Oil and Gas Drilling in America:

Oil and Gas Drilling in America:

“The Most Drilled Nation?”

More oil and gas drilling occurs in America every year than in any other countryAccording to Baker-Hughes, as of April 1, 2011, there were 1,776 rotary drilling rigs operating in U.S. lands and waters, more than in any other country in the world*

* http://investor.shareholder.com/bhi/rig_counts/rc_index.cfm

EIA - U.S. #1 in world natural gas production

United States Russia Algeria Canada Iran0

5000

10000

15000

20000

25000

30000

Total Natural Gas produced (2009) in billions of cubic feet

Total Natural Gas produced (2009) in billions of cubic feet

EIA - U.S. #3 in world oil production

Russia Saudi Arabia

United States

Iran China0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Production (thousands of barrels per day)

Production (thousands of barrels per day)

According to EIA…

• Last year over 43,000 wells were drilled on American lands and waters

• Yet, we have only 3.8% of the world’s natural gas reserves, and less than 2% of proven oil reserves

SOURCE: Energy Information Administration -- http://tonto.eia.doe.gov/cfapps/ipdbproject/iedindex3.cfm?tid=3&pid=alltypes&aid=1&cid=all,&syid=2005&eyid=2009&unit=BCF

; http://www.eia.doe.gov/country/country_energy_data.cfm?fips=US; http://www.eia.doe.gov/emeu/mer/pdf/pages/sec5_4.pdf; http://www.eia.doe.gov/country/country_energy_data.cfm?fips=US

Industry is not drilling on nearly two-thirds of the BLM lands it has already leased

12,205,418

28,980,740

Acres producing

Acres not producing

Onshore acres leased for drilling versus the number producing on BLM lands (FY 2010)

Source: Bureau of Land Management, "Oil &Gas Statistics" http://www.blm.gov/wo/st/en/info/newsroom/Energy_Facts_07/statistics.html

In FY 2010 oil & gas companies received three times as many BLM drilling permits as they used

Applications for permits to drill approved

Wells actually started ("spud")

0500

1,0001,5002,0002,5003,0003,5004,0004,500

4,090

1,480

Approved drilling permits versus new wells started on BLM lands (FY 2010)

Source: BLM, "Oil &Gas Statistics" http://www.blm.gov/wo/st/en/info/newsroom/Energy_Facts_07/statistics.html

As of March, 2011, over 7,000 federal drilling permits sat idle

Industry has shut down over 11,000 producing natural gas wells in Wyoming alone in recent years

“Over the past several years, coal-bed methane gas operators in the Powder River Basin have idled thousands of wells due to low natural gas pricing... the fate of some 11,800 idle coal-bed methane wells in the basin remains uncertain.”

—WyoFile , March 22, 2011. http://wyofile.com/2011/03/cbm-bankruptcies/

Oil and gas drilling must be done right: • Unprotected wild landscapes and sensitive cultural sites should be off-limits to leasing and development.

• Crucial wildlife habitats should be protected from the adverse impacts of oil and gas activities.

• Drinking water and surface water quality should be protected, and the public disclosure of chemical compounds used in drilling required.

• Air quality should be protected from ozone-forming emissions, fugitive methane emissions, and other air pollutants that accompany natural gas development.

• The rights of surface owners to protect their lands and waters in split-estate situations should be protected.

• Sufficient agency staffing and resources for field monitoring, inspection, and enforcement.

Administration Reforms

• New “Master Leasing Plans” required to assure leasing occurs only in appropriate places and with appropriate safeguards

• More careful environmental reviews before oil and gas activities are permitted

• New “Wild Lands Policy” to assure most sensitive lands are identified and protected

Proposed Additional Onshore Reforms

• Asked Congress to raise rental fees for non-producing leases

• Asked Congress for new fees for Inspection & Enforcement

• Chemical disclosure proposal under consideration• Royalty rate increase to be proposed• Reclamation bonding increases being considered