Consolidated Federal Oil and Gas and Federal and Indian Coal Valuation Reform Rule

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Why it Matters

Properly valuing revenues from publicly held mineral rights provides certainty to lessees about their investments and ensures taxpayers get a fair return for their public resources.

Current Status

The rule has been rescinded.

History

On July 1, 2016 The Department of the Interior (DOI) published a final rule reforming the valuation process for oil, gas, and coal on public lands. The purpose was to ensure that the public receives a fair return on the minerals that it owns and provide clarity and certainty to lessees.

On December 29, 2016 industry groups challenged the rule. Cloud Peak Energy, Inc. v. United States Dep’t of the Interior, No. 16CV315-F (D. Wyo.); American Petroleum Inst. V. United States Dep’t of the Interior, No. 16CV316-F (D. Wyo.); Tri-State Generation and transmission Ass’n, Inc., Basin Electric Power Cooperative, and Western Fuels-Wyoming, Inc., v. United States Dep’t of the Interior, No. 16CV319-F (D. Wyo.)

Trump Era

On February 17, 2017 industry groups petitioned DOI to postpone the rule.

On February 27, 2017 DOI postponed the rule “until the judicial challenges to the Rule are resolved.”

On April 4, 2017 DOI published its proposal to rescind the valuation reform rule.

On August 7, 2017 DOI rescinded the valuation rule.

On April 26, 2017 California and New Mexico sued DOI over the delay, arguing DOI did not follow proper administrative procedure.  California & New Mexico  v. Department of Interior, No.17-cv-02376-EDL 

On August 30, 2017 the court ruled that DOI had improperly delayed the rule, and should have notified the public of a proposed delay and taken comments on the proposal.

On October 17, 2017 California and New Mexico sued DOI over the repeal. California & New Mexico  v. Department of Interior, No. 3:17-cv-05948-MEJ (N.D. Cal.).

 

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