Fine: President Biden's 60-day federal land closure mark a new relationship with our public lands

Dan Fine
Special to the Daily Times

The Biden Administration is here and the Republican Party is fractured — as I projected in my last column in these pages. Now the issue for the San Juan Basin and the Four Corners around it is the future of land which the national government owns and manages.  

It collected revenues of nearly $10 billion per year before the Pandemic from oil leases which are worked privately in oil and liquids extraction. All this now is in a 60 day “freeze” as the Biden Administration installs new Interior Department Management.

The Interior Department should soon have a Secretary and a new and different bureaucratic team. The 60-day “freeze” allows for  a transfer of power over 245 million surface acres of the United States. 

Others are reading: New Mexico senators, advocates back Biden oil and gas plans

The holdovers from the Trump Administration in the Bureau of Land Management have been preempted from all authority.

For 60 days, the Four Corners community and the Navajo Nation might begin to adjust to a new relationship to federal land. 

The Trump Administration, doubtless, is the final 19th century vision of the West and the use of this Land. It was part of the “Manifest Destiny” and settled through displacement by millions before and after the War Between the States.

It is now to be managed consistent with its original people, as a characteristic of the Biden Administration

Daniel Fine

The Navajo Nation's future has been changed by the pandemic. San Juan County can merge with security and equity in building a Four Corners defense, storage, manufacturing and transportation hub with a changed Window Rock government.

And more. 

Native American communities have survived across many centuries of discrimination, assaults on lives and culture and, lately, a pandemic. Now U.S. Rep. Deb Haaland, a member of the Pueblo of Laguna, is nominated by President Joe Biden for Secretary of the U.S. Department of the Interior to manage public lands and trust obligations to American Indian tribes and Alaska Natives. 

Economic inequality and environmental justice are the principal variables inside the 60 days of deliberation on new policy objectives. Most  important, the new  the dispensation of the land includes Climate Change for consideration.

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Permits to drill (APD) and leases to take profits after taxes and royalties continue. Nothing has changed, for now. Most operators in New Mexico prepared for the Biden Administration with aggressive lease buying and permitting to allow them at least two years to spud, drill and complete for oil at a time of rising prices.

What is next? First, the Biden Administration, and the Federal Reserve will not reverse the Stimulus Economy. Does a $10 billion loss of Federal Land revenue from oil and gas royalties amount to much when the President is preparing for $16 trillion in 10 years to spend on the infrastructure ($2 trillion alone on clean energy)?

Inflation as a threat no longer exists among government economists.

Cost is no longer an oil and gas industry argument against renewable energy, zero-carbon, and a virus-protected society. Oil industry advocates have lost the comparative superiority of the fossil fuel based on economic cost and benefit. The issue is now over the retention of the social license to drill for and use oil and gas itself.

Beyond the 60 days, the Progressive Democratic Party will easily revise the old National Environmental Policy Act to force the permitting process for oil and gas entry into Federal Land to include impacts on Climate Change.

There will be an increase royalties to from the never-changing 12 plus per cent to highest rate among the states—Texas at 25?   New Mexico should continue to receive 48% of the Federal Land oil and gas collection of revenue in New Mexico.

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All this without a ban on fracking?  Most likely, as American oil production is scaled back and foreign imports revive. Is this a threat to national security in 2026?  Refineries will rebuild the capacity to process high sulfur oil. But threat has been diluted as  OPEC-Russia and Saudi Aramco converge  to balance world oil supply and demand. 

Earlier, I proposed a range of $53  to $58 per barrel of WTI for three years and now add June-July as the higher range. Short-term speculation in the futures market under the Biden Administration would not signal an oil boom revival.

In five years, with most of this on a “yellow brick road” we arrive at electric vehicles and “green” hydrogen amid a post pandemic zero-carbon social psychology that has redefined Federal Land. 

This 60 day “freeze” passes into summer and recovery. But the Biden Administration “time out” will appear to future historians as the beginning in place and time for the re-purposing federal lands in America.

Dr. Daniel Fine is an independent analyst at the New Mexico Institute of Mining and Technology in Socorro.