Murkowski: Interior Report Flawed for Second Year in a Row

WASHINGTON, D.C. – U.S. Senator Lisa Murkowski, R-Alaska, today released the following comment regarding the Department of the Interior’s report attempting to show that millions of acres of oil and gas leases are not being developed in a timely manner.

“The administration claims that just 3 percent of leases in Alaska are producing, without acknowledging that the federal bureaucracy is largely to blame for that dismal percentage,” Murkowski said. “Companies are doing everything in their power to convince federal regulators to allow projects to move forward, and yet this report attempts to blame the companies for the lack of progress.”

Alaska is estimated to have more than 40 billion barrels of recoverable oil, but the state’s federal oil fields are not producing because of regulatory uncertainty, the lack of access and indefensible bureaucratic red tape, Murkowski said.

The laws of the United States already constitute a ‘use-it-or-lose-it’ policy for oil and gas leases. Lease terms are limited to 10 years and leaseholders must pay bids, bonuses, rents, royalties, fees and taxes on production. 

There are a variety of reasons that not every lease that has been issued is in active development. Before production can begin, companies must secure all relevant permits and explore to ensure energy resources are actually present in producible volumes. Those activities often take years to complete and only a fraction of federal leases are determined to have oil or gas beneath them.