Should a private energy company’s recommendation that certain public lands be made available for commercial drilling be kept confidential by the government? Or should everybody be able to know who made the request?
In a move that might surprise some -- or not -- President Obama's administration is backing drilling secrecy. It is the latest example of how the president's energy policy is more complex than many think.
In reaction to a February legal ruling requiring that a leasing request be made public, the Interior Department has announced a new rule that would allow all future leasing requests -- called an “expression of interest” in bureaucrat-speak -- to be done anonymously.
Interior's new Bureau of Land Management rule states that effective next year it will “advise EOI submitters that the BLM does not require their name and address to be on their submission. EOI submitters may exclude any information they consider privileged.”
It was a clever way for Interior to sidestep having to provide the leasing information since it cannot give up the names if it doesn’t have them in the first place.
Interior’s proposal has won it few friends on either side. Environmentalists are exasperated that the administration would allow this. Industry claims the new rule is unworkable and wants to revert to the old one.
It is an important issue because the United States is blessed with abundant stores of oil and natural gas. New technology has led to a boom in production and turned the nation into a net energy exporter. Much of those reserves are under public lands.
Under the old rules, companies could propose lands for drilling. If Interior determined the lands were eligible, they would be put up for auction with the lease sold to the highest bidder. Whoever made the proposal would be kept confidential until after the sale.
Industry sources say confidentiality is needed so that the company making the proposal doesn’t alert its competitors and see the lease bid up.
“They would think, 'Ah, Company X must know something so we'll bid there too,' ” said Kathleen Sgamma, vice president of government and public affairs at the Western Energy Alliance.
The secrecy also serves to keep environmental groups in the dark, preventing so-called “name and shame” campaigns. Activists are candid that that is why they want confidentiality removed.
“Certainly some industry participants have better track records than others when it comes to spills,” said Kyle Tisdel, an attorney with the Western Environmental Law Center, which is leading the push for transparency.
So, wait a minute, isn't Obama on their side on this? After all, the administration has caved to environmentalist pressure on some issues, like the oft-delayed Keystone XL pipeline project.
But the administration has been supportive of industry in other areas. This is especially true of natural gas drilling, also known as “fracking.” Interior Secretary Sally Jewell, herself a former oil industry drilling engineer, has boasted of having safely fracked for natural gas.
So the new rule seems to be an attempt to placate industry privacy concerns. I wanted to ask Interior itself but the agency didn't make a spokesman available.
Sgamma nevertheless said the rule would be problematic since it would mean companies could not follow up on their requests, at least not anonymously. That information could then be subject to Freedom of Information Act requests.
“The environmentalists would just continue to sue until they got to the actual company,” Sgamma said.
Most conservatives would probably back the energy industry on this. But it is worth asking: In whose interest is it to allow confidentiality if it allows companies to hold down the value of the leases? Why shouldn't taxpayers want them to be sold to the highest bidder? Isn't that the free market in action?