BLM Maintains and Makes Publicly Available Incomplete and Inconsistent Information Related to Protests to Its Lease Sales

Although BLM has taken steps to collect information related to protests to  its lease sales, we found that the information it maintained and made  available publicly was incomplete and inconsistent across the four state  offices we reviewed. In May 2010,  the Secretary of the Interior announced several agencywide leasing  reforms that are to take place at BLM, some of which may address  concerns raised by protester groups, by providing the public with earlier  and more consistent data on which parcels may become available for  leasing, thereby giving these groups longer to consider or prepare protests. To better track protests, BLM  in 2007 required its staff to begin using a new module, which it had added  as a component of its LR2000 lease record-keeping system specifically to  capture, among other things, information related to lease sale protests. Protest-Related Information Varies across BLM State Offices, and Protester Groups Have Raised Concerns about This Information

We found that the amount of protest-related information BLM makes  publicly available varies across the four state offices in our review. Most Parcels Identified for Lease Were Protested by a Diverse Group of Entities for a Variety of Reasons

Most parcels identified in BLM lease sale notices from fiscal year 2007  through fiscal year 2009 in Colorado, New Mexico, Utah, and Wyoming  were protested; protests came from a diverse group of entities, including  nongovernmental organizations representing environmental and hunting  interests, state and local governments, businesses, and private individuals. BLM officials provided anecdotal accounts in which protests influenced  their decisions, and they acknowledged that the protest process can serve  as a check on agency decisions to offer parcels for lease sale. Leases on Protested Parcels Were Often Delayed

We found that a majority of leases for protested parcels in the four state  offices from fiscal year 2007 through 2009 were issued after the 60-day  window specified in the Mineral Leasing Act. Despite Concerns, Protest Activity and Delayed Leasing Have Not Significantly Affected Bid Prices, and Near-Term Effects on Nationwide Oil and Gas Production Are Not Likely to Be Significant

We found that protest activity did not systematically decrease bid prices  for leases during the period we reviewed and that overall effects on near- term nationwide oil and gas production are not likely to be significant,  despite industry concerns over protests and delays in issuing leases. At the national level, the near-term effect of protests on U.S. oil and gas  production is likely to be relatively modest because federal lands account  for a small fraction of the total onshore and offshore nationwide oil and  gas output. Recommendations for Executive Action

To improve the efficiency and transparency of BLM’s process with regard  to protests of its lease sale decisions and to strengthen how BLM carries  out its responsibilities under the Mineral Leasing Act, we recommend that  the Secretary of the Interior direct the Director of BLM to take the  following two actions:  revisit the agency’s use of the module for tracking protest information and,  in so doing, determine and implement an approach for collecting protest  information agencywide that is complete, consistent, and available to the  public and in implementing the Secretary of the Interior’s leasing policy reform issued  in May 2010, take steps to improve (1) the transparency of leasing  information provided to the public, including information to explain the  basis of agency decisions to include or exclude particular parcels in a  lease sale and, to the extent feasible, documentation of the role, if any,  that protests played in final lease decisions, and (2) the timeliness of lease  issuance, without compromising the thoroughness of review. GAO staff who made major contributions to this  report are listed in appendix V.

Appendix I: Objectives, Scope, and Methodology

This report examines (1) the extent to which the Bureau of Land  Management (BLM) maintains and makes publicly available information  related to protests, (2) the extent to which parcels were protested and the  nature of protests, and (3) the effects of protests on BLM’s lease sale  decisions and on oil and gas development activities. To determine the extent to which parcels were  protested and the nature of protests, we compared BLM’s lease sale  records with the data available in BLM’s public challenge module. Appendix II: Protest Information from a Sample of Lease Sales in Four Selected State Offices, Fiscal Years 2007-2009

The following tables present information based on our review of a sample  of 12 lease sales held in the state offices of Colorado, New Mexico, Utah,  and Wyoming from fiscal year 2007 through fiscal year 2009.
Why GAO Did This Study

The development of oil and natural gas resources on federal lands contributes to domestic energy production but also results in concerns over potential impacts on those lands. Numerous public protests about oil and gas lease sales have been filed with the Bureau of Land Management (BLM), which manages these federal resources. GAO was asked to examine (1) the extent to which BLM maintains and makes publicly available information related to protests, (2) the extent to which parcels were protested and the nature of protests, and (3) the effects of protests on BLM's lease sale decisions and on oil and gas development activities. To address these questions, GAO examined laws, regulations, and guidance; BLM's agencywide lease record-keeping system; lease sale records for the 53 lease sales held in the four BLM state offices of Colorado, New Mexico, Utah, and Wyoming during fiscal years 2007-2009; and protest data from a random sample of 12 of the 53 lease sales. GAO also interviewed BLM officials and industry and protester groups.

What GAO Found

While BLM has taken steps to collect agency-wide protest data, the data it maintains and makes publicly available are limited. Although in 2007 BLM required its staff to begin using a module, added to its lease record-keeping system, to capture information related to lease sale protests, GAO found that the information BLM collected was incomplete and inconsistent across the four reviewed BLM state offices and, thus, of limited utility. Moreover, in the absence of a written BLM policy on protest-related information the agency is to make publicly available during the leasing process, each state office developed its own practices, resulting in state-by-state variation in what protest-related information was made available. As a result, protester groups expressed frustration with both the extent and timing of protest-related information provided by BLM. In May 2010, the Secretary of the Interior announced several agency-wide leasing reforms that are to take place at BLM. Some of these reforms may address concerns raised by protester groups, by providing earlier opportunities for public input in the lease sale process, thereby potentially giving stakeholders more time to assess parcels and decide whether to file a protest. A diverse group of entities protested the majority of parcels BLM identified in its lease sale notices during fiscal years 2007 through 2009 in the four states, for a variety of reasons. GAO found that 74 percent of parcels whose leases were sold competitively during this period by BLM state offices in Colorado, New Mexico, Utah, and Wyoming were protested. In examining a random sample of lease sales, GAO found that protests came from various entities, including nongovernmental organizations representing environmental and hunting interests, state and local governments, businesses, and private individuals. Their reasons for protesting ranged from concerns over wildlife habitat to air or water quality to loss of recreational or agricultural land uses. The extent to which protests influenced BLM's leasing decisions could not be measured because BLM's information does not include the role protests played in its decisions to withdraw parcels from lease sale. Regardless, BLM officials stated that the protest process can serve as a check on agency decisions to offer parcels for lease. In reviewing BLM's lease sale data in the four selected states during fiscal years 2007 through 2009, GAO found that 91 percent of the time, BLM was unable to issue leases on protested parcels within the 60-day window specified in the Mineral Leasing Act. Industry groups expressed concern that these delays increased the cost and risk associated with leasing federal lands. GAO found that, despite industry concerns, protest activity and delayed leasing have not significantly affected bid prices for leases; if protests or subsequent delays added significantly to industry cost or risk, it would be expected that the value of, and therefore bids for, protested parcels would be reduced. In addition, because federal lands account for a small fraction of the total onshore and offshore nationwide oil and gas output, the effects of protests to BLM leasing decisions on U.S. oil and gas production are likely to be relatively modest.

What GAO Recommends

GAO recommends that BLM (1) revisit the way it tracks protest information and in so doing ensure that complete and consistent information is collected and made publicly available and (2) improve the transparency of leasing decisions and the timeliness of lease issuance. Interior concurred with GAO's recommendations.