67 Million Acres, DU'ers. 67 MILLION. That's The Unused Area Big Oil Is Sitting On Right Now

[KittyWampus]

Big Oil is authorized and capable of producing TWICE as much domestic oil right this second. But they aren't.

Today, oil companies hold leases to about 92 million acres of federal land, both onshore and offshore. Roughly 67 million of those acres — more than 70 percent of the area they own the rights to — are not being used for production. These are areas that oil companies are authorized to start drilling, which have the potential to produce an additional 4.8 million barrels of oil and 44.7 billion cubic feet of natural gas each day. This would nearly double total U.S. oil production!

Why is Big Oil sitting on all this unused land? Simple: Because increasing production would increase supply and threaten the record profits the five major oil companies posted last year — $40.6 billion for Exxon-Mobile alone.

http://www.albertleatribune.com/news/2008/jun/26/why-isnt-big-oil-using-leases-it-already-has/

[Vinca]

1. I heard they can add the value of the leases to the company assets

to make the bottom line look rosier. The current push for more land to lease is a last ditch effort before sane people take over the government.

[KittyWampus]

2. Seems to me they should start using what they got or lose it. Pretty simple to understand

;)

[Paladin]

6. Oil And Gas Leases Don't Last Forever

If exploration companies get leases from the feds, they have 10 years to establish production, or the leases go away. Same thing on leases from private citizens, but the time frame is much shorter---2 to 5 years, generally. It takes oil or gas production---or unitization with other leases that are producing---to hold a lease in place for the long term....

[indepat]

3. And 'pukes would have us think it is patriotic for them to sit on and not drill those acres on land

but unpatriotic for us not to want to drill offshore. That's 'cause holistically 'pukes are mendacious, duplicitous, disingenuous, sanctimonious, reichous, and egregiously hypocritical. Besides that they lie outright, malevolently prevaricate, obstruct, misinform, disinform, cloud the issue, and obfuscate. And that's the only good things I've got to say about 'em. :P

[pinto]

4. Great reminder. This gets overlooked in media discussions, for the most part.

[bridgit]

5. Are these lease' availiable for review? If the devil is in the details...

He will be seen squating there. Are they open ended/never ending? Open till some process or technology is developed that is able to capitalize on the resource that is thought to be there? Or some resource yet determined? Then renewed end to end? Are they able to sub-lease, as can be the case with range land, to cattle dudes for profit in the meantime? Stuff like that.

I agree with your post above: use it or lose it.

[Paladin]

7. The Leases Are Generally Available For Review

If they're federal leases, you can contact the Bureau of Land Management. If they are leases from private citizens, they may be filed of record in the court house of the county where the land is located; some times such leases are not filed, for privacy reasons.....

[bridgit]

9. Sure, it would be interesting to find if they were filed, and if they weren't...

the reasons for their not having to be so filed publicly: simple privacy, privacy associated with trade/corporate secrets, exposure of signed parties & operatives to some form of recourse or remedy, etc...

[Paladin]

10. There Are A Number Of Reasons For Not Filing

Sometimes the landowner wants it that way, sometimes the oil company wants it that way. Most common reason for not filing: varying lease provisions, particularly royalty rates. Example: If an oil company ends up having to grant a shrewd, tough-negotiating landowner a 25% royalty (i.e., the landowner will be getting the revenue from 1 out of every 4 barrels of oil produced), the company may not want to let word out by filing the lease of record, if they think the rest of the area landowners will settle for a smaller, 16.66% royalty (revenue from 1 out of every 6 barrels produced). Nothing dishonest or shady about this; it's the way the oil leasing business has been conducted for decades, and nobody is more aware of it than landowners in petroleum areas.....

[bridgit]

11. I'm sure that one of the reasons could be the sensitive nature of the resource or mineral usage...

as well, my husband has a long time family friend that has developed a process whereby fossil product extraction has become more lucrative within these last several years. Were you, as an energy producer, to be aware of any time-lines/completion rates with respect to on-going R&D vis-a-vis such a technology, you may have an interest in tying up lands via lease' on which you'd be able to profit at a future point in time. You may not care to have such details, or clearly delineated lines back to any operatives/handmaidens that assisted above & beyond the call of their public duty, to raise the ire of activist, or environmentalists just say'n, or...

You may have, essentially & for all intent, received such a lease in your X-Mas stocking for that matter...or in a brown manila envelop on your porch along with a case of single malt Scotch. Unless the matter is researched, it is all just hand wringing as to why these lease holders are allowed to just sit there without providing info regarding their non-usage of otherwise federal, we the people land; especially perhaps in that the OP refers to federal land and not per se "landowners".

In either event, the secretive Cheney Energy Policy has little respect for simple owners of land whether they know what's under ot or not. My husband also worked in the petrochemical industry and has convinced me...most people have no stomach for how oil business has been conducted for decades.

It's easy for me to see the current round of concerns as an extension of such practices predicted upon secrecy-in-the-extreme in the course of 'acquisition without explanation'. Representation without taxation. Where the product is oil; oil being the cause of wars, strife & oppressions worldwide, then the matters of secrecy may include war profiteering. And if war profiteering were legal, then the matters round which swirl secrecy & inexplainable no usage would not need be the case imo. They'd be posted on Pg 1 of glossy quarterly prospectus'.

Though to utilize even your template: an private owner of millions of acres of land seeking equal forms of exclusion regarding lease parameters, articles, and far below market, reasonable (friendly, shall we say), compensations for royalties and possible giveaways to energy producers? Then that introduces yet another level of secrecy and obfuscation.

Americans deserve answers to some if not these questions...unless it is believed we do not.

Thank you for your post :)

[Paladin]

14. If You Can Direct Me To The Region Of The Country,,,

....where I can get an "X-mas stocking" lease from a landowner, along with a case of single malt scotch (my preference would be Glenmorangie, by the way), I'd love to hear about it; that would definitely be a first in my 30 year-plus career. Up in Wyoming where I currently do work, we're paying private landowners anywhere from $500 to $2000-per-acre signing bonuses for the acquisition of 3-year oil and gas leases on their places. The hottest exploration play in the country right now is the Haynesville Shale, located in northern Louisiana; there, bonus payments by oil companies to landowners are up to an unprecedented $25,000 per acre now, and those landowners have multiple companies competing for their mineral rights, boosting the bonus payments higher and higher. I'll let you judge who's getting an "X-mas stocking" deal in those circumstances, and on whose porches brown manila envelopes are turning up. (Helpful hint---sure-fire evidence that there's a hot exploration play in an area: lots and lots of farmers and ranchers driving lots and lots of shiney new pickup trucks.)

I won't try to disabuse you of your feeling that the big oil companies are up to no good, because in many instances you're undoubtedly right. My point is that obtaining details of leasing activity is not that hard to do in many instances; the BLM has details of federal land activities, and most private land leases are filed in the public records. Oil and gas companies generally don't get to hold leases for a long period of time, unless substantial amounts of drilling and production activities take place, converting those leases into HBP ("Held By Production") status. Here endeth the lesson.....

[bridgit]

15. Again, sure, and energy producers are prohibited from certain process'...

in the course of their various extraction. Yet even that little trifle phases not folks such as Bob Murray, as a for instance, his having moved on down the road leaving others behind. To be certain, some of these difference' are found in the political appointments that oversee oversight itself, and regulation. And the ideologies that drive those functions, often with little kindly view toward public or common good, still...

*I* do hear *you* as I know I can't wait for such a X-Mas, though as mentioned; my husband did himself receive a case of single malt Scotch at 3am on a moonless night, as a primer so as to say, while constructing a pipeline through the old Irvine Ranch when cows had to be shoo'd off dirt roads during access through the canyons. Decades indeed. He relates a story as well of his associate, that drove by car as far as he could, to ride a camel out to an oasis with an attache and $35,000 cash seeking rights to drill in the middle of Saudi Arabia from the Sheik of record way back when sitting in a tent, well...'record', but you understand.

The short of it would seem that capitalism, and perhaps energy producers in particular; will be where they think they need to be. The rest are just parliamentaries & formalities. That is why, I think, they push to elect representatives that will enhance their futures & commodities. Their secrecies & their causes.

[Paladin]

16. International Oil Is A Whole Different Deal

Years ago I worked as an international contract negotiator for a big Dallas oil company. I found out quickly that international energy operations bear hardly any similarity to how things are done domestically---mainly because hardly any other country in the world besides the U.S. allows its citizens to own and lease mineral rights. The one incident I recall most vividly is that, in dealing with Arabic countries on exploration matters, we had to conceal the fact that we had a Jewish gentleman on our board of directors. Really rubbed me the wrong way. This was back in the late 70's, and I hope such things don't happen any more....

[bridgit]

18. Argeed, peace & cheers!

:toast:

[Ichingcarpenter]

8. To put the amount of land in perspective = total area of New York & Louisiana

Together, I wish the Democrats would use that analogy vs Millions of Acreage.

[Quixote1818]

12. My cousin owns his own business searching for Oil for the big oil companies

He finds new areas with Oil all the time. The problem is it's just not that much in the big picture. The U.S. just doesn't have much oil compared to some other countries. Not to mention they don't want to find too much at one time or it will drive prices down. It's in their best interest to keep production low so prices stay up.

[JCMach1]

13. It's all about the price...

Peak oil is the narrative that covers up the fact that they are sitting on production...


It doesn't mean that we won't run out of oil. We will! IT's just that the alarmist narrative plays directly into their hands...


Production means shit to these companies... it's all about the price.

[opihimoimoi]

17. DRY WELL SYNDROME??? costs big buck$ to drill anywhere

they hardly wildcat anymore...costs too high

Tests are done first to indicate presence of oil or at least, promising odds.

No odds, no drillin...