BLM proposes rule to streamline Royalty Rate Reduction Process
For Non-Energy Solid Minerals mined on public lands
by Bureau of Land Management
October 15, 2019
The Bureau of Land Management (BLM) proposed a rule that will remove unnecessary and overly burdensome requirements and provide much needed regulatory relief and efficiencies for producers of non-energy solid leasable minerals. The proposed rule could stimulate up to $4.5 million of additional economic activity over the next 10 years.
These minerals include soda ash, potash, phosphate, sodium, potassium, sulphur, and gilsonite. With the publication of the proposed rule in the Federal Register, the BLM will initiate a 60-day public comment period.
"Non-energy solid minerals are vital in the production of such everyday products as toothpaste and garden fertilizers," said Department of the Interior Acting Assistant Secretary of Land and Minerals Management Casey Hammond. "With this proposed rule, the BLM will provide industry with much-needed relief when tough markets make it more difficult to develop these minerals, which support thousands of American jobs in local communities."
Mineral development is an important land use within the BLM's multiple-use mandate, providing economic opportunities and commodities that are essential to maintaining a high quality of life. In fiscal year 2017, the development of non-energy minerals on BLM-managed public lands contributed $13.4 billion to the national economy and supported 48,000 jobs.
The U.S. was once the world’s leading producer of soda ash, a non-energy solid leasable mineral, but Chinese production surpassed domestic production in 2003. With updates in the proposed rule that streamline the reduction process for non-energy solid minerals, the proposal will improve the BLM’s ability to support development and production of the Federal mineral estate.
"Wyoming is home to large deposits of soda ash, and the exploration, development and production of this commodity is done under state-of-the-art industrial, labor, and environmental standards," Wyoming Governor Mark Gordon said. "A reduction of the federal royalty rate to two percent is essential to the long-term global competitiveness of the soda ash industry. This proposed rule will protect jobs in both Wyoming and other states in the industry supply chain and will also enable strategic capital investment for future growth and job creation."
The proposed rule would streamline the process for lessees to seek and/or for the BLM to provide relief in the terms for rental fees, royalty rates and/or minimum production requirements associated with these minerals.
Informed by Secretarial Order 3354, which calls for improvements in the exploration and development of Federal solid mineral resources, the proposed rule also addresses permitting efficiencies and processing times.
The proposed rule would make two key changes that could affect the royalties and rental fees paid by producers of solid leasable minerals other than coal and oil shale on Federal lands. First, it would streamline the process by which producers of these minerals could apply for a reduction in their royalty rate, rental fee or minimum production requirements by lessening the information requirements for operators who apply. This would allow the BLM to approve a reduction in the rental fee, royalty or minimum production requirements on a lease-by-lease basis in response to an application from a producer, if the agency finds that a lease cannot be successfully operated under current market conditions.
In addition, the proposed rule would allow the BLM to reduce the rental fee, royalty rate or minimum production requirements on its own initiative if it finds that a reduction is necessary to develop a type of solid minerals on an area- or on an industry-wide basis.
By reducing informational requirements, the BLM estimates the proposed modifications would have a beneficial impact of up to a half-million dollars per year over the next decade on industry and government staff time in the form of reduced paperwork burdens.
Interested parties may submit comments, identified by the number RIN 1004-AE58, by any of the following methods:
• Mail: U.S. Department of the Interior, Director (630), Bureau of Land Management, Mail Stop 2134 LM, 1849 C St., N.W., Washington, D.C. 20240, Attention: RIN 1004-AE58.
• Personal or messenger delivery: U.S. Department of the Interior, Bureau of Land Management, 20 M Street, S.E., Room 2134LM, Washington, DC 20003, Attention: Regulatory Affairs.
• Federal eRulemaking portal: http://www.regulations.gov. In the Searchbox, enter "RIN 1004-AE58" and click the "Search" button. Follow the instruction at this website.
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