Legal Updates

Top Ten Tips for Leasing on Federal Land

RMP – Review the BLM or U.S. Forest Service Resource Management Plan (“RMP”) covering the geographic area of interest on the agency website. Is it open for leasing? If so, go to the RMP Appendix to review the lease stipulations that apply to the lease parcel.

RMP Oil and Gas Amendment – Check the agency website to see if the RMP is current or undergoing an amendment process to address oil and gas development. An oil and gas RMP update can delay or stop leasing in some situations.

Controversy – Consider whether the area is the focus of heightened environmental concern that could result in lease protests and delays. Is it adjacent to a National Park, Roadless Area, in a Sage-grouse RMP core area, or an area proposed for wilderness?

EOI – A submission of an Expression of Interest (“EOI”) to lease is no longer confidential. Current BLM policy (IM-2014-004) directs BLM to publish the EOI on the BLM website. For confidentiality, submit anonymously or through a lease broker.

2010 Leasing Reform – Understand BLM IM-2010-117 which transformed BLM leasing with the addition of lease NEPA and other new processes. See below. Find this policy at the BLM.gov website under Information Center, Laws Regulations & policies.

Frequency of Lease Sales – The 2010 policy largely limits lease sales to 4 quarterly sales that rotate through a state annually. That means if your parcel is deferred it won’t come up for consideration for another year.

Public participation – The 2010 policy adds significant public participation to the lease process; lessees need to get involved in this process. BLM will

work with state, local and tribal governments, notify split-estate fee surface owners and “groups and individuals with an interest” in O&G leasing to participate in the lease NEPA process.

Lease Parcel NEPA – The BLM will prepare an Environmental Assessment (“EA”) for the lease sale and provide a 30-day comment period. Participate in the comment process to support BLM’s decision to lease your nominated parcels and respond to the opponent’s comments. If you need confidentiality, use a lawyer or industry association.

Lease decision – Post-EA, BLM will identify the lease parcels for sale. BLM may defer or withdraw parcels from the sale up to the day of the sale. BLM will treat your winning bid as a binding offer that can only be withdrawn under limited circumstances. BLM does not “accept” your offer until it actually issues the lease.

Protests – A protest to the sale of a lease parcel must be filed 15 days before the sale. BLM may sell a parcel “under protest,” but will not issue a lease until the protest is resolved. BLM tries to resolve a protest within 60 days from the lease sale. A decision to reject a protest will include simultaneous lease issuance. If post-protest stipulations are added to the lease, you may reject and obtain a refund. If BLM upholds the protest, withdraws the lease parcel and rejects your bid you will receive a refund. If BLM’s decision to reject the protest is appealed to the IBLA, you are not entitled to a refund but may intervene into the appeal to protect your issued lease.

FOR ADDITIONAL INFORMATION ON FEDERAL LEASING PLEASE CONTACT:

REBECCA WATSON rwatson@wsmtlaw.com

STEVE BAIN sbain@wsmtlaw.com

NORA PINCUS npincus@wsmtlaw.com

JENNIFER CADENA jcadena@wsmtlaw.com