Leading Democrats on the US House Natural Resources Committee raised financial and legal questions about EnergyNet, an Amarillo, Tex., transaction service that manages the US Bureau of Land Management’s online oil and gas leasing program.
The company charges a 1.5% “buyer premium” on top of each bonus bid, which basically is a windfall, Rep. Raul M. Grijalva (D-Ariz.), the full committee’s ranking minority member, and Alan Lowenthal (Calif.), the Energy and Mineral Resources Subcommittee’s top Democrat, said in their Jan. 16 letter to Brian Steed, BLM’s deputy director for programs and policy.
They also expressed concern that the additional required payment may be discouraging producers from submitting bids.
Congress amended the 1920 Mineral Leasing Act in 2014 to allow online lease sales that proponents said would make the leasing process more transparent, “allowing people to follow the status of lease sales from anywhere in the country,” Grijalva and Lowenthal said.
But a review of completed sales by the committee’s minority staff found that bidder identities were not available, and identifying winning bidders required cross-referencing the EnergyNet page with the sale results at BLM’s website, the lawmakers said. “Full transparency in the bidding process would involve having the bidder identities available in real time as the sale is taking place,” they said.
They also expressed concern over BLM’s being nearly a year overdue in submitting a report analyzing the impact of online lease sales. They asked Steed to submit that report; BLM’s contract with EnergyNet; and additional documents to the committee by Feb. 1.
Contact Nick Snow at [email protected].