CHEYENNE, Wyo. — Bad news for Rocky Mountain states with lots of fossil-fuel development on federal lands: Low prices for oil and natural gas have driven federal minerals revenue down to the lowest point in five years, even as oil and gas production booms nationwide.
The federal Office of Natural Resources Revenue tracks federal revenue from sales of fossil fuels including oil and gas. Revenue from both offshore and onshore development nationwide over the 2015 federal fiscal year was $9.9 billion, down 26 percent from 2014’s $13.4 billion, according to figures released by the agency this week.
The federal government shares its minerals revenue with American Indian tribes and 37 states with minerals development on federal land.
Home to vast expanses of federal land and a top producer of oil, gas and coal, Wyoming gets a bigger slice than any other state by far. Wyoming’s share last year was $886 million, down from $1 billion the year before.
Elsewhere in the region:
— New Mexico, a top gas-drilling state, claimed $496 million in federal minerals revenue in 2015, down from $579 million in 2014;
— Oil-rich Colorado claimed $124 million, down from $169 million;
— Gas-rich Utah’s share was $116 million, down from $171 million;
— Montana’s portion was $34 million, down from $37.7 million.
Oil prices, especially, plunged over the second half of 2014.
An onshore oil and gas boom brought about by hydraulic fracturing and other extraction technologies continues, however, as wells drilled when prices were relatively high continue to produce at high rates. The production volumes in turn help to keep prices low in the U.S. and worldwide.
The low prices are primarily responsible for the drop-off in revenue, Office of Natural Resources Revenue spokesman Patrick Etchart said.
This year, average oil prices have been down around $55 a barrel, compared to around $100 a barrel last year. Gas prices are down from about $4.30 to $3.10 per thousand cubic feet.
Wyoming also is dealing with slack demand for coal, a power plant fuel suffering from competition from cheaper and cleaner-burning natural gas.
No new coal is being leased for mining in the southern Powder River Basin and state officials project revenue from new coal leases will decline from $740 million in the state’s 2013-14 budget cycle to just $26 million in 2019-20.
Wyoming Gov. Matt Mead has imposed a state hiring freeze and is considering other measures to deal with the expected shortfall.
This article was written by Mead Gruver from The Associated Press and was legally licensed through the NewsCred publisher network.