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Mineral Leasing Act of 1920
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The Mineral Leasing Act of 1920 (MLA) regulates the leasing of public lands for the development of several mineral resources, including coal, oil, natural gas, other hydrocarbons, and other minerals. Prior to the Mineral Leasing Act, these minerals were subject to the General Mining Law of 1872 (and, in the case of coal, the Coal Act of 1873). Approved by the 66th United States Congress, the act was signed into law by President Woodrow Wilson on February 25, 1920.[1][2]
Background
The General Mining Law of 1872 provided for the exploration, development, and production of most minerals on public lands (coal was exempted from the 1872 law and was instead subject to the Coal Act of 1873). Under the 1872 act, individual citizens or corporations were entitled to stake claims on public lands and develop the minerals contained therein. The claimant was not required to pay royalties on minerals produced to the federal government. The act also allowed for the claimant to acquire title to both the surface and mineral rights of the land.[3]
The Pickett Act of 1910 authorized the president to withdraw federal lands from private entry under the aforementioned land use policies. Consequently, according to the United States Congress Office of Technology Assessment, over the course of the next ten years, "substantially all the unappropriated public domain mineral land was withdrawn."[3]
Legislative history
See bill: Mineral Leasing Act of 1920 (current)
Congress approved the Mineral Leasing Act in 1920. At the time, Republicans held a majority in both houses. Democratic President Woodrow Wilson signed the bill into law on February 25, 1920.[4]
Several amendments were made to the act after its enactment. The Mineral Leasing Act for Acquired Lands (1947) extended the original act's provisions to lands acquired by the federal government (acquired lands being those that the federal government obtained by purchase, condemnation, or gift). The complete text of the law can be accessed here.
Components
Mineral leasing
The act authorized the federal government to issue permits for mineral exploration on public domain lands and to lease the rights to those minerals. This enabled the federal government to retain ownership of these lands (under the General Mining Law of 1872, individuals and corporations could purchase title to lands upon which they had staked mineral claims). Minerals subject to MLA include coal, oil, natural gas and other hydrocarbons.[1][5]
The Bureau of Land Management (BLM) oversees the leasing process both for the lands it manages and lands managed by other federal agencies (e.g., the Forest Service). Several types of federal land are excluded from the leasing provisions set forth in MLA, such as national parks and monuments; lands in incorporated cities, towns or villages; and areas within the National Wilderness Preservation System. The Secretary of the Interior may elect to withdraw lands from use under the act.[1][5]
As of August 2014, BLM lands subject to MLA comprised 258 million surface acres and 57 million subsurface acres (i.e., areas where the federal government owned the mineral rights but not the surface rights). At that time, BLM regulated mineral leasing for an additional 385 million acres of land that were managed by other federal agencies.[6]
Lands may be leased in competitive auctions or through noncompetitive processes (usually, lands are leased through competitive auctions; in the event that a bid is not received, the land may be leased via the noncompetitive process).[1][5]
Producers must pay the federal government royalties on minerals removed or sold from the land. The amount of the royalty varies according to the type of mineral extracted. For example, producers of oil or natural gas are required to pay a royalty of at least 12.5 percent of the value of oil or gas removed or sold from the land. Producers must also pay annual rental fees on the lands they lease from the federal government. These fees and any royalties are paid to the U.S. Department of the Treasury. In turn, the treasury must allocate funds from a given lease as follows: 50 percent must be allocated to the state where the land is located; 40 percent must be allocated to the Reclamation Fund (a fund for projects that provide water to states in the western part of the nation); the remaining 10 percent must be allocated to miscellaneous receipts. For lands leased in Alaska, 90 percent of funds received from a lease must be allocated to the state (since Alaska does not receive money from the Reclamation Fund).[1][5]
Oil and gas leases
The table below summarizes information pertaining to oil and gas leases administered by the BLM under MLA.[7]
| Onshore oil and gas lease statistics, fiscal years 2003 to 2013 | |||||
|---|---|---|---|---|---|
| Fiscal year | Total # of acres leased | Total # of new leases issued | Total # of acres leased during the year | Total # of producing leases on federal lands | Total # of producing acres on federal lands |
| FY 2004 | 35,446,444 | 2,699 | 4,157,121 | 21,889 | 11,671,414 |
| FY 2005 | 36,452,327 | 3,514 | 4,314,207 | 23,511 | 12,529,618 |
| FY 2006 | 45,341,322 | 3,746 | 4,385,378 | 22,859 | 12,267,612 |
| FY 2007 | 44,479,478 | 3,499 | 4,634,736 | 21,680 | 11,629,625 |
| FY 2008 | 47,242,495 | 2,416 | 2,615,259 | 23,293 | 14,543,425 |
| FY 2009 | 45,364,991 | 2,072 | 1,913,602 | 22,599 | 12,842,209 |
| FY 2010 | 41,186,158 | 1,308 | 1,353,663 | 22,676 | 12,205,416 |
| FY 2011 | 38,463,552 | 2,188 | 2,016,176 | 22,682 | 12,316,233 |
| FY 2012 | 37,792,212 | 1,729 | 1,752,060 | 23,306 | 12,512,974 |
| FY 2013 | 36,092,482 | 1,468 | 1,172,808 | 23,507 | 12,617,743 |
| FY 2014 | 34,592,450 | 1,157 | 1,197,852 | 23,657 | 12,690,806 |
| Percent difference | 2.41% | -57.13% | -71.19% | 8.08% | 8.73% |
| Source: U.S. Bureau of Land Management, "Oil and Gas Statistics," accessed August 21, 2014 | |||||
See also
- Energy policy in the United States
- Energy use in the United States
- Energy terms and definitions
- General Mining Law of 1872
External links
- Mineral Leasing Act of 1920 (current)
- Congressional Research Service, "Energy Products on Federal Lands: Leasing and Authorization," February 1, 2012
Footnotes
- ↑ 1.0 1.1 1.2 1.3 1.4 United States House of Representatives, "Mineral Leasing Act (and Supplementary Laws)," updated January 15, 2014
- ↑ Center of the American West, "Mineral Leasing Act," accessed August 21, 2014
- ↑ 3.0 3.1 United States Congress Office of Technology Assessment. (1979). Management of Fuel and Nonfuel Minerals in Federal Land: Current Status and Issues. Washington, D.C.: U.S. Government Printing Office
- ↑ United States House of Representatives - History, Art and Archives, "Congress Profiles - 66th Congress (1919-1921)," accessed August 21, 2014
- ↑ 5.0 5.1 5.2 5.3 Congressional Research Service, "Energy Projects on Federal Lands: Leasing and Authorization," February 1, 2012
- ↑ U.S. Bureau of Land Management, "Leasing of Onshore Federal Oil and Gas Resources," accessed August 21, 2014
- ↑ U.S. Bureau of Land Management, "Oil and Gas Statistics," accessed August 21, 2014
