Analysis Find Administration's Pause on New Oil and Gas Projects Caused No Economic Slump

DENVER, CO – The pause on oil and gas leasing President Biden ordered upon taking office has a minimal effect on national and western regional economies, according to a new report by the Conservation Economics Institute (CEI). In fact, the analysis finds that the oil and gas industry currently holds leases worth decades of drilling opportunities.

The study, “Economic Effects of Pausing Oil and Gas Leasing on Federal Lands,” looks at the United States and five Intermountain West states that dominate federal onshore production of oil and gas: Colorado, Montana, New Mexico, Utah and Wyoming.

The Natural Resources Defense Council (NRDC) commissioned the report, in partnership with the Center for Western Priorities (CWP) and eight other groups including the National Parks Conservation Association. The analysis was conducted prior to a recent federal court’s decision to reinstate leasing.

Nationally, the report finds:

• Federal onshore production is a small sliver of overall production, representing about 6% of total domestic oil production, and 8% for gas;
• Demand for federal oil and gas leasing is on the decline;
• There is no meaningful link between acres of federal leasing and employment in the oil and gas sector;
• Pausing leasing does not limit existing drilling or production on federal lands;
• Most of the existing federal lands leased (14 of 26 million acres) are non-producing;
• Industry already holds 75 years of future drilling potential in existing federal onshore leases;
• Remaining unleased public lands are less desirable for oil and gas development.

In the Intermountain West, it finds:

• At least 86% of federal onshore oil and gas production takes place in Colorado, Montana, New Mexico, Utah and Wyoming. These states in 2019 accounted for 86% of federal onshore oil and 95% of federal onshore natural gas production, respectively.
• In western states where federal oil and gas drilling accounts for most of the state’s production industry has stockpiled so many unused leases that each state has more than a decade, and up to 6 decades, of remaining drilling opportunities.

The report cites significant benefits to a pause in leasing:

• Affording time for the Bureau of Land Management to identify fiscal inefficiencies in its leasing program, collect critical information, complete studies, and update decision documents to make more informed policy decisions;
• Expanding conservation goals and multiple uses, such as protecting wildlife habitat, increasing recreation, and identifying potential wilderness;
• Temporarily protecting well over 1 million acres of unleased land while the BLM re-balances its approach to multiple use management;
• Signaling to the marketplace that the Administration is serious about addressing climate and transitioning to cleaner and renewable sources of energy.
• And it shows how these positive outcomes vastly outweigh any potential costs in lost lease revenue.

Finally, the report demonstrates that the Intermountain West today is significantly less dependent on the oil and gas industry.

It considers how protecting public lands can spur regional economic development, by attracting people and businesses, creating high wage information and service jobs, and envisioning development strategies for diversifying into conservation-based development. These alternative growth options include increased tourism, fishing, hunting, off-road riding, mountain biking, and nature viewing.

The report also notes that cleaning and reclaiming legacy wells in the U.S. will create jobs and reduce greenhouse gas emissions, yielding as many as 85,000 direct annual jobs for ten years of duration and eventually eliminating nearly 252,000 metric tons of methane. Finally, the study notes that conservation measures draw people and businesses, while oil and gas drilling can repel them.

“Pausing new oil and gas drilling was a much-needed reprieve for national parks, local communities and the climate, which had all suffered under a reckless approach to energy development,” said Matt Kirby, senior energy director at the National Parks Conservation Association. “In calling out the many scare stories about the pause, this report helps pave a path forward, towards a broader phase out of fossil fuels from public land to protect our people, places and planet.”

CEI, NRDC and CWP are releasing this analysis in close collaboration with eight partner groups, including Conservation Colorado, Conservation Voters New Mexico, the National Parks Conservation Association (NPCA), Powder River Basin Resource Council, Southern Utah Wilderness Alliance (SUWA), Wild Montana, The Wilderness Society (TWS), and the Western Organization of Resource Councils (WORC).

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About the National Parks Conservation Association: Since 1919, the nonpartisan National Parks Conservation Association (NPCA) has been the leading voice in safeguarding our national parks. NPCA and its nearly 1.6 million members and supporters work together to protect and preserve our nation’s most iconic and inspirational places for future generations. For more information, visit www.npca.org.