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Wyoming Oil And Gas Lease Sale Nets $7.7M, ‘Peanuts’ Compared To Trump’s First Term
The Bureau of Land Management’s latest quarterly Wyoming oil and gas lease sale Tuesday took in $7.7 million. It shows that the reality of oil and gas leasing in Wyoming hasn’t yet caught up to President Donald Trump’s pledge to “unleash American energy.”
The Tuesday sale leased 29 parcels totaling about 23,000 acres, the BLM reports, adding that the sale supports “domestic energy production and American energy independence.”
While there’s optimism the new energy landscape under Trump will mean more available leases, reactions are mixed about the news that the recent sale generated just under $4 million for Wyoming.
It doesn’t account for more than 600,000 acres of federal land in Wyoming approved for leases that were closed off during the Biden administration. It’s also a fraction of the $173 million Wyoming reaped in the best lease sale year of Trump’s first administration.
One industry expert expressed skepticism about the size of the latest lease sale and another said he’s happy the BLM is again in the business of actively leasing public land in Wyoming.
Ryan McConnaughey, vice president of the Petroleum Association of Wyoming, views the June 10 sale as a sign of improved consistency under the Trump administration.
“We appreciate Secretary (of the Interior Doug) Burgum returning the BLM to regularly scheduled, quarterly lease sales as required by the Mineral Leasing Act after four years of uncertainty and roadblocks for federal development that were the hallmarks of the Biden Administration,” said McConnaughey.
“Regular lease sales give the industry more certainty when planning for project investments,” he added. “Furthermore, the money Wyoming receives from the sales benefits K-12 education and other public infrastructure.”
Truly Unleashed?
Steve Degenfelder, a leasing expert with Kirkwood Oil and Gas in Casper, expressed skepticism about claims linking the recent revenue to President Trump’s energy initiatives.
“My comment on the BLM statement of $7.7 million — half or $3.85 million to Wyoming — supports the President’s energy first initiative: That dog doesn’t hunt,” Degenfelder said.
Degenfelder provided an analysis of Wyoming BLM lease sale data from 2015-2024. He said it reveals dramatic variations in annual revenue that don’t show the BLM ramping up leasing to levels seen under the Obama administration and Trump’s first term.
During the Obama administration’s final years from 2015-2016, Wyoming saw $11.8 million and $18.5 million respectively, averaging $15.1 million annually.
Trump’s first term from 2017-2020 showed dramatic swings, with exceptional performance reaching $173 million in 2017, $115.7 million in 2018, and $139 million in 2019, but then dropping sharply to $11.4 million in 2020. This averaged $109.8 million annually, driven largely by the first three years.
The Biden administration from 2021-2024 saw no sales in 2021, followed by $12.9 million in 2022, $31 million in 2023, and $14 million in 2024, averaging $14.5 million annually.
“What BLM is saying is that their actions are supporting that (Trump’s energy initiative),” Degenfelder said. “And I said no, that dog doesn’t hunt — that $7.7 million, $3.8 million to the state of Wyoming is peanuts compared to what was seen during the Trump administration in 2016 to 2020.
“And even with Obama, when in fact you realize there was more federal land under lease when Obama left office in 2016 than when Trump left office in 2020.”
What About Those 606,000 Acres?
A key concern raised by Degenfelder involves the Biden administration’s deferral of those 606,000 acres that were authorized for leasing.
“Through the Biden administration, the BLM deferred 606,000 acres. My question is, why have they not resumed the lease sales at the number of acres that we saw during the Trump administration?” he said.
The Wyoming BLM office did not respond to a question about the deferred acres.
Biden Policy
When presented with Degenfelder’s comments, McConnaughey acknowledged his concerns about increased costs.
“He is correct in saying minimum bids and royalty rates rose during the Biden administration and are still in effect today,” he said. “Those rules make leasing more expensive for operators and may drive down interest in marginal parcels.”
The BLM’s Wyoming office told Cowboy State Daily that the jump in the minimum lease price per acre from $1 to $10 came from language in the Biden era Inflation Reduction Act.
At a minimum of $10 an acre, “Parcels offered in high potential areas like the Powder River Basin continue to see significant interest,” said McConnaughey.
But for more speculative drilling ventures, that higher cost may inhibit investment.
Degenfelder drilled down on the changes in lease terms that increase costs for oil and gas producers while generating less overall revenue compared to previous administrations.
The minimum bid increased from $1 per acre to $10 per acre is a 900% jump — and royalty rates rose from 12.5% to 16.67%, representing a 33% increase.
“A lot of new plays begin with an idea from a geologist,” said Degenfelder. “They just might take 10 years to put the lease play together. And then you’ve increased the royalty rate by 33%. And all of that works to the economic detriment of the developer.
“You know, to the ordinary citizen, $7 million looks like a lot of money, but it really isn’t compared to these parcel sales that they had. You’re offering a lot less acreage than industry has asked for. And then you’ve changed the terms.”
Emerging Pattern
In the first roughly six months of Trump’s second term, federal agencies tracking oil and gas resources and development have fallen into a pattern of announcing new discoveries, speeding up environmental reviews and offering parcels of public land for lease.
On Wednesday, the U.S. Geological Survey — which recently touted massive oil and gas reserves in the Mowry Shale of southwest Wyoming — announced more reserves in the Niobrara Formation.
Also located in Southwest Wyoming and extending into northwest Colorado, the USGS assessed that there are technically recoverable resources of 703 million barrels of oil and 5.8 trillion cubic feet of gas.
The USGS assessment estimates there is enough undiscovered oil in the Niobrara Formation to meet U.S. needs for one month, and as much undiscovered natural gas as the U.S. consumes in two months, at the current rates of consumption.
“USGS energy assessments typically focus on undiscovered resources — areas where science tells us there may be a resource that industry hasn’t discovered yet. In this case, our assessment found substantial oil and gas resources,” said Sarah Ryker, acting director of the USGS.
What does it all mean for future oil and gas lease sales?
“For land-management agencies such as the Bureau of Land Management, the results of an energy resources assessment feed into land-use and resource management plans,” stated the USGS in its June 11 statement. “For the private sector, USGS assessments of undiscovered energy resources provide context for planning detailed exploration.”
David Madison can be reached at david@cowboystatedaily.com.
