Executive and Secretarial Orders

Secretarial Order 3395 and March 19, 2021 Memo: Continued Suspension of Local Approval Authority

On inauguration day, the DOI Acting Secretary of Interior issued Secretarial Order No. 3395, “Temporary Suspension of Delegated Authority” (SO 3395), suspending the delegation of authority to the Department Bureaus and Offices to take certain outlined actions for 60 days, thereby requiring approval of those actions by the identified non-career officials. After protest by several Indian tribes, by a Memorandum dated January 25, 2021, DOI quickly clarified that SO 3395 did not apply to “actions taken with respect to Indian tribal and individual trust and restricted lands.” SO 3395 has now expired. However, by Memorandum dated March 19, 2021 (March Memo), Laura Daniel-Davis, Principal Deputy Assistant Secretary Lands and Minerals Management, to Bureau Directors (BLM, OSMRE, BSEE, BOEM), continued the Office of the Assistant Secretary of Land and Minerals Management (ASLM) review prior to taking final action on the following oil and gas activities:

• Draft or Final Resource Management Plans (RMPs)
• Records of Decision
• Lease sale notices
• National Environmental Policy Act analysis for final agency action, related to pending litigation, and/or high priority or high conflict areas where it may impact:
  • High priority sage grouse habitat
  • State, Tribal or Federally identified wildlife migration corridors
  • Lands with wilderness characteristics
  • Lands with special designations
• Reinstatement of terminated oil and gas leases
• Extension of Applications of Permit to Drill (APDs)
• Lease suspension
• Applications for royalty relief

Notably, the March Memo specifically states that the above list is not exhaustive. And, to the extent approval is discretionary (i.e., extensions of APDs), we suspect an oil and gas lessee or operator will have difficultly receiving approval for those above-listed actions.

Although the March Memo is not addressed to the Bureau of Indian Affairs (BIA), the Bureau of Land Management (BLM) serves as a technical advisor to the BIA and is required to approve certain actions that impact Indian tribal and individual trust and restricted lands. The March Memo fails to make this distinction, thus raising the question whether the March Memo also excludes actions taken with respect to Indian tribal and individual trust and restricted lands.

Executive Order 14008: Pause on Federal Oil and Gas Leasing

As discussed in our January 27, 2021 article, President Biden signed EO 14008, ordering DOI to “pause” issuing new oil and gas leases on public lands or offshore waters pending completion of a “comprehensive review and reconsideration of Federal oil and gas permitting and leasing practices.” Immediately, 2021 first quarter lease sales in several states were cancelled; the Gulf of Mexico Outer Continental Shelf lease sale set for March 2021 was cancelled; and work on environmental review for an Alaska Outer Continental Shelf sale scheduled for later this year was halted. On April 21, 2021, the BLM also cancelled all 2021 second quarter lease sales.

On March 25, 2021, the DOI hosted a virtual Public Forum on Federal Oil and Gas Program (Forum) as part of its mandated “comprehensive review.” Newly confirmed Secretary Haaland set the tone with opening remarks stating she recognized “there is no doubt that oil, gas, and coal energy from our public lands and ocean have helped build our economy and power our nation. Fossil fuels will continue to play a major role in America for years to come.” She then pivoted stating, “too often the extraction of resources have been rushed to meet the false urgency of political timetables rather than careful consideration for the impacts of current and future generations.”

Thereafter, DOI Principal Deputy Assistant Secretary for Land and Minerals Management, Laura Daniel-Davis, provided introductory remarks giving a glimpse at the priorities of the Administration when she stated, “We’re facing serious challenges onshore, in the form of contribution of fossil fuel development to climate change, including emissions from operations and addressing idled and orphaned wells. In addition, we have royalty rates that have not increased in more than a century and bonding rates that were set in the middle of the last century. In the offshore program, we also need to ensure we’re driving down emissions, protecting marine life, and that the program serves the interests of taxpayers…. Through this review and how we do our work, we think that we can ensure greater equity, transparency, and public involvement, shore up our environmental review processes, provide a fair return to the American taxpayer, and be sure that we’re protecting the special and sacred places that we hear about from so many.” Each of the six invited stakeholder groups then gave a short presentation and responded to questions from the panelists, Principal Deputy Assistant Secretary Daniel-Davis, BLM Deputy Director of Policy and Programs, Nada Culver, and Bureau of Ocean Energy Management (BOEM) Director, Amanda Lefton. The stakeholder groups made the following general observations:

• Indigenous experts representatives from the National Congress of American Indians, Alaska Federation of Natives, and Diné C.A.R.E, differed in their support for federal oil and gas development and recognition of the economic benefits derived therefrom, but they universally urged the unique political and legal status of the tribal nations and their citizens be recognized and collaboration with their organizations and constituents be prioritized.
• Industry representatives from the American Petroleum Institute, American Exploration and Production Council, and the National Ocean Industries Association, unanimously supported continued leasing and development of federal lands, embracing a mixed energy strategy with oil and gas playing a role in reducing greenhouse gas emissions. Not surprisingly, they focused on the economic benefits to local communities, conservation efforts, and the nation and the benefits of the United States’ energy independence.
• Environmental organizations representatives from the Natural Resources Defense Council, Earthworks, and the Ocean Conservancy, advocated for a halt to all new oil and gas leasing, an update to all regulations and legislation prioritizing the environment, and changes to rent and royalty provisions to account for pollution externalities.
• Labor experts representatives from the United Association of Plumbers and Pipefitters and the North America Building Trades Union, reiterated that the oil and gas industry provides high paying jobs to tens of thousands of American workers and similarly paying jobs are necessary to support the local communities. They expressed skepticism that renewable industry jobs or jobs plugging abandoned wells would be a sufficient substitute for the loss of middle-class family sustaining jobs from a permanent leasing ban.
• Equity experts representatives from the Hispanic Access Foundation, NAACP Environmental and Climate Justice Program, and the Deep South Center for Environmental Justice, stated that most oil and gas drilling, transportation, and processing and petrochemical manufacturing happen within Latinx, black, and indigenous communities, exposing the residents to toxic emissions and spills with serious health consequences to the residents and loss days of school for their children; and these communities are further disproportionately impacted by climate change.
• Academics experts hailing from the University of Colorado Law School, Texas A&M, and the Resources for the Future institute, encouraged management of the decline of oil and gas in a responsible manner, evaluation of increasing rentals, royalty rates, minimum bids, and bonding to discourage speculation, and increased use of lease stipulations to protect the environment, with recognition given to the fact that such policies will increase cost of operations on public lands and cause a shift to foreign, private and state lands. They advocated for consideration to be given to carbon pricing or a fee on every ton of carbon and border taxes.