Federal Legislation

Off-shore drilling rig
Much of our public lands and the rights to develop oil and gas on them are governed by federal legislation.

Politicians work together to establish laws to ensure our public lands are used in safe, responsible ways. These laws spell out who can access the lands, the steps to protect the surrounding environment and the best way to produce the energy our country needs.

Mineral Leasing Act of 1920

The Mineral Leasing Act established the policy for the leasing and development of oil and gas resources on the 700 million acres of public lands. The Department of the Interior’s Bureau of Land Management administers the program. The U.S. Forest Service also has major management responsibilities for oil and gas development in national forests. Key features of the law are:

  • Permission to enter the public lands to explore for minerals must be obtained from the government.
  • Land is leased, not sold, by the government to companies to drill and extract minerals. Oil and natural gas leases generally last 10 years.
  • The government has the power to ensure that exploration, drilling and land reclamation follows land and resource management plans and protects the environment.
  • The United States receives fees, including a royalty, bonus bids and rents, from oil and gas companies that drill on public lands. These fees – a major federal revenue source – totaled $6.5 billion in 2010. These funds are evenly split between the federal government and the state where the oil and gas lease is located.  

Outer Continental Shelf Lands Act

This 1953 law established ownership of off-shore coastal lands and mineral resources, especially oil and gas deposits.
Under the act:

  • The U.S. government owns mineral resources more than three miles from the shore.
  • In most cases, own mineral resources within the three-mile limit are owned by the state.
  • A clear process for underwater drilling was created, which is increasingly important with the growth of off-shore drilling.

National Environmental Policy Act

This landmark law passed in 1969 requires that federal agencies evaluate environmental concerns when making crucial decisions. Environmental decision making can follow three courses:

  • Categorical exclusion: An agency determines that a category of actions does not individually or cumulatively have a significant effect on the quality of the human environment.
  • Environmental Assessment: An agency determines if a more detailed report, called an Environmental Impact Statement, is needed. If not, it is considered a “Finding of No Significant Impact."
  • Environmental Impact Statement: An agency determines what impact the proposed decision will have on the environment. It attempts to show other options and their environmental impact.

NEPA is a crucial step forward for the federal government in determining the effects their decisions would have on the environment. This includes leasing and development decisions under the Mineral Leasing Act and the Outer Continental Shelf Lands Act.

Federal Land Policy and Management Act

This 1976 law established a systematic approach for managing the 248 million acres of public lands under the Bureau of Land Management. The law requires the BLM’s management practices to:

  • Protect the scientific, scenic, historical and environmental values of the lands.
  • Preserve and protect certain public lands in their natural condition.
  • Provide food and habitat for fish and wildlife.
  • Provide for outdoor recreation and human occupancy and use.