Biden makes his move against oil and gas

Pres. Biden signed three executive orders today, which apparently include a ban on new leasing on federal lands, and a suspension of new drilling permits. The C-Span link to the remarks is below. I have not seen the text of the executive orders yet. Onshore production of oil and gas is 8% of U.S. production. Include offshore, and it rises to 20%. There are some real whoppers in the speech.

Here are a few notes on the video: 2:00 remarks begin 5:00 Air quality is getting worse and contributing to Covid symptoms (Hmm- Thought I read switch from coal to natural gas had actually improved air quality) 6:20 Will be creating new union jobs with renewable power grid (Hmm- was not aware all these solar installers were union shops) 7:20 Will reinstate and impose new vehicle and building efficiency standards 8:20 Will require all new government vehicles to be clean energy (Hmm- I guess I missed the all electric tanks and fighter planes) 8:40 - All clean energy power grid by 2035 10:30 - Federal government is going to plug over 1 million abandoned wells 12:00 - New Office of Climate Policy 12:30 - Biden pledges help for coal and oil and gas communities he is about to devastate 13:20 - He is not banning fracing, but new standards on methane emissions 14:00 - Will eliminate $40 billion in oil and gas subsidies (watch out - here comes the repeal of the depletion allowance) 16:10 - 40% of the money will go to communities to address “environmental justice” 17:00 - He will listen to the science (and the science says how will shifting oil production overseas reduce carbon emissions?)

In short, Biden is making it increasingly clear he will try to gut the oil and gas industry, confiscate mineral owner rights to develop, and remove normal tax incentives that other industries enjoy.

Mix that stiff drink before you click

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Here are the Executive Orders from 1/20 on Keystone and suspending new permits.


I have seen another summary that says they are not banning permitting under existing federal leases, but are “pausing” new leasing. Will try to get the details as to which is correct.

The speculation is that a permitting ban may be illegal so what they will do instead is strangle or slow play permits so they are a practical impossibility.

Wayne- I am all against the Biden agenda. But to combat the leftist agenda begins in local elections. NM used to be a conservative state. Conservatives became complacent. This is the result. No need to complain about the top of the ticket. Start at the bottom. Run for office at the local level otherwise we are barking up a dead tree. The socialist agenda began in the Johnson administration & won’t be stopped until local governments stop it. My 2cents.


What Mr. Baker said is correct:
No need to waste time, start local. Find your local GOP group and start there, get involved in local delegates for state conventions. Start at the bottom and work your way to the top to straighten out this mess!!

Everyone stay safe – USA Oil, Gas and Energy!!!


Other outlets reporting the new executive order does not ban new permits, but no confirmation from one I trust yet.

If interested, here is the Federal Register link to Executive Orders. It runs a few days behind in publishing them. Since we are going on 12+ years of partisan gridlock, much of the action on the legislative front comes through Executive Orders these days. A sad commentary on the health of our democracy.

Federal Register

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Here is an article summarizing the potential tax changes Biden may push for. Depletion allowance is listed about 1/2 way down.

If unfamiliar to you, depletion allowance is the deduction you get to take on your taxes for your minerals being depleted by production. So in other words, if eliminated, a big real estate developer will get to depreciate any building they build or equipment they buy, while you will not get to deprecate your minerals being physically depleted. Sound fair? Probably not.

Tax changes

Forbes summary of impact to New Mexico of the Permian Basin. Lea and Eddy Counties were poised to become the #1 and #2 oil producing counties in the U.S. before this latest salvo by the administration.

Biden’s impact on New Mexico

Wade, Thanks for all of the information and resources - this is very helpful. In addition to the potential rollback of fossil fuel “subsidies” like the depletion allowance which will impact all royalty owners, many may be wondering how a federal leasing ban would affect their private mineral rights.

Given the massive amount of federal mineral rights (700 million acres in the US), especially in the western US, many private mineral rights and royalty owners will be impacted by decisions made with respect to federal oil & gas leases. This is because fee (private) minerals can be pooled with federal mineral rights when a spacing unit is formed that covers both government and privately owned minerals. In fact, I have interests in several wells that are part of federal units and have benefited greatly from this ability for mineral owners to “partner” with the federal government for the responsible development of oil & gas reserves under our collective lands. In fact, we covered this topic in detail in Episode 89 of The Mineral Rights Podcast in January if anyone wants to find out more.

Thankfully, the seven companies that control most of the federal onshore oil and gas activity have been building a stockpile of drilling permits in anticipation of this eventuality. In fact, several companies including EOG Resources have said that they have at least four years of federal permits on hand already. That said, the small mom and pop oil and gas producers who operate on federal acreage that aren’t so lucky are the ones that will feel the pain of this policy if it becomes permanent.

That said, this is a time where all of our voices need to be heard. Write to your representatives to let them know how these policy changes will hurt private citizens like you. If you aren’t already a member of NARO, now’s a great time to join (or to be sure to renew) as this will be one of our main focus areas this year, in addition to the webinars and other education opportunities.

Matt Sands

A separate Forbes summary of impact of a leasing ban.

Prepare for tax hikes New Mexico

Gov. Abbott’s response to Biden’s flurry of executive orders.


It only pertains to govt land, not private lands. I wonder if this will actually be like 2012 with the policy of oil independence. Made so many little guys so much money. Richest I ever was off oil was 2011-2014. So the fat cats in Alaska can’t make money off the govt land anymore, that only makes the Permin basin and New Mexico’s independent guys all that more valuable. This could be great for independent royalty owners. Why on earth would anyone think offshore oil is a good thing for the Permian? Less new places to produce the more you produce in places already permittable.


I like your logic, Carolyn. It does seem that the ban on exploration on federal lands would create a flight by producers to private lands and that would create scarcity. That could lead to rising lease bonuses and some negotiating power for us little guys, especially for gas wells, that may be more appealing as a “cleaner” fuel. The question is, “will the Biden administration find ways to come after us, too?” The possible attack on the deletion allowance is one example. I would love to hear more thoughts about the impact on small private royalty owners, of the Biden policies.

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The problem is that in states such as New Mexico it is very difficult to drill horizontal wells that do not partially include federal lands due to the checkerboard patterns. If easements are restricted on federal lands, then the oil company cannot install a pipeline to move the oil and gas or a temporary water line to a well, even for private land wells. Once the anti-oil forces stop production on federal lands, then they will move against private lands.

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Local GOP is being more divided of late with the requirement for Representatives to sign agreements to vote 80+% on the far right policies and to ostracize those who do not (or not receive GOP funding). This was made clear after Cheney stood firm on how she voted.

As far as leasing and drilling on fed. land pause, this could be good for private lease holders/producers and royalty owners.

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A post was split to a new topic: Occidental Delivers World First Carbon-Neutral Oil

Platts analysis- moratorium will cost loss of natural gas production growth of 4 billion cubic feet per day. 3 billion of that loss will come from New Mexico.

Clean out your fireplace

Midland article - moratorium a “nail in the coffin” for Houston and the industry in general, because of offshore and federal lands effects.


Here is the link for the Feedback form for the US Department of the Interior if you want to email your thoughts on the leasing ban and permitting “review”.


Sarcasm is not always the best way to react. Clearly, your response is based in self interest. We all live in this country, our children and grandchildren live in this country. We need to take a balanced approach to both the oil and gas industry and global warming and air quality. Biden’s approach is not going to devastate the community. Shifting oil production overseas does not, as you well know, slow down global warming.