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Senator presses deputy secretary nominee on higher royalties, steep drop in BLM leasing and long permitting delays
Summary
At a Senate Committee on Energy and Natural Resources hearing, a senator challenged the nominee for deputy secretary over a 2022 decision raising oil-and-gas royalty rates, data saying onshore leasing fell sharply under the current leadership, and permitting delays that left some leases unsigned for years.
During a confirmation hearing before the Senate Committee on Energy and Natural Resources, Senator (Speaker 1) pressed the nominee for deputy secretary (Speaker 2) about a November 2022 decision memo signed by Laura Daniel Davis that raised royalty rates on oil and gas leases and whether the change was consistent with national energy-security needs.
"According to the memo, they said lowering rates would actually encourage more oil and gas development and offer greater energy security," Senator (Speaker 1) said, adding that the decision to raise royalty rates appeared to aim for a "socially optimal" level of production rather than maximizing U.S. energy supply. "Do you believe that less American oil and gas production is socially optimal for our nation?"
The nominee responded that they were not sure how to define "socially optimal" and said the administration is pursuing "a clean energy transition" and treating the climate crisis as a high priority, while acknowledging that "oil and gas production is gonna be a part of the energy mix for a long time." The nominee said, if confirmed, participating in those policy debates would be a top priority.
The senator also cited what they described as stark declines in onshore leasing and leasing activity under the current secretary, saying the department has leased "on average 96% less onshore acreage" and issued "93% fewer onshore oil and gas leases" per year than prior administrations, including the Obama administration. The senator asked whether the department was headed in the right direction on leasing.
The nominee said they had not been involved in the policy discussion to date but would engage in administration deliberations and seek to understand senators' perspectives if confirmed.
Senator (Speaker 1) also raised reliability concerns raised to the committee by the Federal Energy Regulatory Commission (FERC) and the North American Electric Reliability Corporation (NERC), saying those entities had told the committee the administration's approach was wrong on reliability. The senator urged the nominee to examine the scientific basis for the administration's views.
Permitting timelines drew sustained attention. "The average time under [the current secretary] to get an oil and gas permit is nearly tripled," the senator said, citing one BLM field office where the average wait time was reported as "more than a year and a half." The nominee acknowledged permitting "can take longer than any of us really wants" and said they would look into concerns about processing times if confirmed.
The senator further noted a federal law requiring the Bureau of Land Management to issue oil and gas leases to winning bidders within 60 days and said the bureau had not issued leases from a 2020 sale, leaving those leases outstanding for roughly three and a half years. The nominee said issues raised by a U.S. senator would merit their personal attention and that the deputy secretary would step in and communicate directly on such matters.
The exchange concluded with the senator indicating a brief follow-up and thanking the nominee. The hearing continued with other business following this line of questioning.
