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Permit Processing Times and Prioritize Inspections' which was released 
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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

August 2013: 

Oil and Gas Development: 

BLM Needs Better Data to Track Permit Processing Times and Prioritize 
Inspections: 

GAO-13-572: 

GAO Highlights: 

Highlights of GAO-13-572, a report to congressional requesters. 

Why GAO Did This Study: 

BLM has key responsibilities for the development of federal oil and 
gas resources, including processing APDs. In 2005, GAO reported that 
the total number of APDs approved by BLM had increased, and as a 
result, BLM staff had less time for activities such as environmental 
inspections. 

GAO was asked to review BLM’s processing of APDs and efforts to 
protect the environment since then. This report examines, from fiscal 
years 2007 to 2012, (1) changes in BLM’s permitting workload; (2) 
actions BLM has taken to manage its oil and gas permitting workload 
and challenges, if any, that remain; and (3) actions BLM has taken to 
mitigate the environmental impact of developing federal oil and gas 
resources, and challenges, if any, that remain. GAO analyzed BLM data 
on APDs and environmental inspections, from fiscal years 2007 to 2012, 
and interviewed officials at 11 BLM field offices selected to reflect 
a range of characteristics, including geographic representation. 

What GAO Found: 

Bureau of Land Management (BLM) data indicate that BLM received about 
half as many applications for permit to drill (APD) for federal oil 
and gas resources in fiscal year 2012 as it had in fiscal year 2007. 
The decline in APDs since 2007 was driven by declines in natural gas 
and coalbed methane APDs on federal lands even while oil development 
on federal lands increased significantly. The reasons BLM officials 
and industry representatives cited for these changes in APDs include, 
among other things, a general industry move toward developing gas in 
shale formations using horizontal drilling and hydraulic fracturing; 
shale development has largely occurred on state and private lands, 
where shale resources are predominately located. However, the number 
of APDs has varied by BLM location, with 23 of 33 BLM offices seeing 
declines, 9 offices seeing increases, and 1 office seeing no change in 
APDs. 

BLM has taken actions to improve management of its oil and gas 
permitting workload, including revising its permitting rule in 2007 
and implementing a pilot project to improve APD processing that 
increased funding and staff in seven BLM offices. It is unclear 
whether the pilot project has met its goals as BLM has neither 
completed an assessment of the project in the past 5 years, nor 
reported to Congress, as required by the Energy Policy Act of 2005, on 
the results of the project along with a recommendation about 
implementing the project throughout the United States. Further, in a 
2013 internal memorandum, BLM reported that it has been unable to 
consistently process completed APDs within the 30-day deadline 
required by the act. GAO found that BLM’s central oil and gas database 
was missing certain data needed to assess compliance with this 
deadline and contained other inaccurate APD processing data. Without 
complete data on approved APDs, GAO could not perform a comprehensive 
assessment of the amount of time it took BLM to process APDs from 
their date of receipt to date of approval. Without accurate data on 
the amount of time it takes to process APDs, BLM does not have the 
information it needs to make adjustments that could improve its 
operations. 

To mitigate the environmental impact of oil and gas development, BLM 
increased the number of environmental inspections it conducted of 
federal oil and gas wells and facilities from 10,941 in fiscal year 
2007 to 17,866 in fiscal year 2012. BLM attributed the increase to 
revised guidance, performance targets for staff, additional staff in 
some offices, and technological changes in the oil and gas industry 
that result in more wells on a single well pad, allowing for multiple 
inspections at one site. Nevertheless, BLM’s environmental inspection 
prioritization process may not identify oil and gas wells that pose 
the greatest environmental risk because the agency’s central oil and 
gas database does not include data on the environmental inspection 
history of many wells, and environmental inspection history is not one 
of the criteria that BLM staff use in prioritizing inspections. GAO’s 
review of data on approximately 60,330 federal oil and gas wells found 
no record in BLM’s database of 24,840 wells ever having received an 
environmental inspection. In addition, GAO found inconsistent 
documentation of inspections and enforcement actions across BLM 
offices. 

What GAO Recommends: 

GAO recommends, among other things, that BLM should report to Congress 
on the results of a pilot project to improve APD processing and 
recommend whether it should be implemented throughout the United 
States; improve the completeness and accuracy of data on processing of 
APDs; and take steps to improve its ability to identify wells that are 
a high priority for environmental inspection. In commenting on a draft 
of this report, the Department of the Interior generally agreed with 
GAO’s recommendations. 

View GAO-13-572. For more information, contact Frank Rusco at (202) 
512-3841 or ruscof@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

BLM's Permitting Workload Has Changed in Number, Type, and Location of 
APDs: 

BLM Has Taken Actions to Better Manage Its Oil and Gas Permitting 
Workload, but Challenges Remain: 

BLM Has Taken Actions to Better Mitigate the Environmental Impact of 
Oil and Gas Development, but Challenges Remain: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Comments from the Department of the Interior: 

Appendix III: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Change in the Number of Applications for Permit to Drill 
Received by BLM Offices from Fiscal Years 2007 to 2012: 

Table 2: Change in the Number of Environmental Inspections Performed 
by BLM Offices from Fiscal Years 2007 to 2012: 

Figures: 

Figure 1: BLM's Lead Offices for Oil and Gas Development and the 
Number of Wells They Manage: 

Figure 2: BLM's Common Environmental Inspection Activities at 
Different Stages in the Life Cycle of a Well: 

Figure 3: Number of Applications for Permit to Drill Received by BLM 
by Source, Fiscal Years 2007-2012: 

Figure 4: Overview of Selected Key Dates, Steps, and Requirements in 
BLM's Review Process for Applications for Permit to Drill: 

Abbreviations: 

AFMSS: Automated Fluid Minerals Support System: 

APD: application for permit to drill: 

BLM: Bureau of Land Management: 

COA: conditions of approval: 

FLPMA: Federal Land Policy and Management Act of 1976: 

FOGRMA: Federal Oil and Gas Royalty Management Act of 1982: 

INC: Incident of Noncompliance: 

IT: information technology: 

NEPA: National Environmental Policy Act of 1969: 

[End of section] 

GAO:
United States Government Accountability Office: 
441 G St. N.W. 
Washington, DC 20548: 

August 23, 2013: 

The Honorable Peter DeFazio: 
Ranking Member: 
Committee on Natural Resources: 
House of Representatives: 

The Honorable Edward J. Markey: 
United States Senate: 

Over the past decade, the development of the nation's domestic sources 
of oil and natural gas--including on state, private, and federal 
lands--has intensified. At the same time, several changes have 
occurred in the oil and gas sector, such as shifts in oil and natural 
gas prices and technological advancements in horizontal drilling 
techniques combined with hydraulic fracturing.[Footnote 1] For 
example, horizontal drilling combined with hydraulic fracturing has 
resulted in the substantial growth of domestic onshore shale oil and 
shale gas production from 2007 to 2011.[Footnote 2] The changing 
dynamics of the onshore oil and gas sector contribute to challenges 
faced by the Department of the Interior's Bureau of Land Management 
(BLM), which manages onshore federal oil and gas resources. 
Specifically the Federal Land Policy and Management Act of 1976 
(FLPMA), as amended, directs Interior to manage federal land for 
multiple uses, such as recreation and mineral extraction, while also 
taking any action required to prevent the "unnecessary or undue 
degradation" of federal land, including federal land that has been 
leased for oil and gas operations. The challenges BLM faces in 
managing the development of federal oil and gas resources while also 
mitigating the environmental impacts of this development have 
generated concern among some federal and state government officials, 
conservationists, and oil and gas companies about the balance between 
oil and gas development and the use of these federal lands for other 
purposes. 

Under the Mineral Leasing Act of 1920, as amended, and other statutes, 
BLM issues leases for the development of oil and gas resources where 
authorized on and under BLM-managed federal land, under other federal 
agencies' lands, and under private land for which the federal 
government holds mineral rights--amounting to roughly 700 million 
subsurface acres. Companies or individuals (referred to in this report 
as operators) holding leases for oil and gas development must submit 
an application for permit to drill (APD) to BLM and obtain approval 
before preparing land or drilling new oil or gas wells. After 
receiving an APD, BLM generally communicates with operators until they 
provide all of the required documents. The Energy Policy Act of 2005, 
[Footnote 3] among other things, requires BLM to approve or defer the 
APD within 30 days after the operator has submitted a complete APD. 
BLM's process for reviewing an APD includes several key steps. For 
example, BLM generally reviews the APD to mitigate or avoid adverse 
impacts on the land, air, water, vegetation, and wildlife. 
Additionally, under its regulations, BLM is to ensure that the 
operator's plans comply with relevant laws and regulations under BLM's 
jurisdiction.[Footnote 4] In addition, BLM is to review lease 
requirements, known as stipulations. BLM staff also are to review the 
APD to determine if any conditions of approval (COA)--such as 
protections for wildlife habitat, management of invasive species, or 
testing of well control equipment--should be included in the APD. Once 
BLM approves the APD, and operators have obtained any necessary state 
permits or approvals, operators may drill, subject to the conditions 
of the APD. 

BLM is responsible for requiring that operators comply with the terms 
of APDs, including COAs, during the entire life cycle of every well, 
and can take enforcement action if operators do not comply. Under the 
Federal Oil and Gas Royalty Management Act of 1982 (FOGRMA), as 
amended,[Footnote 5] BLM has the authority to inspect federal oil and 
gas sites, including well pads and production facilities. According to 
the agency's handbook for its inspection and enforcement program, BLM 
must ensure that oil and gas operations on federal lands are prudently 
conducted in a manner that ensures protection of the surface and 
subsurface environment. [Footnote 6] Among the inspections conducted 
by BLM are environmental inspections that, among other things, ensure 
that (1) sensitive species are not disturbed during the construction 
of a well pad, (2) pits designed to hold the waste by-products of 
drilling activities are appropriately constructed and maintained, (3) 
significant erosion is not occurring on the well site, and (4) 
disturbed lands are properly reclaimed to as close to original 
condition as practical. If BLM determines through an inspection that a 
violation of a restriction or requirement of the APD occurred or is 
occurring, the agency can, depending on the violation, issue 
assessments or civil penalties or take other enforcement action. 

In 2005, we reported on aspects of BLM's responsibilities for onshore 
oil and gas development.[Footnote 7] Specifically, we reported that an 
increase in oil and gas operations on federal lands had lessened BLM's 
ability to meet its responsibilities for mitigating the environmental 
impacts of oil and gas development. We found that from fiscal year 
1999 to fiscal year 2004, the total number of APDs approved by BLM 
more than tripled--from 1,803 to 6,399--and BLM officials in five out 
of eight field offices that we visited said that staff had to devote 
more time to processing APDs, leaving less time for conducting 
environmental inspections. 

You asked us to review BLM actions taken after our 2005 report with 
respect to processing APDs for oil and gas resources on federal lands 
and mitigating environmental impacts. The objectives of this review 
were to determine, from fiscal years 2007 to 2012, (1) what changes 
have occurred in BLM's oil and gas permitting workload; (2) what 
actions BLM has taken to manage its oil and gas permitting workload 
and what challenges, if any, remain; and (3) what actions BLM has 
taken to mitigate the surface environmental impact of developing 
federal oil and gas resources and what challenges, if any, remain. We 
focused on actions BLM has taken to mitigate surface environmental 
impacts. We did not analyze other areas of BLM's environmental efforts 
including land use planning, lease decisions, and inspections of 
subsurface activity. 

To conduct this work, we reviewed federal laws and regulations 
regarding BLM's management of onshore oil and gas resources owned by 
the federal government. In addition, we obtained data from BLM's 
Automated Fluid Minerals Support System (AFMSS)--the central database 
that BLM uses to track oil and gas information on public land--
including data on APDs received or approved and environmental 
inspections performed since fiscal year 2005. Since BLM's information 
technology (IT) systems for tracking data on oil and gas development 
on Indian Trust lands were shut down for various periods from 2001 to 
2008 because of a lawsuit, we did not review data on APDs or 
environmental inspections for nonfederal wells located on Indian Trust 
lands. Consequently, the data on APDs presented in this report refer 
exclusively to APDs for federal oil and gas resources, and the data 
presented on environmental inspections refer exclusively to 
inspections that were performed on federal wells and facilities. To 
determine how BLM's permitting workload has changed, we analyzed the 
data on APDs received by BLM. We also analyzed BLM's data on approved 
APDs to assess the time it takes to process APDs from the date of 
receipt to the date of approval. To assess the reliability of the APD 
data, we performed electronic testing of the data and interviewed 
agency officials about the data. We determined that the APD data were 
sufficiently reliable to present results on the number of APDs 
received by BLM from fiscal years 2007 to 2012 and the average number 
of days it took BLM to process APDs from the date of receipt to the 
date of approval in fiscal year 2012. We determined that BLM's data on 
approved APDs were not sufficiently reliable to assess BLM's 
compliance with the required 30-day deadline to approve or defer 
completed APDs or to assess the number of days it took BLM to process 
APDs prior to fiscal year 2012. To evaluate BLM's efforts to mitigate 
the surface environmental impacts of oil and gas development, we 
analyzed BLM's data on environmental inspections performed on federal 
oil and gas wells and facilities. To assess the reliability of the 
environmental inspection data, we performed electronic testing and 
interviewed agency officials about the data. We determined that the 
environmental inspection data for fiscal years 2005 and 2006 were not 
sufficiently reliable for our purposes; as a result, we limited the 
scope of the environmental inspections analysis to fiscal years 2007 
through 2012. We believe the AFMSS data for those years are 
sufficiently reliable for the purposes presented in this report. To be 
consistent with our presentation of the environmental inspection data, 
we also limited the scope of the APD data presented in this report to 
fiscal years 2007 to 2012.To identify actions BLM has taken to manage 
its permitting workload and to mitigate the environmental impact of 
oil and gas development on federal lands, we reviewed BLM guidance and 
documentation and interviewed officials in BLM's Washington, D.C., 
headquarters office. We selected a nonprobability sample of 11 BLM 
field offices that manage oil and gas development to contact and 
collect information about how each office manages its oil and gas 
program, including how the office reviews APDs for environmental 
mitigation purposes and inspects oil and gas activity on federal 
lands.[Footnote 8] We selected the 11 offices to reflect different 
geographical locations and types of oil and gas resources managed. In 
fiscal year 2012, these offices accounted for about 68 percent of all 
APDs received by BLM for federal oil and gas resources and for about 
52 percent of all environmental inspections performed by BLM. In 
addition, we interviewed officials from four BLM state offices, 
selected on the basis of their jurisdiction over some of the field 
offices we contacted. We also interviewed representatives from 
environmental organizations and energy industry organizations to 
obtain their perspectives on BLM's management of federal oil and gas 
resources. Appendix I describes our scope and methodology in more 
detail. 

We conducted this performance audit from May 2012 to August 2013 in 
accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

Background: 

This section discusses BLM's organizational structure for managing oil 
and gas development, provides an overview of the process for 
developing federal oil and gas resources, and describes BLM's 
inspection and enforcement program. 

BLM's Organizational Structure for Managing Oil and Gas Development: 

Implementation of BLM's oil and gas program, including processing APDs 
and performing environmental inspections, primarily occurs at the 
field office level and is led by 33 BLM offices located primarily in 
the Mountain West.[Footnote 9] BLM's headquarters, state, and district 
offices oversee and provide guidance and support to the field offices 
that implement BLM's oil and gas program. As of December 2012, BLM 
offices were responsible for managing nearly 92,600 wells involved in 
developing federal onshore oil and gas resources. BLM offices in two 
states--New Mexico and Wyoming--accounted for about 67 percent of the 
total wells and BLM offices in three other states--California, 
Colorado, and Utah--accounted for about 24 percent. BLM's remaining 
offices collectively accounted for about 9 percent of the total (see 
figure 1).[Footnote 10] Overall, the number of wells managed by BLM 
has increased since fiscal year 2007, when BLM reported managing about 
79,970 wells. 

Figure 1: BLM's Lead Offices for Oil and Gas Development and the 
Number of Wells They Manage: 

[Refer to PDF for image: illustrated U.S. map and associated data] 

BLM Office Name (location): Farmington Field Office (New Mexico); 
Number of Wells: 14,732 

BLM Office Name (location): Buffalo Field Office (Wyoming); 
Number of Wells: 12,607 

BLM Office Name (location): Carlsbad Field Office (New Mexico); 
Number of Wells: 8,425 

BLM Office Name (location): Bakersfield Field Office (California); 
Number of Wells: 7,930 

BLM Office Name (location): Vernal Field Office (Utah); 
Number of Wells: 6,643 

BLM Office Name (location): Pinedale Field Office (Wyoming); 
Number of Wells: 5,527 

BLM Office Name (location): Hobbs Field Station (New Mexico)[A]; 
Number of Wells: 4,802 

BLM Office Name (location): Casper Field Office (Wyoming); 
Number of Wells: 3,546 

BLM Office Name (location): Worland Field Office (Wyoming); 
Number of Wells: 2,858 

BLM Office Name (location): Rawlins Field Office (Wyoming); 
Number of Wells: 2,477 

BLM Office Name (location): White River Field Office (Colorado); 
Number of Wells: 2,369 

BLM Office Name (location): Colorado River Valley Field Office 
(Colorado; 
Number of Wells: 2,358 

BLM Office Name (location): Newcastle Field Office (Wyoming); 
Number of Wells: 1,597 

BLM Office Name (location): Roswell Field Office (New Mexico); 
Number of Wells: 1,519 

BLM Office Name (location): Rock Springs Field Office (Wyoming); 
Number of Wells: 1,489 

BLM Office Name (location): Miles City Field Office (Montana); 
Number of Wells: 1,481 

BLM Office Name (location): Oklahoma Field Office (Oklahoma); 
Number of Wells: 1,417 

BLM Office Name (location): North Dakota Field Office (North Dakota); 
Number of Wells: 1,404 

BLM Office Name (location): Great Falls Oil and Gas Field Office 
(Montana); 
Number of Wells: 1,402 

BLM Office Name (location): Northeastern States Field Office 
(Wisconsin); 
Number of Wells: 1,182 

BLM Office Name (location): Southeastern States Field Office 
(Mississippi); 
Number of Wells: 988 

BLM Office Name (location): Lander Field Office (Wyoming); 
Number of Wells: 908 

BLM Office Name (location): Kemmerer Field Office (Wyoming); 
Number of Wells: 797 

BLM Office Name (location): Moab Field Office (Utah); 
Number of Wells: 680 

BLM Office Name (location): Price Field Office (Utah); 
Number of Wells: 662 

BLM Office Name (location): Rio Puerco Field Office (New Mexico); 
Number of Wells: 555 

BLM Office Name (location): Little Snake Field Office (Colorado); 
Number of Wells: 554 

BLM Office Name (location): Grand Junction Field Office (Colorado); 
Number of Wells: 514 

BLM Office Name (location): Royal Gorge Field Office (Colorado); 
Number of Wells: 454 

BLM Office Name (location): Tres Rios Field Office (Colorado); 
Number of Wells: 397 

BLM Office Name (location): Nevada State Office (Nevada); 
Number of Wells: 119 

BLM Office Name (location): Alaska State Office (Alaska); 
Number of Wells: 113 

BLM Office Name (location): Salt Lake Field Office (Utah); 
Number of Wells: 79 

Total (all offices): 
Number of Wells: 92,585[B]. 

Sources: GAO analysis of BLM data; Map Resources (map). 

Note: The data presented in this figure include (1) wells that were 
located on lands whose surface is managed by BLM and that were in a 
producible or service status (i.e., wells that were physically and 
mechanically capable of producing oil or gas or that were used to 
support oil and gas operations through activities such as water 
disposal) as of December 18, 2012, and (2) wells that were located on 
lands whose surface is managed by other federal, state, or private 
entities, but which have mineral rights that are controlled by the 
federal government and that were in a producible or service status as 
of November 30, 2012. This figure does not include data on federal 
wells that have been abandoned or nonfederal wells located on Indian 
Trust lands. Some BLM field offices in other locations also have small 
oil and gas programs that are administered with the assistance of the 
33 lead offices, and their well numbers are included in the totals 
presented in this figure for their respective lead office. 

[A] Staff from the Carlsbad Field Office provide support to the Hobbs 
Field Station on some oil and gas activities, including processing 
APDs and performing environmental inspections. 

[B] BLM also manages 14 additional federal wells that are not included 
in the total presented in this figure due to their database records 
listing multiple field offices for the same well. 

[End of figure] 

Overview of the Process for Developing Federal Oil and Gas Resources: 

FLPMA requires the Secretary of the Interior to develop land use plans 
that are evaluated for potential revision at least every 5 years. 
These plans identify federal lands and mineral resources that will be 
available for oil and gas development and other activities.[Footnote 
11] As part of developing or revising land use plans, BLM is required 
under the National Environmental Policy Act of 1969 (NEPA), as 
amended, to evaluate likely environmental effects of decisions in the 
plan, such as selecting areas for oil and gas development. Generally, 
Interior prepares an environmental impact statement--a detailed 
statement of the likely environmental effects of the proposed action--
in preparing land use plans, but it may use an environmental 
assessment--a more concise analysis developed if the environmental 
effect of the proposed action is unknown in association with other 
actions to determine whether the action is likely to affect the 
environment significantly.[Footnote 12] BLM officials said the agency 
uses the land use plans and environmental impact statements to (1) 
help develop "reasonably foreseeable development scenarios" to 
estimate outcomes, such as the number of wells and likely surface 
disturbance that may occur under the land use plan; (2) identify lands 
open and closed to leasing; (3) identify resource protection measures 
such as lease stipulations and environmental best management 
practices; and (4) to establish monitoring protocols. Consistent with 
a completed land use plan and its associated environmental impact 
statement, BLM can offer for lease those mineral rights identified in 
the plan and hence deemed available for leasing. 

Operators that have obtained a lease must submit an APD to BLM and 
obtain BLM's approval before drilling any new oil or gas wells. 
Beginning in fiscal year 2008, Congress authorized BLM to collect a 
$4,000 processing fee from operators for each new oil and gas APD. 
This processing fee was increased by Congress to $6,500 per APD in 
fiscal year 2010; any fees collected are used by BLM and offset the 
agency's general fund appropriation. A complete APD must include, 
among other things, a Surface Use Plan of Operations with the 
operator's plan for reclaiming disturbed lands during production 
(known as interim reclamation) and upon final abandonment of the well 
site (known as final reclamation). The reclamation plan covers both 
interim and final reclamation, and it outlines the steps the operator 
proposes to take to reclaim the well site. Those steps may include 
recontouring the topography to better match the surrounding landscape, 
redistributing topsoil, and revegetating the site with native plant 
species. 

Once BLM determines the APD is complete, it decides whether to approve 
the APD. BLM may approve the APD as submitted or approve it subject to 
certain COAs. According to BLM officials, COAs are generally attached 
to ensure environmental protection, safety, or conservation of mineral 
resources, and may be based on environmental best management 
practices. These environmental best management practices emphasize, 
among other things, the importance of interim steps to reclaim land 
during oil and gas production and the benefits of reclamation 
activities for mitigating the environmental impacts of oil and gas 
development.[Footnote 13] The COAs can be general in nature or site-
specific. Typically, a field office develops COAs over a number of 
years of active management of oil and gas development. They can 
address such topics as interim and final reclamation, protection of 
wildlife habitat or archeological and paleontological sites, noise 
reduction, wildfire suppression, or management of invasive species. 
After BLM approves an APD, the operator generally has a 2-year window 
before the APD expires during which the operator can drill the well 
and begin production, subject to any lease stipulations or COAs. 
[Footnote 14] However, upon a written request from the operator, BLM 
may extend the APD for up to 2 years. 

When an operator determines, and BLM agrees, that a well has no 
further economic value, the operator must plug the well and complete 
final reclamation by following the original or an amended reclamation 
plan for the well. BLM is then responsible for inspecting the site to 
ensure reclamation actions have taken place and for monitoring the 
success of the reclamation, a process that typically occurs over 
several years. Once BLM determines that reclamation has been 
completed, it approves a Final Abandonment Notice.[Footnote 15] As we 
reported in February 2011, all operators are required to complete 
reclamation, but they do not always do so.[Footnote 16] In these 
circumstances, BLM may use the bond the operator posted for the well 
to help defray some of the cost of completing reclamation. If the bond 
is not sufficient to cover well plugging and surface reclamation and 
there are no responsible or liable parties, the well is considered 
"orphaned," and BLM uses federal dollars to fund reclamation. 

As we reported in February 2011, BLM is also concerned with the status 
of idle wells.[Footnote 17] Under the Energy Policy Act of 2005, an 
idle well is defined as a well that has been nonoperational for at 
least 7 years and has no anticipated beneficial use. These are 
previously operating wells that an operator has decided not to operate 
for a period of time. In some instances, this may be because the 
operator is waiting for oil and gas prices to rise. In our February 
2011 report, we found that idle wells have the potential to create 
environmental, safety, and public health hazards if they fall into 
disrepair, and that they are at greater risk than other wells of 
becoming orphan wells.[Footnote 18] Following our February 2011 
report, BLM issued revised guidance on its reviews of idle wells in 
September 2012.[Footnote 19] 

BLM's Inspection and Enforcement Program: 

To help ensure operators' compliance with all stipulations in the 
lease and COAs in the APD, as well as certain laws and regulations, 
BLM has an inspection and enforcement program. BLM's authority for 
inspecting wells is derived from FOGRMA, which requires the Secretary 
of the Interior to develop guidelines that specify the coverage and 
frequency of inspections. BLM's AFMSS database tracks data on federal 
oil and gas wells, including data on environmental inspections. 

Environmental inspections are BLM's primary mechanism to ensure 
operators' compliance with lease stipulations, and COAs related to the 
surface environment, and to initiate enforcement actions if needed. 
For example, BLM may perform environmental inspections to help ensure 
that operators are adhering to COAs designed to mitigate the impact of 
oil and gas development on sensitive species and their habitat. BLM 
guidance does not require environmental inspection of all wells, or 
specify when a well should have an environmental inspection. Instead, 
BLM guidance instructs field offices to conduct environmental 
inspections annually on all wells rated high priority due to 
environmental concerns. BLM's inspection and enforcement handbook 
instructs offices to determine high-priority environmental inspections 
based on criteria including whether (1) operations on a well or 
facility are in or adjacent to an area of special environmental 
sensitivity, such as near threatened or endangered species habitat; 
(2) operations occur in an area where noncompliance with lease 
stipulations or COAs could have a significant adverse impact on the 
environment; (3) the operator has a history of noncompliance with 
environmental requirements; (4) 6 months have elapsed since a new well 
was completed or since a well has been abandoned, to ensure that 
earthwork for reclamation has been completed; and (5) an operator has 
submitted a Final Abandonment Notice. Based on these criteria, BLM's 
33 lead oil and gas offices are to develop annual targets for the 
number of high-priority environmental inspections they plan to conduct 
for (1) wells expected to be drilled, (2) wells already producing oil 
or gas, and (3) wells expected to be plugged and abandoned. 

Environmental inspections typically are performed by BLM staff--such 
as natural resource specialists, environmental protection specialists, 
or other resource program specialists--with specific training in 
environmental issues. For the purpose of this report, we will refer to 
all BLM staff who perform environmental inspections as environmental 
staff. As shown in figure 2, environmental inspections can occur 
during any stage in the life cycle of a well. 

Figure 2: BLM's Common Environmental Inspection Activities at 
Different Stages in the Life Cycle of a Well: 

[Refer to PDF for image: 3 photographs and associated data] 

Stage 1: Construction and drilling: 
Environmental inspection activities[A]: 
During the construction of a well pad, BLM may perform environmental 
inspections to ensure that, among other things, operators do not 
disturb lands outside of the boundaries identified in the application 
for permit to drill (APD); that the construction does not disturb 
sensitive species; and that any topsoil removed from the site is 
stored in accordance with the plan described in the APD. 

During the drilling of a new well, BLM may perform environmental 
inspections to review the surface disposal methods the operator is 
using for the by-products of drilling activities—such as drilling 
fluids or mud—and to verify that pits or tanks are free of visible 
leaks and have been adequately fenced or netted to protect wildlife 
and livestock. 

Stage 2: Production: 
Environmental inspection activities[B]: 
Within 6 months of when a new well is completed, BLM guidance 
instructs operators to complete the earthwork for interim reclamation 
and instructs BLM to perform an environmental inspection to ensure 
that this has been done properly. During the production stage, 
environmental inspections are also performed to ensure compliance with 
all other interim reclamation requirements outlined in the Surface Use 
Plan of Operations, including applicable conditions of approval. 

Also, BLM may perform environmental inspections on producing wells to 
ensure that, among other things, no fluids are leaking into the 
environment; that wildlife mitigation measures (such as screens or 
nets) have been installed; and that the well pad is free of trash or 
debris. 

Stage 3: Abandonment: 
Environmental inspection activities[C]: 
BLM guidance instructs operators to complete the earthwork for final 
reclamation within 6 months of a well being plugged and instructs BLM 
to perform an environmental inspection to ensure that this has been 
done properly. Also, before approving the final abandonment of a well, 
BLM’s guidance calls for BLM to perform an environmental inspection to 
ensure that all of the surface reclamation standards required in the 
Surface Use Plan of Operations have been satisfied. 

Source: GAO analysis of BLM documents and data; GAO (left-hand and 
center photos); BLM (right-hand photo). 

[A] BLM may also perform other types of inspections during this stage 
that are not specifically related to the surface environment, such as 
inspections to witness tests of the well's blowout prevention 
equipment or to examine the cementing or casing of the well. 

[B] BLM may also perform other types of inspections of a well when it 
is producing oil or gas, such as inspections to verify that the well 
equipment is working properly and that the production meters are 
accurately measuring and accounting for the full volume of oil and gas 
being produced by the well. 

[C] During this stage, BLM staff may also perform inspections to 
observe and examine the plugging of the well hole. BLM does not track 
these inspections as environmental inspections. 

[End of figure] 

BLM's inspection and enforcement handbook defines a violation as a 
noncompliance with a specific requirement outlined in federal 
regulations, onshore orders, or COAs, among other things, and a 
problem as a concern or issue identified during an inspection that is 
not covered by a specific regulatory requirement. If BLM staff 
determine that a violation has occurred, they can issue a formal 
Incident of Noncompliance (INC) violation notice. Depending on the 
severity of a violation, INCs can result in the operator being fined. 
For example, if BLM discovers that an operator has begun construction 
of a well pad on federal or Indian surface without having approval to 
do so, BLM is authorized to assess the operator $500 for each day that 
the violation existed, up to a maximum of $5,000. If BLM staff 
determine that a problem occurred or is occurring, they can issue a 
verbal warning or a written order. The handbook also instructs BLM 
staff to document any enforcement actions in AFMSS. 

BLM's Permitting Workload Has Changed in Number, Type, and Location of 
APDs: 

BLM's permitting workload has changed from fiscal year 2007 to fiscal 
year 2012 in terms of the (1) number and type of APDs received and (2) 
their location. 

Natural Gas and Coalbed Methane APDs Have Decreased from Fiscal Year 
2007 to Fiscal Year 2012 and APDs for Oil Wells Have Increased: 

Our analysis of BLM data found that BLM received about half as many 
APDs for federal oil and gas resources in fiscal year 2012 (4,303) as 
in fiscal year 2007 (8,573). Nonetheless, the number of APDs received 
in fiscal year 2012 represented about a 4 percent increase over fiscal 
year 2010, which was the year during our review that BLM received the 
fewest APDs (4,121). The general decline in APDs since 2007 was most 
evident in the number of APDs BLM received for new natural gas and 
coalbed methane wells, which dropped by approximately 52 percent and 
99 percent, respectively, from fiscal year 2007 to fiscal year 2012. 
In contrast, the number of APDs received for oil wells increased by 
approximately 70 percent, with about 1,300 APDs received in fiscal 
year 2007 to about 2,200 APDs received in fiscal year 2012.[Footnote 
20] Figure 3 shows the total number of APDs for federal oil and gas 
resources received by BLM each fiscal year from 2007 through 2012 and 
breaks down the numbers of APDs received for coalbed methane, natural 
gas, oil, and other types of wells. 

Figure 3: Number of Applications for Permit to Drill Received by BLM 
by Source, Fiscal Years 2007-2012: 

[Refer to PDF for image: stacked vertical bar graph] 

APDs received by BLM: 

Fiscal year 2007; 
Other[A]: 167; 
Oil: 1,304; 
Natural Gas: 4,107; 
Coalbed methane: 2,995. 

Fiscal year 2008; 
Other[A]: 117; 
Oil: 1,654; 
Natural Gas: 3,427; 
Coalbed methane: 2,486. 

Fiscal year 2009; 
Other[A]: 133; 
Oil: 1,251; 
Natural Gas: 2,661; 
Coalbed methane: 1,189. 

Fiscal year 2010; 
Other[A]: 85; 
Oil: 1,504; 
Natural Gas: 1,998; 
Coalbed methane: 534. 

Fiscal year 2011; 
Other[A]: 150; 
Oil: 2,005; 
Natural Gas: 1,918; 
Coalbed methane: 194. 

Fiscal year 2012; 
Other[A]: 113; 
Oil: 2,211; 
Natural Gas: 1,960; 
Coalbed methane: 19. 

Source: GAO analysis of BLM data. 

Note: This figure presents data by fiscal year (FY) on applications 
for permit to drill (APD) for federal oil and gas resources and does 
not include APDs received by BLM for nonfederal oil and gas resources 
on Indian Trust lands. According to BLM officials, APDs for nonfederal 
oil and gas resources on Indian Trust lands are a sizable portion of 
some BLM offices' permitting workload. 

[A] Other includes, among other things, injection wells, which can be 
used to support oil and gas operations by injecting water or other 
fluids into oil- or gas-producing formations to increase the pressure 
in the formation and force additional oil or gas out of nearby 
producing wells. 

[End of figure] 

BLM officials and oil and gas industry representatives we interviewed 
identified a variety of factors that can influence an operator's 
decision to develop oil and gas resources and that may provide context 
to the changes in BLM's permitting workload since fiscal year 2007. 
These factors include the following: 

* The price of oil and natural gas. Officials from the 11 BLM field 
offices we contacted said they consider the price of oil and natural 
gas to be a factor contributing to changes in their offices' 
permitting workload. For example, officials in 6 offices we contacted 
said that lower prices for natural gas have contributed to the decline 
in the number of natural gas and coalbed methane APDs their offices 
have received in recent years. In addition, officials from 5 offices 
located in areas where oil is being developed said that higher prices 
for oil have contributed to an increase in the number of oil APDs 
their offices have received. This is consistent with what we found in 
July 2010, when we reported on the relationship between fluctuations 
in oil and gas prices and development activities and found that 
changes in the prices of oil and gas closely paralleled changes in 
development activities from 1990 through 2009.[Footnote 21] 
Specifically, we reported that the peaks and troughs in prices and 
development activities, measured by the number of oil and gas wells 
drilled, largely overlapped, strongly suggesting that development 
activities reacted quickly and proportionally to changes in the prices 
of oil and gas. 

* Increased development of shale oil and shale gas. BLM officials and 
industry representatives cited the growth in development of oil and 
natural gas from shale formations (shale oil and shale gas) as a 
significant change in the oil and gas sector that has influenced where 
oil and gas resources are developed. This growth was made possible in 
part due to technological advancements in combining horizontal 
drilling techniques and hydraulic fracturing. According to BLM 
officials and industry representatives, the increase in the 
development of shale oil and shale gas has largely occurred on state 
and private lands. This is consistent with our finding from September 
2012, when we reported that the location of shale formations appears 
to be predominately on nonfederal lands, according to an official from 
the Energy Information Administration.[Footnote 22] Also, an oil and 
gas industry representative we interviewed said the economics have 
become more attractive for developing oil and gas from shale 
formations than from other onshore sources. For example, the industry 
representative said that shale gas wells have, in general, become more 
profitable than coalbed methane wells in recent years. This is due in 
part to the fact that shale gas wells often produce more natural gas 
than coalbed methane wells and also because coalbed methane wells 
generally involve additional costs associated with the disposal of 
large quantities of water they produce. 

* Differences between federal and state permitting processes. Oil and 
gas industry representatives said there is a perception in the 
industry that the permitting process and regulatory environment 
associated with developing federal oil and gas resources is more 
complex and time-consuming than for oil and gas resources located on 
state or private lands. According to these representatives, delays in 
obtaining permits are costly for operators and may prompt operators to 
seek to develop oil and gas on state and private lands rather than on 
federal lands. BLM officials said that BLM must consider multiple uses 
of the land and that the environmental standards and legal 
requirements they must follow when managing oil and gas development 
may differ from the requirements for state or private lands. 

APD Activity Has Varied by Location: 

Permitting activity since 2007 has varied among BLM offices, as shown 
in table 1. For instance, 23 of BLM's 33 lead oil and gas offices 
received fewer APDs for federal oil and gas resources in fiscal year 
2012 than in fiscal year 2007; 9 offices received more APDs; and 1 
office did not experience any change in APDs received. 

Table 1: Change in the Number of Applications for Permit to Drill 
Received by BLM Offices from Fiscal Years 2007 to 2012: 

Office name (state): Buffalo FO (WY)[A]; 
Number of APDs received (FY 07): 2,673; 
Number of APDs received (FY 12): 127; 
Change in number of APDs received (FY 07 to FY 12): -2,546. 

Office name (state): Farmington FO (NM[A]); 
Number of APDs received (FY 07): 825; 
Number of APDs received (FY 12): 96; 
Change in number of APDs received (FY 07 to FY 12): -729. 

Office name (state): Pinedale FO (WY); 
Number of APDs received (FY 07): 814; 
Number of APDs received (FY 12): 326; 
Change in number of APDs received (FY 07 to FY 12): -488. 

Office name (state): Rawlins FO (WY)[A]; 
Number of APDs received (FY 07): 372; 
Number of APDs received (FY 12): 126; 
Change in number of APDs received (FY 07 to FY 12): -246. 

Office name (state): Colorado River Valley FO (CO)[A]; 
Number of APDs received (FY 07): 383; 
Number of APDs received (FY 12): 182; 
Change in number of APDs received (FY 07 to FY 12): -201. 

Office name (state): Great Falls Oil and Gas FO (MT); 
Number of APDs received (FY 07): 103; 
Number of APDs received (FY 12): 1; 
Change in number of APDs received (FY 07 to FY 12): -102. 

Office name (state): White River FO (CO); 
Number of APDs received (FY 07): 199; 
Number of APDs received (FY 12): 106; 
Change in number of APDs received (FY 07 to FY 12): -93. 

Office name (state): Miles City FO (MT)[A]; 
Number of APDs received (FY 07): 122; 
Number of APDs received (FY 12): 43; 
Change in number of APDs received (FY 07 to FY 12): -79. 

Office name (state): Rock Springs FO (WY); 
Number of APDs received (FY 07): 149; 
Number of APDs received (FY 12): 73; 
Change in number of APDs received (FY 07 to FY 12): -76. 

Office name (state): Kemmerer FO (WY); 
Number of APDs received (FY 07): 87; 
Number of APDs received (FY 12): 16; 
Change in number of APDs received (FY 07 to FY 12): -71. 

Office name (state): Southeastern States FO (MS); 
Number of APDs received (FY 07): 93; 
Number of APDs received (FY 12): 24; 
Change in number of APDs received (FY 07 to FY 12): -69. 

Office name (state): Roswell FO (NM); 
Number of APDs received (FY 07): 68; 
Number of APDs received (FY 12): 7; 
Change in number of APDs received (FY 07 to FY 12): -61. 

Office name (state): Lander FO (WY); 
Number of APDs received (FY 07): 81; 
Number of APDs received (FY 12): 24; 
Change in number of APDs received (FY 07 to FY 12): -57. 

Office name (state): Worland FO (WY); 
Number of APDs received (FY 07): 78; 
Number of APDs received (FY 12): 22; 
Change in number of APDs received (FY 07 to FY 12): -56. 

Office name (state): Royal Gorge FO (CO); 
Number of APDs received (FY 07): 81; 
Number of APDs received (FY 12): 30; 
Change in number of APDs received (FY 07 to FY 12): -51. 

Office name (state): Moab FO (UT); 
Number of APDs received (FY 07): 56; 
Number of APDs received (FY 12): 13; 
Change in number of APDs received (FY 07 to FY 12): -43. 

Office name (state): Tres Rios FO (CO); 
Number of APDs received (FY 07): 41; 
Number of APDs received (FY 12): 10; 
Change in number of APDs received (FY 07 to FY 12): -31. 

Office name (state): Little Snake FO (CO); 
Number of APDs received (FY 07): 50; 
Number of APDs received (FY 12): 21; 
Change in number of APDs received (FY 07 to FY 12): -29. 

Office name (state): Northeastern States FO (WI); 
Number of APDs received (FY 07): 16; 
Number of APDs received (FY 12): 1; 
Change in number of APDs received (FY 07 to FY 12): -15. 

Office name (state): Salt Lake FO (UT); 
Number of APDs received (FY 07): 9; 
Number of APDs received (FY 12): 0; 
Change in number of APDs received (FY 07 to FY 12): -9. 

Office name (state): Nevada State Office (NV); 
Number of APDs received (FY 07): 17; 
Number of APDs received (FY 12): 10; 
Change in number of APDs received (FY 07 to FY 12): -7. 

Office name (state): Rio Puerco FO (NM); 
Number of APDs received (FY 07): 9; 
Number of APDs received (FY 12): 5; 
Change in number of APDs received (FY 07 to FY 12): -4. 

Office name (state): Alaska State Office (AK); 
Number of APDs received (FY 07): 4; 
Number of APDs received (FY 12): 2; 
Change in number of APDs received (FY 07 to FY 12): -2. 

Office name (state): Newcastle FO (WY); 
Number of APDs received (FY 07): 52; 
Number of APDs received (FY 12): 52; 
Change in number of APDs received (FY 07 to FY 12): 0. 

Office name (state): Grand Junction FO (CO); 
Number of APDs received (FY 07): 48; 
Number of APDs received (FY 12): 49; 
Change in number of APDs received (FY 07 to FY 12): 1. 

Office name (state): Bakersfield FO (CA); 
Number of APDs received (FY 07): 279; 
Number of APDs received (FY 12): 287; 
Change in number of APDs received (FY 07 to FY 12): 8. 

Office name (state): Price FO (UT); 
Number of APDs received (FY 07): 77; 
Number of APDs received (FY 12): 92; 
Change in number of APDs received (FY 07 to FY 12): 15. 

Office name (state): Oklahoma FO (OK); 
Number of APDs received (FY 07): 48; 
Number of APDs received (FY 12): 79; 
Change in number of APDs received (FY 07 to FY 12): 31. 

Office name (state): Casper FO (WY); 
Number of APDs received (FY 07): 90; 
Number of APDs received (FY 12): 158; 
Change in number of APDs received (FY 07 to FY 12): 68. 

Office name (state): Vernal FO (UT)[A]; 
Number of APDs received (FY 07): 946; 
Number of APDs received (FY 12): 1072; 
Change in number of APDs received (FY 07 to FY 12): 126. 

Office name (state): Hobbs Field Station (NM); 
Number of APDs received (FY 07): 145; 
Number of APDs received (FY 12): 283; 
Change in number of APDs received (FY 07 to FY 12): 138. 

Office name (state): North Dakota FO (ND); 
Number of APDs received (FY 07): 84; 
Number of APDs received (FY 12): 287; 
Change in number of APDs received (FY 07 to FY 12): 203. 

Office name (state): Carlsbad FO (NM)[A]; 
Number of APDs received (FY 07): 474; 
Number of APDs received (FY 12): 679; 
Change in number of APDs received (FY 07 to FY 12): 205. 

Office name (state): Total; 
Number of APDs received (FY 07): 8,573; 
Number of APDs received (FY 12): 4,303; 
Change in number of APDs received (FY 07 to FY 12): -4,270. 

Legend: FY = fiscal year; FO = Field Office. 

Source: GAO analysis of BLM data. 

Note: The names of offices participating in the Federal Permit 
Streamlining Pilot Project, which was established in section 365 of 
the Energy Policy Act of 2005 to improve oil and gas permitting, are 
presented in bold. This table presents data on applications for permit 
to drill (APD) for federal oil and gas resources and does not include 
APDs received by BLM for nonfederal oil and gas resources on Indian 
Trust lands. According to BLM officials, APDs for nonfederal oil and 
gas resources on Indian Trust lands are a sizable portion of some BLM 
offices' permitting workload. 

[End of table] 

Variations in the level of permitting activity in different locations 
from fiscal year 2007 to fiscal year 2012 reflect the general shift in 
the types of APDs submitted to BLM that occurred over the same time 
period. For example, in fiscal year 2007, the Buffalo Field Office in 
Wyoming received more APDs than any other office, and nearly 98 
percent of the APDs received were for coalbed methane wells. However, 
as the number of APDs for coalbed methane has declined in recent 
years, the Buffalo Field Office has experienced a significant drop in 
the number of new APDs it received, declining from 2,673 APDs in 
fiscal year 2007 down to 127 APDs in fiscal year 2012. As a result of 
this decline, the Buffalo Field Office transitioned from receiving 
more than 30 percent of all APDs for federal oil and gas resources in 
fiscal year 2007 to receiving about 3 percent of all APDs by fiscal 
year 2012.[Footnote 23] 

In contrast, BLM's North Dakota Field Office experienced more than a 
240 percent increase in the number of APDs it received, from 84 in 
fiscal year 2007 to 287 in fiscal year 2012, and all of the APDs were 
for oil wells.[Footnote 24] The North Dakota Field Office, which was 
the seventeenth most active BLM office for APDs received in fiscal 
year 2007, ranked as the fourth most active BLM office in fiscal year 
2012.[Footnote 25] In response to the increase in APDs at the North 
Dakota Field Office, BLM officials said the agency created two special 
response strike teams in 2012 that consisted of 10 to 12 oil and gas 
staff from field offices across BLM. These teams helped process 
pending APDs for about 3 weeks and, according to BLM officials, the 
strike teams assisted in approving more than 200 APDs for federal and 
Indian Trust wells. BLM officials also said that they may consider 
using the strike team concept again under certain circumstances, such 
as when a field office experiences a large increase in APDs. 

BLM Has Taken Actions to Better Manage Its Oil and Gas Permitting 
Workload, but Challenges Remain: 

BLM has taken actions to improve its management of its oil and gas 
permitting workload since we last reported on this issue in 2005, 
including revising its permitting rule in 2007, developing plans for a 
new APD processing system, and implementing a pilot project that 
increased funding and staff for APD processing. Even with the actions 
taken to address its permitting workload, BLM continues to face 
challenges with APD processing. 

BLM Revised Its Permitting Rule, Developed Plans for a New APD 
Processing System, and Implemented a Pilot Permitting Project: 

Since we reported on BLM's oil and gas permitting workload in 2005, 
BLM has implemented a number of actions to manage its changing 
permitting workload and implement provisions of the Energy Policy Act 
of 2005. These actions include (1) revising its oil and gas permitting 
rule, (2) developing plans for a new APD processing system, and (3) 
implementing a pilot project in some field offices to streamline APD 
processing. The impact of some of these actions on BLM's performance 
and effectiveness is not yet known because BLM has not completed fully 
implemented or fully evaluated the actions. 

Revisions to BLM's Permitting Rule: 

In March 2007, BLM issued its revised rule for oil and gas permitting, 
known as Onshore Oil and Gas Order Number 1 (the order), which 
specifies the requirements necessary for the approval of proposed oil 
and gas wells on areas covered by federal onshore oil and gas leases. 
[Footnote 26] The order incorporated changes in law, policy, 
procedures, and requirements that had been implemented since the 
previous rule for oil and gas permitting was published in 1983. These 
changes include the Federal Onshore Oil and Gas Leasing Reform Act of 
1987 and the Energy Policy Act of 2005. The order includes several 
changes that could affect BLM's permitting workload, the content of 
the APDs submitted by operators, and the procedures BLM uses to 
process those APDs. Among other things, the order: 

* Clarified what operators must include in an APD for it to be 
considered complete.[Footnote 27] Key components include (1) a 
completed application form, (2) a well plat depicting the proposed 
location and boundaries of the proposed development, (3) a Drilling 
Plan containing technical information such as the operator's minimum 
specifications for blowout prevention equipment, (4) a Surface Use 
Plan of Operations, (5) evidence of bond coverage,[Footnote 28] and 
(6) operator certification that the information it has provided in the 
APD is correct and that the operator will develop the proposed site in 
conformity with the terms and conditions of the APD. 

* Incorporated the required deadlines for APD processing established 
by the Energy Policy Act of 2005 which, among other things, requires 
BLM to (1) notify the operator within 10 days of receiving an APD as 
to whether or not the APD is complete and (2) approve or defer the APD 
within 30 days after the operator has submitted a complete APD. 
[Footnote 29] 

* Established a new approval process for Master Development Plans, 
which allows operators to submit multiple APDs together for wells that 
share a common Drilling Plan and Surface Use Plan of Operations. 
According to BLM officials, a Master Development Plan increases 
processing efficiency and enables BLM to consider the cumulative 
effects of development early in the process of developing an oil and 
gas field to minimize adverse environmental impacts. 

* Encouraged operators to voluntarily use environmental best 
management practices when developing their APDs and stated that BLM 
may incorporate these practices as required COAs based on the results 
of the NEPA analysis or other analyses performed during the APD review 
process.[Footnote 30] 

Development and Planned Implementation of a New APD Processing and 
Tracking System: 

In 2012, BLM announced plans to implement a new automated APD 
processing and tracking system in 2013. According to information 
provided by BLM, this new system is intended to help BLM process APDs 
faster and more efficiently and improve the quality of data on APDs 
tracked by the agency. Specifically, the new system is expected to 
improve APD processing and data quality by: 

* Promoting the use of online submissions of APDs and automatically 
preventing the submission of an APD if any required fields are 
incomplete. Currently, operators can submit APDs to BLM in hard copy 
format or electronically. According to information provided by BLM, 
operators will be able to input APD data directly into BLM's new 
system and will be automatically alerted if any information is missing. 

* Improving BLM's workflow by automatically generating the letters BLM 
sends to operators about their APDs and the results of BLM's review 
process, thus reducing the time it takes staff to prepare these 
letters. Also, according to BLM officials, the new system will improve 
the routing of different parts of the APD package to various BLM 
specialists (e.g., petroleum engineers or geologists) for their review. 

* Allowing operators to electronically track the progress of their 
submitted APDs and identify delays so that they can proactively 
resolve issues with BLM. Under current practice, operators must either 
wait for BLM to contact them about problems with APDs or contact staff 
in BLM offices to identify any deficiencies that need resolution. 

* Allowing BLM to better track and evaluate its progress in processing 
APDs and to identify common sources of delays. According to BLM 
officials, the new system will support more advanced analyses of BLM's 
processing performance and improve the quality of BLM's data by, for 
example, automatically recording some dates associated with the 
processing of APDs. 

According to BLM officials, a similar APD processing and tracking 
system used by the Carlsbad Field Office since 2007 has helped reduce 
the time it takes to process APDs in that office. BLM officials said 
they expect to implement the new APD processing and tracking system 
agency-wide within calendar year 2013. According to BLM officials, the 
new APD processing and tracking system is one step in a broader effort 
to upgrade its oil and gas IT systems and replace AFMSS in the future. 

BLM Implemented a Pilot Project to Streamline Permit Processing: 

As prescribed by section 365 of the Energy Policy Act of 2005, BLM 
implemented the Federal Permit Streamlining Pilot Project. According 
to a Memorandum of Understanding signed by the Departments of 
Agriculture, the Army, and the Interior, as well as the Environmental 
Protection Agency, the project was aimed at improving the processing 
of APDs and coordination among BLM and other federal and state 
agencies on oil and gas permitting issues. The Energy Policy Act of 
2005 required the Secretary of the Interior to increase staff in seven 
BLM field offices as necessary to ensure the effective implementation 
of the Pilot Project and other programs administered by the field 
offices, such as their oil and gas inspection and enforcement 
programs. The seven pilot offices are Rawlins and Buffalo, Wyoming; 
Miles City, Montana; Farmington and Carlsbad, New Mexico; Grand 
Junction/Glenwood Springs, Colorado (now called the Colorado River 
Valley Field Office); and Vernal, Utah. 

To help implement the Pilot Project, the Energy Policy Act of 2005 
established a Permit Processing Improvement Fund to provide funds that 
BLM can use or transfer to other agencies, such as Interior's Fish and 
Wildlife Service. With some of these funds, BLM hired additional staff 
to assist with APD processing and inspection and enforcement efforts 
in the seven pilot offices. According to a 2008 report assessing the 
Pilot Project that was prepared for BLM, the agency had hired more 
than 140 new staff members for the seven pilot offices by the end of 
fiscal year 2007.[Footnote 31] This report assessed the overall impact 
and results of the Pilot Project in its first 2 years of 
implementation--fiscal years 2006 and 2007--and analyzed a variety of 
performance measures established by BLM for the project, including APD 
workloads and the average number of days it took the pilot offices to 
process APDs from date of receipt to date of approval. According to 
the report, the total number of APDs processed by the seven pilot 
offices increased by more than 10 percent from fiscal year 2005 (the 
year before the Pilot Project began) to fiscal year 2007, but the 
average number of days it took to process the APDs from date of 
receipt to date of approval increased by more than 40 percent during 
the same period. 

The Energy Policy Act of 2005 required Interior to issue a report to 
Congress by August 2008 that outlined the results of the Pilot Project 
to date and also make a recommendation to the President on whether the 
Pilot Project should be implemented throughout the United States, such 
as by expanding to all field offices. BLM, however, has not met this 
requirement. The 2008 assessment covered fiscal years 2006 and 2007, 
but it did not contain a recommendation on the future of the Pilot 
Project. Instead, the report stated that BLM would issue a separate 
report that would outline the results of the project and make a 
recommendation on whether it should be implemented in BLM's nonpilot 
offices as well. BLM officials prepared a draft report dated August 
2009 but, as of April 2013, BLM officials said there was no date set 
for its completion. As of June 2013, this report had not been 
finalized or released. The 2009 draft report contained an analysis of 
the results of the Pilot Project through fiscal year 2008 and also 
included recommendations.[Footnote 32] According to a BLM official, 
the report was not finalized or cleared by Interior or the Office of 
Management and Budget and therefore was not submitted to Congress. We 
asked BLM for supporting documentation of why the report was not 
finalized or submitted to Congress, but BLM did not provide any 
additional information. 

Since BLM has not completed an assessment of the Pilot Project since 
2008, it is unclear whether the project has met its goals or whether 
changes would improve its performance and effectiveness. Nevertheless, 
in its fiscal year 2014 budget request, BLM proposed changes to the 
Pilot Project and the Permit Processing Improvement Fund portion of 
the Pilot Project. Specifically, BLM is seeking flexibility to change 
which of its offices are pilot offices as needed based on changing 
permitting demands. BLM has also proposed that Congress eliminate the 
Permit Processing Improvement Fund and the annual APD fees beginning 
in 2015 and replace them by authorizing BLM to establish cost recovery 
fees for APDs that would finance BLM's labor and other expenses in 
processing the APDs. As of May 2013, Congress had not acted on these 
proposals. We asked for more details about how the proposed changes in 
funding would affect BLM's ability to carry out its operations under 
the Pilot Project, but BLM did not provide additional information, 
such as the amount of funds anticipated to be generated by the 
proposed change compared with the funds BLM is currently receiving. 
Instead, BLM officials said that the amount of funding BLM would 
receive through the APD cost recovery fees would vary based on the 
number of APDs submitted in a given year and thus may be subject to 
peaks and valleys based on fluctuations in permitting levels. It is 
uncertain what impact these or other changes would have on the Pilot 
Project and BLM's ability to process APDs. 

BLM Faces Challenges Meeting and Assessing Its Compliance with the 
Required Processing Deadline for Completed APDs and Does Not 
Consistently Track Key APD Data: 

In a 2013 internal memorandum, BLM reported that it had not been able 
to meet the 30-day deadline required by the Energy Policy Act of 2005 
to process (either approve or defer) completed APDs, and that it has 
struggled to consistently track the amount of time it takes to process 
APDs due to data gaps in AFMSS. Specifically, BLM reported that the 
APD data in AFMSS were incomplete and missing critical processing 
dates, making it difficult to reliably track and make adjustments to 
any steps in the APD review process to improve its operations. 

Similarly, our analysis of BLM's APD data from fiscal years 2007 to 
2012 identified challenges with the completeness and accuracy of the 
data on APDs' completion dates. We found that the data in AFMSS were 
missing completion dates for some APDs and contained potential 
inaccurate entries for the completion dates for other APDs. An APD's 
completion date is important because it is needed to determine whether 
BLM complied with the required 30-day deadline to approve or defer 
completed APDs, and because it helps BLM track how much time is spent 
in the two periods of the APD review process--Period 1, which is the 
time from initial submission of an APD until the time BLM determines 
an APD is complete, and Period 2, which is the time from when an APD 
is designated as complete until the time BLM makes a decision to 
approve, or in limited instances deny, the completed APD. Without 
accurate data on the amount of time spent in each period, it is 
difficult to determine whether any actions could be taken to improve 
the efficiency of the APD review process. Figure 4 depicts the steps 
that occur in each period of the review process, as well as key dates 
and requirements, including the requirement for BLM to approve or 
defer completed APDs within 30 days. 

Figure 4: Overview of Selected Key Dates, Steps, and Requirements in 
BLM's Review Process for Applications for Permit to Drill: 

[Refer to PDF for image: illustration] 

Review process timeline: 

Key date #1: BLM receives the application for permit to drill (APD). 

Period 1: 
Select key steps and requirements during Period 1: 

* BLM will review the APD to determine if it is complete and contains 
all of the items required in Onshore Oil and Gas Order Number 1. 

* Within 10 days of receiving an APD, BLM is required to notify the 
operator as to whether or not the APD is complete, and to identify 
what, if any, additional information is necessary to address 
deficiencies and complete the application. 

* The operator then has 45 days to provide BLM with the additional 
information or else the APD may be returned to the operator. 

* BLM must also perform an on-site inspection of the proposed well 
site and notify the operator of any additional deficiencies identified 
during the inspection. In some instances, the on-site inspection can 
occur prior to the operator submitting the APD to BLM. 

* This period concludes once BLM has completed the on-site inspection 
and determines that all information required to complete the APD has 
been obtained from the operator. 

Period 2: 
Select key steps and requirements during Period 2: 

* Within 30 days of the date when BLM determines that the APD is 
complete, BLM is required to approve or defer the application. 

* If BLM defers action on the APD, it must notify the operator of any 
actions BLM needs to take before making a final decision on the APD, 
and it must identify any steps the operator could take to assist BLM. 

* If applicable, BLM will coordinate with other federal, state, or 
private surface owners to obtain their approval of the APD’s Surface 
Use Plan of Operations. 

* BLM must also complete and document all analyses for the APD 
required by the National Environmental Policy Act of 1969 and other 
applicable laws. In some instances, BLM may have begun working on 
these analyses during Period 1. 

* Based on the results of these analyses, its review of the completed 
APD package, and the on-site inspection, BLM will add necessary 
conditions of approval to the APD prior to approving the application. 

Source: GAO analysis of BLM documents and information. 

Note: This figure focuses on the review process for APDs that are 
approved by BLM, but in limited instances BLM may also deny APDs if 
its review finds there are no actions the operator could take that 
would enable BLM to issue the permit. The steps described in this 
figure apply to APDs for all well types, including oil, natural gas, 
and coalbed methane wells. 

[End of figure] 

We reviewed BLM's data on nearly 27,400 APDs approved from fiscal year 
2007 to fiscal year 2012 and found that approximately 5,160 (about 19 
percent) of the APDs did not have a completion date entered in AFMSS. 
[Footnote 33] Furthermore, even when the APD data we reviewed included 
a completion date, we identified differences among BLM offices in how 
the data were entered; this suggests that inaccurate completion dates 
may have been recorded for some APDs. In particular, the data on more 
than 5,560 of the nearly 27,400 approved APDs (about 20 percent) we 
reviewed listed the same date for when the APD was completed as for 
its approval. In other words, the data for these APDs indicate that it 
took BLM zero additional days to process the APDs once the agency 
determined the APDs were complete, thus suggesting the entire 
processing of these APDs occurred in Period 1. BLM officials said 
there are some limited instances in which an office could approve an 
APD on the same day that it was determined to be complete. However, 
they said many of the cases we identified were more likely the result 
of staff from some offices following different practices for entering 
APD completion dates into AFMSS and misinterpreting BLM's guidance on 
this matter. Consequently, we cannot confirm the accuracy of the 
completion dates listed in AFMSS for these APDs.[Footnote 34] Also, 
because of these different practices in entering APD completion dates 
into AFMSS, we have concerns about the accuracy and reliability of the 
completion dates listed for the remaining 61 percent of the APDs for 
which we reviewed data.[Footnote 35] As a result of these problems 
with the data on APD completion dates, we were unable to assess the 
extent to which BLM has complied with the required 30-day deadline for 
approving or deferring completed APDs established in the Energy Policy 
Act of 2005. 

On April 15, 2013, BLM issued new guidance on APD processing and data 
entry that states, among other things, that BLM staff are required to 
enter the APD completion date into AFMSS and clarifies how BLM staff 
should determine this date. BLM officials said they expect the new 
guidance to help improve the reliability of BLM's APD data. 

We also analyzed BLM data on approved APDs to assess the average 
number of days it took BLM to process APDs from date of receipt to 
date of approval, and the extent to which this may have changed from 
fiscal year 2007 to fiscal year 2012. We found that the number of days 
from date of receipt to date of approval averaged 229 days in fiscal 
year 2012. However, due to the incompleteness of data in AFMSS, we 
were unable to determine how this average changed from fiscal year 
2007 to fiscal year 2012. Without information on how the average 
number of days has changed, it is difficult to determine whether 
actions could be taken to improve BLM's APD review process. 
Specifically, we were unable to obtain data on the approval date for 
APDs that BLM reported were approved during fiscal years 2007 to 2012 
but later had expired or were rescinded, canceled, or withdrawn 
without a well having been drilled. Once an APD has expired or been 
rescinded, canceled, or withdrawn, AFMSS stops retaining data on the 
approval date for that APD. Since approved APDs can potentially remain 
valid for up to 4 years, APDs approved in the earlier years of the 
period we analyzed were more likely to have expired and be missing an 
approval date than APDs that were approved more recently. For example, 
the data we obtained from AFMSS did not include the approval dates for 
about 23 percent of the APDs that BLM reported were approved in fiscal 
year 2007. In contrast, less than 1 percent of the APDs that BLM 
reported were approved in fiscal year 2012 were missing approval 
dates.[Footnote 36] Further, BLM officials confirmed that they also 
cannot accurately determine how the average number of days to process 
APDs from date of receipt to date of approval has changed over time 
for individual offices due to the problem of approval dates not being 
retained in AFMSS for APDs that have expired or have been rescinded, 
canceled, or withdrawn. According to BLM officials, BLM intends to 
address this problem with data retention as it replaces AFMSS in the 
future. BLM officials did not estimate when changes to improve the 
tracking of APD approval dates would occur, but they did not expect 
this change to be part of the new APD processing and tracking system 
that is expected to be implemented within calendar year 2013. 

BLM officials and industry representatives we interviewed identified a 
variety of factors that may contribute to the amount of time it takes 
BLM to process an APD from its date of receipt to its date of 
approval. For example, BLM officials we spoke with identified several 
factors, including: 

* The level of complexity of the APDs being submitted by operators. In 
its 2014 budget justification report, BLM reported that the time it 
takes to process APDs has increased or remained high due to the 
increased complexity of issues analyzed in environmental documents 
associated with new APDs.[Footnote 37] According to BLM officials, 
some of the new areas being developed may have unique challenges that 
are encountered during the permitting phase, such as operators seeking 
to drill in new locations that involve more challenging terrain or 
habitat for sensitive species, which can increase the complexity of 
the APDs. 

* The use of Master Development Plans. BLM officials said that Master 
Development Plans--in which operators submit multiple APDs together 
that share a common Drilling Plan and Surface Use Plan of Operations--
are beneficial for the environment because they allow BLM to assess 
the cumulative environmental impacts of proposed development on a 
project-level scale rather than on a well-by-well basis. However, 
officials said it generally takes BLM more time to process these plans 
given their larger scope. According to BLM officials, AFMSS does not 
currently track whether an APD was approved as part of a Master 
Development Plan, but this information will be tracked under the new 
APD processing and tracking system once it has been implemented. 

* Operators submitting incomplete APDs and taking longer to correct 
deficiencies. In its 2014 budget justification report, BLM reported 
that due to turnover in operators' permitting staff, the agency often 
receives inconsistent and incomplete APDs. BLM reported this has 
contributed to longer times to process APDs. According to BLM 
officials, since an operator's new employees may not be familiar with 
the APD process and BLM's requirements, they may be more likely to 
submit incomplete APDs and take longer to correct deficiencies. 

* The use of categorical exclusions. BLM officials also said it is 
possible that changes in how frequently categorical exclusions are 
used to approve oil and gas APDs could influence the amount of time it 
takes BLM to process APDs.[Footnote 38] The Energy Policy Act of 2005 
established several categorical exclusions under which, if conditions 
are met, BLM need not prepare any new environmental impact analysis, 
such as an environmental assessment or environmental impact statement, 
which would ordinarily be required for oil and gas projects. However, 
since, according to BLM officials, the agency has not maintained data 
on the use of categorical exclusions in recent years, it is unclear to 
what extent this issue has impacted the amount of time it took BLM to 
process APDs since 2007. 

Industry representatives we interviewed also cited the level of 
complexity of an APD as one factor that contributes to the amount of 
time it takes BLM to process an APD from date of receipt to date of 
approval. However, industry representatives cited other factors 
specific to BLM that could affect the time it takes to process APDs. 
For example, industry representatives stated that, in their 
experience, the amount of time it takes BLM to process APDs is 
noticeably longer in some offices than in others. They attributed the 
differences to inadequate BLM staffing in some offices with large APD 
workloads, inconsistent standards for processing APDs, and their 
opinion that some BLM offices place less urgency on processing APDs 
than other offices do. Industry representatives we spoke with also 
said that the amount of time it takes BLM to process APDs may make the 
development of federal oil and gas resources less attractive to oil 
and gas operators in some situations. 

BLM Has Taken Actions to Better Mitigate the Environmental Impact of 
Oil and Gas Development, but Challenges Remain: 

To mitigate the environmental impact of oil and gas development, BLM 
has increased the number of environmental inspections completed on 
federal oil and gas wells and facilities from fiscal year 2007 to 
fiscal year 2012. Nevertheless, BLM continues to face challenges in 
mitigating the environmental impact of oil and gas development due to 
insufficient information and inconsistent documentation of its 
inspection and enforcement actions and staffing challenges. 

BLM Has Increased the Number of Environmental Inspections to Better 
Mitigate the Environmental Impact of Oil and Gas Development: 

BLM increased the number of environmental inspections it performed on 
federal oil and gas wells and facilities by approximately 63 percent, 
from 10,941 in fiscal year 2007 to 17,866 in fiscal year 2012. The 
number of environmental inspections performed in fiscal year 2012 was 
about 1 percent lower than the peak reached in fiscal year 2011, when 
BLM performed 18,110 environmental inspections.[Footnote 39] Table 2 
shows the change in environmental inspections from fiscal year 2007 to 
fiscal year 2012 among BLM offices. 

Table 2: Change in the Number of Environmental Inspections Performed 
by BLM Offices from Fiscal Years 2007 to 2012: 

Office name (state): Pinedale FO (WY); 
Number of environmental inspections (FY 07): 604; 
Number of environmental inspections (FY 12): 2,320; 
Change in number of environmental inspections (FY 07 to FY 12): 1,716. 

Office name (state): Buffalo FO (WY)[A]; 
Number of environmental inspections (FY 07): 1,826; 
Number of environmental inspections (FY 12): 3,461; 
Change in number of environmental inspections (FY 07 to FY 12): 1,635. 

Office name (state): Vernal FO (UT)[A]; 
Number of environmental inspections (FY 07): 318; 
Number of environmental inspections (FY 12): 1,752; 
Change in number of environmental inspections (FY 07 to FY 12): 1,434. 

Office name (state): Colorado River Valley FO (CO)[A]; 
Number of environmental inspections (FY 07): 376; 
Number of environmental inspections (FY 12): 1,417; 
Change in number of environmental inspections (FY 07 to FY 12): 1,041. 

Office name (state): Farmington FO (NM)[A]; 
Number of environmental inspections (FY 07): 386; 
Number of environmental inspections (FY 12): 965; 
Change in number of environmental inspections (FY 07 to FY 12): 579. 

Office name (state): Carlsbad FO (NM)[A]; 
Number of environmental inspections (FY 07): 1,104; 
Number of environmental inspections (FY 12): 1,590; 
Change in number of environmental inspections (FY 07 to FY 12): 486. 

Office name (state): White River FO (CO); 
Number of environmental inspections (FY 07): 48; 
Number of environmental inspections (FY 12): 402; 
Change in number of environmental inspections (FY 07 to FY 12): 354. 

Office name (state): Kemmerer FO (WY); 
Number of environmental inspections (FY 07): 36; 
Number of environmental inspections (FY 12): 376; 
Change in number of environmental inspections (FY 07 to FY 12): 340. 

Office name (state): Great Falls Oil and Gas FO (MT); 
Number of environmental inspections (FY 07): 108; 
Number of environmental inspections (FY 12): 438; 
Change in number of environmental inspections (FY 07 to FY 12): 330. 

Office name (state): Bakersfield FO (CA); 
Number of environmental inspections (FY 07): 232; 
Number of environmental inspections (FY 12): 503; 
Change in number of environmental inspections (FY 07 to FY 12): 271. 

Office name (state): Newcastle FO (WY); 
Number of environmental inspections (FY 07): 3; 
Number of environmental inspections (FY 12): 211; 
Change in number of environmental inspections (FY 07 to FY 12): 208. 

Office name (state): Oklahoma FO (OK); 
Number of environmental inspections (FY 07): 47; 
Number of environmental inspections (FY 12): 187; 
Change in number of environmental inspections (FY 07 to FY 12): 140. 

Office name (state): Alaska State Office (AK); 
Number of environmental inspections (FY 07): 12; 
Number of environmental inspections (FY 12): 116; 
Change in number of environmental inspections (FY 07 to FY 12): 104. 

Office name (state): Lander FO (WY); 
Number of environmental inspections (FY 07): 4; 
Number of environmental inspections (FY 12): 104; 
Change in number of environmental inspections (FY 07 to FY 12): 100. 

Office name (state): Tres Rios FO (CO); 
Number of environmental inspections (FY 07): 57; 
Number of environmental inspections (FY 12): 151; 
Change in number of environmental inspections (FY 07 to FY 12): 94. 

Office name (state): Northeastern States FO (WI); 
Number of environmental inspections (FY 07): 162; 
Number of environmental inspections (FY 12): 250; 
Change in number of environmental inspections (FY 07 to FY 12): 88. 

Office name (state): Moab FO (UT); 
Number of environmental inspections (FY 07): 26; 
Number of environmental inspections (FY 12): 99; 
Change in number of environmental inspections (FY 07 to FY 12): 73. 

Office name (state): Salt Lake FO (UT); 
Number of environmental inspections (FY 07): 0; 
Number of environmental inspections (FY 12): 27; 
Change in number of environmental inspections (FY 07 to FY 12): 27. 

Office name (state): Casper FO (WY); 
Number of environmental inspections (FY 07): 107; 
Number of environmental inspections (FY 12): 120; 
Change in number of environmental inspections (FY 07 to FY 12): 13. 

Office name (state): Price FO (UT); 
Number of environmental inspections (FY 07): 98; 
Number of environmental inspections (FY 12): 102; 
Change in number of environmental inspections (FY 07 to FY 12): 4. 

Office name (state): Rawlins FO (WY)[A]; 
Number of environmental inspections (FY 07): 514; 
Number of environmental inspections (FY 12): 491; 
Change in number of environmental inspections (FY 07 to FY 12): -23. 

Office name (state): Royal Gorge FO (CO); 
Number of environmental inspections (FY 07): 55; 
Number of environmental inspections (FY 12): 24; 
Change in number of environmental inspections (FY 07 to FY 12): -31. 

Office name (state): Miles City FO (MT)[A]; 
Number of environmental inspections (FY 07): 361; 
Number of environmental inspections (FY 12): 329; 
Change in number of environmental inspections (FY 07 to FY 12): -32. 

Office name (state): Rio Puerco FO (NM); 
Number of environmental inspections (FY 07): 52; 
Number of environmental inspections (FY 12): 19; 
Change in number of environmental inspections (FY 07 to FY 12): -33. 

Office name (state): Hobbs Field Station (NM); 
Number of environmental inspections (FY 07): 867; 
Number of environmental inspections (FY 12): 833; 
Change in number of environmental inspections (FY 07 to FY 12): -34. 

Office name (state): North Dakota FO (ND); 
Number of environmental inspections (FY 07): 239; 
Number of environmental inspections (FY 12): 192; 
Change in number of environmental inspections (FY 07 to FY 12): -47. 

Office name (state): Nevada State Office (NV); 
Number of environmental inspections (FY 07): 87; 
Number of environmental inspections (FY 12): 15; 
Change in number of environmental inspections (FY 07 to FY 12): -72. 

Office name (state): Southeastern States FO (MS); 
Number of environmental inspections (FY 07): 247; 
Number of environmental inspections (FY 12): 142; 
Change in number of environmental inspections (FY 07 to FY 12): -105. 

Office name (state): Little Snake FO (CO); 
Number of environmental inspections (FY 07): 247; 
Number of environmental inspections (FY 12): 92; 
Change in number of environmental inspections (FY 07 to FY 12): -155. 

Office name (state): Grand Junction FO (CO); 
Number of environmental inspections (FY 07): 361; 
Number of environmental inspections (FY 12): 175; 
Change in number of environmental inspections (FY 07 to FY 12): -186. 

Office name (state): Rock Springs FO (WY); 
Number of environmental inspections (FY 07): 779; 
Number of environmental inspections (FY 12): 392; 
Change in number of environmental inspections (FY 07 to FY 12): -387. 

Office name (state): Roswell FO (NM); 
Number of environmental inspections (FY 07): 664; 
Number of environmental inspections (FY 12): 171; 
Change in number of environmental inspections (FY 07 to FY 12): -493. 

Office name (state): Worland FO (WY); 
Number of environmental inspections (FY 07): 914; 
Number of environmental inspections (FY 12): 400; 
Change in number of environmental inspections (FY 07 to FY 12): -514. 

Office name (state): Total; 
Number of environmental inspections (FY 07): 10,941; 
Number of environmental inspections (FY 12): 17,866; 
Change in number of environmental inspections (FY 07 to FY 12): 6,925. 

Legend: FY = fiscal year; FO = Field Office. 

Source: GAO analysis of BLM data. 

Note: This table presents data on environmental inspection performed on 
federal oil and gas wells and facilities and does not include 
information on environmental inspections performed by BLM on nonfederal 
oil and gas wells or facilities located on Indian Trust lands. In 
addition, the table excludes results from more than 580 environmental 
inspections recorded in BLM's Automated Fluid Minerals Support System 
database in fiscal year 2012 and more than 160 environmental 
inspections recorded in fiscal year 2007 due to concerns about the 
accuracy of the data. 

[A] These offices are participating in the Federal Permit Streamlining 
Pilot Project, which was established in section 365 of the Energy 
Policy Act of 2005 to improve oil and gas permitting. 

[End of table] 

BLM offices with the greatest increases in environmental inspections 
from fiscal year 2007 to fiscal year 2012 were generally those 
responsible for managing the most federal oil and gas wells. The three 
offices with the greatest increase in environmental inspections from 
fiscal year 2007 to fiscal year 2012 were the Pinedale and Buffalo 
Field Offices in Wyoming, and the Vernal Field Office, in Utah. As of 
December 2012, these three offices also managed nearly 27 percent of 
all federal oil and gas wells. Similarly, BLM's Farmington Field 
Office, in New Mexico, managed the largest number of federal wells as 
of December 2012 and increased the environmental inspections it 
performed, from 386 in fiscal year 2007 to 965 in fiscal year 2012. 

BLM management officials at three field offices said that having fewer 
APDs to process has allowed their environmental staff, who also help 
process APDs, to spend more time on enforcement activities, including 
environmental inspections. For example, the number of APDs received by 
the Pinedale Field Office dropped from 814 in fiscal year 2007 to 326 
in fiscal year 2012, and the number of environmental inspections it 
performed increased from 604 to 2,320 during that period. In contrast, 
some offices that experienced an increase in APDs during the period 
conducted fewer environmental inspections. For example, the North 
Dakota Field Office, which experienced a 240 percent increase in the 
number of APDs received from fiscal years 2007 to 2012, going from 84 
APDs in fiscal year 2007 to 287 APDs in fiscal year 2012, performed 
nearly 20 percent fewer environmental inspections during the same 
period, going from 239 environmental inspections in fiscal year 2007 
to 192 in fiscal year 2012. 

BLM officials attributed the overall increase in environmental 
inspections to the following actions: 

* BLM revised its guidance for documenting environmental inspection 
activities, particularly interim reclamation inspections. In 2005, we 
recommended that BLM track interim reclamation inspections in its 
centralized database.[Footnote 40] In response, BLM required field 
office staff to enter those data into AFMSS. BLM also developed a new 
inspection form to ensure that data gathered during reclamation 
inspections were standardized. These actions improved tracking of 
BLM's environmental inspection workload, according to BLM officials. 

* BLM increased the focus on environmental inspections by establishing 
targets for managers and staff and including those targets in annual 
staff performance plans and expectations. For example, metrics are 
included in the annual performance plans for certain BLM state 
directors who oversee offices involved in oil and gas development. 
These metrics generally specify that the state directors should ensure 
that their offices conduct all high-priority environmental inspections 
identified during the inspection prioritization process. Also, BLM 
field office management staff said that their annual performance plans 
include meeting their office's high-priority environmental inspections 
targets. In addition, environmental staff said that they had targets 
for the number of environmental inspections they were expected to 
complete in a given fiscal year. 

* BLM increased environmental inspections as a result of the Pilot 
Project that enabled some field offices to hire additional staff and 
designate some environmental staff to work primarily on environmental 
inspections. At the four pilot offices we contacted,[Footnote 41] some 
environmental staff reported working only on environmental 
inspections. In contrast, staff at other field offices we visited 
reported that environmental staff usually conduct environmental 
inspections and process APDs. 

* BLM field offices increased the planned amount of work time devoted 
to environmental inspections. In fiscal year 2007, BLM offices 
reported planning to spend about 131 workmonths (a workmonth is about 
172 hours) on environmental inspections. In fiscal year 2012, 

BLM offices planned to spend 182 workmonths on environmental 
inspections.[Footnote 42] 

* In some cases, environmental staff can perform more inspections due 
to efficiencies created when the average number of wells per well pad 
increases, and when new wells are drilled in closer proximity to other 
wells, according to BLM officials. Some field offices reported that 
technology such as directional drilling has enabled operators to place 
more wells on a given well pad. This allows BLM inspectors to review 
more wells in a given time frame.[Footnote 43] 

BLM's Environmental Mitigation Efforts Are Hampered by Insufficient 
Information, Inconsistent Documentation, and Staffing Challenges: 

BLM's environmental mitigation efforts are hampered by (1) an 
environmental inspection prioritization process that does not have 
sufficient information to ensure that wells receiving inspections are 
those that pose the greatest environmental risk, (2) inconsistent 
documentation of inspections and enforcement actions, and (3) 
challenges with retaining and hiring environmental staff in some 
offices. 

BLM's Inspection Prioritization Process Does Not Have Information to 
Ensure Wells Receiving Inspections Pose Greatest Environmental Risk: 

BLM's environmental inspection prioritization process does not 
effectively ensure that the wells posing the greatest environment risk 
are identified as high-priority for environmental inspections 
conducted each year. In particular, BLM staff face challenges 
obtaining information from AFMSS to prioritize wells for environmental 
inspections, and BLM staff do not have sufficient information on the 
environmental condition of wells that have never received an 
environmental inspection. 

Environmental staff in some BLM field offices reported challenges 
using AFMSS to identify which wells should be considered high-priority 
for environmental inspections each year because AFMSS does not have 
the capability to flag individual wells as high priority for 
environmental concerns. Consequently, some BLM environmental staff 
said that they must rely on their own knowledge and memory of wells to 
determine which ones meet prioritization criteria. Also, some 
environmental staff said they sometimes selected wells to inspect 
based on convenience, including selecting some that were close to each 
other. BLM officials said that the agency is planning to replace AFMSS 
with a new system that, among other things, can be used by staff to 
prioritize and develop targets for environmental inspections. However, 
the officials said that due to budget uncertainties they could not say 
when this will occur. 

BLM also does not have information on the environmental condition of 
many wells. We analyzed data on approximately 60,330 federal oil and 
gas wells on lands managed by BLM and found no record for about 
24,840, or 41 percent, in AFMSS of those wells ever having received an 
environmental inspection as of December 2012. At least 75 percent of 
the wells with no environmental inspection record in AFMSS became 
capable of production in fiscal year 2007 or earlier. Since there is 
no environmental inspection history for these wells in AFMSS, BLM does 
not have the information to assess whether the wells pose any current 
environmental risks or whether sufficient environmental mitigation has 
occurred. BLM environmental staff said that wells with no record of an 
environmental inspection could have environmental problems that go 
undetected. 

According to BLM officials, it is possible that some of these wells 
may have been inspected for environmental issues, but that the 
inspections were not recorded in AFMSS. Nevertheless, it would still 
be difficult for BLM staff attempting to prioritize environmental 
inspections to determine the environmental condition of wells under 
these circumstances, since the information on their previous 
environmental inspections is not in AFMSS. For example, BLM officials 
said some environmental inspections of federal oil and gas wells 
performed in fiscal years 2005 and 2006 were likely never entered into 
AFMSS because the database was shut down for several months in 2005 as 
a result of a court order. BLM officials also said that it is possible 
that some wells could have been inspected prior to the development of 
AFMSS in 1997, and that information was not entered into AFMSS. In 
addition, BLM officials said that when ownership of an oil and gas 
lease on federal lands changes through sale, trade, or transfer, AFMSS 
deletes certain inspection dates. 

BLM officials also said that some of the wells we identified with no 
record of an environmental inspection in AFMSS may have received other 
types of inspections, such as production inspections, that would have 
identified any significant environmental issues. We did not determine 
whether the wells we identified as having no environmental inspection 
records had received other types of inspections. However, in 2011, a 
BLM internal assessment of inspection and enforcement activities in 
several field offices found examples of wells that had not received an 
inspection of any kind despite being in production for 10 to 12 years. 
[Footnote 44] Furthermore, according to BLM officials, the other types 
of inspections would typically be conducted by staff who do not have 
the same training as the environmental inspection staff. For example, 
environmental staff are generally trained in such areas as interim 
reclamation and environmental best management practices and can assess 
the adequacy of interim reclamation efforts and identify surface 
environmental concerns such as erosion and invasive species. As a 
result, BLM officials said some aspects of environmental protection 
might not be addressed during other types of inspections. 

BLM officials said that the agency is considering making changes to 
its approach for prioritizing wells for environmental inspections. 
BLM's current criteria for prioritizing environmental inspections do 
not take into account when a well last received an environmental 
inspection, if ever. This approach differs from BLM's approach to 
production inspections, which considers the last inspection date in 
prioritizing production inspections.[Footnote 45] The officials said 
that whether a well has received an environmental inspection in the 
last 5 years is being considered as a new prioritization factor for 
environmental inspections. BLM officials said they expect to complete 
updates to their approach for prioritizing environmental inspections 
by 2015. 

Inconsistent Documentation of Inspections and Enforcement Actions: 

BLM's 2011 internal assessment also found that some environmental 
inspections of oil and gas wells and any resulting enforcement actions 
did not have adequate documentation in accordance with BLM's 
inspection and enforcement handbook.[Footnote 46] Our site visits and 
interviews with BLM staff found similar problems. For example, we 
found that staff in some field offices do not document in AFMSS verbal 
warnings to operators to address environmental violations or problems. 
According to BLM's inspection and enforcement handbook, a verbal 
warning is a nonwritten communication to an operator for a violation 
or problem that will be corrected immediately prior to the inspector 
leaving the location and must be documented in AFMSS. However, some 
environmental staff said they prefer to handle environmental 
violations or problems informally, and that documenting all 
environmental violations or problems in AFMSS would be difficult given 
competing demands on their time. BLM officials acknowledged that such 
practices are not consistent with current agency policy. As a result 
of BLM's inconsistent documentation of violations or problems, it is 
difficult for BLM to (1) determine the extent to which they have 
occurred and whether the level of violations or problems has changed 
over time; (2) track whether corrective actions were taken; or (3) 
identify trends in an individual operator's history of environmental 
violations or problems and use this information to help prioritize 
environmental inspections. 

BLM Faces Staffing Challenges: 

In some locations, BLM also faces challenges in retaining its oil and 
gas staff and in hiring new employees, including staff responsible for 
environmental inspections and enforcement. For example, management 
officials at the 11 field offices we contacted reported having some 
difficulty in hiring or retaining environmental protection staff. 
Difficulties reported included some environmental protection positions 
going unfilled for long periods and new staff hired often being 
inexperienced and requiring greater supervision, limiting their 
effectiveness. Field office management attributed the difficulties in 
hiring and retention to a variety of factors including a high cost of 
living in some areas, limited cultural opportunities, the remote 
locations of some field offices, and competition from industry. Also, 
according to BLM officials, some environmental staff prefer to be 
specialists in fields such as biology or botany rather than 
generalists, so they take other positions in BLM when they become 
available. BLM officials said that staff turnover and staff 
inexperience impact both the number of environmental inspections that 
can be conducted and the quality of environmental inspections and 
enforcement actions that are taken. For example, BLM officials said 
that it may take years for newly hired environmental staff members to 
complete training and be able to function without additional 
supervision, and once fully trained, they are frequently offered 
higher salaries in industry than BLM can pay. 

In 2011, we added Interior's management of federal oil and gas 
resources to our high-risk list based, in part, on BLM's persistent 
problems in hiring, training, and retaining sufficient staff to meet 
its oversight and management of oil and gas operations on federal 
lands.[Footnote 47] For example, in 2010, we found that BLM 
experienced high turnover rates in key oil and gas inspection and 
engineering positions, potentially affecting their oversight of oil 
and gas development on federal leases. In 2013, we updated our high-
risk list and reported that the bureaus responsible for oversight and 
management of federal oil and gas resources on federal lands and in 
federal waters--including BLM--have encountered persistent problems in 
hiring, training, and retaining staff.[Footnote 48] [Footnote 49] 

Conclusions: 

BLM has taken or initiated various actions in recent years to improve 
its processing of APDs, including implementing the Federal Permit 
Streamlining Pilot Project established under section 365 of the Energy 
Policy Act of 2005. BLM reported in 2008 that additional staff 
provided by the Pilot Project helped some offices improve their 
processing of APDs, but BLM has not finalized an updated assessment of 
the results of the Pilot Project since that time. The act required BLM 
to submit to Congress by 2008 a report that included a recommendation 
to the President on whether the Pilot Project should be implemented 
throughout the United States, such as by expanding to all field 
offices, but BLM has not done so. In its 2014 budget justification 
report, Interior proposed several changes to the Pilot Project's 
statutory provisions and its funding mechanism; as of May 2013, 
Congress had not acted on this proposal, and the Pilot Project's 
future is uncertain. Without additional information from BLM on the 
Pilot Project, including a recommendation from the agency and updated 
information on the project's results, Congress may not have the 
information it needs as it considers the future of the project and its 
related funding. 

The Energy Policy Act of 2005 also established a deadline for BLM to 
approve or defer completed APDs, but problems with the completeness 
and accuracy of BLM's data prevent an assessment of the agency's 
compliance with the deadline. Without such data, BLM also cannot 
accurately determine how much time it spends during the first period 
of the APD review process where BLM works with operators to provide 
necessary information to complete the APD, or during the second period 
where BLM reviews the completed APD. In April 2013, BLM issued new 
guidance regarding APD data entry, but it is unclear at this time what 
impact the guidance will have on the quality of BLM's APD data. In 
addition, AFMSS stops tracking some data for approved APDs when they 
expire or are rescinded, canceled, or withdrawn. BLM would be in a 
better position to evaluate its performance and find ways of improving 
the efficiency of the permitting process or reducing the time it takes 
to process APDs if its APD data were more completely and accurately 
entered and retained in AFMSS, as well as in any new system that 
replaces AFMSS. 

BLM increased the number of environmental inspections it performed on 
federal oil and gas wells and facilities from fiscal years 2007 to 
2012, but the agency's environmental inspection prioritization process 
does not effectively ensure that the wells posing the greatest 
environmental risk are identified as high priority for environmental 
inspections. In part, this is due to challenges that BLM staff face 
obtaining information from AFMSS to prioritize wells for environmental 
inspections and because BLM staff do not have sufficient information 
on wells that have never received an environmental inspection. 
Further, BLM's process for prioritizing wells for environmental 
inspections does not consider when, or if, a well last received an 
environmental inspection. BLM would be in a better position to ensure 
that wells posing the greatest environmental risk are prioritized for 
environmental inspections if its staff were better able to obtain the 
information they need to do so from AFMSS, and from any new system 
that replaces AFMSS, and if information on the environmental 
inspection history of wells were included in the prioritization 
process. Furthermore, BLM is not consistently documenting 
environmental violations or problems found during the inspections that 
are conducted. Inconsistent documentation of environmental violations 
or problems and related enforcement actions makes it difficult to 
determine whether environmental compliance by operators is improving 
and limits the ability of BLM offices to find the information they 
need to prioritize future environmental inspections. 

Recommendations for Executive Action: 

We recommend that the Secretary of the Interior direct the Director of 
the Bureau of Land Management to take the following four actions: 

* Complete and submit to Congress a final report that outlines the 
results of the Federal Permit Streamlining Pilot Project to date, and 
makes a recommendation on whether the Pilot Project should be 
implemented throughout the United States, to meet the mandate of 
section 365 of the Energy Policy Act of 2005. 

* Ensure that all key dates associated with the processing of APDs are 
completely and accurately entered and retained in AFMSS, and in any 
new system that replaces AFMSS, to help BLM assess compliance with 
required deadlines and identify ways to improve the efficiency of the 
APD review process. 

* Take steps, including making changes to AFMSS, and in any new system 
that replaces AFMSS, to improve the ability of staff to identify wells 
that are a high priority for environmental inspection and to 
incorporate information on the inspection history of wells into the 
environmental inspection prioritization process. 

* Take steps to ensure that environmental violations or problems and 
enforcement actions are documented in a consistent manner. 

Agency Comments and Our Evaluation: 

We provided a draft of this report to the Department of the Interior 
for review and comment, and Interior provided written comments, which 
are summarized below and reprinted in appendix II. In its comments, 
Interior generally agreed with our report's recommendations. However, 
the agency stated that it noted some technical errors and incomplete 
information within the report relative to the oil and gas data that 
BLM maintains and its identification of high-priority environmental 
inspections. We incorporated BLM's technical comments as appropriate. 

BLM had no comments concerning our first two recommendations. In 
regard to our third recommendation that BLM take steps, including 
making changes to AFMSS, and in any new system that replaces AFMSS, to 
improve the ability of staff to identify wells that are a high 
priority for environmental inspection and to incorporate information 
on the inspection history of wells into the environmental inspection 
prioritization process, Interior stated that it recognized that the 
inspection history of a well is an important factor to consider when 
assessing risk related to environmental compliance. Further, the 
department stated that in fiscal year 2011, it developed a new risk-
based strategy for its oil and gas inspection and enforcement program 
in which risk factors are assigned to each type of inspection that BLM 
performs. For environmental inspections, one of the risk factors that 
field offices must consider is when an environmental inspection was 
last conducted on a well and that under the strategy, higher risk 
ratings are given to wells that have never had an environmental 
inspection or have not had an inspection for an extended period of 
time. However, the department said the environmental inspections 
component of the risk-based strategy has not yet been implemented 
because of limitations with the current AFMSS database and that the 
department is planning to transition to a new database system that 
will, among other things, have the ability to support the risk-based 
strategy for environmental inspections. According to Interior, the 
first phase of the new database system (related to APD processing and 
tracking) is expected to be implemented by the end of calendar year 
2013, but the department did not specify when additional phases of the 
new system will be implemented to be able to support the risk-based 
strategy for environmental inspections. We appreciate the department's 
effort and mention in the report that it is considering making changes 
to its approach for prioritizing wells for environmental inspections. 
However, delays to the implementation of the new database system 
hinder staff's ability to identify wells that are a high priority for 
environmental inspection and incorporating information on the 
inspection history of wells into the environmental inspection 
prioritization process. 

In regard to our recommendation that BLM take steps to ensure that 
environmental violations or problems and enforcement actions are 
documented in a consistent manner, Interior stated that incomplete 
documentation of environmental inspections was included in the 
findings of an Internal Control Review of 10 field offices with major 
oil and gas responsibilities conducted by BLM in fiscal year 2011. The 
Internal Control Review report made recommendations regarding 
documentation of enforcement actions and inspections that Interior 
said the 10 field offices are in the process of implementing. In 
addition, the department stated the Internal Control Review report has 
been shared with all BLM State Directors. As our findings are 
consistent with those of the Internal Control Review, we reiterate the 
importance of BLM taking steps to ensure that environmental violations 
or problems and enforcement actions are documented in a consistent 
manner. We look forward to seeing how BLM addresses our recommendation. 

As agreed with your offices, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 30 days 
from the report date. At that time, we will send copies to the 
Secretary of the Interior, the appropriate congressional committees, 
and other interested parties. In addition, this report will be 
available at no charge on the GAO website at [hyperlink, 
http://www.gao.gov]. 

If you or your staff members have any questions about this report, 
please contact me at (202) 512-3841 or ruscof@gao.gov. Contact points 
for our Offices of Congressional Relations and Public Affairs may be 
found on the last page of this report. GAO staff who made key 
contributions to this report are listed in appendix III. 

Signed by: 

Frank Rusco: 
Director, Natural Resources and Environment: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

This appendix details the methods we used to assess the Department of 
the Interior's Bureau of Land Management's (BLM) management of the 
development of federal oil and gas resources. Specifically, the 
objectives of this report were to determine, from fiscal years 2007 to 
2012, (1) what changes have occurred in BLM's oil and gas permitting 
workload; (2) what actions BLM has taken to manage its oil and gas 
permitting workload and what challenges, if any, remain; and (3) what 
actions BLM has taken to mitigate the surface environmental impact of 
developing federal oil and gas resources and what challenges, if any, 
remain. 

To conduct our work, we reviewed relevant laws, regulations, and BLM 
guidance. We also interviewed officials in BLM headquarters and 
officials from a nonprobability sample of 11 BLM field offices and 4 
BLM state offices.[Footnote 50] We selected field offices based on 
their different geographical locations and the different types of oil 
and gas resources they manage, and to reflect varied levels of oil and 
gas permitting and environmental inspection activity and a mix of 
offices that are or are not participating in the Federal Permit 
Streamlining Pilot Project. Specifically, we visited and interviewed 
officials in 8 BLM field offices (Colorado River Valley, Little Snake, 
and White River in Colorado; Moab, Price, and Vernal in Utah; and 
Pinedale and Rock Springs in Wyoming) and interviewed officials by 
telephone in 3 additional field offices (Carlsbad and Farmington in 
New Mexico, and the North Dakota Field Office). In fiscal year 2012, 
these offices accounted for about 68 percent of all APDs received by 
BLM for federal oil and gas resources and for about 52 percent of all 
environmental inspections performed by BLM. During our site visits to 
the Colorado River Valley, Vernal, and Pinedale Field Offices, we 
observed BLM officials conduct environmental inspections of oil or gas 
wells and related facilities. In addition, we interviewed officials by 
telephone in 4 BLM state offices (Colorado, New Mexico, Utah, and 
Wyoming), which were selected based on their jurisdiction over 10 of 
the 11 field offices we contacted.[Footnote 51] We also interviewed 
representatives from environmental organizations--the Western 
Organization of Resource Councils and the Upper Green River Alliance--
and energy industry organizations--the American Petroleum Institute, 
the American Exploration and Production Council, and the Western 
Energy Alliance--to obtain their perspective on BLM's management of 
the oil and gas permitting process and on the implementation of BLM's 
environmental inspection and enforcement program. 

In addition, we requested and analyzed electronic BLM data from 
Automated Fluid Minerals Support System (AFMSS) on federal oil and gas 
wells. We obtained data on applications for permit to drill (APD) 
received by BLM from fiscal years 2005 through 2012, environmental 
inspections performed from fiscal years 2005 through 2012, and data on 
all federal wells managed by BLM, including information on their last 
environmental inspection, if any, recorded in AFMSS. We assessed the 
reliability of these data by (1) performing electronic testing for 
obvious errors in accuracy and completeness; (2) reviewing existing 
documentation about the data and AFMSS; (3) interviewing BLM officials 
knowledgeable about the data; and (4) verifying with agency officials 
a limited sample of some of our results. On the basis of our 
assessment, we determined that the data we obtained were sufficiently 
reliable for our purposes to determine the number of federal wells 
managed by BLM. However, a BLM official knowledgeable about AFMSS said 
that BLM's environmental inspection data in AFMSS were not entirely 
reliable for fiscal years 2005 and 2006, primarily due to issues 
stemming from the Cobell Indian Trust lawsuit that resulted in the 
temporary shutdown of BLM's information technology (IT) systems. 
[Footnote 52] As a result, BLM officials said they were unable to 
enter information into AFMSS on federal oil and gas wells, including 
information on APDs and environmental inspections, for several months 
in 2005. According to the officials, BLM field offices entered much of 
the backlogged information into AFMSS after the shutdown ended, but 
some data from fiscal years 2005 and 2006, particularly data on 
environmental inspections, were never entered into AFMSS due to the 
shutdown and the subsequent backlog of data entry the field offices 
faced in 2006. 

We preliminarily analyzed the environmental inspection data for fiscal 
years 2005 and 2006 and shared the results with some of the field 
office staff we interviewed, who confirmed that the data for their 
offices appeared to be incomplete, but they did not know what the 
correct numbers should have been. Consequently, we determined that the 
environmental inspection data for fiscal years 2005 and 2006 were not 
sufficiently reliable for our purposes, and we limited the scope of 
our data analysis on environmental inspections to fiscal years 2007 
through 2012. We similarly limited the scope of our data analysis on 
APDs to fiscal years 2007 through 2012 to be consistent with our 
presentation of the environmental inspection data, and to focus this 
analysis on the years in which BLM's revised permitting rule was used. 
In addition, since the shutdown of BLM's IT systems for tracking data 
on oil and gas development on Indian Trust lands lasted until 2008, we 
limited the scope of our data analysis to federal oil and gas 
activities, and we did not include Indian Trust oil and gas 
information in any of the well, APD, or environmental inspection data 
presented in this report. In some offices, such as the North Dakota 
Field Office, activities related to Indian Trust wells can represent a 
sizable portion of the office's overall oil and gas workload. 

To determine how BLM's permitting workload has changed, we analyzed 
the electronic data obtained from AFMSS to count the number of APDs 
for federal oil and gas resources with a received date listed from the 
start of fiscal year 2007 to the end of fiscal year 2012. Based on the 
results of our electronic testing of the APD data and interviews with 
agency officials about the data, we determined that the data were 
sufficiently reliable for this purpose. As part of our analysis, we 
reviewed summary data that BLM had provided us on received APDs to see 
how they compared with our results and to corroborate our results when 
possible. We identified differences between the numbers we calculated 
and BLM's summary data on received APDs for some offices, but since 
BLM could not provide us with additional information on its summary 
numbers, we were unable to determine why those differences exist. We 
present the results of our analysis on the total number of APDs 
received by BLM by fiscal year from 2007 to 2012 in figure 3, and our 
results for the number of APDs received by BLM's 33 lead oil and gas 
offices in fiscal years 2007 and 2012 are presented in table 1. To 
identify potential factors that may have contributed to changes in 
BLM's permitting workload, we interviewed BLM headquarters officials 
and representatives of energy industry organizations to obtain their 
views. 

To identify actions BLM has taken to better manage its oil and gas 
permitting workload, we reviewed BLM guidance and documentation and 
interviewed officials in BLM headquarters to discuss policy, 
procedural, and other changes that BLM has implemented. To examine the 
impact of these actions and to determine if BLM continues to face any 
challenges in managing its permitting workload, we interviewed 
officials in 11 BLM field offices that manage oil and gas development, 
including staff at the managerial and nonmanagerial levels. We also 
analyzed electronic data from AFMSS on approved APDs to assess the 
average number of days it took BLM to process APDs from the date of 
receipt to the date of approval. To calculate the average number of 
days in fiscal year 2012, we obtained and analyzed data on 4,228 APDs 
approved in fiscal year 2012, representing more than 99 percent of the 
4,256 APDs for federal oil and gas resources that BLM reported were 
approved that year. The data we obtained from BLM did not contain 
sufficient information on the 28 other APDs approved in fiscal year 
2012 to include them in our analysis, and it is unclear how the 
average number of days it took BLM to process these APDs compared with 
the average number of days we calculated for fiscal year 2012. Based 
on our electronic testing of BLM's data on approved APDs and 
interviews with agency officials about the data, we found that the 
data were not sufficiently reliable to determine the number of days it 
took BLM to process APDs prior to fiscal year 2012. To determine 
whether BLM maintains the data necessary to assess its compliance with 
the required deadline to approve or defer completed APDs, we analyzed 
data on nearly 27,400 approved APDs that listed an approval date in 
AFMSS from fiscal year 2007 to fiscal year 2012. Based on a review of 
BLM documentation, we determined that our analysis included 
approximately 89 percent of all APDs for federal oil and gas resources 
that BLM reported were approved from fiscal year 2007 to fiscal year 
2012. We found that BLM's data were not sufficiently reliable to 
assess the agency's compliance with the required deadline due to 
problems with the completeness and accuracy of the data. To identify 
potential factors that may impact the amount of time it takes BLM to 
process APDs, we interviewed BLM headquarters officials and 
representatives of energy industry organizations to obtain their 
perspectives. 

Our examination of actions BLM has taken to better mitigate the 
environmental impact of oil and gas development on federal lands 
focused on actions in BLM's oil and gas inspection and enforcement 
program. We reviewed BLM guidance and documentation and interviewed 
BLM headquarters officials to discuss key policy and procedural 
changes that BLM has implemented. To examine how these changes have 
impacted BLM's oil and gas environmental mitigation efforts and to 
determine if any challenges remain, we interviewed officials in 11 BLM 
field offices, including staff at the management level, natural 
resource specialists, and other specialists responsible for conducting 
environmental inspections. In three of these offices, we observed BLM 
staff conduct environmental inspections of federal oil and gas wells 
to better understand the role of environmental inspections in BLM's 
mitigation efforts and to identify the challenges BLM staff face in 
performing these inspections. 

We also analyzed electronic data obtained from AFMSS to quantify the 
change in the number of environmental inspections performed by BLM 
from fiscal year 2007 to fiscal year 2012. To measure this change, we 
analyzed AFMSS data on environmental inspections performed on federal 
oil and gas wells and facilities that listed an inspection completion 
date from fiscal year 2007 to fiscal year 2012. We present data on the 
change in environmental inspections from fiscal year 2007 to fiscal 
year 2012, broken down by BLM's 33 lead oil and gas offices, in table 
2. Based on information provided by a BLM official knowledgeable about 
the AFMSS data, we excluded some environmental inspections listed in 
AFMSS from this analysis due to concerns about the accuracy of the 
AFMSS inspection records. In most cases, the environmental inspection 
records we excluded indicated that the inspections had been performed 
on well sites where no surface disturbance had occurred as of the date 
of inspection. According to the BLM official, some of these records 
may represent on-site inspections that occurred during the APD review 
process and were incorrectly recorded in AFMSS as environmental 
inspections. In total, we identified and excluded from our analysis 
more than 2,800 environmental inspections listed in AFMSS as having 
completion dates from fiscal years 2007 to 2012 due to the data not 
being sufficiently reliable for our purposes. This included excluding 
more than 160 environmental inspection records from the 2007 totals 
presented in table 2 and more than 580 environmental inspection 
records from the 2012 totals presented in the same table. 

In addition, we obtained and analyzed electronic data from AFMSS on 
all wells involved in developing federal onshore oil and gas 
resources, including data on each well's most recent environmental 
inspection recorded in AFMSS, if any, and data on when each well was 
originally drilled. The data we analyzed from AFMSS included wells 
that were in a producible or service status (i.e., wells that were 
physically and mechanically capable of producing oil or gas or that 
were used to support oil and gas operations through activities such as 
water disposal) and were located either on lands with surfaces managed 
directly by BLM (data current as of December 18, 2012) or on lands 
with surfaces managed by other federal, state, or private entities, 
but with mineral rights controlled by the federal government (data 
current as of November 30, 2012).[Footnote 53] We identified wells 
using the well's unique 10-digit American Petroleum Institute number. 
We analyzed these data to determine the number of federal wells 
managed by BLM offices, which is presented in figure 1. We also 
analyzed these data to assess how many federal wells had no record in 
AFMSS of ever receiving an environmental inspection. We limited the 
scope of our analysis of wells with no environmental inspection 
records in AFMSS to approximately 60,330 federal wells located on 
lands with surfaces managed directly by BLM. However, we excluded some 
other wells located on federal lands managed by BLM due to challenges 
we encountered analyzing their data, and we also excluded wells that 
were located on lands whose surface are managed by other federal, 
state, or private entities, but which have mineral rights that are 
controlled by the federal government. In total, about 32,270 wells in 
these categories were not included in this analysis. 

We conducted this performance audit from May 2012 to August 2013 in 
accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

[End of section] 

Appendix II: Comments from the Department of the Interior: 

United States Department of the Interior: 
Office of The Secretary: 
Washington, D.C. 20240: 

July 29, 2013: 

Mr. Frank Rusco: 
Director, Natural Resources and the Environment: 
Government Accountability Office: 
441 G Street, N.W. 
Washington, D.C. 20548: 

Dear Mr. Rusco: 

Thank you for the opportunity to review and comment on the Government 
Accountability Office (GAO) draft report titled, "Oil and Gas 
Development BLM Needs Better Data to Track Permit Processing Times and 
Prioritize Inspections" (GAO-13-572). The GAO's draft report 
recognizes the Bureau of Land Management's (BLM) key responsibilities 
for administering the development of oil and gas resources on Federal 
lands. 

The Department generally concurs with the GAO's recommendations. 
However, we noted some technical errors and incomplete information 
within the report relative to the oil and gas data the BLM maintains 
and its identification of high-priority environmental inspections. 
Please refer to the enclosure for a description of those items and the 
BLM's recommended changes. 

We would also like to bring to your attention important improvements 
that the BLM has developed related to recommendations three and four. 
Recommendation three states: 

Take steps, including making changes to AFMSS, and in any new system 
that replaces AFMSS, to improve the ability of staff to identify wells 
that are a high priority for environmental inspection and to 
incorporate information on the inspection history of wells into the 
environmental prioritization process. 

The BLM recognizes that the inspection history of a well is an 
important factor to consider when assessing risk related to 
environmental compliance. In FY 2011, the BLM developed a new risk-
based strategy for its oil and gas inspection and enforcement (I&E) 
program in which risk factors are assigned to each type of inspection 
that the BLM performs. For example, for environmental inspections, one 
of the risk factors that field offices must consider is when a well 
was last inspected. Higher risk ratings are given to those wells that 
have not had an environmental inspection or for which an extended 
period of time has elapsed since the last inspection. 

Due to limitations associated with the current Automated Fluid 
Minerals Management System (AFMSS) database, the environmental 
inspections component of the risk-based strategy has not yet been 
implemented. However, the BLM plans to transition to a new database 
system that will, among other things, have the ability to support a 
risk-based environmental inspection strategy. The BLM Directorate and 
the Department have approved the project, which is being
implemented in phases due to funding limitations. The BLM expects to 
implement the first phase of the new database system, which is the APD 
processing and tracking system mentioned in the GAO report, agency-
wide by the end of this calendar year. 

Recommendation four states: 

Take steps to ensure that environmental violations or problems and 
enforcement actions are documented in a consistent manner.
Environmental inspections and enforcement are an important part of the 
BLM's onshore oil and gas I&E program. In Fiscal Year 2011, the BLM 
conducted an Internal Control Review (ICR) of its I&E program in ten 
field offices with major oil and gas responsibilities. The BLM
transmitted the result of the ICR to the State Directors via an 
information bulletin. One of the findings from the ICR was that the 
BLM's AFMSS database did not contain complete documentation of 
environmental inspections. Missing documentation included incidents of 
noncompliance and entries of written or verbal orders issued by BLM 
oil and gas I&E staff to operators. The ICR report included 
recommendations for the field offices to ensure that enforcement 
actions and inspections are properly and timely documented in the 
official well file and in AFMSS in accordance with national policy (H-
3160-5). These field offices have submitted and are currently in the 
process of implementing their corrective action plans to comply with 
the report's recommendations and ensure that environmental violations 
and enforcement actions are appropriately documented. In addition to 
the ten field offices that participated in the ICR, the report was 
also shared with all BLM State Directors. The State Directors were 
asked to ensure that I&E operations in their field offices were not 
experiencing issues similar to those outlined in the ICR. 

The BLM's corrective actions to date and its ongoing efforts to 
strengthen the oil and gas I&E program through implementation of a 
risk-based inspection strategy will help improve its environmental 
inspection prioritization process and standardize the documentation of 
inspections and enforcement actions across BLM offices. 

Again, thank you for the opportunity to review and comment on GAO's 
report. We appreciate the GAO's insights and recommendations. If you 
have any questions or concerns regarding this response, please contact 
Steve Wells, Chief, Division of Fluids Mineral, at (202) 912-7143 or 
LaVanna Stevenson, BLM Audit Liaison Officer, at (202) 912-7077. 

Sincerely, 

Signed by: 

Tommy P. Beaudreau: 
Acting Assistant Secretary: 
Land and Minerals Management: 

Enclosure: 

[End of section] 

Appendix III: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Frank Rusco, (202) 512-3841 or ruscof@gao.gov: 

Staff Acknowledgments: 

In addition to the individual named above, key contributors to this 
report included Kimberly Brooks (Assistant Director); Cheryl Arvidson; 
Elizabeth Beardsley; David Bennett; Cindy Gilbert; Michael Kendix; Dan 
Royer; Christine San; Kiki Theodoropoulos; and Joshua Wiener. 

[End of section] 

Footnotes: 

[1] Hydraulic fracturing is a process in which water, sand, and 
chemical additives are injected under high pressure to create and 
maintain fractures in underground formations in order to extract oil 
and gas resources. When combined with horizontal drilling, hydraulic 
fracturing allows operators to fracture the rock formation along the 
entire horizontal portion of a well, increasing the number of pathways 
through which oil or gas can flow. 

[2] See GAO, Oil and Gas: Information on Shale Resources, Development, 
and Environmental and Public Health Risks, [hyperlink, 
http://www.gao.gov/products/GAO-12-732] (Washington, D.C.: Sept. 5, 
2012). 

[3] Pub. L. No. 109-58, 119 Stat. 594 (2005). 

[4] BLM officials said that they generally review APDs for compliance 
with laws that are relevant to BLM's jurisdiction, but not for laws 
that fall under the jurisdiction of other agencies, such as the 
Environmental Protection Agency, or for state laws and regulations. In 
some cases, BLM and states may regulate similar activities; in such 
cases, operators must comply with the more stringent regulation. For 
additional information on selected state requirements, see, GAO, 
Unconventional Oil and Gas Development: Key Environmental and Public 
Health Requirements, [hyperlink, 
http://www.gao.gov/products/GAO-12-874] (Washington, D.C.: Sept. 5, 
2012). 

[5] Pub. L. No. 97-451, 96 Stat. 2447 (1993), codified as amended at 
30 U.S.C. §§ 1701 et seq. (2013). 

[6] U.S. Department o the Interior, BLM, 2009 Inspection and 
Enforcement Documentation and Strategy Development Handbook 
(Washington, D.C., 2009). 

[7] GAO, Increased Permitting Activity Has Lessened BLM's Ability to 
Meet Its Environmental Protection Responsibilities, [hyperlink, 
http://www.gao.gov/products/GAO-05-418] (Washington, D.C.: June 17, 
2005). 

[8] Because this was a nonprobability sample, observations from 
interviews with these offices, taken alone, do not support 
generalizations about other offices. However, such observations 
provide illustrative examples of the types of challenges BLM faces in 
managing its permitting workload and mitigating the environmental 
impact of oil and gas development. We visited and interviewed 
officials in eight BLM field offices (Colorado River Valley, Little 
Snake, and White River in Colorado; Moab, Price, and Vernal in Utah; 
and Pinedale and Rock Springs in Wyoming) and interviewed officials by 
telephone in three additional field offices (Carlsbad and Farmington 
in New Mexico, and the North Dakota Field Office). During our site 
visits to the Colorado River Valley, Vernal, and Pinedale Field 
Offices, we observed BLM officials conduct environmental inspections 
of oil or gas wells and related facilities. 

[9] These 33 offices consist of 30 field offices, 1 field station--
located in Hobbs (NM), which works closely with the Carlsbad (NM) 
Field Office--and 2 state offices, the BLM Alaska State Office and the 
BLM Nevada State Office, which oversee the development of federal oil 
and gas resources throughout their respective states. Some BLM offices 
in other locations have small oil and gas programs that are 
administered with the assistance of the 33 lead offices. 

[10] The number of wells presented here does not include federal wells 
that have been abandoned by operators or nonfederal wells that are 
located on Indian Trust lands. 

[11] Revisions to land use plans are necessary if monitoring and 
evaluation findings, new data, new or revised policy, or changes in 
circumstances indicate that decisions for an entire plan or a major 
portion of a plan no longer serves as a useful guide for resource 
management. BLM, Land Use Planning Handbook H-1601-1, p. 46 
(Washington, D.C.: 2005). 

[12] Pub. L. No. 91-190, 83 Stat. 852 (1970), codified as amended at 
42 U.S.C. §§ 4321-4347 (2013); see § 4332(2)(C)(i). 

[13] U.S. Department of the Interior, BLM, Surface Operating Standards 
and Guidelines for Oil and Gas Exploration and Development 
(Washington, D.C., 2007). 

[14] Oil and gas development on federal lands also must comply with 
applicable state laws. 

[15] In circumstances where the surface land is managed by another 
federal agency, BLM generally is to obtain the approval of the surface 
management agency prior to approving the Final Abandonment Notice. 
Where the surface land is owned by a state or private entity, BLM 
generally may consider the surface owner's views respecting the 
abandonment plan. 

[16] GAO, Oil and Gas Bonds: BLM Needs a Comprehensive Strategy to 
Better Manage Potential Oil and Gas Well Liability, [hyperlink, 
http://www.gao.gov/products/GAO-11-292] (Washington, D.C.: Feb. 25, 
2011). 

[17] [hyperlink, http://www.gao.gov/products/GAO-11-292]. 

[18] [hyperlink, http://www.gao.gov/products/GAO-11-292]. 

[19] As BLM was just beginning to implement this revised guidance 
during the course of our review, we did not include BLM's 
environmental mitigation efforts related to idle wells in this report. 

[20] Oil, gas, and coalbed methane APDs, collectively, represent at 
least 96 percent of all APDs that BLM received each fiscal year from 
2007 through 2012. In addition, BLM received a small number of APDs 
for monitoring wells, injection wells, and other types of wells that 
are used to support oil and gas operations. Together, these well types 
represented from about 2 to 4 percent of the total number of APDs BLM 
received each year. 

[21] GAO, Onshore Oil and Gas: BLM's Management of Public Protests to 
Its Lease Sales Needs Improvement, [hyperlink, 
http://www.gao.gov/products/GAO-10-670] (Washington, D.C.: July 30, 
2010). 

[22] [hyperlink, http://www.gao.gov/products/GAO-12-732]. 

[23] The Buffalo Field Office is responsible for managing the second 
largest number of federal oil and gas wells of all BLM offices (see 
figure 1 in the Background of this report). In fiscal year 2012, this 
office accounted for 10 of the 19 (about 53 percent) coalbed methane 
APDs received by BLM. 

[24] These numbers represent APDs for federal oil and gas resources 
that the North Dakota Field Office received. According to BLM 
officials, Indian Trust APDs represent a significant part of the North 
Dakota Field Office's overall permitting workload, but those APDs were 
not included in our analysis. 

[25] The North Dakota Field Office was tied with the Bakersfield Field 
Office for the fourth most active BLM office in terms of APDs for 
federal oil and gas resources received in fiscal year 2012. 

[26] 72 Fed. Reg. 10,308 (March 7, 2007). 

[27] Before an APD is considered complete, BLM must also perform an on-
site inspection of the proposed well site to help determine if the 
materials submitted in the APD package are accurate and whether any 
COAs are necessary. The operator must correct any deficiencies 
identified during this on-site inspection. The on-site inspections 
that occur during the permitting phase are not included in our 
analysis of BLM's environmental inspection activities. 

[28] These bonds are intended to ensure that operators perform the 
required reclamation, as well as the lease's other terms and 
conditions, such as the payment of federal royalties. 

[29] The order also provides that, under certain conditions, BLM may 
deny an APD within 30 days. 

[30] As we reported in June 2005, BLM established its agency policy on 
the use of environmental best management practices in 2004, but 
officials from some field offices said they had already been using 
these practices prior to the issuance of the agency policy. See 
[hyperlink, http://www.gao.gov/products/GAO-05-418]. 

[31] Booz Allen Hamilton, Section 365 of the Energy Policy Act of 
2005: Year Two Report for the Pilot Project to Improve Federal Permit 
Coordination, a report prepared for the Department of the Interior's 
Bureau of Land Management (Washington, D.C.: February 2008). 

[32] In a letter transmitting the draft report to us, BLM indicated 
the report contains outdated information, including obsolete budgetary 
and legislative information, and does not represent departmental 
policy. 

[33] The nearly 27,400 approved APDs for which we reviewed data 
represented approximately 89 percent of all APDs for federal oil and 
gas resources that BLM has reported it approved from fiscal years 2007 
to 2012. We were unable to obtain sufficient data on the remaining 11 
percent of APDs that BLM has reported it approved during this time 
period to include them in our analysis. 

[34] Our concern about the reliability of the data on these 5,160 APDs 
is focused on their listed completion date in AFMSS and does not 
extend to their received and approved dates listed in the database. 
Consequently, we included these APDs in our analysis of data on the 
average number of days it took BLM to process APDs from date of 
receipt to date of approval discussed below. 

[35] As a result of the concerns about the reliability of the listed 
completion dates for these APDs, we were unable to quantify how much 
of the processing time for these APDs was spent in each of the two 
review periods. 

[36] The data we obtained from BLM on APDs approved in fiscal years 
2009 to 2011 were more complete than the data from fiscal years 2007 
and 2008 but were less complete in some years than the data from 
fiscal year 2012. As a result of the variation in the completeness of 
the data on APDs approved from fiscal years 2007 to 2012 and 
uncertainty about the impact of the missing data, we limited our 
reporting of the average number of days to process an APD from date of 
receipt to date of approval to fiscal year 2012. 

[37] Department of the Interior, Budget Justifications and Performance 
Information Fiscal Year 2014: Bureau of Land Management (Washington, 
D.C.: 2013). 

[38] Under certain circumstances established in section 390 of the 
Energy Policy Act of 2005, BLM can approve an APD relying on a 
categorical exclusion rather than preparing the environmental impact 
statement or environmental assessment that is normally required under 
NEPA for an APD. See GAO, Energy Policy Act of 2005: BLM's Use of 
Section 390 Categorical Exclusions for Oil and Gas Development, 
[hyperlink, http://www.gao.gov/products/GAO-11-941T] (Washington, 
D.C.: Sept. 9, 2011). 

[39] Prior to the slight decline in fiscal year 2012, BLM had 
increased the number of environmental inspections it performed on 
federal oil and gas wells and facilities every year from fiscal year 
2007 to fiscal year 2011. 

[40] [hyperlink, http://www.gao.gov/products/GAO-05-418]. 

[41] The pilot offices we contacted were Colorado River Valley in 
Colorado, Carlsbad and Farmington in New Mexico, and Vernal in Utah. 

[42] We did not analyze the extent to which the actual number of 
workmonths BLM spent on environmental inspections for these years 
matched or differed from the number of planned environmental 
inspection workmonths recorded in BLM's planning documents. 

[43] BLM officials noted that the placing of more wells on a given pad 
reduces habitat fragmentation (the breaking up a large area of habitat 
into smaller areas) and thus provides additional benefits to wildlife. 

[44] U.S. Department of the Interior, BLM, 2011 Inspection and 
Enforcement Internal Control Review of Documentation of Inspections 
and Review of Drilling, Environmental, and Production Inspections 
(Washington, D.C., 2011). 

[45] Production inspections are performed on wells that produce oil or 
gas to ensure that equipment, practices, and procedures adhere to the 
regulations, orders, and any applicable approval documents. Generally, 
specially trained petroleum engineering technicians, petroleum 
accountability technicians, or petroleum engineers conduct these 
inspections. 

[46] BLM's 2011 Inspection and Enforcement Internal Control Review of 
Documentation of Inspections and Review of Drilling, Environmental, 
and Production Inspections also found similar problems with 
nonenvironmental inspections, such as production inspections, and 
nonenvironmental enforcement actions. Our review did not cover these 
types of inspections or enforcement actions. 

[47] GAO, High-Risk Series: An Update, [hyperlink, 
http://www.gao.gov/products/GAO-11-278] (Washington, D.C.: February 
2011). 

[48] GAO, High-Risk Series: An Update, [hyperlink, 
http://www.gao.gov/products/GAO-13-283] (Washington, D.C.: February 
2013). 

[49] We are currently reviewing the extent to which BLM, the Bureau of 
Ocean Energy Management, and the Bureau of Safety and Environmental 
Enforcement continue to face problems hiring, training, and retaining 
staff to provide oversight and management of oil and gas, including 
whether the bureaus have identified the causes of their human capital 
challenges, the actions taken in response, and how they plan to 
measure the effectiveness of such actions. 

[50] Because this was a nonprobability sample, observations from 
interviews with these offices, taken alone, do not support 
generalizations about other offices. However, such observations 
provide illustrative examples of the types of challenges BLM faces in 
managing its permitting workload and mitigating the environmental 
impact of oil and gas development. 

[51] We did not interview officials from the BLM Montana State Office, 
which has jurisdiction over the North Dakota Field Office. 

[52] In the Cobell class-action lawsuit, which concerned the 
government's management of Native American trust funds, a U.S. 
District Court Judge on December 5, 2001, ordered Interior to 
disconnect from the internet all IT systems that house or provide 
access to individual Indian Trust data. Specifically, Interior's IT 
systems were impacted multiple times starting in 2001, and were shut 
down for several months in 2005 for federal data and until 2008 for 
Indian Trust data. 

[53] The results we present from our analysis of these data do not 
include federal wells that had been abandoned or nonfederal wells that 
were located on Indian Trust lands. 

[End of section] 

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