Analysis & Projections

Sales of Fossil Fuels Produced from Federal and Indian Lands, FY 2003 through FY 2013

Release date: June 19, 2014


Summary

The U.S. Energy Information Administration (EIA) estimates that total sales of fossil fuels from production1 on federal and Indian lands decreased by 7% during fiscal year2 (FY) 2013. The decrease in production on federal lands alone was also 7% (Table 1). Sales from production on Indian lands, which account for less than 7% of total federal and Indian lands production, increased by 9% (Table 2).

Crude oil production on federal lands increased slightly in FY 2013, but that increase was more than offset by decreases in coal, natural gas, and natural gas plant liquids (NGPL) production. Other notable developments in FY 2013 included the following:

  • The continued steady decline of offshore natural gas production in the federal Gulf of Mexico (Table 4), a mature area with declining natural gas production from existing fields
  • A 9% drop in federal onshore natural gas production, with most of that decrease in Wyoming
  • A 9% drop in coal production

Breakdowns by state and area of the fuel production volumes on federal and Indian lands show that:

  • Wyoming and the federal Gulf of Mexico together produced 73% of the federal and Indian lands fossil fuels total in FY 2013 (Table 6).3
  • The federal Gulf of Mexico produced 69% of the federal and Indian lands crude oil total in FY 2013 (Table 7).
  • Wyoming, the federal Gulf of Mexico, New Mexico, and Colorado together represented 86% of total production of natural gas on federal and Indian lands in FY 2013 (Table 8).
  • Wyoming produced 80% of the federal and Indian lands coal total in FY 2013 (Table 10).

EIA's estimates are based on data provided by the Department of the Interior's (DOI) Office of Natural Resources Revenue (ONRR) and include sales of production from federal onshore and offshore lands, and from Indian lands.4 EIA summarizes total sales of fossil fuels produced on federal and Indian lands in common energy units (British thermal units, or Btu) to allow for aggregation across fuels, including crude oil and lease condensate, natural gas, natural gas plant liquids, and coal (Tables 1 and 2). The data presented in this paper update data previously reported by EIA5 for FY 2003 through FY 2012.

The sales reported by ONRR are a reasonable proxy for marketed production for a fiscal year. Sales are assigned to the fiscal year in which the sales were made rather than when royalties were collected. They also include production leaving the lease that is exempt from royalty payments under various royalty relief programs.

Sales from production on federal lands

Coal represented 51% of fossil fuel sales from production on federal lands in FY 2013, measured in common Btu units, followed by natural gas (25%), crude oil (22%), and NGPL (2%). Total fossil fuels sales from production on federal lands decreased 7% from 17,230 trillion Btu in FY 2012 to 15,942 trillion Btu in FY 2013 (Table 1):

  • Sales of crude oil6 from federal lands increased 1% to 606 million barrels in FY 2013. A 1% decrease in federal offshore volumes was more than offset by a 7% increase in the much smaller federal onshore volumes (Table 3). Despite this increase, crude oil production from federal lands as a share of total U.S. crude oil production dropped from 26% in FY 2012 to 23% in FY 2013 (Table 1). This drop in the federal lands share of total production was the result of the 15% increase in total U.S. crude oil production, with the continued growth in production of tight oil outpacing the modest increase in sales from federal lands.7
  • Sales of natural gas from federal lands decreased 10% in FY 2013 to 3,843 billion cubic feet, with both offshore (13%) and onshore volumes (9%) declining (Table 4). Natural gas production on federal lands dropped to 16% of the U.S. total in FY 2013 from 18% in FY 2012 (Table 1).
  • Sales of NGPL produced on federal lands decreased 13% to 103 million barrels in FY 2013, the third consecutive decrease since the peak year (FY 2010) over the period FY 2003 to FY 2013 (Table 5). Nevertheless, FY 2013 NGPL production was at or above levels reported from FY 2003 through FY 2009. Compared with FY 2012, federal onshore volumes dropped 21% in FY 2013, while federal offshore volumes were virtually unchanged.
  • Coal sales from production on federal lands decreased by 9% to 401 million short tons in FY 2013, a 17% decrease from its peak in FY 2008 (Table 1), driven primarily by a decline in Wyoming production (Table 10). Coal produced on federal lands accounted for 40% of the U.S. total in FY 2013, down from 42% in FY 2012.

Coal represented 42% of fossil fuel sales from production on Indian lands in FY 2013, measured in common Btu units, followed by crude oil (29%), natural gas (22%), and NGPL (2%). Total fossil fuels sales from production on Indian lands increased 9% from 836 trillion Btu in FY 2012 to 912 trillion Btu in FY 2013 (Table 2), as an increase in crude oil volumes outpaced a decrease in natural gas volumes:

  • Sales of crude oil produced on Indian lands increased a fourth consecutive year, by 48% to 46 million barrels in FY 2013 (Table 3), the highest level between FY 2003 and FY 2013.
  • Sales of natural gas from Indian lands decreased by 5% to 239 billion cubic feet in FY 2013 (Table 4).
  • Sales of NGPL and coal produced on Indian lands were virtually unchanged at 4 million barrels and 19 million short tons, respectively, in FY 2013 (Tables 5 and 6).

Trends in federal and Indian lands production from FY 2003 through FY 2013

Overall fossil fuel production from federal lands generally declined between FY 2003 and FY 2013, down 21% in FY 2013 compared with FY 2003 (Table 1). This trend is primarily the result of a steady decline in federal offshore natural gas production between FY 2003 and FY 2013 and the 9% drop in coal production from federal lands in FY 2013 from FY 2012.

  • Crude oil production from federal lands decreased 11% between FY 2003 and FY 2013 (Figure 1, Table 3). Lower production in the federal Gulf of Mexico over that period led to a decrease in federal offshore production of 18%, which outweighed the 33% increase in the much smaller federal onshore volumes over the same period.
  • Natural gas production from federal lands has declined steadily, down 43% by FY 2013 (Figure 1, Table 4). The once-larger federal offshore volumes have declined every year through FY 2013, down 74% from FY 2003. That decrease has been only partially offset by the now-larger onshore volumes, which have increased 17% over the period. This declining natural gas production from federal lands coupled with increasing total U.S. natural gas production8 steadily reduced the federal lands share of total U.S. natural gas production (Table 1).
  • NGPL production from federal lands increased 11% between FY 2003 and FY 2013 (Figure 1, Table 5). Following the natural gas trend, the once-larger federal offshore NGPL volumes have declined 14%, while the now-larger onshore NGPL volumes have increased 40% over the period.
  • With the notable exceptions of FY 2008 and FY 2013, years of high and low production respectively, coal production from federal lands has generally not deviated much from its average annual level of 445 million short tons (Table 1). Measured from peak to trough, federal land coal volumes declined 17% over FY 2008 to FY 2013. Coal production on private land declined 12% over the same period.9

Total fossil fuel production from Indian lands increased each year since FY 2010, although it decreased 6% between FY 2003 and FY 2013. Rapid increases in oil production partially offset large decreases in coal production and smaller decreases in natural gas production between FY 2003 and FY 2013 (Table 2).

  • Crude oil production from Indian lands increased 360% from 10 million barrels in FY 2003 to 46 million barrels in FY 2013. Almost all of this increase took place since FY 2010 (Figure 2, Table 3), and mostly in North Dakota (primarily the Fort Berthold Indian Reservation in the western part of the state), with the increase in horizontal drilling and fracking and generally higher oil prices.10
  • Natural gas production and coal production from Indian lands declined between FY 2003 and FY 2013 by 16% and 37%, respectively. Except for a small deviation in FY 2011, natural gas and coal production have steadily declined since FY 2005 (Table 2).
  • NGPL production from Indian lands doubled between FY 2003 and FY 2013, although from a low base level (Table 5).

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Footnotes

1Throughout this report, the term production means sales from production.

2The U.S. government's fiscal year runs from October 1 through September 30.

3For state-level summaries, ONRR combines Indian and federal lands data to avoid revealing proprietary data.

4Includes offshore and onshore areas the federal government owns or administers, including American Indian lands.

5Sales of Fossil Fuels Produced from Federal and Indian Lands, FY 2003 through FY 2012, EIA, May 2013, found at http://www.eia.gov/analysis/requests/federallands/pdf/eia-federallandsales.pdf

6Throughout this report, the term crude oil includes lease condensate.

7http://www.eia.gov/dnav/pet/pet_crd_crpdn_adc_mbblpd_a.htm.

8http://www.eia.gov/dnav/ng/ng_prod_sum_dcu_NUS_a.htm.

9Implied by Table 1. Also see http://www.eia.gov/coal/data.cfm.

10http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=rwtc&f=a.