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Published March 04, 2021
The University of Wyoming’s Enhanced Oil Recovery Institute (EORI) has reviewed the impact of President Joe Biden’s temporary moratorium on new oil and gas leases on federal lands, finding significant potential impacts on Wyoming oil and gas production, access to existing and future reserves, as well as state revenue.
EORI says its analysis of the federal lease moratorium on Wyoming’s conventional oil reserves is stark due to the fact that the federal government owns 68 percent of the federal minerals in the state. The federal lease moratorium will impact 75 percent of Wyoming’s legacy (conventional) fields and 60 percent of drillable land. This policy will restrict, or possibly prevent, access to 2.9 billion barrels of potentially recoverable oil reserves on federal lands and the associated $12.9 billion in tax revenue, according to the EORI report.
EORI’s analysis complements an earlier report by UW energy economist Tim Considine of the School of Energy Resources, who conducted a study exploring potential scenarios affecting energy development with the change in federal administration. While Considine focused on unconventional, horizontal production and future drilling, EORI’s study covers production from conventional/vertical wells in legacy (existing) fields.
EORI’s report notes that federal ownership of anything greater than 25 percent of the minerals in a field triggers federal control and the drilling moratorium for the entire field. Wyoming’s legacy fields, on both federal lands and on nonfederal lands, have a combined potential of 4.2 billion barrels of oil reserves that could be recovered through enhanced oil recovery techniques. Such projects, however, require drilling of infill wells, for which federal permits are not being issued at present.
An interactive map illustrating EORI’s report may be found here.
EORI intends to continue studies on the impact of the Biden administration’s policies on production and revenue generated from both conventional and unconventional oil and gas fields in Wyoming as new data and policy decisions become known.