Oil industry challenges Interior leasing rule

By Niina H. Farah | 05/17/2024 06:53 AM EDT

The Western Energy Alliance claims royalties and fees price small drillers out of the market.

Pump jacks work in a field.

Pump jacks work in a field near Lovington, New Mexico. Charlie Riedel/AP

The oil and gas industry is asking a federal judge to overturn an Interior Department leasing rule that raises royalty rates and toughens cleanup requirements on public land.

The Western Energy Alliance and trade associations in New Mexico, North Dakota, Wyoming and Utah filed a lawsuit Wednesday to challenge the Bureau of Land Management’s rule they claim would close eligible lands for leasing and harm small companies.

“At its heart, the final rule is procedurally deficient, arbitrary and capricious, and contrary to law. The Court should invalidate and vacate the Leasing Rule,” the trade groups told the U.S. District Court for the District of Wyoming.


The leasing rule represents the first time in decades that BLM had revamped its public lands leasing program, and is part of the Biden administration’s broader effort to promote public lands conservation.