The Biden administration is adding an additional delay to a rule that is expected to lessen the amount companies that drill on public lands and in public waters pay in fees to the federal government.
The rule, which was finalized in January and previously delayed until this Friday, will now be halted until Nov. 1, according to a department spokesperson.
During the delay period, the department’s Office of Natural Resources Revenue will weigh whether to revise or withdraw the prior rule, and possibly propose a new one in its place.
“In its final days, the previous administration sought to shortchange American taxpayers for the resources that oil and gas companies extract from public lands,” an Interior spokesperson said in a statement.
“The Department of the Interior is delaying the rule’s effective date in order to provide the Office of Natural Resources Revenue with needed time to consider whether it will revise or withdraw the 2020 rule and, if so, publish a proposed rule and invite further public comment,” the spokesperson added.
The rule changed the way that royalties companies pay to the government for drilling on federal property is calculated and was expected to decrease how much the government collects by $28.9 million each year.
This amounts to less than 0.5 percent of the total federal oil and gas royalties it collected in 2018, the rule notes.
When he proposed the rule in August, then-Interior Secretary David Bernhardt said in a statement that it would provide “regulatory certainty and clarity to States, Tribes and stakeholders, removing unnecessary and burdensome regulations for domestic energy production.”
The rule’s promulgation followed a request from a leading industry lobbying group, the American Petroleum Institute, for changes to how royalties are calculated.
In February, the department put an initial delay on the rule and started a 30-day comment period to allow for “additional engagement.” The spokesperson said that this comment period spurred 1,300 pages worth of documents.