Pitfalls in Interior's New Accelerated Offshore Leasing Program Require Attention
Highlights
GAO was requested to review the Department of Interior's proposed 5-year offshore oil and gas leasing and development program. In addition to accelerating leasing, the new proposal calls for changes reducing the time for environment analyses and allowing for larger acreage offerings in lease sales. The evaluation focused on the following: (1) differences between the proposed and current programs; (2) processes by which Interior developed the new program and the influence of non-Interior agencies and other affected groups in the process; (3) Interior's capabilities to handle the accelerated program; (4) capability of industry to lease and diligently explore additional offshore land in a timely manner; (5) potential impacts of the program in terms of the amount of land to be leased, the economy and the environment, receipt of fair market value for leased lands, small company participation, and competition in lease sales; (6) legal implications of the program; and (7) soundness and workability of the program.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Interior | The Secretary of the Interior should provide detailed information and analyses of the practices and procedures by which the streamlining concepts are to be implemented. This effort should focus on such key areas as environmental impact statement preparation and fair market value determinations, these being areas of considerable controversy and litigation in the past. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of the Interior | The Secretary of the Interior should provide detailed information and analyses of the estimated potential impacts of the program in terms of: (1) increased amounts of land to be leased on energy supply and environmental degradation, (2) competition and small company participation in lease sales, (3) the ability of State and local governments to participate in decisionmaking, (4) revenue projections, and (5) the economy. The implications of using alternative bidding systems should also be included in this analysis. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of the Interior | The Secretary of the Interior should provide detailed information and analyses of the Department's capabilities to implement the proposed program. The relationship between reduced funding and staffing and an accelerated program should be carefully documented. |
Closed – Not Implemented
The new accelerated leasing program was submitted to Congress in May 1982 and approved by the Interior Secretary in July 1982. Some information in response to the recommendation was provided to Congress but not in the detail GAO recommended. Because of time and events, the recommendation is no longer applicable.
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| Department of the Interior | The Secretary of the Interior should also consider adopting a modified streamlining approach by reducing the size of the areas offered for lease. Trimming the lease sales down to smaller offerings will allow for a more detailed analysis of the environmental features in an area and also reduce the acreage Interior must consider for tract valuations. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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| Department of the Interior | The Secretary of the Interior should: (1) exercise caution in awarding 10-year leases, limiting the issuance of such leases to only those areas where the situation clearly warrants this option, and (2) closely monitor the impact on diligent development of changes in lease terms and conditions, including possible extensions of timeframes for submitting exploration plans. |
Closed – Not Implemented
This recommendation is directed toward longer range practices in the Department of the Interior. Interior maintains that it is using 10-year lease terms in accordance with the recommendation and will continue to do so over the next several years. In later years, GAO may want to review the followon use of the 10-year term, but not at this time.
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