OIL AND GAS LEASE 

MANAGEMENT 

BLM Could Improve 

Oversight of Lease 

Suspensions with 

Better Data and 

Monitoring 

Procedures

Report to Congressional Requesters 

June 2018 

GAO-18-411 

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-18-411, a report to 

congressional requesters

June 2018

OIL AND GAS LEASE MANAGEMENT

BLM Could Improve Oversight of Lease Suspensions 

with Better Data and Monitoring Procedures

What GAO Found

According to data at the end of fiscal year 2016 from the Bureau of Land 

Management (BLM), a small portion of oil and gas leases were suspended for 

various lengths of time (as shown below), but the reasons for the suspensions

were difficult to determine. During a suspension, the government generally does

not collect revenues from the lease. Determining the reasons for suspensions is 

difficult, in part because BLM does not require the inclusion of this information in 

its database. To obtain this information, BLM officials would have to review the 

official lease files, of which many are in hard copy. Under Standards for Internal 

Control in the Federal Government, management should use quality information 

to achieve the entity’s objectives. BLM field officials GAO interviewed said that 

additional, more detailed information in the database on reasons for suspensions 

would be helpful in tracking lease suspensions. By including a data field in the 

database to record the reasons for suspensions, BLM could better ensure that 

federal lands are not being inappropriately kept from development—potentially 

foregoing revenue—or from other valuable uses of public lands.

Active Oil and Gas Leases and Leases Recorded as in Suspension by Length of Suspension,

as of September 30, 2016

Note: Numbers represented in the figure have been rounded.

The approach BLM uses to monitor lease suspensions does not ensure 

consistent and effective oversight because BLM does not have procedures in 

place for monitoring. BLM state offices generally delegate responsibility for 

monitoring lease suspensions to their field offices. Officials from 12 selected field 

offices in two states with relatively large numbers of lease suspensions reported 

various frequencies in their monitoring of suspensions, ranging from every few 

months to rarely or not at all. In the absence of BLM monitoring procedures, field 

officials have discretion in how and when to monitor. By developing procedures

for monitoring lease suspensions, including when to conduct monitoring efforts, 

BLM could better ensure that lease suspensions in effect are warranted. 

View GAO-18-411. For more information, 

contact Frank Rusco at (202) 512-3841 or 

ruscof@gao.gov.

Why GAO Did This Study

Oil and gas leases on federal lands 

generate billions of dollars in rents 

and royalty payments for the federal 

government each year, but these 

revenues can be reduced if leases 

are suspended (i.e., placed on hold). 

Questions have been raised about 

whether some suspensions, 

particularly those in effect for more 

than 10 years, may hinder oil and 

gas production or adversely affect 

the use of federal lands for other 

purposes, such as recreation. 

GAO was asked to review oil and 

gas lease suspensions on federal 

lands managed by BLM. This report 

examines, among other things, (1) 

the extent of and reasons for such

suspensions and (2) the approach

BLM uses to monitor the status of 

lease suspensions. GAO analyzed 

all data on suspensions in a BLM

database and the official lease files 

for a nongeneralizable sample of 48

leases recorded as suspended in,

Montana and Wyoming, which GAO 

selected based in part on the large 

number of suspensions these states

had. GAO also reviewed BLM 

documents and interviewed BLM 

officials. 

What GAO Recommends

To better ensure that federal lands 

are not being inappropriately kept 

from development, GAO is making 

four recommendations, including that

BLM record the reasons for lease 

suspensions in its database and

develop procedures for monitoring 

suspensions. Interior concurred with 

GAO’s recommendations.
Page i GAO-18-411 Oil and Gas Lease Management

Letter 1

Background 4

BLM Uses a Multistep Process in Determining Whether to 

Suspend Leases 10

A Small Portion of BLM’s Oil and Gas Leases Were Recorded as 

Suspended, but Reasons for Suspensions Were Difficult to 

Determine 14

BLM Relies on an Informal Monitoring Approach That May Not 

Provide for Consistent and Effective Oversight of Lease 

Suspensions 20

Conclusions 24

Recommendations for Executive Action 25

Agency Comments 26

Appendix I Objectives, Scope, and Methodology 28

Appendix II Bureau of Land Management Oil and Gas Leases, Suspensions, 

and Acreage, as of September 30, 2016 32

Appendix III Bureau of Land Management Oil and Gas Leases Recorded as in 

Suspension 34

Appendix IV Comments from the Department of the Interior 35

Appendix V GAO Contact and Staff Acknowledgments 37

Tables

Table 1: Bureau of Land Management (BLM) Oil and Gas 

Recorded Leases, Suspensions, and Acreage, as of 

September 30, 2016 32

Table 2: Bureau of Land Management (BLM) Oil and Gas Leases 

Recorded as in Suspension by Length and State, as of 

September 30, 2016 34

Contents
Page ii GAO-18-411 Oil and Gas Lease Management

Figures

Figure 1: Circumstances That May Warrant Suspension of Oil and 

Gas Leases 11

Figure 2: Typical Bureau of Land Management (BLM) Review 

Process for Oil and Gas Lease Suspension Requests 13

Figure 3: Location of Oil and Gas Leases and Recorded 

Suspensions, as of September 30, 2016 16

Figure 4: Bureau of Land Management Oil and Gas Leases 

Recorded as in Suspension, by Length of Suspension, as 

of September 30, 2016 17

Abbreviations

BLM Bureau of Land Management

LR2000 Legacy Rehost 2000 System

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Page 1 GAO-18-411 Oil and Gas Lease Management

441 G St. N.W.

Washington, DC 20548

June 4, 2018

The Honorable Raúl Grijalva

Ranking Member

Committee on Natural Resources

House of Representatives

The Honorable Alan Lowenthal

Ranking Member

Subcommittee on Energy and Mineral Resources

Committee on Natural Resources

House of Representatives

The Honorable Jared Polis

House of Representatives

Oil and gas leases on onshore federal lands managed by the Department 

of the Interior’s Bureau of Land Management (BLM) generate billions of 

dollars in rents and royalty payments for the federal government each 

year. According to BLM’s database for mineral and land use—the Legacy 

Rehost 2000 System (LR2000)—approximately 41,000 oil and gas leases 

cover 28 million subsurface acres. Under the terms of these leases, 

operators have 10 years to begin drilling for oil and gas unless BLM 

suspends their leases.1 BLM may suspend leases, for example, when an 

environmental review is necessary to avoid harm to endangered species 

on the leased lands or during periods of extraordinary weather conditions, 

such as hurricanes or other natural catastrophes. Suspensions typically 

remain in effect until the conditions that led to the suspensions no longer 

apply. There is no limit on how long a lease can be suspended. During a 

suspension of operations and production, the government does not 

collect rents or royalty payments and the time remaining to begin drilling 

is reserved so that the operator is not penalized for the time the lease is 

in suspension.

BLM is responsible for implementing the Federal Land Policy and 

Management Act of 1976, as amended, which directs Interior to manage 

federal lands for multiple uses, such as recreation and resource 

 1

Lease terms may be extended if, for example, oil or gas is being produced in paying 

quantities. See 30 U.S.C. § 226(e). 

Letter
Page 2 GAO-18-411 Oil and Gas Lease Management

extraction, while also taking any action required to prevent “unnecessary 

or undue degradation” of these lands.2 Members of Congress and others 

have raised questions about whether some suspensions, particularly 

those that have been in effect for more than 10 years, may hinder oil and 

gas production or adversely affect the use of federal lands for other 

purposes, such as recreation.

You asked us to review oil and gas lease suspensions on lands that BLM 

manages. This report examines (1) the process BLM uses to determine 

whether to suspend oil and gas leases; (2) the extent of oil and gas lease 

suspensions and the reasons for the suspensions of selected leases; and 

(3) the approach that BLM uses to monitor the status of lease 

suspensions and the extent to which this approach provides for oversight 

of such lease suspensions.

To examine the process BLM uses to determine whether to suspend oil 

and gas leases, we reviewed applicable laws, agency documents, and 

the criteria used by BLM officials when considering lease suspensions. 

We also interviewed BLM officials about how they use these criteria. To 

examine the extent of oil and gas lease suspensions and the reasons for 

the suspensions, we analyzed data on all lease suspensions recorded in 

BLM’s LR2000 database as of September 30, 2016.3 We took a number 

of steps to assess the reliability of these data—such as checking the 

extent to which the data were complete and within expected ranges and 

interviewing BLM officials about how the data were collected—and 

determined that the data were sufficiently reliable to give a high-level 

summary of suspension information, such as the number of leases in 

suspension and the lengths of the suspensions (see app. I for additional 

detail).

We also analyzed information contained in the official lease files, 

maintained by BLM state offices, for a nongeneralizable sample of leases 

in suspension in Montana and Wyoming to identify the reasons behind 

the suspensions as well as to assess their status. We chose these states 

because they were among the states with the largest numbers of 

recorded lease suspensions. We also selected Montana because their 

files were electronically maintained and easily accessible and Wyoming 

 2

43 U.S.C. § 1732.

3

LR2000 contains information on all mineral and land assets managed by BLM, including 

oil and gas leases.
Page 3 GAO-18-411 Oil and Gas Lease Management

because it had some leases recorded as suspended for the longest 

period of time of any state as of September 30, 2016. We selected 48 

suspended leases in these two states and limited the extent to which we 

selected multiple leases that were suspended at the same time for the 

same reason. For Montana leases, we found that there were only 12 

suspension dates. Therefore, we randomly selected a single lease from 

each date. For Wyoming, we selected leases based on a combination of 

suspension date, similarity of lease numbers, and field office of 

jurisdiction. In addition, to review suspensions that had been in effect for 

a relatively long period of time, we selected suspensions that had been in 

effect for 20 or more years. The results of our review of selected leases 

are not generalizable to other BLM leases in suspension but provide 

examples of the types of reasons given for suspensions.

To verify the status of each selected lease, we compared information in 

LR2000 and the official lease file with information in the Office of Natural 

Resources Revenue’s database.4 We also interviewed officials from the 

BLM state and field offices in our sample about specific lease files to 

learn more about the status of specific lease suspensions and the 

reasons why these suspensions were still in effect. We compared how 

BLM maintains and verifies its lease suspension information with 

Standards for Internal Control in the Federal Government for information 

and communication.5 To examine the approach BLM uses to monitor the 

status of lease suspensions and the extent to which this approach 

provides for oversight of such lease suspensions, we reviewed agency 

databases and documents, including information in LR2000 and selected 

lease files from the Montana and Wyoming state offices. These two state 

offices comprised a total of 12 field offices that were responsible for 

monitoring the 48 suspended leases in our sample.6 We also interviewed 

BLM officials from BLM headquarters and those state and field offices to 

learn about how, if at all, they monitor lease suspensions or oversee such 

monitoring. We compared their actions with agency guidance, federal 

 4

The Office of Natural Resources Revenue, within Interior, is responsible for collecting 

rental and royalty payments associated with oil and gas leases.

5

GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 

(Washington, D.C.: September 2014).

6

Montana had 2 field offices and Wyoming had 10 field offices with leases included in our 

review of selected lease files. Montana had 8 additional field offices that did not have 

leases in our sample.
Page 4 GAO-18-411 Oil and Gas Lease Management

regulations, and federal standards for internal control for control 

activities.7

We conducted this performance audit from September 2016 to June 2018 

in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

This section provides information on oil and gas leasing and development 

on federally managed lands, lease revenues, lease suspensions, and 

BLM’s LR2000 database.

BLM is responsible for managing approximately 700 million acres of 

subsurface mineral estate throughout the country, including the acreage it 

leases to operators for oil and gas development.8 At the end of fiscal year 

2016, about 41,000 oil and gas leases accounted for approximately 28.2 

million acres in 32 states, according to BLM data (see app. II for 

additional details).

The Federal Land Policy and Management Act of 1976, as amended, 

requires the Secretary of the Interior to develop land use plans for public 

lands.9 These plans identify federal lands and mineral resources that will 

be available for oil and gas leasing and development and other activities. 

The act requires the plans to be revised as appropriate, and BLM 

generally evaluates plans for potential revisions at least every 5 years.10

 7

GAO-14-704G.

8

The Mineral Leasing Act of 1920, as amended, gives Interior responsibility for oil and gas 

leasing on federal and private lands where the federal government has retained mineral 

rights. 30 U.S.C. § 226. The Mineral Leasing Act for Acquired Lands of 1947 (30 U.S.C. § 

351 et seq.) extended that authority to lands acquired by the federal government.

9

43 U.S.C. § 1712.

10Revisions to land use plans are necessary if monitoring and evaluation findings, new 

data, new or revised policy, or changes in circumstances indicate that an entire plan or a 

major portion of a plan no longer serves as a useful guide for resource management. 

Bureau of Land Management, Department of the Interior, Land Use Planning Handbook, 

H-1601-1, p. 46 (Washington, D.C.: 2005).

Background

Oil and Gas Leasing and 

Development on Federally 

Managed Lands
Page 5 GAO-18-411 Oil and Gas Lease Management

As part of developing or revising land use plans, BLM is required under 

the National Environmental Policy Act of 1969, as amended, to evaluate 

likely environmental effects of any decisions in the plan, such as selecting 

areas for oil and gas development.11 Generally, Interior prepares an 

environmental impact statement—a detailed statement of the likely 

environmental effects of the proposed action—in preparing land use 

plans.12 BLM officials said the agency uses the land use plans and 

environmental impact statements to (1) help develop “reasonably 

foreseeable development scenarios” to estimate outcomes, such as the 

number of wells and likely surface disturbance that may occur under the 

land use plan; (2) identify lands open and closed to leasing; (3) identify 

resource-protection measures, such as lease stipulations and 

environmental best management practices; and (4) establish monitoring 

protocols. With a completed land use plan and its associated 

environmental impact statement, BLM can offer for lease the mineral 

rights identified in the plan.

The parcels of land that BLM offers for potential leasing and development 

are nominated by industry and the public or identified by BLM. BLM offers 

leases through a competitive bidding process and requires a uniform 

national minimum bid of $2 per acre, due as a one-time payment when a 

bidder is awarded the lease.13 If BLM receives any bids on an offered 

lease, the lease is awarded to the bidder with the highest bid.14 Since 

1992, BLM has offered leases with a 10-year primary term—the initial 

period of time prescribed in a lease to begin oil and gas development.15

Operators generally begin oil and gas exploration on leased lands by 

analyzing available geologic and seismic information and other testing to 

determine if economically viable oil and gas reservoirs exist. If the 

 1142 U.S.C. § 4332.

12BLM may also use an environmental assessment—which is a more concise analysis 

developed if the environmental effect of the proposed action is unknown—to determine 

whether the action is likely to significantly affect the environment.

13The Secretary of the Interior has the authority to raise the uniform national minimum 

acceptable bid for all leases but has not done so. See 30 U.S.C. § 226 (b)(1)(B).

14Leases that do not receive any bids in the initial offer are offered noncompetitively the 

day after and remain available for leasing for a period of 2 years after the competitive 

lease sale.

15The Energy Policy Act of 1992 required BLM to offer all competitive and noncompetitive 

leases with 10-year primary terms. Prior to 1992, BLM offered primary lease terms of 5 

years for competitively sold leases and 10 years for leases issued noncompetitively.
Page 6 GAO-18-411 Oil and Gas Lease Management

findings are positive, the operators may begin efforts to prepare for 

development, such as completing the environmental studies required to 

apply for permits to begin lease development activities. For example, 

operators holding leases for oil and gas development must submit a 

drilling permit application to BLM and obtain approval before preparing 

the land and drilling new oil or gas wells.16 After receiving a permit 

application, BLM generally communicates with operators until they 

provide all of the required documents, including necessary environmental 

information or studies.17 The Energy Policy Act of 2005 requires BLM to 

approve or defer permit applications within 30 days of submission by the 

operator.18 After such applications are approved, operators may begin 

development activities, including building roads to the well site, 

constructing platforms, drilling wells, and constructing additional pipeline 

transportation necessary to transport the oil and gas to market.

BLM has the authority to inspect federal oil and gas sites, including well 

pads and production facilities,19 under the Federal Oil and Gas Royalty 

Management Act of 1982, as amended.20 According to the agency’s 

handbook for its inspection and enforcement program, BLM must ensure 

that oil and gas operations on federal lands are prudently conducted in a 

manner that ensures protection of the surface and subsurface 

environment.

 16A complete drilling permit application, formally called an application for permit to drill, 

must include, among other things, a Surface Use Plan of Operations with the operator’s 

plan for reclaiming disturbed lands during production and upon final abandonment. BLM 

may approve the application as submitted or, according to BLM officials, approve it with 

certain conditions that ensure environmental protection, safety, or conservation of mineral 

resources, and the approval may be based on environmental best management practices. 

17Prior to leasing lands, BLM conducts broad environmental assessments. However, 

before drilling operations can begin, the operator must submit, with their application for 

permit to drill, an assessment of the environmental impact of their specific lease 

development plans.

18Pub. L. No. 109-58, § 366, 119 Stat. 594, 726 (2005), codified at 30 U.S.C. § 226(p)(2).

19Prior to drilling, an operator prepares the area of land where drilling will take place, 

referred to as a well pad. In some cases, multiple wells will be located on a single well 

pad.

20Pub. L. No. 97–451, tit. 1, § 108, 96 Stat. 2447, 2453 (1983), codified as amended at 30 

U.S.C. § 1718.
Page 7 GAO-18-411 Oil and Gas Lease Management

For issued leases, the operator pays a fixed amount of rent each year 

until the lease begins producing or expires. Under the Mineral Leasing 

Act of 1920, as amended, once a federal lease begins producing, the 

operator pays royalties on the oil and gas it produces in lieu of paying 

rent.21 The act sets the royalty rate for competitive leases at not less than 

12.5 percent of the amount or value of production.22 A producing lease 

remains in effect so long as the operator continues to produce oil and gas 

in paying quantities.23

The Office of Natural Resources Revenue, within Interior, is responsible 

for managing and collecting revenues from operators that produce or 

extract resources from federal leases. In fiscal year 2016, approximately 

164 million barrels of oil and 3.25 trillion cubic feet of gas were produced 

on federal lands, according to agency data. According to Office of Natural 

Resources Revenue data, in fiscal year 2016, the federal government 

collected approximately $1.6 billion in gross revenue from the production 

of these resources on federal land. The majority of this revenue—nearly 

$1.5 billion, or 91 percent—came from royalties. The remaining revenue 

came from bids made on new leases—more than $120 million—and rent 

for existing leases—more than $20 million.

According to agency guidance, specifically the Suspensions of 

Operations and/or Production Manual, BLM generally uses two types of 

suspensions for oil and gas leases: (1) suspension of operations or (2) 

suspension of operations and production.24 A suspension of operations 

halts the operations associated with a particular lease, such as drilling or 

developing a well pad and roads. A suspension of operations and 

production—the most common type of suspension, according to BLM 

officials—is broader because it halts both operations and any production 

of oil and gas. BLM’s guidance also states that a suspension of 

operations may be granted in cases in which the operator is prevented 

from operating or producing on the lease for reasons beyond the 

 2130 U.S.C. § 226(d); 43 C.F.R. § 3103.2-2.

2230 U.S.C. § 226(b)(1).

2330 U.S.C. § 226(b)(3)(D); 43 C.F.R. § 3107.2-1.

24There is a third type: suspension of production; however, this type of suspension is 

seldom used, according to BLM officials. See 43 C.F.R. § 3103.4-4.

Lease Revenues

Lease Suspensions
Page 8 GAO-18-411 Oil and Gas Lease Management

operator’s control, and a suspension of operations and production may be 

granted only in the interest of the conservation of natural resources.25

During either type of suspension, the time remaining in the primary term 

of the lease is reserved until the suspension is terminated, so that the 

operator is not penalized for the time the lease is in suspension.

According to BLM officials, lease suspensions typically are initiated by the 

operator but may also be initiated by BLM. BLM guidance states that 

before an operator can request a suspension, the operator must first 

demonstrate being hampered in performing some operation or activity on 

the lease. The operator must submit thorough documentation of the 

reason for requesting a suspension and should include evidence that 

activity has been attempted on the lease, such as filing an application for 

a drilling permit, and that the activity has been prevented by actions 

beyond the operator’s control. For BLM’s part, according to BLM’s 

guidance, requests filed less than 30 days prior to the expiration of the 

lease are considered late and should normally be denied. If a request is 

filed in a timely manner, BLM is to assess the request and, if the reasons 

for the request are acceptable and justify a suspension, BLM should 

approve the request, according to BLM guidance. The state director at 

each BLM state office is responsible for reviewing and approving requests 

for lease suspensions; however, BLM’s guidance encourages the 

delegation of this responsibility to the field manager at the field office with 

jurisdiction over the lease. According to BLM officials, BLM state offices 

generally delegate responsibility for monitoring lease suspensions to their 

field offices.

According to BLM officials, LR2000 is a national database that provides 

internal and external users with access to, among other things, land and 

mineral use authorizations for oil, gas, and other mineral development; 

land titles; and other data extracted from case files that support BLM land, 

mineral, and resources programs. LR2000 contains information on 

 25The Mineral Leasing Act of 1920, as amended, defines the types of suspensions and 

the criteria that need to be met for each. Under Section 17, BLM can suspend either 

operations or production, while suspensions under Section 39 suspend both operations 

and production. Section 17 suspensions halt the term of the lease but rental and, if 

applicable, royalty payments continue. Section 39 suspensions of operations and 

production halt the term of the lease as well as any rent and royalty payments during the 

duration of the suspension. According to BLM guidance, suspension of production is 

unnecessary in most cases since the ability of the lease to produce oil or gas will generally 

prevent the lease from expiring. 

BLM’s LR2000 Database 

and Other Interior 

Databases
Page 9 GAO-18-411 Oil and Gas Lease Management

approximately 6 million land and mineral case files. BLM designed the 

database for use by the oil and gas industry, mining industry, land and 

mineral title companies, utilities, state and local governments, interest 

groups, and members of the public that need access to BLM land and 

mineral case files.

The agency has conducted a series of reviews of LR2000 over the last 5 

years in an attempt to improve the accuracy of the data in the system, 

according to BLM officials we interviewed.26 In particular, the officials 

informed us that they created a tool, known as Data Flux, to improve the 

accuracy of the data, and that the tool has helped identify numerous data 

errors.27 BLM officials told us that each spring a report is generated using 

Data Flux that highlights the errors found in LR2000, and BLM state 

offices are responsible for taking action to address the identified errors for 

their respective states. These officials also told us that BLM plans to 

either significantly update or replace LR2000 but has not set a definitive 

date for doing so.

Interior and BLM manage several other databases that contain 

information about the development and production of oil and gas on 

federal lands. In prior work, we found weaknesses in how Interior tracks 

and uses some information in its data systems. Specifically, in July 2010, 

we reported that BLM’s publicly available data related to protests, or 

challenges, to lease sales were incomplete or inconsistent, and we 

recommended that Interior determine and implement an agency-wide 

approach for collecting protest information that is complete, consistent, 

and available to the public.28 BLM agreed with the recommendation and 

issued guidance to standardize data collection. In addition, we found in 

July 2016 that Interior could improve the data it collects to help track 

progress toward its goal of reducing methane emissions from oil and gas 

operations.29 We made four recommendations to improve BLM’s reporting 

 26These reviews were intended to improve the quality of the data in LR2000 but did not 

necessarily address information contained in official lease files. 

27According to agency officials, the Data Flux tool uses a set of business rules to examine 

data in LR2000 in order to identify data that do not match the prescribed format, such as 

numerical fields that contain letters.

28GAO, Onshore Oil and Gas: BLM’s Management of Public Protests to Its Lease Sales 

Needs Improvement, GAO-10-670 (Washington, D.C.: July 30, 2010).

29GAO, Oil and Gas: Interior Could Do More to Account for and Manage Natural Gas 

Emissions, GAO-16-607 (Washington, D.C.: July 7, 2016).
Page 10 GAO-18-411 Oil and Gas Lease Management

of emissions data. The agency generally concurred with all of the 

recommendations and has implemented two of them. Further, in April 

2017, we found that BLM field offices had not effectively used data 

collected during environmental inspections, which could have enhanced 

BLM’s ability to assess and mitigate environmental impacts.30 We 

recommended that BLM develop guidance and consistently track 

inspections data, among other things. BLM generally concurred with 

these recommendations.

BLM uses a multistep process to determine whether to suspend oil and 

gas leases, and this process, according to BLM guidance and officials, 

typically begins with an operator submitting a suspension request to the 

appropriate BLM field office.31 Once the request is received, the cognizant 

BLM field official—usually a petroleum engineer at the field office—

reviews it for completeness and whether the reasons cited meet the 

suspension criteria established in federal regulations and BLM’s 

Suspensions of Operations and/or Production Manual. These criteria 

require that lease suspensions be approved only in the interest of the 

conservation of natural resources or for circumstances beyond the 

operator’s control. Officials we interviewed stated that field officials 

generally have broad discretion in how to apply suspension criteria when 

considering a request. See figure 1, below, for examples of 

circumstances for which suspensions can be issued.

 30GAO, Oil and Gas Development: Improved Collection and Use of Data Could Enhance 

BLM’s Ability to Assess and Mitigate Environment Impacts, GAO-17-307 (Washington, 

D.C.: Apr. 25, 2017).

31In some cases, suspensions can be initiated, or directed, by BLM in response to unique 

circumstances, such as a court order.

BLM Uses a Multistep 

Process in 

Determining Whether 

to Suspend Leases
Page 11 GAO-18-411 Oil and Gas Lease Management

Figure 1: Circumstances That May Warrant Suspension of Oil and Gas Leases

According to BLM officials, if the field office recommends approving the 

operator’s request for suspension, the field office is to forward the request 

to the appropriate BLM state office for final review, as shown in figure 2 

below. In cases in which the state office agrees with the field office’s 

recommendation, the state office is to issue a decision letter to the 

operator noting the changes to the terms and conditions of the lease. A 

copy of the letter is also to be sent to the Office of Natural Resources 

Revenue, if necessary, requesting deferment of rent and royalty 

payments while the lease is suspended.

Conversely, if the field office recommends that the suspension request be 

denied, the field office is to inform the operator in writing, BLM officials 

said. According to agency guidance, the operator can appeal the field 

office’s recommendation to the state office director within 20 days after 

receiving the notification. The state director then has 10 days to render a 

decision.32 If the state director denies the request for suspension, the 

 32The state director’s final decision is to be issued within 10 days of the receipt of a 

complete request for administrative review or within 10 days after an oral presentation has 

been made.
Page 12 GAO-18-411 Oil and Gas Lease Management

operator can challenge the decision at the Interior Board of Land 

Appeals.33 After the board’s decision, the operator may make additional 

appeals in federal court. In cases in which a decision is overturned, the 

state office is to issue a decision letter to the operator that highlights 

changes in the lease’s terms and conditions. The state office is to record 

the new terms and conditions in LR2000, notify the Office of Natural 

Resources Revenue of any rental or royalty payments that are to be 

deferred, and update the official lease file in the state office. Other 

affected parties (i.e. any party who is adversely affected by a decision) 

can also appeal a suspension decision, according to BLM officials.

 33The Interior Board of Land Appeals is an appellate review body that exercises the 

delegated authority of the Secretary of the Interior to issue final decisions for the 

Department of the Interior. Its administrative judges decide appeals from bureau decisions 

relating to the use and disposition of public lands and their resources, mineral resources 

on the Outer Continental Shelf, and the conduct of surface coal mining operations under 

the Surface Mining Control and Reclamation Act. Located within the Department’s Office 

of Hearings and Appeals, the board is separate and independent from the bureaus and 

offices whose decisions it reviews.
Page 13 GAO-18-411 Oil and Gas Lease Management

Figure 2: Typical Bureau of Land Management (BLM) Review Process for Oil and 

Gas Lease Suspension Requests

a

The Office of Natural Resources Revenue, within the Department of the Interior, is responsible for 

collecting rental and royalty payments associated with leases on onshore federal lands. During a 

suspension of operations and production, both rental and minimum royalty payments are halted. 

Other types of suspensions do not halt collection of rental payments.
Page 14 GAO-18-411 Oil and Gas Lease Management

Agency officials stated that BLM field offices are primarily responsible for 

monitoring the status of lease suspensions they issue to ensure that the 

conditions for granting the suspension still exist.34 If the conditions have 

changed, the field office is to recommend that the lease suspension be 

terminated and notify the operator. The state office is to terminate the 

suspension and send a letter to the operator with the updated lease terms 

and conditions, which should extend the original lease expiration date to 

reflect the length of the suspension.35 BLM guidance states that the state 

office also is to send a copy of the suspension termination letter to the 

Office of Natural Resources Revenue to alert that office that any rental 

and royalty payments on hold for the lease should resume. The state 

office is then responsible for updating LR2000 and the official lease file 

regarding any new lease terms and conditions, according to BLM officials.

A small portion of BLM’s oil and gas leases were suspended as of the 

end of fiscal year 2016, according to the agency’s LR2000 data, but the

reasons for the suspensions were difficult to determine. These data 

indicated that as of September 2016, about 2,750 of BLM’s approximately 

41,000 oil and gas leases were suspended in various locations for various 

lengths of time. LR2000 did not always contain the reasons for 

suspensions, which required us to take additional steps to identify the 

reasons.

 34BLM officials we interviewed stated that most lease suspensions are approved by field 

offices and the field offices would be responsible monitoring these suspensions. 

Suspensions issued by the state office would be monitored by the state office.

35For example, if a suspension was in effect for 3 years, the primary lease term would be 

extended by 3 years.

A Small Portion of 

BLM’s Oil and Gas 

Leases Were 

Recorded as 

Suspended, but 

Reasons for 

Suspensions Were 

Difficult to Determine
Page 15 GAO-18-411 Oil and Gas Lease Management

According to LR2000 data, approximately 2,750 oil and gas leases were 

suspended at the end of fiscal year 2016. Our analysis of these data 

showed that the lease suspensions spanned 16 states and accounted for 

about 3.4 million acres of federally managed land. The data also showed 

that most of the suspensions were in five Mountain West states: 

Colorado, Montana, New Mexico, Utah, and Wyoming. These five states 

accounted for more than 2,350 of the approximately 2,750 recorded lease 

suspensions and encompassed more than 2.9 million acres of federally 

managed land (see app. II for additional details).36 Figure 3, below, 

provides information on the location of oil and gas leases and recorded 

suspensions across the United States.

 36According to BLM data, these five states also accounted for nearly 32,000 of BLM’s 

41,000 leases as of September 30, 2016. 

As of September 2016, 

about 2,750 Oil and Gas 

Leases Were Recorded as 

Suspended and Varied in 

Their Location and Length 

of Suspension
Page 16 GAO-18-411 Oil and Gas Lease Management

Figure 3: Location of Oil and Gas Leases and Recorded Suspensions, as of September 30, 2016
Page 17 GAO-18-411 Oil and Gas Lease Management

Our analysis of LR2000 data showed that, of the approximately 2,750 

recorded lease suspensions,

• about 630 had been in place for less than 3 years,

• about 1,150 had been in place for 3 years to less than 10 years,

• about 190 had been in place for 10 years to less than 20 years,

• about 130 had been in place for 20 years to less than 30 years, and

• about 650 had been in place for 30 years or more.

See figure 4 and appendix III for additional details.

Figure 4: Bureau of Land Management Oil and Gas Leases Recorded as in 

Suspension, by Length of Suspension, as of September 30, 2016

Note: Numbers represented in the figure have been rounded. The length of a lease suspension was 

calculated based on when the suspension was first issued through the end of fiscal year 2016—

September 30, 2016.
Page 18 GAO-18-411 Oil and Gas Lease Management

BLM’s database, LR2000, did not always contain information on the 

reasons for oil and gas lease suspensions. BLM officials said that while 

LR2000 does not have a field to specifically capture the reason for a 

suspension, and inclusion of this information is not mandatory, the 

general remarks field could be used for this purpose.

Because we found this remarks field was rarely used to capture the 

reason for suspensions, we reviewed the official lease files for a sample 

of 48 leases in Montana and Wyoming that were suspended as of 

September 30, 2016, and we interviewed field office staff for clarification. 

The reasons for suspensions in this sample generally fell into four broad 

categories: environmental reviews, delays in reviewing applications for 

permits to drill, logistical conflicts, and other reasons.

Our review of the official lease files for our sample found the following 

reasons cited for suspensions:

• Sixteen leases were suspended for large-scale environmental 

concerns, such as wilderness or wildlife protection areas or 

environmental reviews that affected large parcels of land. These 16 

suspensions had been in effect for approximately 6 years to 38 years. 

One of these leases was suspended because of a court order that 

also resulted in suspension of 422 other leases; the leases 

suspended as a result of this court order accounted for most of the 

suspensions that had been in place for more than 30 years.37

• Fourteen leases were suspended because BLM required additional 

time to complete its review of the operator’s drilling permit application. 

These 14 suspensions had been in effect for approximately 1 year to 

13 years. Seven of these 14 suspensions were issued because BLM 

needed additional time to review the environmental assessments 

submitted with the drilling permit applications.

 37These leases were located on federal lands in Montana. The court ruled that no further 

action on the leases could occur without additional environmental and wildlife analyses. 

File documents from the Forest Service indicate that there was little interest at that time in 

conducting these analyses because of, among other things, their expense, and that there 

was also little interest from operators in developing these lands for oil and gas production. 

Conner v. Burford, 605 F. Supp. 107 (D. Mont. 1985), affd in part and rev’d in part, 836 

F.2d 1521 (9th Cir. 1988), superseded, 848 F.2d 1441 (9th Cir. 1988), cert denied sub. 

nom., Sun Exploration & Prod. Co. v. Lujan, 489 U.S. 1012 (1989).

Reasons for Suspensions 

Were Not Always 

Recorded in BLM’s 

Database and Required 

Reviews of Official Lease 

Files to Identify
Page 19 GAO-18-411 Oil and Gas Lease Management

• Eight leases were suspended because they faced logistical conflicts 

with other surface development, such as mining activities occurring on 

the lease or adjacent lands. These suspensions had been in effect for 

approximately 4 years to 25 years.

• Five leases were suspended for other, short-term reasons, such as 

weather-related issues or economic conditions, but were recorded in 

LR2000 as suspended for approximately 22 years to 74 years.38

• We were unable to determine the reasons why the 5 remaining leases 

were suspended. These leases were recorded as suspended for 

approximately 28 to 82 years. The agency was unable to provide 

lease files for 1 of the leases. Field officials said that some of these 

suspensions may have been issued at the state level, and the officials 

had no additional information on them.

According to Standards for Internal Control in the Federal Government, 

management should use quality information to achieve the entity’s 

objectives; quality information may be defined as appropriate, current, 

complete, accurate, accessible, and provided on a timely basis.39 BLM 

does not have quality information on the reasons for suspensions, in part 

because such reasons are not routinely included in LR2000, and there is 

no specific data field for them. To obtain this information, BLM officials 

would have to review the official lease files, as we did, and most of the 

files were available only in hard copy in BLM state offices. Therefore, the 

information is not readily accessible across the agency. Field officials we 

interviewed from one field office said that additional information on 

reasons for suspension in the database would be helpful in monitoring 

lease suspensions and in communicating with others, such as 

management or the public, about suspensions. BLM headquarters 

officials said they are planning to update or replace LR2000. By including 

a data field in the update or replacement for LR2000 to record the 

reasons for suspensions, BLM could better ensure that federal lands are 

not being inappropriately kept from development—potentially foregoing 

revenue—or from valuable uses of public lands.

 38As discussed later in this report, officials from relevant field offices indicated that these 

suspensions were not in effect for this period of time and that the information in LR2000 

was outdated.

39GAO-14-704G.
Page 20 GAO-18-411 Oil and Gas Lease Management

BLM uses an informal approach to monitor lease suspensions and does 

not have procedures in place for monitoring suspensions, which may not 

ensure consistent and effective oversight. We also found that BLM’s state 

offices do not always maintain current information on lease suspensions 

in the official lease files or LR2000, and BLM headquarters and state 

officials told us they generally do not oversee the monitoring of lease 

suspensions.

Field offices vary in how they monitor lease suspensions, and BLM does 

not have official agency procedures in place for monitoring, relying 

instead on an informal approach. We found that the field offices we 

reviewed differed in the frequency of their monitoring activities for lease 

suspensions.40 According to officials we interviewed from these offices:

• 8 field offices monitor with varying frequency, depending on the 

circumstances; and

• 3 field offices monitor rarely.

Officials who monitored with varying frequency said that the frequency 

depends in part on the nature of the suspension. For instance, they said 

suspensions that involve seasonal protection of wildlife habitat, which can 

last for several months, typically require relatively little monitoring 

because the time frames for these suspensions are more clearly defined. 

In contrast, suspensions involving environmental reviews often require 

more frequent monitoring because the time frames associated with these 

suspensions are less definitive and can range from several months to 

several years. Several of these officials said that their offices have 

established prompts to alert staff when to conduct monitoring activities. 

For example, an official from 1 field office told us the office’s staff use 

handwritten notes to track their lease suspensions. An official from 

another field office informed us that their office uses an electronic 

calendar feature to alert staff when to monitor, and several other field 

office officials reported that they rely on various spreadsheets and emails 

 40We reviewed a total of 12 field offices; however, 1 field office did not respond to our 

request for information on monitoring of lease suspensions.

BLM Relies on an 

Informal Monitoring 

Approach That May 

Not Provide for 

Consistent and 

Effective Oversight of 

Lease Suspensions

Monitoring Varies Among 

Field Offices, and BLM 

Does Not Have 

Procedures for How to 

Conduct It
Page 21 GAO-18-411 Oil and Gas Lease Management

to remind them when to monitor. Officials from 1 field office also stated 

that their office uses an estimated end date for every suspension41—that 

is, the date the suspension is expected to terminate—to prompt them to 

review the current conditions to ensure that the suspension is still 

warranted.

Officials who monitored with varying frequency also said that the 

frequency depends on the availability of staff for monitoring. These 

officials said they generally rely on petroleum engineers in their 

respective offices to monitor lease suspensions because these individuals 

are normally the most familiar with leases.42 However, some officials 

added that staffing limitations, particularly a shortage in petroleum 

engineers, have hindered their ability to monitor lease suspensions in a 

timely manner. Several of the field officials we interviewed noted that, in 

recent years, they have had to rely on other staff or petroleum engineers 

who were on loan from other field offices because their offices did not 

have a petroleum engineer on staff. According to two field officials we 

interviewed, while assistance from other field offices is needed and 

appreciated, there is invariably a lack of consistency in the knowledge 

that engineers from other offices have about the lease sites involved. 

Field officials also said that there have been instances in which petroleum 

engineers left the agency for the private sector, resulting in a loss of 

institutional knowledge about certain leases, possibly contributing to 

lapses in follow-up on particular leases. Officials from offices that rarely or 

never conduct monitoring also cited problems with staff availability. We 

reported on human capital challenges at BLM, specifically in hiring and 

retaining petroleum engineers, in March 2010.43 We also noted BLM’s 

human capital constraints in our High-Risk Series update report in 

February 2011, and we reported on human capital issues at BLM in 

 41End dates are estimated because it is difficult to predict the period of delay, and BLM’s 

guidance states that suspensions should be granted for an indefinite term.

42Several field officials we interviewed informed us that they also rely on legal staff to 

assist with follow-up on lease suspensions, typically when legal documents are prepared 

for a lease, such as when the term and conditions of a lease are revised because of a 

suspension or in cases where a suspension has been terminated. They stated that these 

activities are usually one-time events and do not involve the routine monitoring of lease 

suspensions.

43GAO, Oil and Gas Management: Interior’s Oil and Gas Production Verification Efforts Do 

Not Provide Reasonable Assurance of Accurate Measurement of Production Volumes, 

GAO-10-313 (Washington, D.C.: Mar. 15, 2010). 
Page 22 GAO-18-411 Oil and Gas Lease Management

January 2014 and September 2016.44 In several of these reports, we 

recommended that BLM take a number of actions, including using 

existing authorities and incentives to improve staff retention. BLM 

generally agreed with these recommendations and has taken action on 

some, but not all, of these recommendations.

Nonetheless, the extent of variability we found, including 3 field offices 

that monitor rarely or not at all, indicates that allowing individual field 

offices to determine when to monitor suspensions may not ensure that 

monitoring takes place. Under Standards for Internal Control in the 

Federal Government, management should design control activities, such 

as procedures, to ensure the objectives of the program are achieved.45

The Office of Management and Budget has also acknowledged the 

importance of internal guidance documents to channel the discretion of 

employees, increase efficiency, and enhance the fair treatment of 

similarly situated parties.46 Some field officials we interviewed said that 

procedures to help guide them on monitoring could be beneficial and 

provide a level of consistency. By developing procedures for monitoring 

lease suspensions, including when to conduct monitoring efforts, BLM 

could promote more consistent monitoring to better ensure that lease 

suspensions in effect are warranted.

Officials from BLM’s state offices told us that they do not oversee field 

office monitoring of suspensions, and we found that they did not always 

have current or complete information on suspensions. We found that 

more than three-quarters of the official lease files in BLM state offices we 

reviewed contained outdated documentation regarding the status of lease 

suspensions. Specifically, files for 37 of the 48 lease suspensions we 

reviewed did not contain updated information on whether the lease 

suspension had been monitored or reviewed since the suspension was 

initially issued. For example, we reviewed a lease file for a suspension 

issued in 1949 for economic reasons, but the file only contained 

 44GAO, High-Risk: An Update, GAO-11-278 (Washington, D.C.: February 2011); Oil and 

Gas: Interior Has Begun to Address Hiring and Retention Challenges but Needs to Do 

More, GAO-14-205 (Washington, D.C.: Jan. 31, 2014); and Oil and Gas Oversight: Interior 

Has Taken Steps to Address Staff Hiring, Retention, and Training but Needs a More 

Evaluative and Collaborative Approach, GAO-16-742 (Washington, D.C.: Sept. 19, 2016).

45GAO-14-704G.

46Office of Management and Budget, Final Bulletin for Agency Good Guidance Practices, 

72 Fed. Reg. 3432 (Jan. 25, 2007).

BLM State Offices and 

Headquarters Generally 

Do Not Oversee Field 

Office Monitoring of Lease 

Suspensions and Do Not 

Always Have Current or 

Complete Information on 

Suspensions
Page 23 GAO-18-411 Oil and Gas Lease Management

information on the suspension issuance and not whether monitoring 

occurred to assess the economic conditions associated with the lease. 

Additionally, we discovered that some official lease files were not 

complete and did not have certain required information, such as letters 

issuing the suspension. For example, three of the lease files we reviewed 

were missing required information. We could not verify the reasons these 

leases were suspended, their current status, or any information 

concerning monitoring efforts associated with them. Field officials we 

interviewed did not have any information on these suspensions and said 

that they may have been initiated by the state office more than 30 years 

ago. However, BLM state officials were unable to confirm or deny this. 

For another lease, there was no lease file. Officials in BLM headquarters 

and state offices said that there is no requirement for them to oversee the 

field offices’ monitoring activities. However, they said that performing 

such oversight could help to ensure effective and consistent monitoring of 

lease suspensions.

We also identified some instances in LR2000 where data on suspensions 

were not up to date. Specifically, 7 of the 48 leases we reviewed were 

recorded in LR2000 as suspended, but information we received from 

agency officials indicated that the suspensions were no longer warranted. 

We later confirmed with state and field officials that none of the 7 

suspensions remained in effect. Five of these 7 leases were recorded as 

being in suspension for 22 years or more for what appeared to be shortterm reasons, such as weather-related issues or economic conditions. 

One Wyoming suspension, for instance, was granted in 1990 because of 

low oil prices at the time, which made repairing wells uneconomical. 

While this lease was still recorded as suspended in LR2000 as of 

September 2016, a termination letter in the lease file indicated that the 

suspension was terminated in 1991. In another example, a lease was 

listed in the official lease file as suspended for 3 years because of delays 

in processing a drilling permit application. When we followed up with field 

officials about the lease, they informed us that the suspension should 

have been terminated years ago; however, we found no termination letter 

in the official lease file maintained by the state office. Field officials 

speculated that the letter may not have been sent because the case 

manager had retired and no one in the field office knew to follow up on 

the lease. Because field officials informed us that these leases were no 

longer suspended, we confirmed with officials from Interior’s Office of 
Page 24 GAO-18-411 Oil and Gas Lease Management

Natural Resources Revenue that payments were being appropriately 

collected for these 7 leases.47

Moreover, these data are not available in a standardized report that could 

be used to help oversee monitoring, such as a report showing the 

average length or frequency of suspensions. BLM produces standardized 

reports from LR2000 for other aspects of oil and gas leases, such as 

when leases have been issued or are set to expire. BLM officials said that 

a standardized report for lease suspensions could assist headquarters 

and state officials in conducting oversight of field offices’ monitoring 

efforts.

Standards for Internal Control in the Federal Government state that 

management should design control activities, such as conducting toplevel reviews of actual performance, to ensure the objectives of the 

program are being achieved.48 By requiring that management, particularly 

cognizant headquarters and state office officials, conduct top-level 

reviews of field offices’ monitoring efforts, as well as top-level reviews of 

official lease files and databases, BLM could better ensure that lease 

suspensions in effect continue to be warranted and that information on 

suspensions is current and complete. Additionally, federal standards for 

internal control state that management should design control activities, 

such as developing mechanisms that enforce management’s directives, 

to achieve the entity’s objectives and address related risks. By developing 

mechanisms, such as summary reports on lease suspensions, as BLM 

updates or replaces LR2000, BLM could assist cognizant officials in 

headquarters and state offices with their oversight of monitoring.

The ability of federal agencies to manage their programs effectively 

depends in part on the information systems the agencies use and the 

quality of the data within these systems. Over the past several years, 

BLM has worked to improve the quality of the data in LR2000, including 

data related to oil and gas lease suspensions. These efforts have helped 

to improve the accuracy of certain data, but they do not address some 

 47The Office of Natural Resources Revenue tracks rents and royalty payments collected 

from oil and gas leases using a separate database. Office of Natural Resources Revenue 

officials informed us that their database does not electronically communicate with LR2000, 

and staff must manually convert identification numbers from LR2000 in order to cross 

check these leases against their database. 

48GAO-14-704G.

Conclusions
Page 25 GAO-18-411 Oil and Gas Lease Management

constraints of LR2000. In particular, LR2000 does not contain a data field 

for recording the reasons for suspensions. BLM officials told us that they 

will upgrade or replace LR2000 in the near future. By including a data 

field in the update or replacement for LR2000 to record the reasons for 

suspensions, BLM could better ensure that federal lands are not being 

inappropriately kept from development—potentially foregoing revenue—

or from other valuable uses of public lands.

BLM’s ability to effectively manage the program also depends on the 

establishment of effective internal controls. To date, BLM has not 

developed procedures for monitoring lease suspensions. By developing 

procedures for monitoring lease suspensions, including when to conduct 

monitoring efforts, BLM could promote more consistent monitoring to 

better ensure that lease suspensions in effect are warranted. Additionally, 

BLM does not conduct top-level reviews to oversee field offices’

monitoring efforts, and we found instances in which BLM’s information on 

suspensions was outdated or incomplete. By requiring that management, 

particularly cognizant headquarters and state office officials, conduct 

reviews of field offices’ monitoring efforts, as well as official lease files 

and databases, BLM could better ensure that information on suspensions 

is current and complete. Finally, BLM does not have mechanisms to 

provide officials with some key information relevant for oversight, such as 

when suspensions were last reviewed or the average length and 

frequency of suspensions. By developing mechanisms, such as summary 

reports on lease suspensions, as BLM updates or replaces LR2000, BLM 

could assist cognizant officials in headquarters and state offices with their 

oversight of monitoring.

We are making the following four recommendations to BLM:

As BLM updates or replaces its database, the Director of BLM should 

include a data field to record the reasons for suspensions. 

(Recommendation 1)

The Director of BLM should develop official agency procedures for 

monitoring oil and gas lease suspensions, including when to conduct 

monitoring activities. (Recommendation 2)

The Director of BLM should require cognizant officials in headquarters 

and state offices to conduct top-level reviews of field offices’ monitoring of 

oil and gas lease suspensions, as well as of official lease files and 

databases to ensure they are current and complete. (Recommendation 3)

Recommendations for 

Executive Action
Page 26 GAO-18-411 Oil and Gas Lease Management

As BLM updates or replaces LR2000, the Director of BLM should ensure 

the development of mechanisms, such as standardized summary reports 

on lease suspensions, to assist cognizant officials in headquarters and 

state offices with oversight of field offices’ monitoring efforts.

(Recommendation 4)

We provided a draft of this report to Interior for review and comment. In its 

comments, reproduced in appendix IV, Interior generally agreed with our 

findings and recommendations. Interior also outlined plans for 

addressing the recommendations. 

Regarding our first recommendation, Interior stated that it agrees that any 

future database used to track information on oil and gas lease 

suspensions should include a data field to more explicitly record the 

reasons for suspensions. 

Interior also stated that it will develop standardized procedures for 

monitoring oil and gas lease suspensions, consistent with our second 

recommendation. These procedures will be instituted agency-wide, 

according to Interior, and agency policy and handbooks will be updated 

as needed to implement the procedures.

With respect to our third recommendation, Interior stated that it will 

provide updated guidance and online training to assist the state and field 

offices in managing, monitoring, and reviewing lease suspensions. These 

actions are positive steps and may address our recommendation 

depending on their implementation. 

Finally, consistent with our fourth recommendation, Interior stated that 

any future update to or replacement of LR2000 database will include the 

capability to create standardized reports for oil and gas lease 

suspensions.

As agreed with your offices, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 30 days from the 

report date. At that time, we will send copies to the appropriate 

congressional committees, the Secretary of the Interior, and other 

interested parties. In addition, the report will be available at no charge on 

the GAO website at http://www.gao.gov.

Agency Comments
Page 27 GAO-18-411 Oil and Gas Lease Management

If you or your staff members have any questions about this report, please 

contact me at (202) 512-3841 or ruscof@gao.gov. Contact points for our 

Office of Congressional Relations and Public Affairs may be found on the 

last page of this report. GAO staff who made key contributions to this 

report are listed in appendix V.

Frank Rusco

Director, Natural Resources and Environment
Appendix I: Objectives, Scope, and 

Methodology

Page 28 GAO-18-411 Oil and Gas Lease Management

This report examines (1) the process the Bureau of Land Management 

(BLM) uses to determine whether to suspend oil and gas leases; (2) the 

extent of oil and gas lease suspensions and the reasons for the 

suspensions of selected leases; and (3) the approach that BLM uses to 

monitor the status of lease suspensions and the extent to which this 

approach allows for oversight of such lease suspensions.

To examine the process BLM uses to determine whether to suspend oil 

and gas leases, we reviewed applicable laws, agency documents, and 

the criteria BLM uses when considering lease suspensions. Specifically, 

we reviewed BLM’s statutory requirements for granting a lease 

suspension. We also reviewed BLM’s guidance for reviewing suspension 

requests—Suspensions of Operations and/or Production Manual––which 

outlines the process and criteria BLM uses to approve or deny a lease 

suspension request as well as the process for appealing a suspension 

decision. We interviewed BLM officials at headquarters, as well as state 

and field offices responsible for leases in our review, about how they 

apply these criteria when assessing suspension requests. We also 

interviewed representatives from the Interior Board of Land Appeals 

about suspension decisions that are appealed to the board, how these 

appeals are handled, board decisions that are subsequently appealed, 

and the process involved with those appeals.

To examine the extent of oil and gas lease suspensions and the reasons 

for the suspensions of selected leases, we analyzed data on lease 

suspensions from BLM’s Legacy Rehost 2000 System (LR2000) 

database as of September 30, 2016.1 We took a number of steps to 

assess the reliability of suspension data and related fields in LR2000. 

Specifically, we performed electronic tests to check the extent to which 

data were complete and within expected ranges. Testing included 

comparison of data extractions prepared by BLM officials for us against 

data we downloaded directly from LR2000. We also interviewed BLM 

officials responsible for managing the system about how data are 

collected and entered into the system as well as the steps the officials 

take to help ensure that the data are accurate and complete. We also 

clarified discrepancies regarding lease suspension data with these 

officials when necessary. We determined the data were sufficiently 

reliable to give a high-level summary on suspensions, including 

 1

LR2000 contains information on all mineral and land assets managed by BLM, including 

oil and gas leases.

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 29 GAO-18-411 Oil and Gas Lease Management

information on the number and location of leases, the number in 

suspension, and suspension length.

LR2000 contains information on activities related to an oil and gas lease’s 

status, among other things. For each lease, we identified the latest 

record, if any, for actions in fiscal year 2016 and earlier that indicate 

suspension initiation or termination. We determined that a lease was in 

suspension if the most recent action related to a suspension indicated 

that the suspension was initiated. We determined the length of 

suspension based on the date of that initiation record. We then 

determined distributions of the numbers of leases recorded as still in 

suspension in each state as of the end of fiscal year 2016.

We also reviewed the official lease files, maintained by BLM state offices, 

for a nongeneralizable sample of leases recorded as suspended as of 

September 30, 2016, in Montana and Wyoming to assess their status and 

the reasons behind the suspensions. We chose these two states because 

they were among the states with the largest numbers of suspended 

leases. Montana’s official lease files were electronically maintained and 

easily accessible, while Wyoming, which had leases recorded as 

suspended for the longest period of time as of September 30, 2016, 

maintained hard copy official lease files. Montana and Wyoming 

collectively represent about 50 percent of all oil and gas leases recorded 

as suspended. We used the following approaches to select a sample of 

48 suspended leases in these states and limited the extent to which we 

selected multiple leases that were suspended at the same time for the 

same reason.

For Montana leases, we found that only 12 suspension initiation dates 

were recorded for the leases in suspension as of the end of fiscal year 

2016. We therefore randomly selected for review a single lease from 

those suspended on each of these dates. For Wyoming, the suspension 

initiation dates were much more dispersed, so we identified groups of 15 

or more leases based on a combination of suspension date, similarity of 

lease numbers, and the field office of jurisdiction. From these groups, we 

selected 19 suspended leases—each lease was the lease with largest 

acreage from each field office within its group. There were a number of 

leases that did not fit into these groups because there were fewer than 15 

suspensions on a given date with similar lease numbers, so we selected 

a single lease file with the largest acreage from each year that was at 

least 20 years old. This allowed us to review suspensions that have been 

in effect for a relatively long period of time. This approach resulted in our 

selection of an additional 17 suspended leases in Wyoming. While our 
Appendix I: Objectives, Scope, and 

Methodology

Page 30 GAO-18-411 Oil and Gas Lease Management

review of suspended lease files is not generalizable to other BLM lease 

suspensions, our findings provide examples of types of reasons that are 

cited for lease suspensions.

To verify the status of each selected lease, we compared information in 

LR2000 and the official lease file to information in the Offices of Natural 

Resources Revenue’s database. The Office of Natural Resources 

Revenue, within the Department of the Interior, is responsible for 

collecting rental and royalty payments associated with oil and gas leases. 

We also interviewed the BLM state and field office officials responsible for 

the specific lease files we reviewed to obtain additional information about 

the status of certain lease suspensions and the reasons these 

suspensions remained in effect. We compared how BLM maintains and 

verifies its lease suspension information with Standards for Internal 

Control in the Federal Government for information and communication.2

To examine the approach BLM uses to monitor the status of lease 

suspensions and the extent to which the approach provides for oversight, 

we reviewed agency data, guidance and requirements, and official lease 

documents. In particular, we reviewed monitoring information in LR2000, 

BLM’s Suspensions of Operations and/or Production Manual, and 

monitoring information in the official lease files for our sample of 48 

leases recorded as being in suspension as of September 30, 2016. We 

also interviewed officials from BLM headquarters, as well as BLM’s state 

offices in Montana and Wyoming and the field offices responsible for the 

48 selected leases in our review—a total of 12 field offices, 2 from 

Montana and 10 from Wyoming. We interviewed officials from 11 field 

offices about the approaches they used to monitor lease suspensions, 

including the frequency of monitoring and the staff involved.3 We also 

interviewed officials at headquarters and state offices to examine the 

extent to which these approaches provided for oversight of lease 

suspensions. We compared BLM’s actions and documentation with 

agency guidance, federal regulations, and federal standards for internal 

control for control activities.4

 2

GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 

(Washington, D.C.: September 2014).

3

We reviewed a total of 12 field offices; however, 1 office did not respond to our request 

for information on monitoring of lease suspensions.

4

GAO-14-704G.
Appendix I: Objectives, Scope, and 

Methodology

Page 31 GAO-18-411 Oil and Gas Lease Management

We conducted this performance audit from September 2016 to June 2018 

in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Appendix II: Bureau of Land Management Oil 

and Gas Leases, Suspensions, and Acreage, 

as of September 30, 2016

Page 32 GAO-18-411 Oil and Gas Lease Management

Table 1: Bureau of Land Management (BLM) Oil and Gas Recorded Leases, Suspensions, and Acreage, as of September 30, 

2016 

State Number of leases Leased acreage Number of suspensions Suspended acreage

Alabama 114 70,620 0 0

Alaska 174 1,006,960 0 0

Arizona 6 12,217 0 0

Arkansas 619 416,194 138 147,990

California 530 198,820 27 20,870

Colorado 4,135 3,099,068 180 236,901

Idaho 15 19,852 0 0

Illinois 8 1,581 0 0

Indiana 8 11,358 0 0

Kansas 462 120,151 0 0

Kentucky 69 38,073 4 7,516

Louisiana 578 349,457 2 133

Maryland 4 2,637 0 0

Michigan 235 129,769 0 0

Mississippi 630 351,925 2 1,025

Montana 2,751 2,145,774 607 992,145

Nebraska 27 10,442 0 0

Nevada 731 1,385,511 10 13,663

New Mexico 8,021 4,508,477 158 84,256

New York 5 1,183 0 0

North Dakota 1,854 889,427 88 68,345

Ohio 259 55,847 0 0

Oklahoma 1,209 250,358 2 440

Oregon 111 187,197 105 172,759

Pennsylvania 75 9,954 0 0

South Dakota 383 168,938 0 0

Tennessee 2 736 1 620

Texas 676 406,733 7 12,288

Utah 3,045 2,984,294 731 1,054,288

Virginia 38 27,509 0 0

Appendix II: Bureau of Land Management 

Oil and Gas Leases, Suspensions, and 

Acreage, as of September 30, 2016
Appendix II: Bureau of Land Management Oil 

and Gas Leases, Suspensions, and Acreage, 

as of September 30, 2016

Page 33 GAO-18-411 Oil and Gas Lease Management

State Number of leases Leased acreage Number of suspensions Suspended acreage

West Virginia 242 100,917 0 0

Wyoming 13,996 9,195,483 687 568,775

Total 41,003 28,157,462 2,749 3,382,014

Source: GAO analysis of BLM data. | GAO-18-411

Note: We reviewed BLM data to identify leases and suspensions and associated acreage for all 

states with BLM leases.
Appendix III: Bureau of Land Management Oil 

and Gas Leases Recorded as in Suspension

Page 34 GAO-18-411 Oil and Gas Lease Management

Table 2: Bureau of Land Management (BLM) Oil and Gas Leases Recorded as in Suspension by Length and State, as of 

September 30, 2016

State < 3 years ≥ 3 years to

< 10 years

≥ 10 years to

< 20 years

≥ 20 years to

< 30 years

≥ 30 years Total

Arkansas 11 125 0 2 0 138

California 22 2 1 2 0 27

Colorado 59 113 5 0 3 180

Kentucky 0 0 0 4 0 4

Louisiana 0 1 1 0 0 2

Mississippi 1 0 0 1 0 2

Montana 12 167 1 3 424 607

North Dakota 66 22 0 0 0 88

New Mexico 49 15 4 11 79 158

Nevada 2 1 3 4 0 10

Oklahoma 0 2 0 0 0 2

Oregon 105 0 0 0 0 105

Tennessee 0 0 1 0 0 1

Texas 0 6 1 0 0 7

Utah 160 326 111 29 105 731

Wyoming 142 374 67 70 34 687

Total 629 1,154 195 126 645 2,749

Source: GAO analysis of BLM data. | GAO-18-411

Note: We reviewed BLM data to identify the length of suspensions for all states with suspended 

leases. We calculated the length of a lease suspension based on when the suspension was first 

issued through the end of fiscal year 2016—September 30, 2016.

Appendix III: Bureau of Land Management 

Oil and Gas Leases Recorded as in 

Suspension
Appendix IV: Comments from the Department 

of the Interior

Page 35 GAO-18-411 Oil and Gas Lease Management

Appendix IV: Comments from the 

Department of the Interior
Appendix IV: Comments from the Department 

of the Interior

Page 36 GAO-18-411 Oil and Gas Lease Management
Page 37 GAO-18-411 Oil and Gas Lease Management

Frank Rusco, (202) 512-3841 or ruscof@gao.gov

In addition to the contact named above, Dan Haas (Assistant Director), 

Karla Springer (Assistant Director), John C. Johnson (Analyst-in-Charge), 

Richard Burkard, Cindy Gilbert, John W. Hocker, Cynthia Norris, Daniel 

Purdy, Stuart Ryba, Sara Sullivan, Kiki Theodoropoulos, Barbara 

Timmerman, Jack Wang, and Khristi Wilkins made key contributions to 

this report.

Appendix V: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(101103)
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