Culver. The Mineral Leasing Act directs the BLM to do 
this.
    The Chairman. I got you.
    Ms. Culver. As the General Accounting Office has noted, we 
receive three times the income from leases purchased 
competitively, and leases purchased competitively and with 
higher bonus bids are much more likely to actually be developed 
than leases----
    The Chairman. So you would not object if we made some 
changes to that?
    Ms. Culver. We would appreciate some guidance from Congress 
and also to address the concerns the GAO has cited on this----
    The Chairman. We would love to work with you.
    Anyone on the panel have comments on that, that leasing 
process?
    Governor. Just push that button. It will eventually come 
on.
    Mr. Gordon. Thank you, Mr. Chairman. Sorry, the button is a 
little bit reluctant to accept my gesture.
    One of the big issues, I think, that has demonstrated 
itself over the last couple of years, Mr. Chairman, is the fact 
that there's so much uncertainty at this point with federal 
leasing. There are lawsuits that make almost every leasing 
opportunity problematic. And so it makes it very difficult to 
plan, as Ms. Hollub said, for a rational and logical approach 
to development.
    Thank you.
    The Chairman. Thank you. My time is expired.
    Now I will go to Senator Barrasso.
    Senator Barrasso. Thanks so much, Mr. Chairman.
    Governor Gordon, you mentioned uncertainty. You know, it is 
a difficult time. It is difficult to overstate the importance 
of jobs in the oil and natural gas industry to families, to 
communities in Wyoming, New Mexico, and other western states, 
they cannot afford to lose all of these oil and gas jobs. Can 
you discuss the impact of oil and gas jobs on communities and 
families across the West?
    Mr. Gordon. Thank you, Mr. Chairman, Ranking Member 
Barrasso.
    Oil and gas jobs really make up the bulk of jobs in many of 
our communities in Wyoming, as you know, everything from oil 
field services, those small businesses that provide parts and 
equipment and pipe and so on, to ancillary services like water 
hauling and so on. They provide field men, mineral consultants, 
regional wildlife consultants, and other jobs--all high-paying 
jobs. For a young person coming out of high school in Wyoming, 
as I think was mentioned here, they can get a high-quality job 
and start a career, which is really important. Those jobs are 
essential to the basic services of any community, from schools, 
to cafes, to the retail stores and so on. And as I say, it 
provides valuable income. It provides a community that has some 
purpose over time.
    One of the challenges, I think, with renewables is that 
they are sort of ``one and done.'' They kind of come in, get 
built. There is maybe a little bit of a legacy crew that's 
there to sort of take care of some things, but oftentimes you 
end up sort of pulling the guts out of a small community. So 
oil and gas jobs, Ranking Member, are absolutely essential.
    Thank you.
    Senator Barrasso. Well then, you talked about the impact on 
families and in the communities. Let's talk about the 
importance of oil and gas revenue to states--to Wyoming, to New 
Mexico, to other western states. I know you have been talking 
to the New Mexico Governor. You are also a member of the 
Western Governors' Association. Do other governors share the 
concerns that you have talked about in terms of President 
Biden's actions that are going to limit the ability to provide 
essential services--things like public education? You talked 
about essential services to residents of their states, as you 
talked to additional governors.
    Mr. Gordon. Yes, thank you, Mr. Chairman and Ranking Member 
Barrasso, I have to say that it was somewhat heartening to 
reach out to fellow governors. I think we had 17 on a letter 
and it was a bipartisan letter basically saying that this 
leasing ban is detrimental to all of our states. And 
particularly, I have had the opportunity to work with Governor 
Michelle Lujan Grisham over the last several months to talk 
about the importance to both Wyoming and New Mexico for funding 
our education system, for making sure that these jobs don't 
migrate to states that don't have the same kinds of federal 
restrictions, and so on. And I think, you know, one of the 
things to remember in all of this is that New Mexico, Colorado, 
Wyoming, Utah, and North Dakota have all established very 
strong regulatory programs, and coupled with the federal 
leasing programs, these guarantee that resources are developed 
under the most stringent kinds of guidelines. When federal 
leasing is put at risk, those jobs migrate to places where 
there aren't those restrictions and where there's much more 
private land.
    So actually, I think, both onshore and offshore, Mr. 
Ranking Member, I have to say, there is a lot of governor 
support for not continuing this leasing ban.
    Senator Barrasso. So Ms. Culver, on March 19th, Laura 
Daniel-Davis, who is a political appointee, issued a policy 
memo which effectively extended the Secretarial Order. The 
order transferred authority over oil and gas permitting 
decisions from the career staff at the BLM, who normally make 
these decisions at the BLM state and field offices and took it 
out of their hands and said, nope, political appointees at the 
BLM in Washington are going to make this decision instead of 
the career staff that have made these historically.
    So as a result, we are now seeing delays in permitting 
decisions on existing leases. Why is it necessary for this 
Administration to act in this way for political appointees to 
make routine permitting decisions usually made by the career 
staff, including decisions on applications to extend permits to 
drill and when will this March 19th policy memo expire?
    Ms. Culver. Thank you, Senator.
    The March 19th memo followed the end of the term of 
Secretarial Order 3395, which did impose a temporary 
requirement for many decisions to be approved through the 
Department. The March 19th memo identifies categories of action 
for which advice will be given so that the Secretary has an 
opportunity to inquire further, if desired, through the 
Assistant Secretary's office. There are not currently approvals 
being required through the Assistant Secretary's office. That 
authority has been delegated back to the field after the 
initial review was occurring. Under this current memo, the BLM, 
from the field up, do provide regular updates as to their 
activities and intended activities and that is the way that the 
Assistant Secretary's office traditionally oversees the Bureau 
of Land Management operations and that's how this is set up. It 
is not a formal approval process. It is an opportunity for 
inquiry and an advice as to intended actions.
    Senator Barrasso. Mr. Chair, my time is expired.
    The Chairman. Senator Heinrich.
    Senator Heinrich. Thank you.
    Governor Gordon, you mentioned the negative impact that 
frivolous lawsuits have on certainty in the industry. Given 
that the Department of the Interior is currently involved in a 
public process around oil and gas leasing reform, why did 
Wyoming resort immediately to litigation and why should we view 
that as merited as opposed to frivolous?
    Mr. Gordon. Thank you, Mr. Chairman, Senator Heinrich.
    The question you raise really goes to the merits of why we 
are having this leasing moratorium. I think in my testimony I 
spoke about a number of the advancements we have made in 
protecting critical wildlife habitat, et cetera. Those all come 
with stipulations for development. So, for instance, the 
greater sage-grouse--for which Wyoming has the only stable 
population, in fact it's slightly growing--an endangered 
species, is very important. I know, and Ms. Culver also knows 
about this--there is a longstanding program that was 
established in Wyoming that has stipulations as to when and how 
development can occur. A large corporation or a small, 
independent driller has very much the same issues of 
mobilization and cost if there's no predictability----
    Senator Heinrich. But why go immediately to litigation 
rather than engage the Administration?
    Mr. Gordon. Thank you for that, Mr. Chairman, Senator 
Heinrich. The reason is that the moratorium was extended and we 
see no end in sight and as contrary to what has been said here, 
there is still very uneven application of permissions that are 
being granted from the BLM. So it seems getting clarity on this 
is absolutely critical.
    Senator Heinrich. Thank you, Governor.
    Governor Vallo, why does it matter to the Pueblo of Acoma 
whether oil and gas development occurs on public land?
    Mr. Vallo. Thank you, Mr. Chairman, Senator Heinrich. I 
appreciate that question.
    You know, one of the things to understand is that Native 
American people, while we may be confined to reservation land 
and have the opportunity to manage affairs on our own tribal 
lands, there is a landscape that is indigenous to our present-
day cultures and those landscapes are very important to the 
continuance of our culture and our traditions and our life 
ways. And so, we are always concerned when these types of 
developments are occurring on lands outside of our boundaries. 
And I'll use Chaco as an example--that Chaco Canyon and that 
Greater Chaco landscape, which is quite vast, is all very 
important to the life way of the Acoma people. We return based 
on solar and lunar cycles. I, myself, as a member of the Sun 
Clan, will return at different periodic times of the solar 
cycle to various places on that landscape. And we have other 
cultural leaders who are engaged on a much more frequent level 
to return to these areas for maintenance of our culture.
    Senator Heinrich. Governor Vallo.
    Mr. Vallo. Yes.
    Senator Heinrich. Have those cultural resources, in your 
view, been adequately taken into consideration by the Bureau of 
Land Management, historically, when leasing parcels around 
Chaco Canyon?
    Mr. Vallo. Mr. Chairman, Senator Heinrich, thank you for 
the question.
    I would say no, unfortunately. You know, we have been 
engaged in ongoing discourse and negotiations and some 
consultation regarding this very problem that our requests and 
our input in this is oftentimes overlooked and we are 
oftentimes, you know, settling for only temporary protections, 
temporary agreements for access to these areas. There has not 
been an effort to secure these resources over the long-term.
    Senator Heinrich. Governor, thank you for that testimony.
    Ms. Culver, before my time runs out, we have heard a lot 
about the Land and Water Conservation Fund from some of our 
witnesses today. How much of the revenue in the Land and Water 
Conservation Fund is generated by oil and gas leasing on 
Western public lands?
    Ms. Culver. The Land and Water Conservation Fund is 
primarily funded from offshore leasing, Senator.
    Senator Heinrich. Thank you.
    Senator Barrasso [presiding]. Before turning to Senator 
Lee, I would like to introduce a letter for the record. On 
March 15th of this year, New Mexico's Governor wrote President 
Biden expressing concern about the economic impact of his oil 
and gas leasing ban on that state. The governor explained that 
financial losses resulting from the leasing ban, ``could have 
real impacts on our ability to achieve major goals like 
universal access to early childhood education.''
    I ask unanimous consent to enter the Governor of New 
Mexico's letter to the record.
    And without objection, it will be done.
    [Letter from the Governor of New Mexico follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Barrasso. Senator Lee.
    Senator Lee. Thank you.
    Ms. Hollub, I would like to start with you. We have 
Administration officials and some special interest groups that 
have repeatedly said that the pause on oil and gas leasing will 
have no impact on businesses or local economies because, as 
they put it--as they describe it, the industry has ``stockpiled 
leases.'' Can you briefly speak to that assertion?
    Ms. Hollub. Yes, as I said earlier, about four percent of 
the federal leases available are oil and gas. So of the federal 
mineral estate, four percent is oil and gas. And of that four 
percent, 50 percent of the leases that we have today are 
producing oil and gas. The other 50 percent are in some stage 
of development. That stage of development takes a lot of work 
initially, as I was describing, to set up an optimum 
development program that ensures the prudent development and 
the maximization of the value. So there is a process that must 
be taken and now we have, as was mentioned earlier, we have 
almost the lowest of all-time leasing--oil and gas leases--on 
federal acreage.
    And so, given where we are today and the fact that we have 
much more advanced technologies--but these technologies take 
time and then the permitting takes time. So we're three to four 
years into the lease, into a federal lease before we can begin 
activities. And so it may seem to some people that nothing is 
going on, but a lot is going on, on these leases as we learn 
more about them and as we prepare our development programs.
    Senator Lee. Thank you.
    Governor Gordon, the President's Executive Order calls for 
this moratorium and review to address potential climate 
impacts, but do you believe this is going to lead to decreased 
oil or gas consumption in the United States?
    Mr. Gordon. Thank you, Mr. Chairman, Ranking Member, and 
Senator Lee.
    No, I do not believe it is going to decrease the amount of 
consumption of oil and gas. Market conditions are going to 
change, but it is clear to me that for the foreseeable future, 
oil and gas will be a very important part of our energy mix.
    Senator Lee. So in other words, you are saying we will 
consume whatever quantity of oil and gas that is--for which 
there is demand, and if there is less production from U.S.-
owned lands, it is just going to be made up for somewhere else?
    Mr. Gordon. Senator Lee, yes, I believe that to be the 
case. And let me also state that while we talk about 
electrification of our fleet, there's quite a bit of question 
about how practical that is, particularly in western states 
with large areas. And then we have hydrogen, which can be an 
alternative fuel that can help meet greenhouse emission goals--
that can be produced from natural gas. So I think there will be 
increasing demand at the same time that consumer demand and 
efficiencies may make a little bit of a decrease.
    Senator Lee. Thank you.
    Ms. Culver, as the U.S. District Court for the District of 
Columbia recently recognized, if a resource management plan 
authorizes oil and gas development on certain federal land 
parcels, the Bureau of Land Management must sell leases for 
those parcels on a quarterly basis, and this is not just based 
on something a judge contrived, this is what the law requires 
under 30 U.S.C. 226(b)(1)(A) and 43 CFR 3120.1-2. So this is 
what the law requires. Now this seems to be inconsistent with 
the President's moratorium or pause. Can you briefly explain to 
me under what applicable laws the BLM has halted the oil and 
gas leasing program?
    Ms. Culver. Thank you, Senator, for the question.
    Right now, we are operating under an Executive Order issued 
by President Biden that directs us to pause leasing on federal 
lands while we conduct a comprehensive review of the program. 
Under the Mineral Leasing Act, the Secretary of the Interior 
has discretion to determine whether or not to lease nominated 
lands and to determine which lands are eligible and available 
for leasing. That discretion has also been delegated to the 
Bureau of Land Management, and I believe that the courts have 
upheld this discretion, including the discretion not to lease 
nominated parcels all the way up to the Supreme Court. So that 
is the authority we are operating under right now.
    Senator Lee. Okay. It is important that we follow the law 
there, and the law, as I read it, requires these things to 
occur quarterly. I know I am almost out of time.
    Ms. Hollub, I want to ask you one more question. You 
mentioned that Occidental was the first U.S. oil and gas 
company to establish comprehensive net-zero greenhouse gas 
emissions goals. Can you expand on what efforts you have taken 
to reach that goal?
    Ms. Hollub. Yes, we have entered into agreements with an 
ethanol producer to take the CO2 emissions from 
their plants and get it to the Permian for sequestration. We 
also have an agreement with a cement plant in Southern 
Colorado. We have announced the plan to build the world's 
largest direct air capture facility in the Permian Basin. We 
have the FEED study underway. We will begin construction next 
year. We have also invested in NET Power, which is, I mentioned 
earlier, is a net-zero-emission, gas-fired, electrical 
generator. And so it's the first of its kind. We also are 
working not only just on carbon capture and sequestration, but 
we're working on other ways to use carbon. We have entered into 
a joint venture with Cemvita in Houston to actually produce 
bioethylene from using ripening bananas to convert the 
CO2. That will begin a process where we can start to 
use photosynthesis for converting CO2 on a large 
scale to bioethylene.
    In addition, we are trying to help the car industry with 
electric vehicles because we are trying to provide a cheaper 
source of lithium by investing in a technology that actually 
extracts lithium from brine water. So that's the other thing 
that we're doing. This is all above and beyond what we do in 
our own operations to ensure that we are reducing emissions 
there. And we have done a lot that would take me quite a 
while--and I know I'm out of time--to address that. But in our 
own operations, there are a lot of steps that we have taken to 
reduce methane, both from a flaring standpoint and from routine 
operations through the design of our facilities and 
implementing more aggressive analysis of potential leak points 
and starting to take those out of the system.
    Senator Barrasso. Thank you. And thank you, Senator Lee.
    Senator Cortez Masto.
    Senator Cortez Masto. Thank you. Thank you so much, Mr. 
Chairman, Ranking Member, for this conversation.
    Ms. Culver, let me start with you.
    Let's talk about areas where there is low or no potential 
for any type of development. How does the leasing of low- and 
no-potential lands negatively impact our land use, like 
recreation, renewable energy development, and other activities, 
and what solutions would you propose?
    Ms. Culver. Thank you, Senator, for the question.
    We have determined that low-potential lands are more likely 
to be included in and acquired through non-competitive lease, 
and therefore less likely to go into production or to generate 
revenues. The vast majority of our revenues from the program do 
come from producing leases, not from rents. So they are much 
less likely to contribute to the Treasury and to states. At the 
same time, lands that are leased are less likely to be able to 
be managed for other uses, so they can interfere in that way.
    Senator Cortez Masto. So Ms. Culver, I have a bill that is 
called the End Speculative Oil and Gas Leasing Act, and it 
prohibits leasing on lands with no or low potential for 
development, and reprioritizes the management of those lands. 
And one of the reasons is because it is also a waste of time 
for the BLM to take the time to determine that if it is low- or 
no-potential if they already know that and there is a lot of 
speculative leasing going on. Here is my concern, you know, we 
have the pristine Ruby Mountains in Nevada, and there was 
speculative leasing that was purchased right around the Ruby 
Mountains--54,000 acres of National Forest System land was 
actually proposed for oil and gas leasing. Now, we know that 
there was no oil, or there was low potential for oil there, but 
it was still put out for potential oil and gas leasing. And 
this was an individual who was not even from Nevada--had no 
involvement. It was probably a broker, which there are a lot of 
those brokers, but it is taking the time of BLM now to have to 
assess that, along with the concerns that we want to use and 
prioritize that land for other options.
    And so my concern is, why are we letting speculators engage 
in any type of leasing if we know there is no potential for it 
or there is low potential for it? And let me give you an 
example. You know, I understand that a recent investigation 
found that a woman from Myanmar purchased about a quarter of 
all the federal acreage sold at lease sales held during the 
pandemic, including over 31,000 acres in Wyoming. This woman 
had no prior experience in oil and gas development and has 
already tried selling some of these drilling leases off at 
inflated prices.
    So let me ask, Governor Gordon, shouldn't the Interior 
Department start taking better precautions to curb speculation?
    Mr. Gordon. Thank you for that, Senator, Chairman, Ranking 
Member Barrasso.
    Wyoming is a dual regulation state. And so, anybody who 
chooses to develop in Wyoming has to seek permits from both the 
Bureau of Land Management and from the Wyoming Oil and Gas 
Conservation Commission. We take an extensive look at the 
viability of the operations and make sure that those leases are 
well-documented and properly adhered to. One thing I would say 
is that oil and gas is not the only area where speculation can 
occur. Wind development and solar development--it happened 
there as well----
    Senator Cortez Masto. No, I understand that, but right 
now--and I don't mean to cut you off. I only have so much time, 
Governor, and I really appreciate you being here because I am 
trying to understand, but--and maybe this is a question for Ms. 
Hollub. Do you agree it is unfair for Wyoming taxpayers to have 
their lands leased for as little as $2.00 an acre just for 
someone with no interest or experience in oil and gas 
development to flip them for a profit, or is that something 
that is just normal course and we should let that happen, even 
though it is tying up land where we know there is low or no 
potential for oil and gas?
    Ms. Hollub. I would say that oil and gas has been developed 
in the past in areas where for years we didn't know that there 
was any potential. So it would be hard for me, without knowing 
of the particular situation, to make a judgment on what someone 
else is doing. I would say that it's, since you do have to pay 
a fee on an annual basis, there are not too many companies I 
know of that would hold acreage that was not speculative and 
that didn't have, in some way, have some potential for oil and 
gas and I'm speaking from an oil and gas perspective here, not 
from any other potential use of the acreage. We wouldn't hold 
it----
    Senator Cortez Masto. Thank you. Can I stop you there? I 
have one final question because, and I want to talk with Ms. 
Hollub because I am trying to understand. When you talked about 
stockpiles of leases, please explain to me why the 50 percent 
that you talked about that are in some stage of development is 
somehow running afoul of the Executive Order that the President 
issued because the Executive Order he issued was a pause on new 
leases. So that Executive Order would not impact the 50 percent 
that are in some stage of development, isn't that correct? Or 
am I missing something?
    Ms. Hollub. What you're saying is correct, but what I'm 
talking about is 50 percent of the oil and gas leases today 
produce, another 50 percent are under evaluation. If the 
leasing process does not continue then we will get behind on 
development of oil and gas in the United States. So it's an 
important thing.
    Senator Cortez Masto. No, I understand that, but there is 
no indication that 50 percent leasing is not continuing. You 
just said it is in some stage of development and it is 
continuing, correct?
    Ms. Hollub. The leasing has stopped as far as I'm aware of.
    Senator Cortez Masto. The new leases?
    Ms. Hollub. The new leases.
    Senator Cortez Masto. But what you, and I am just trying to 
understand this----
    Ms. Hollub. Maybe what----
    Senator Cortez Masto [continuing]. Because we don't have 
oil and gas in our state. My understanding is the pause is for 
new leases, but what you said--50 percent of leases in this 
country are in some stage of development. That would not stop 
that stage of development for those 50 percent, correct?
    Ms. Hollub. The 50 percent would need to get permits to 
continue the development. So as you're holding the acreage, 
you're evaluating it and then you have to put your plan 
together and then you have to get the permit to drill the 
wells.
    Senator Cortez Masto. Correct, I understand that.
    Ms. Hollub. So it's the permitting process.
    Senator Cortez Masto. I appreciate it. I know my time is 
up. I appreciate what you are saying. I just, I needed to 
understand that the Executive Order is not impacting those 
leases and from my understanding it isn't, because those are 
old leases not new leases. But if I am incorrect in that 
statement, please let me know. I will submit my questions for 
the record. Thank you.
    The Chairman [presiding]. Thank you, Senator.
    Senator Daines.
    Senator Daines. Well, they say it is impacting us. I mean, 
Senator Murkowski would say the same thing. These new leases, 
it is a long process here and it is creating great problems 
right now as we think about our long-term future.
    Chairman Manchin, thank you.
    Just last week, President Biden and Interior Secretary 
Haaland announced they extended their oil and gas leasing 
moratorium and canceled this quarter's mandatory lease sales in 
Montana and around the United States. This Administration has 
now put a stop to two mandatory lease sales and there appears 
to be no end in sight and this decision greatly affects 
Montana. In fact, according to a recent study, oil and gas 
supports over 33,000 permanent, high-paying jobs in Montana, 
average wage is $71,000. Let me tell you something, that is 1.5 
times greater than our average wage in Montana. It also 
provides millions of dollars of revenue for Montana 
communities, helping fund schools, public safety, and roads. I 
toured a very small community in Southeast Montana, graduating 
class size of six. They have a beautiful, brand new gymnasium 
that they love to host basketball tournaments in. I asked the 
superintendent of the schools, how in the world did you fund 
this new gymnasium in this public school? He said 94 percent of 
our tax revenues for this school come from pipelines--that is 
tied directly to our oil and gas.
    Now, this Administration has said that this pause, in fact, 
does not impact current leases in production, but let me be 
clear, they fail to tell you it will have a major impact on the 
revenue that states like Montana and others will receive 
because states like Montana receive half of all the royalties, 
rents, and bonuses generated from oil and gas on federal land. 
Bonuses come during lease sales, the same lease sales that 
President Biden has halted. And in Montana, it's a significant 
amount of money.
    Ms. Culver, what is this Administration's plan to make up 
for the lost revenue and jobs that the leasing ban is causing 
in states like Montana?
    Ms. Culver. Thank you, Senator.
    Right now, we do not see a major loss in revenue. As I 
mentioned in my testimony as well, the majority of income comes 
from royalties from producing leases. And right now, the 
industry has approximately 7,900 permits available, ready to 
use for drilling. The BLM has approximately 5,599--so I guess 
that's not approximate--additional permits that have been 
submitted for consideration. We know of over 7,400 wells that 
have been drilled and are ready to be completed and have not 
yet. So when we look at those numbers, we look at the math. We 
see the----
    Senator Daines. Do you realize the chilling effect? Do you 
realize the chilling effect you are having in terms of these 
companies are thinking about long-term? These are 
entrepreneurs. When you cancel it, that is sending a chilling 
message to the industry that basically this is just step one 
here of eventually stopping oil and gas leasing on public 
lands.
    Ms. Culver. Right now, we are directed to pause leasing 
while we conduct a comprehensive review, which we are doing to 
ensure that any changes that need to be made to these policies 
can be made so that future decisions will withstand judicial 
review.
    Senator Daines. And do they have an appreciation for how 
much time it takes, in terms of the upfront investment in 
exploration and so forth and what you--they sent a very clear 
shot over the bow that oil and gas leasing is not welcome. And 
I am just--it is having a huge effect. The promise of future 
possible jobs, new revenue is little consolation. I can tell 
you the union workers that already lost their job or the 
schools are now having to make cuts because they are seeing 
declines in these revenues.
    There has been a push by some lawmakers and environmental 
groups to increase royalty rates on federal oil and gas 
development. According to a recent GAO report, increasing 
royalty rates would lead to an increase in federal revenue and 
a decrease in production. While this may be a win for President 
Biden, this is a loss for rural communities in places across my 
State of Montana. You have caused production to move away from 
rural, low-producing areas and concentrate in just a few 
places, again, leaving eastern Montana out to dry and killing 
important jobs created by oil and gas in these very rural 
communities who need the help the most.
    Ms. Sgamma, can you explain how increased royalty rates is 
a bad decision for rural, smaller Western communities?
    Ms. Sgamma. Well, Senator, I think you said it well there. 
I think when some of these reports look at just increasing the 
royalty rates, they forget that when you tax something, you get 
less of it. And so the Federal Government has chosen to extract 
more in process and regulatory costs than it can command in 
royalty rates. Now, if we had a stable environment on federal 
lands, like we do in the State of Texas or in North Dakota, off 
of federal lands, then, you know, sure, maybe the Federal 
Government could command a higher royalty rate. But with all of 
the extra cost on federal lands, raising the royalty rate would 
just continue to transfer jobs and production away from small 
communities, rural communities in the West to other areas of 
the country.
    Senator Daines. Thank you, Ms. Sgamma.
    The Chairman. Thank you, Senator.
    Now we have Senator Hickenlooper.
    Senator Hickenlooper. Thank you, Mr. Chair. I appreciate 
all the time and effort of each of our panelists.
    I want to start with Ms. Culver. A recent EPA report had 
some startling data that there are roughly 2.8 million 
abandoned oil and gas wells that have emitted about 280 
kilotons of methane. We know that over a 20-year period, 
methane is very harmful to the environment, and we have over 
90,000--almost 100,000 wells operating right now on public 
lands, but we don't right now have a system for tracking how 
many of those wells have been orphaned or would be orphaned. 
And I think there is significant threat to the environment, to 
wildlife, to people.
    So how can the BLM better track and make sure that these 
wells are not abandoned without being properly abandoned, if 
you know what I mean? If you could explain that, if you want to 
go there.
    Ms. Culver. Thank you, Senator.
    The BLM does currently do some tracking of wells and we 
coordinate with other agencies to identify and assist with 
cleaning up orphaned, abandoned, and idled wells across the 
federal estate. The President has asked for $450 million for 
addressing orphaned wells and abandoned mine lands in his 
Fiscal Year 2022 budget proposal and the BLM would certainly be 
part of that and we feel that we have the ability to continue 
tracking these wells. One of the challenges is different 
definitions within the BLM, across the federal estate on what 
counts as an orphaned well or an idled well or an abandoned 
well and these all do overlap, and that is an area where we 
would like to do additional analysis and definition and would 
really appreciate working with Congress on that as well.
    Senator Hickenlooper. Great, thank you so much.
    And I guess I could ask everyone on the panel. Let's start 
with Ms. Hollub. There are a number of different proposals to 
try and put some sort of a price on carbon and allow companies 
like your own that are really making a serious effort to reduce 
carbon emissions and to do so dramatically. Do you favor any of 
these? You don't have to get specific, but do you favor finding 
some sort of a price on carbon, whether it is a fee and a 
dividend system or, you know, some variation of that? I can 
just very briefly let each of you go down the line.
    Ms. Hollub. Just quickly, I would say that I favor what is 
being done today, the help with 45Q, and what would help even 
more with 45Q is what has been put forth by some of the 
Senators on this Committee and that is to expand 45Q to provide 
direct pay and more value for direct air capture because I do 
believe it is this kind of program, 45Q, that will develop 
technology. A price on carbon would come too late for us and a 
price on carbon will be built by the market in time, but today, 
to have the incentives in place, that enables us to advance 
this technology and to advance it faster than waiting on a 
price of carbon or some carbon tax. So we like what's happening 
today with 45Q and I think that it will help us to 
commercialize the technology for others to adopt.
    Senator Hickenlooper. Anyone else want to chime in?
    Mr. Gordon. Thank you, Mr. Chairman, Ranking Member. 
Senator Hickenlooper, nice to fly back with you yesterday.
    Wyoming, what I would say is very much along the lines of 
what Ms. Hollub just mentioned. The concern that I think our 
state 
has is that the price of carbon be durable and that it be a 
market truly established between a consumer and a producer. And 
by that I mean that we have a marketplace that functions and is 
incentivized, that allows people to properly price for 
agricultural work that's done to sequester carbon, for things 
like carbon capture and sequestration, and is not sort of 
rooted in administrative policies that can come and go or 
buying absolution. It really should be in direct carbon capture 
and there should be a price associated with it.
    Senator Hickenlooper. Great. I am, unfortunately, out of 
time, I can see. So I will yield my time back to the Chair. 
Thank you.
    The Chairman. Thank you, Senator.
    And now we have Senator Lankford.
    Senator Lankford. Mr. Chairman, thank you very much. Thanks 
to all of you for your testimony today.
    Ms. Culver, I want to get a chance to sink in a little bit 
more on this letter that went out from the Department of the 
Interior on March the 19th, you referenced it before, to be 
able to talk through.
    [The letter from the Department of the Interior follows:]
    [GRAPHIC] [TIFF OMITTED] T4471.118
    
    [GRAPHIC] [TIFF OMITTED] T4471.119
    
    Senator Lankford. Help me understand, just to clarify on 
this, no decision can be made on the field office without 
reaching out to the Assistant Secretary. They have to be able 
to review it first to be able to come back. Is that correct?
    Ms. Culver. The way the process works is, it is part of the 
regular reporting of what is expected in the field offices.
    Senator Lankford. But the field office may not make a 
decision without DC actually signing off on it. Is that correct 
or not correct?
    Ms. Culver. There's not a formal sign-off process.
    Senator Lankford. So this says the final decision, for 
matters that have been submitted in accordance with S.O. 3395, 
but for which you have not received a final Assistant Secretary 
of Land and Minerals decision, you may not proceed without 
approval, without the Assistant Secretary of Land and 
Minerals--that is in the little reminder section at the end of 
it. And then it walks through at the very beginning of it in 
saying, ``for review prior to taking final action on the 
matters or publicly announcing decisions.'' So before they can 
publicly announce a decision or before they can take final 
action on anything, it has to come to the Assistant Secretary 
and they need to wait. Is that correct?
    Ms. Culver. So the language at the end that you started 
with is related to decisions that were already in the queue at 
the time that that order ended. So when Secretarial Order 3395 
ended----
    Senator Lankford. Right.
    Ms. Culver [continuing]. There were some decisions that 
were already in the queue and we felt that there was clarity 
needed on what to do with those.
    Senator Lankford. Right. So they cannot make a decision on 
those. That has to wait. The earlier decisions that this letter 
supersedes also states to them that they cannot make that 
decision in the field office, it has to come from the Assistant 
Secretary's office. This is just a yes or no on it.
    Ms. Culver. It's a regular course of business review, 
Senator----
    Senator Lankford. Okay.
    Ms. Culver [continuing]. So that the Secretary's office has 
an opportunity to inquire if the Assistant Secretary would like 
more information on this topic.
    Senator Lankford. So in the past the field office could 
make decisions or could not make decisions?
    Ms. Culver. In the past, in similar ways, the BLM has 
always provided a look-ahead to headquarters and to the 
Assistant Secretary's office on upcoming activities so that 
there was an opportunity for review and to ask----
    Senator Lankford. So the field office could make decisions 
or could not make decisions without a sign-off in the past?
    Ms. Culver. There was not a formal sign-off in the past. 
There is not a formal sign-off now. There is----
    Senator Lankford. There is not a sign-off, but it's a 
``don't make a decision until we tell you.''
    Ms. Culver. The part at the end that you read only applied 
to questions that were already in the queue when the 
Secretarial Order expired.
    Senator Lankford. I get that, but it also applies at the 
very beginning of this letter. I am not trying to be 
contentious. We are just trying to provide clarity. This is the 
question that everybody has, is what does this letter mean? 
This letter appears to mean that no decisions can be made in 
the field office until DC signs off, DC has not decided when 
they are going to sign off yet, we will get back to you when we 
start making decisions on it, we are doing a comprehensive 
review, as you have mentioned. Is that correct or not?
    Ms. Culver. That is not correct, Senator.
    Senator Lankford. Okay.
    Ms. Culver. This is the way the BLM has operated before 
under previous administrations and under this Administration. 
There are regular updates provided so that if the Assistant 
Secretary or headquarters has further inquiries they can make 
them. It is not a formal sign-off and that----
    Senator Lankford. Did the field office make a decision on a 
right-of-way decision in the past?
    Ms. Culver. Yes, and it would go up through an advisory 
process before it was finalized, so if there was a question, 
the regular reporting would provide that opportunity before it 
was finalized. It's not a formal sign-off.
    Senator Lankford. So can a field office make a decision on 
a right-of-way now?
    Ms. Culver. It's the same as it was before. If a right-of-
way would be included in an update, if it met the category in 
that memo----
    Senator Lankford. Right, so----
    Ms. Culver [continuing]. Then it would go through that 
advisory.
    Senator Lankford. So help me understand. What's different 
about--why is this memo needed then if this is exactly the same 
as it has been in the past?
    Ms. Culver. That memo was necessary because of the end of 
Secretarial Order 3395, to indicate that there was no longer a 
formal approval process and to highlight the specific 
categories of actions that this Assistant Secretary's office 
would like to ensure were included in the update.
    Senator Lankford. So every company should assume things now 
are functioning on leases, on right-of-way, on all the long 
list of approvals for permits here, exactly the same as it was 
in 2019? It is the same, no different than it was in 2019?
    Ms. Culver. Each administration has a different type of 
information they want and different types of activities that 
they are looking at, but the process is the same, yes, for 
review.
    Senator Lankford. But you are saying there wasn't a sign-
off in 2019, there isn't a sign-off now. It is functioning the 
same now as it was before?
    Ms. Culver. The function of regular reporting with an 
opportunity to ask for more information is the same process 
that we were using before.
    Senator Lankford. Ms. Hollub, do you have any questions on 
the functioning of how things will operate on federal lands at 
this point that's different than 2019?
    Ms. Hollub. I'm sorry, was that a question to me?
    Senator Lankford. Yes, ma'am.
    Ms. Hollub. Well, I would say that a few days after the 
letter, 300 extension requests were sent in by our industry 
that I'm aware of and not any of those have been approved yet. 
Twenty-six of those were ours. These are sundry addition or 
lease extension requests that would have been pretty typical 
and routine in the past that have not yet been approved.
    Senator Lankford. So things seem to be significantly 
different than what they were before.
    Ms. Hollub. This appears to be different to us.
    Senator Lankford. Mr. Chairman, thank you.
    The Chairman. Thank you, Senator.
    Now we have Senator King.
    Senator King. Thank you, Mr. Chairman.
    Ms. Hollub, as you know, and I want to get on to some other 
larger questions, but a specific question, as you know, methane 
is a particularly potent greenhouse gas. As you know, one of 
the great sources of methane is fugitive emissions from 
drilling. The Obama Administration put restrictions on that 
release. The Trump Administration issued a rule to essentially 
lift those restrictions. We have a motion on the Floor of the 
Senate, I think this week, to rescind the rescinding. You are 
nodding. What is your company's position on that action?
    Ms. Hollub. We support the direct regulation of methane 
just for the reasons you said, that it is very potent and we 
need to have regulation in place to ensure that we have 
adequate controls throughout the industry. We support that.
    Senator King. So you would urge us to vote yes on this 
resolution to restore the direct regulation?
    Ms. Hollub. We support doing that, yes.
    Senator King. Thank you.
    Ms. Culver, another sort of quick question. Listening to 
these various exchanges, as I gather, there is no direct effect 
on revenues from leases because of the moratorium because that 
is future-
looking. Right now, there are leases that have not even begun 
to be developed in the queue, if you will--in the industry 
queue. So when will the states and the industry see a decline? 
In other words, what is the lag time here?
    Ms. Culver. Thank you, Senator.
    As you mentioned, we do have 13.9 million acres currently 
under lease that are not yet in development and are in the 
process that could be developed. In addition, we do have 
thousands of permits issued and also pending.
    Senator King. So how long will it take before there is a 
real monetary impact of this moratorium, assuming for a moment 
that it continues indefinitely?
    Ms. Culver. Right, so the monetary loss right now is new 
bonus bids and additional rents from leases. However, the vast 
majority, as I mentioned, of income comes from producing leases 
from royalties. We do not anticipate a significant effect on 
income to states and the Treasury in the near future during 
this current pause.
    Senator King. Can you define near future? Several years?
    Ms. Culver. There have been reports issued that identify 
periods of several years. We have not yet undertaken that 
specific estimate.
    Senator King. Thank you.
    Governor Gordon, welcome. I served as Governor of Maine 
alongside Jim Geringer of Wyoming. I hope you will give him my 
very best regards when you are back in the state. The jobs loss 
issue is really tough and I understand that. I have lived 
through, in my state, some wrenching industrial changes, lots 
of jobs lost. However, that happens because of changes in the 
economy. Shouldn't we be talking more about how to reskill and 
reemploy those jobs rather than trying to change the direction 
of where the economy is headed? An example is coal. Coal has 
largely gone into a serious decline because of natural gas and 
the replacement of coal plants with natural gas plants. Talk to 
me about--and I really understand what you are talking about--
those are good, high-wage jobs, but the economy changes. We had 
good, high-wage jobs in Maine doing a lot of other things 50 
years ago, we don't have them anymore.
    Mr. Gordon. Thank you, Mr. Chairman, Ranking Member 
Barrasso, and Senator King. My mother grew up in Kennebunk when 
it was a shoe factory place.
    Senator King. There were 30,000 jobs in shoes in 1970 in 
Maine, now there may be a thousand.
    Mr. Gordon. Absolutely correct.
    In Wyoming we, in fact, have stepped up, recently announced 
a new initiative which will tie the university to our community 
colleges so that many of our workers can up-skill and get more 
certifications and more opportunities. All of these industries 
are evolving and we want to make sure that our workforce has 
the ability to meet that. When we're talking about, you know, 
``transitioning'' from coal to renewables, we--and this is 
something Governor Lujan Grisham and I----
    Senator King. The major transition was from coal to natural 
gas. Your state benefited from that and this guy's state didn't 
benefit.
    Mr. Gordon. Well, thank you, Senator. What I would say is 
no matter what you do in energy, somehow, you're going to do it 
in Wyoming. And so, for us, we want to make sure we have a 
nimble workforce that can meet those needs, but what I will say 
that is important is that the pay for those jobs changes. There 
is not a one-for-one opportunity for jobs. This is something 
that Michelle Lujan Grisham, Governor of New Mexico, and I have 
talked extensively about. How do we build that economy over 
time? And I think there are chances to do that. Doing something 
as extraordinarily Draconian as we are with the policies of 
this Administration doesn't give us time to evolve.
    Senator King. I think the time is an important point and 
orientation toward transition is important as well.
    Thank you very much, Governor, I appreciate your making the 
trip. Thank all of you for joining us today.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    Senator Hoeven.
    Senator Hoeven. Thank you, Mr. Chairman.
    Deputy Director Culver, my question is for you. With the 
moratorium on leasing on federal lands, please tell me what the 
status of that is?
    Ms. Culver. Right now, we have a pause on leasing while we 
conduct a comprehensive review of the oil and gas program, 
looking at the fiscal aspects as well as the climate impacts.
    Senator Hoeven. How long do you anticipate that taking?
    Ms. Culver. Right now, we are conducting the review.
    Senator Hoeven. How long do you anticipate that taking?
    Ms. Culver. Right now, we are conducting the review. I 
don't have a specific time to give you.
    Senator Hoeven. So last year, just in the State of North 
Dakota for 2020, Interior disbursed over $66 million in 
revenue. So what is the revenue impact on this moratorium going 
to be on the states and the Federal Government as well for 
revenues it receives from energy development on federal lands?
    Ms. Culver. Since the majority of revenue that we receive--
and it goes to the states--comes from producing leases on 
royalties, we anticipate that looking at the amount of lands 
under lease, the amount of permits, the thousands of permits 
that have been issued and the thousands of permits that are 
under consideration, as well as the leased lands available, we 
do not anticipate a significant impact on income in the near 
future.
    Senator Hoeven. Well, but you just said thousands of leases 
under consideration.
    Ms. Culver. Those are the permits.
    Senator Hoeven. So if those are not able to proceed, 
wouldn't that create a significant revenue impact both for the 
states and for the Federal Government? And the states share 
that revenue with the counties as well.
    Ms. Culver. Indeed, they do. And what I said was there are 
approximately 7,900 permits that are issued and available for 
use right now to drill and produce and another 5,600 permits 
that we are considering to issue.
    Senator Hoeven. Do you expect imports of oil to go up or 
down if we stop developing oil and gas on federal lands?
    Ms. Culver. That is not an assessment I have made, but I 
would be happy to look into it for you.
    Senator Hoeven. I'm sorry, could you say that again----
    Ms. Culver. I said that is not an assessment that I have 
made right now. We will be continuing to evaluate the impacts 
of the program as the comprehensive review continues.
    Senator Hoeven. So if we are not able to develop oil and 
gas resources in this country, will that shift production to 
countries like Russia and to Saudi Arabia and Venezuela that 
have lower environmental standards than we do?
    Ms. Culver. Right now, we don't see a slowdown on 
development in our country based on the 13.9 million acres of 
leases that have not yet been developed as well as the 12.7 
million acres that are currently being developed.
    Senator Hoeven. So you don't think having a moratorium on 
leasing on federal lands will slow down development--that is 
your position?
    Ms. Culver. What I can tell you is the math and the facts--
that we have thousands of permits available for drilling and 
millions of acres of land that can be developed right now.
    Senator Hoeven. Do you realize that if you were a mineral 
owner in North Dakota and you owned the surface acres, but that 
if you share some of that mineral ownership with federal--with 
Interior, and Interior has no surface acreage, that your 
moratorium would prevent that private landowner from developing 
his mineral interests?
    Ms. Culver. I know that our pause does not affect non-
federal acres or minerals. So private acres, tribal acres are 
not affected.
    Senator Hoeven. Not tribal acres, but I am talking about 
privately-owned mineral interests, even where you have no 
surface acreage, but you have an interest as well, a partial 
interest in those minerals. You are preventing someone from 
developing their minerals. Do you realize that?
    Ms. Culver. Thank you, Senator.
    My understanding is our pause only affects the federal 
minerals.
    Senator Hoeven. Okay, well then, we should talk some more 
about that because remember--mineral interest--you share 
mineral interest in some of these tracts based on spacing unit 
with other owners. You are aware of that?
    Ms. Culver. Yes, I am. And I would be happy to talk about 
it with you further.
    Senator Hoeven. Okay.
    Governor Gordon, what would you say is the impact of this 
moratorium in terms of lost revenues and so forth?
    Mr. Gordon. Thank you, Mr. Chairman, Ranking Member, and 
Senator Hoeven. It is dramatic. In my testimony I mentioned a 
couple of those numbers--$5.7 million of that from lease sales 
alone, lease bonuses et cetera, and that's significant in our 
state. I want to compliment North Dakota and Doug Burgum, your 
Governor, for their leadership on carbon capture and 
sequestration.
    But returning to the topic, one of the biggest issues that 
I see--and I see this because I serve on our Oil and Gas 
Conservation Commission--is, as a field develops, issues like 
flaring become more important. We need to make sure that 
infrastructure can be built out to new development. If that new 
development is uncertain, the build-out probably doesn't 
happen. It doesn't allow us to capture the flares and that is 
something that Wyoming has been particularly--and I know North 
Dakota, as well--has been particularly aggressive in making 
sure that we don't see excessive flaring.
    Senator Hoeven. Right, and that would be my final question, 
which is, Governor, both in our state and your state, it is not 
just about producing more energy, aren't we also putting the 
latest technologies out there to also garner better 
environmental stewardship, and that includes development on the 
federal lands, does it not?
    Mr. Gordon. Absolutely, Mr. Senator. The technology has 
improved dramatically over the last decade or two. We can now 
drill horizontally--much better technology. It is much more 
expensive and the capital at risk is much more of an issue. So 
having some dependability about how you're going to be able to 
develop those leases is absolutely essential. What that does to 
the uncertainty that is put into our program because we don't 
know when these leases will be able to be purchased again 
really causes a lot of concern for our development.
    Senator Hoeven. Right. And that includes things like carbon 
capture, which both of our states, as you said, correctly so, 
are working very hard to do and really lead the way forward on 
it.
    So thank you for your leadership, Mr. Governor, and thank 
you, Mr. Chairman.
    The Chairman. Thank you, Senator.
    Senator Kelly.
    Senator Kelly. Thank you, Mr. Chairman.
    Ms. Culver, I understand that half of onshore oil and gas 
revenue collected by DOI is distributed to states, while the 
other half is intended to enhance federal conservation programs 
in western state water projects. Arizona is not an oil-
producing state, but the natural gas extracted in Senator 
Heinrich's state and Senator Barrasso's state helps pay for the 
water projects along the Colorado River in the State of 
Arizona. If your review extends beyond the summer, does 
Congress need to prepare for budgetary impacts to the 
Reclamation Fund?
    Ms. Culver. Thank you, Senator.
    In the immediate term, including through the summer, we do 
not expect significant impacts to the amount of money in the 
Reclamation Fund based on the amount of permits that have 
already been issued, the amount of drilling permits that are 
under consideration, and the amount of land that is under lease 
on which permits can continue to be issued and generate 
revenue.
    Senator Kelly. And when do you think those budgetary 
impacts would occur if the review wasn't completed, let's say, 
by the fall?
    Ms. Culver. We do not expect to see significant budgetary 
impacts in the short-term.
    Senator Kelly. Well, thank you.
    And Ms. Culver, in a few decades, fossil fuels will not be 
the backbone of our energy economy. Do we--does Washington--do 
we need to start rethinking policies that use fossil fuel 
revenue to fund the federal water and conservation projects?
    Ms. Culver. Well, certainly, for projects like these, those 
in the Land and Water Conservation Fund and those in the 
Reclamation Fund and the maintenance backlog, we would 
certainly welcome working with Congress to ensure those are 
funded, regardless, going forward.
    Senator Kelly. Great. I think we need to do that.
    Ms. Hollub, so I think we agree that methane leakage in oil 
and gas production, transportation, and storage is a problem. 
You know, methane is around 30 times more potent than 
CO2 as a greenhouse gas. NASA satellites can 
visually detect plumes of methane from human sources, and the 
largest hot spot right now that they found in the United States 
was an accumulation of industrial emissions over the Four 
Corners region. What are your thoughts on the support from 
companies like BP, Exxon, and Shell for restoring EPA's 
regulation of methane?
    Ms. Hollub. I can't speak for the other companies, but I do 
believe that our industry organizations are supporting, in some 
cases, the regulation of methane directly. I know that API has 
made a commitment to help member companies initiate best 
practices throughout their operations. And so we have a 
voluntary program, but we have a lot of companies involved in 
ensuring that we are doing the best we can to manage our 
methane, but we, Oxy, I can say that we support the direct 
regulation. We support the vote tomorrow to go in support of 
the CRA to go back to more stringent regulations around 
methane.
    Senator Kelly. Do you feel that the majority of companies 
in your industry are now supportive of that?
    Ms. Hollub. I haven't taken a poll, so I really can't say, 
but I do know that we do have a growing industry support--a 
growing support within the industry for methane regulation. And 
I think that some of the companies, or at least, I'm sure, that 
a few other companies have already come out in support of the 
vote tomorrow to approve that. So I think the support is 
growing, but certainly our industry has, over the last couple 
of decades, made significant strides to improve the technology 
and to improve the way we design our equipment to start to 
minimize what's happening with methane.
    Senator Kelly. Well, thank you for doing that and thank you 
for your answer.
    And I yield back the remainder of my time.
    The Chairman. Senator Murkowski. Thank you, Senator.
    Senator Murkowski. Thank you, Mr. Chairman, I appreciate 
the hearing this morning.
    Ms. Culver, to you--National Petroleum Reserve. What is it 
in that title, that was created back in 1923 under the Harding 
Administration, that would suggest that this would not be an 
area that we would look to as a nation for petroleum resources?
    Ms. Culver. Thank you, Senator.
    Under the National Petroleum Reserve Production Act, we are 
managing that area under an integrated activity plan and are 
directed to consider both development of oil and gas and 
protection and conservation of other resources in that area.
    Senator Murkowski. It is the largest single tract of 
federal land in the entire country. Its primary purpose is to 
satisfy the energy needs of the United States. So it has been 
pretty consistent with that. I would like to understand if you 
are suggesting to me then that, with the reviews that are part 
of this pause, there is some consideration within this new 
Administration that within the NPR-A, this primary purpose, 
which is to satisfy the United States' energy needs, whether 
you believe that this is now something different.
    Ms. Culver. We have not made any such decisions and we are 
conducting a review of the entire program. There is ongoing 
permitting for projects in the National Petroleum Reserve-
Alaska.
    Senator Murkowski. I understand that.
    So others have suggested that the pause has a chilling 
effect, to use Senator Daines' terms. I certainly believe that. 
I would ask you--I have 18 letters, Mr. Chairman, that I am 
going to submit for the record--18 statements of support for a 
particular project within the NPR-A, you are probably well 
aware--the Willow Project.
    [Letters of support for the Willow Project follow:]
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    Senator Murkowski. This is a project that has been under 
review for multiple administrations, beginning within the Obama 
Administration. It has gone through a process that most would 
consider to be extraordinarily extensive. It has the support, 
not only from the Native people, the Inupiat people of the 
North Slope, but from our unions, from Alaska shipping and 
maritime industries, the list is pretty extensive. And when you 
look through some of these letters, and it is because of not 
only the resource that it promises, but some 2,000 construction 
jobs--about 75 percent of them would be well-paying union jobs, 
$2.3 billion in revenue for the state, $7.6 billion in federal 
royalties. Not insignificant.
    `Today In Energy' notes that oil production in Alaska 
reached its lowest level in more than 40 years. What we are 
producing now, I had an opportunity to speak on the Floor last 
week, but Russia is providing more oil to this country than 
Alaska is currently. I have suggested that that is not a 
trajectory that I want to go down. One of the things that is 
really quite concerning to me though, as I read these letters, 
is the fact that the Native people, who live and work and raise 
their families in this region, feel that they have not had an 
opportunity to be heard on this, that this decision for this 
review and this pause was made without consultation.
    So a direct question to you is, prior to this pause and the 
halt, effectively, of the Willow Project and the other ongoing 
projects within the area, did the Department consult with 
Alaska Native representatives in these areas that are closest 
in proximity to the land and the projects where these decisions 
are going to be impacted?
    Ms. Culver. Thank you, Senator. I appreciate the question 
and understand the importance of this industry to Alaska and 
your concerns for this. President Biden issued the Executive 
Order. Since the issuance of the Executive Order, we have been 
consulting with tribes, including this week, in depth.
    Senator Murkowski. So you are saying that you are 
conducting consultation with the tribes now, but you are doing 
this after you have halted or paused the review. Is that 
correct?
    Ms. Culver. The Executive Order was issued in January and 
we're engaging in consultation now. We have not halted 
permitting, but we have halted--we do have a pause on leasing.
    Senator Murkowski. Well, you have a pause on leasing. The 
Willow pause has been in place now for 100 days. I had an 
opportunity to speak directly with Secretary Haaland about what 
a pause means on any kind of activity when you are operating in 
the North Slope. For my colleagues, whether you are in Montana 
or Wyoming or Oklahoma, your reality is you can put it on a 
pause and you are going to be okay. In Alaska, our season is 
limited to several months. You know that. You understand that. 
This is a concern and a consideration that, again, is 
extraordinarily concerning.
    I have one quick add here and it relates to public land 
orders, the PLOs. I do not know whether you have personally 
received a briefing from the Alaska BLM Office regarding these 
PLOs. The BLM took unilaterally and, in my view, legally 
questionable action to pause and reopen the administrative 
record on these completed PLOs. I do not know what the 
authority is. I have asked for it. I have not gotten anything. 
Secretary Haaland has said we do not intend to hold up the 
distribution or the process for Native allottees, our Alaska 
Native veterans who are waiting for their land allotments, some 
40-plus years after Vietnam.
    Right now, I don't have any commitments from anyone. I am 
trying to get the Secretary to make good on her call to me that 
there was going to be a process that was outlined clearly. I 
have not received anything regarding that. I want a commitment 
from you that these allotments are not going to continue to be 
delayed and that you will provide me a status, like within the 
next 24 hours, as to where we are with these PLOs because 
people in Alaska are anxious, they are upset, they are mad, and 
we are going to continue to channel that anger because what has 
happened with this, basically, this re-look at these PLOs is 
absolutely egregious.
    Ms. Culver. Thank you, Senator.
    I am aware of the PLOs and I can commit to you that we----
    Senator Murkowski. Did you talk to BLM Alaska about this?
    Ms. Culver. Yes. I have spoken with BLM Alaska.
    Senator Murkowski. Ahead of the decision?
    Ms. Culver. The decision was made, you know, with the 
Secretary's office and was----
    Senator Murkowski. So you did not talk to Chad Padgett 
ahead of the decision?
    Ms. Culver. I have spoken with Mr. Padgett repeatedly 
during this process and as part of the decision and I can 
commit to you that we feel we are on strong legal ground that 
there will not be delays to the selections for the Vietnam Vet 
era.
    Senator Murkowski. Well, I would like you to tell me how 
you are going to allow for their opportunity for selection with 
continuing the PLOs in place because last I checked, that land 
is not available to them or anybody else until these 
withdrawals go forward.
    Ms. Culver. I would be happy to provide you with additional 
information in the next couple of days. We intend to, as the 
Secretary said, to be very clear about a path forward here.
    Senator Murkowski. Okay, well she said she was going to be 
very clear. She was going to get to my folks within a day or 
two and it has now been ten days and I have not heard word one. 
And so, as far as I know, I am not sure where you are going to 
get the authority unless you are going to pull it out of thin 
air.
    Thank you, Mr. Chairman.
    The Chairman. Senator Barrasso.
    Senator Barrasso. Thank you, Mr. Chair.
    I would like to just follow up with some of the things that 
Senator Murkowski is asking about because on February 12th, 
BLM's Wyoming State Office postponed its March 2021 oil and gas 
lease sale; and then on April 21st, the BLM Headquarters 
notified the public that it was exercising its discretion not 
to hold oil and gas lease sales into the second quarter of 
2021, which would be April, May, and June. So has BLM postponed 
or canceled the second quarter lease sales?
    Ms. Culver. Yes, the second quarter lease sales are not 
going forward.
    Senator Barrasso. Okay, so you have canceled it.
    Ms. Culver. Yes.
    Senator Barrasso. All right. Will BLM reschedule these 
lease sales, and when can we expect that to happen?
    Ms. Culver. We have not made a decision yet regarding the 
third quarter lease sales.
    Senator Barrasso. So lease sales: first quarter, canceled; 
second quarter, canceled. Correct?
    Ms. Culver. Correct.
    Senator Barrasso. All right.
    On March 19th, Laura Daniel-Davis--and Senator, a number of 
us have raised a letter that she has written in the past--wrote 
a memo. The memo mentions the Department's 30 by 30 initiative, 
a plan to conserve 30 percent of federal land by the year 2030. 
Now, I am having trouble understanding why this memo would even 
mention this 30 by 30 initiative. Is it the Department's 
position that a staff memo can legally restrict or limit the 
rights of existing oil and gas leaseholders?
    Ms. Culver. All of the actions we take are subject to 
valid, existing rights. I think the reason that 30 by 30 and 
other issues have been mentioned is that the Interior 
Department, and in particular, the BLM, manages these public 
lands for all Americans under our Multiple-Use, Sustained-Yield 
mandate. So we're looking at both the ongoing requests from the 
oil and gas industry, our review of the program itself, input, 
and other uses across public lands for recreation, to manage 
for wildlife, to manage for conservation.
    Senator Barrasso. Ms. Sgamma, would you like to add 
anything to what you just heard?
    Ms. Sgamma. Well, it's not a discretionary authority in the 
Mineral Leasing Act, it's very clear: the Secretary shall lease 
on a quarterly basis.
    Senator Barrasso. And finally, Mr. Chairman, I know we have 
a vote that is winding down and we need to get to the Floor.
    Ms. Culver, on March 25th, Secretary Haaland hosted a 
``virtual forum'' on the federal oil and gas leasing program. 
The forum featured, really, a carefully selected set of 
speakers, most of whom supported the Administration's ban on 
oil and gas leasing. For example, the forum did not include 
Governor Gordon, did not include Ms. Sgamma. We are told that 
the Department will use the forum to then write a report that 
will inform the Biden Administration's decisions on federal oil 
and gas leasing, obviously putting a heavy thumb on the scale 
by excluding some and including others who are favorable to 
this. How does the virtual forum comply with the Administrative 
Procedure Act and other laws?
    Ms. Culver. The forum is part of an ongoing public process. 
We haven't started a formal process, but we did invite a number 
of representative individuals and organizations to speak at the 
forum. We explicitly have exempted ongoing discussion with 
Members of Congress, state and local elected officials, and 
tribes, which is ongoing. Unfortunately, for the forum, we 
could only have a few people and organizations from each 
interest group. In particular, with the oil and gas industry, 
we were actually really pleased to have so many companies offer 
to participate in the forum, and we couldn't accommodate them 
all, as you noticed. But since the forum, we have been holding 
quite a few meetings with different trade groups and individual 
companies and they have been continuing that conversation.
    Senator Barrasso. I think you said you intentionally 
exempted--I'm going to think you intentionally excluded--so I 
am going to ask Kathleen and then the Governor to please 
comment on what they might have thought about that.
    Ms. Sgamma. Well, small independents definitely weren't 
represented at that stakeholder meeting, but I do appreciate 
that Ms. Culver is going to be meeting with us very shortly.
    Senator Barrasso. Okay. Governor Gordon, any final 
thoughts?
    Mr. Gordon. Thank you, Mr. Ranking Member.
    I think virtual forums are very difficult to get much 
public input in and I appreciate the opportunity to have 
further conversations, but I, Mr. Ranking Member, I think, 
really, the challenge of having a limited audience really sets 
the tone. And to your point, that tone then carries forward. So 
I don't think it was a particularly good effort.
    Senator Barrasso [presiding]. Thank you.
    Senator Cantwell.
    Senator Cantwell [presiding]. Thank you, Senator Barrasso, 
thank you, and I think the Chairman has run to vote as you are 
as well. And so I think it is me left here, so I will ask my 
questions, and if anybody else shows up, I obviously will turn 
to them.
    Thank you for the hearing today, to both Senator Manchin 
and Senator Barrasso. The issue of public land management and 
public policy on this is near and dear to my heart for a lot of 
reasons, but obviously because I love the outdoors and love the 
outdoor economy. But I also think it is critically important 
that we get a fair return to taxpayers. Taxpayers deserve to 
look at our federal lands and the leasing of those federal 
lands and get a federal return. The Federal Land Policy 
Management Act requires the Federal Government to ``consider 
the long-term needs of future generations.''
    So given the looming climate crisis and hundreds of 
billions of dollars in climate damage we are starting to 
accumulate each year, I think we need to face the fact that our 
public lands have an impact on all of this. And indeed, we need 
to get a fair return to the taxpayers. A 2018 USGS study found 
that the life cycle emissions from oil, gas, and coal pulled 
from the public lands and waters were equivalent to 20 percent 
of the total U.S. greenhouse gas emissions, and at the same 
time, a recent study from the National Academy of Sciences 
estimates the U.S. can store up to 500 million metric tons of 
CO2 per year through a mix of carbon-enhancing 
practices on crop land, grassland, and forest. I appreciate the 
fact that we are having this hearing on the complexity of this 
issue, but as I said, I care a lot about the outdoor economy 
and I care a lot about this issue.
    Ms. Culver, do you believe that the current royalty rate 
takes into consideration the full environmental cost posed on 
Americans from oil and gas development, and do you believe the 
12.5 royalty rate adequately provides the taxpayers a fair 
return for development on mineral lands?
    Ms. Culver. The royalty rate was set over a century ago now 
and, certainly, we have a lot more information we can take into 
account. The General Accounting Office has repeatedly 
identified this as an issue for the BLM to address and that we 
could be giving taxpayers a more fair return if we looked at 
that.
    Senator Cantwell. Well, thank you. I think, according to 
GAO, as many as 99 percent of the bonds for wells currently 
operating on federal lands are insufficient. We know from our 
own GAO that BLM just got $204 million in Reclamation bonds, 
but the cost to reclaim over 96,000 producible oil and gas 
wells on public land could exceed $6 billion. So this number 
fails to account for the cost to clean up an unknown number of 
abandoned wells scattered across federal land. We know this in 
our state. We paid attention to a variety of these issues on 
abandoned wells that emit methane and the cost and the backlog 
of existing need is known.
    Ms. Sgamma, a recent poll showed that 73 percent of the 
people in the West believe that industry should fully remediate 
sites when drilling is complete. Do you believe that taxpayers 
and industry should be responsible for the cost of cleaning up 
those oil and gas wells?
    Ms. Sgamma. Well, under the current system, companies are 
responsible for cleaning up and reclaiming their well sites. So 
the number of--IOGCC, the Interstate Oil and Gas Compact 
Commission, estimates that about 56,000 wells are currently 
abandoned, and that is a result of many wells that were 
abandoned before regulatory systems came into play, such as in 
Wyoming, which has been the law of the land for decades now. So 
there is definitely an ongoing problem of those pre-regulatory 
wells. But as far as current systems for ensuring that wells 
are not abandoned and that they are reclaimed, well, companies 
are already held liable for that and the bonding is an 
assurance and when a company does go bankrupt or another 
company acquires their assets, that acquiring company is 
responsible for any of those wells as well.
    So the current system and the current processes in place 
ensure that we don't abandon wells and orphan them today and 
that, in that rare example, that companies are held liable.
    Senator Cantwell. Yes, you are reminding me of these 
assurance laws. We have worked on them in the past. Trust me, I 
do not think they are sufficient, clearly, on the land side, 
and should be, to holding people accountable.
    Ms. Culver, what steps do you think BLM has taken to hold 
people accountable on the Abandoned Mine Land Program, and what 
else do we need to do in this area to make sure that we 
certainly have assurances for companies that go out of 
business?
    Ms. Culver. The BLM, as you noted, has standard bonding 
rates, which the General Accounting Office has repeatedly 
acknowledged do not cover the cost of reclamation and we have 
learned over the years that when a mining company or an oil and 
gas company goes into bankruptcy, the funds needed for the 
cleanup of our public lands do not tend to get primacy. So it 
is certainly something we're looking at in our ongoing review.
    Senator Cantwell. Yes, I have been involved in two of these 
cases in the Northwest and, basically, had to make sure that we 
got the Federal Government to help intervene, otherwise the 
community would have been left with the refuse and the 
pollution and no resolution to the issue. And so these issues 
of the ability to get out through bankruptcy or acquisition, 
you know, we should not have to go to DOJ and to agencies to 
mandate that the cleanup happens or that the city and taxpayers 
are not left on the hook.
    So anyway, well, thank you so much. I may submit some more 
questions for the record.
    I thank all of our witnesses for being here today and for 
your testimony. I hope that we can get more out of our public 
lands and protect them at the same time because the stewardship 
of our public lands, from a revenue perspective, I think, is 
very important to American taxpayers.
    So with that, I thank the witnesses. Members will have 
until close of business tomorrow to submit additional questions 
for the record.
    The Committee stands adjourned.
    [Whereupon, at 12:10 p.m., the Committee was adjourned.]

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