Indian Lands And Fossil Fuels: North Dakota, Colorado, Utah Lead

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Bureau of Indian Affairs

Oil and gas plays are located on reservations.

Amid the current U.S. energy boom, the amount of fossil fuels extracted from Indian lands is lower than it was a decade ago, according to the Energy Information Administration.

Why does it matter whether fossils fuels are extracted from  Indian lands? Because land ownership dictates where the money goes and how the mining is regulated – a topic Inside Energy examined yesterday in the context of federal lands.

The U.S. has laws designed to ensure Indian tribes can be in charge of their own fossil fuel extraction, and the Bureau of Indian Affairs claims the average royalty rate is higher on Indian lands than on federal lands.  But some feel this freedom gives both energy companies and tribes too much leeway.  Critics of fossil fuel production argue that if tribes (or local governments) can negotiate directly with energy companies, it could spur a “race to the bottom” in terms of the least strict regulations over the industry.  On the other side,  some argue that existing laws hinder, rather than expedite, energy development and tribal autonomy.

Just how much coal, crude oil, and natural gas is resting below  Indian lands?   Estimates vary. One oft-quoted law article puts three percent of U.S. oil and gas reserves and nearly a third of coal west of the Mississippi on Indian lands. The Department of Energy cites Indian energy reserves at 10 billion cubic feet of gas, 1.2 billion tons of coal, and 882 million barrels of oil – a negligible fraction of total U.S.  gas and coal reserves, but three percent of crude oil reserves. Indian reservations in Wyoming, Colorado, North Dakota, South Dakota, Utah, Montana, Oklahoma and New Mexico have substantial oil, gas or coal resources.

But Indian land energy production remains proportionately small: Just 1.4 percent percent of fossil fuels produced in 2013 nationwide came from Indian lands, according to the Energy Information Administration.

Oil and gas plays are located on reservations.

Bureau of Indian Affairs

Oil and gas plays and Indian reservations.

Why might fossil fuel energy extraction on Indian lands be disproportionately low? In some cases, intra-tribe conflicts slow fossil fuel production. (And tribes may have good reason to be wary: Wild game in tribal lands near oil and gas developments in Canada have shown elevated levels of arsenic and mercury). But the Property and Environment Research Center, a “free market environmentalism” think-tank, claims outdated federal laws are to blame for a missed economic opportunity for Indian tribes. The relationship between tribal governments and the U.S. federal governments around mining and natural resource extraction remains fraught.

The EIA data shows that,

  • 1.4 percent of fossil fuel production came from Indian lands in 2013, a rate that has dropped slightly over the past 10 years.
  • Crude oil production all Indian lands more than quadrupled in the past 10 years, up from 10 million barrels in 2003 to 46 million barrels in 2013. Compare this to federal lands, where crude oil production actually decreased over the past 10 years (from 679 million barrels in 2003 to 606 million barrels in 2013) and all U.S. lands, where production increased 32 percent, from 2,062 million barrels in 2003 to 2,716 million barrels in 2013.
  • Coal and natural gas production on Indian lands has declined over the past 10 years. Coal and natural gas production has also declined on federal lands, while natural gas production nationwide has increased 25 percent and coal production has remained relatively flat.

The EIA data, at the state level, lumps federal and Indian lands together. It doesn’t tell us, in each state, what portion of fossil fuel energy from federal and Indian lands came from Indian lands, and what portion came from federal lands?

Inside Energy estimated how much oil, coal and natural gas was produced on Indian lands and how much was produced on federal lands using data from the Office of Natural Resources Revenue, which has a tool for looking at royalty revenue from fossil fuels state-by-state and year-by-year.

For the most part, fossil fuel production on Indian lands represents a small portion of total energy production. But there are notable exceptions:

  •  In Colorado in 2013, 29 percent of natural gas produced on federal or Indian lands – 135 billion cubic feet –  was from Indian lands. This makes sense because the state’s only Indian reservations are located in the coal-methane rich San Juan Basin.
  • In North Dakota, 70 percent of crude oil produced on federal or Indian lands – 32.4 million barrels – was from Indian lands. This represented roughly 10 percent of the state’s total crude oil production in 2013, and is likely Bakken oil from the Fort Berthold Reservation in western North Dakota.
  •  In Utah, 45 percent of crude oil produced on federal or Indian lands – 4.5 million barrels – was from Indian lands. This represented roughly 27 percent of the state’s total crude oil production in 2013, and is due to substantial reserves in the Uintah Basin.

Which raises the question: Where are Indian lands with large fossil fuel resources that aren’t being tapped, and why?

View state-level federal and Indian lands data on a spreadsheet or explore it in the visualization below:

Data Notes: