Development of Indian energy resources is a complex process that may involve a range of stakeholders, including federal agencies, state agencies, tribal governments, individual Indian mineral owners, and private oil and gas operators. When an operator seeks to develop land that includes Indian resources, the operator must identify ownership of surface and subsurface resources and acquire a lease for the right to drill for oil and gas resources, among other things. BIA maintains these surface and mineral ownership records, including lease information. There are several ways in which Indian oil and gas resources can be leased. For example, oil and gas resources can be nominated for lease by operators, the tribe, or an individual Indian mineral owner. BIA then reviews nominated oil and gas resources to determine ownership, and in some cases, BLM may assist with identifying ownership of the proposed parcels. If the resources are not already leased, BIA may advertise and conduct competitive lease sales where operators can bid on nominated leases. BIA reviews the bids, identifies the highest bidder, notifies the operator whether its bid was accepted, and issues the lease. An Indian lease document comprises a primary term and a secondary term, both of which are negotiated as part of the lease agreement. The primary term is the time frame in which the company has to begin drilling or the lease will expire. The length of this term varies, but it usually ranges from 2 to 10 years for Indian leases, according to Interior officials. The secondary term is established after production begins and remains in effect as long as the well is producing in paying quantities. The lease also consists of three payment types between the operator and the tribe or Indian mineral owner: (1) a onetime bonus payment paid per acre following lease approval, (2) an annual rental payment for the leased land, and (3) ongoing royalty payments for development of the resource. If an Indian lease cannot be independently developed in conformity with well spacing requirements set by the state and BLM, the operator developing an area including Indian mineral interest must request approval of a CA from BIA. Production from a well located within the CA is attributed to the entire area—meaning that all owners share a percentage of the royalties based on their percentage of surface ownership, regardless of where the well is located. According to BIA’s Fluid Mineral Estate Procedural Handbook, communitization serves a conservation function by eliminating excessive drilling and minimizing surface disturbance, while protecting adjoining properties from drainage of their minerals. Figure 1 illustrates a hypothetical example in which three leases are included in an approved CA. The example shows how royalties are allocated among each lessor. A CA must be approved before operators can distribute royalty payments for Indian leases to the appropriate mineral owners. BIA, through several divisions and its various regional and agency offices, has primary authority for managing Indian energy development and has ultimate approval authority for Indian CAs. BIA may approve a CA if it determines that approval “is advisable and in the best interest of the Indian mineral owner”. However, other offices within Interior also have a role in the development and accounting of Indian energy resources in regard to CAs. For example, BLM reviews a CA application and recommends to BIA whether to approve an Indian CA based on the engineering and technical aspects. Operators send royalty payments from the production of Indian mineral leases to ONRR. Once the CA is approved by BIA and production has been established, payments are made to ONRR, unless otherwise provided for by the lease. ONRR transfers royalty payments to the appropriate Indian accounts, and the Office of the Special Trustee for American Indians (OST) makes the royalty payments to Indian mineral owners based on instructions from BIA. An approved CA is effective on either the date of first production or the date the CA is approved, whichever is earlier. Traditionally, Interior encouraged the operator to submit an Indian CA before the well was drilled, but it was common for operators to wait until the results of the well were known before submitting the CA application, according to Interior officials. In recent years, some offices within Interior have taken actions to address the backlog of CAs in their regions. For example, we previously reported that in North Dakota the BLM Dickinson field office, BIA Fort Berthold agency office, and ONRR created a preliminary CA process in March 2011 to address the backlog of CAs in their region. According to Interior officials, the preliminary CA process was used by some BIA and BLM offices as an interim step to ensure the timely collection and distribution of royalties while operators prepared the required documents for a complete CA application. However, in early 2015 Interior’s Office of the Solicitor instructed BIA and BLM to cease using this process. The Office of the Solicitor determined that preliminary CAs were not legally binding because documents used in the process were not formally reviewed, approved, and signed by the Secretary of the Interior or the Secretary’s designee. In addition, Interior officials said that they signed a contract with Lockheed Martin in October 2011 that included providing technical assistance and additional staff to help expedite the processing and approval of CA packages at the BIA Fort Berthold agency office. We previously reported that some BIA offices did not have adequate staff resources or staff with the skills needed to effectively evaluate energy-related documents, including the large number of CAs. According to Interior officials, the additional staff and technical resources that the Lockheed Martin contract provided allowed the office to review and approve more CAs than it otherwise could have. However, Interior officials told us that because the contract is scheduled to end in September 2016, some of these functions will subsequently be administered directly by Interior’s recently established Indian Energy Service Center. As of March 2016, according to Interior officials, the Service Center has some funding available for fiscal year 2016 and is in the process of hiring a director, identifying overall staffing needs, and defining its roles and responsibilities. We are examining the roles and responsibilities of the Indian Energy Service Center in a separate ongoing review. In the summer of 2015, BIA and BLM issued guidance in an effort to streamline the CA review and approval process and address the backlog of Indian CAs awaiting review and approval. The guidance seeks to shorten the time required to review and approve a CA by, among other things, reducing paperwork, eliminating duplicative reviews, and expediting the review of key information early in the process. However, Interior does not have plans to set time frames for CA reviews, systematically collect data on review times, or assess the effect of its revised guidance. As a result, Interior will be unable to determine whether the resulting actions have had a positive effect on the CA review and approval process. In 2015, BIA and BLM worked collaboratively to develop guidance intended to streamline the CA review and approval process and help address the current backlog of Indian CAs awaiting approval. Specifically, in July 2015, BLM issued guidance that called for the CA approval process to be streamlined to ensure the more timely payment of royalties to Indian mineral owners. Approximately one month later, BIA issued corresponding guidance to ensure the timely review, adjudication, and approval of Indian CAs. The guidance for both BIA and BLM, which we refer to in this report as the revised guidance, was developed through a collaboration between BLM, BIA, ONRR, and OST senior officials who attend biannual meetings of the Indian Energy and Minerals Steering Committee (IEMSC). According to Interior officials, the revised guidance incorporates best practices of individual offices and standardizes the CA review and approval process to better ensure consistency of approval methods in offices across the country. The guidance also helps to clarify and delineate the responsibilities of BIA, BLM, and the operators. Based on our review of Interior’s former and revised guidance and supporting documents, the revised process includes approximately the same number of steps as the former process. However, as shown in figure 2, the revised process includes various steps designed to reduce paperwork, eliminate duplicative reviews, and expedite the review of key information early in the process, which, according to the guidance, should dramatically reduce CA adjudication and processing times. Specifically, Interior took the following actions in an effort to streamline the CA process: Reducing paperwork: The new guidance reduces and simplifies the information required to be submitted to BIA and BLM as part of a the CA package by, among other things, allowing operators to combine all nonfederal and non-Indian ownership interests, such as private and state interests, into a single entry representing total acreage. As a result, information such as the individual lease date, lease term, and lessor is no longer required by BIA and BLM. According to the revised guidance, BLM now verifies the total acreage and land description of the proposed CA. One operator told us that this change will significantly reduce the amount of paperwork submitted to BIA and BLM for review. For example, according to the operator, BIA and BLM used to review CAs with attachments numbering approximately 400 pages of lease information, often in hardcopy; in contrast, the attachments may now be as few as 10 pages of lease information. In addition, the revised guidance states that BIA and BLM should already have the necessary information for Indian and federal leases. According to officials, BIA and BLM used to verify the signatures of all interest owners that were party to the CA but did not have the staff to accomplish this task in a timely manner. The revised guidance allows operators to self-certify that they have collected the necessary signatures, including signatures from private and state interests, which, according to officials, further decreases the amount of information federal officials are responsible for reviewing and places the burden on operators to collect such information. The reduction in paperwork submitted is expected to reduce the workload for both BIA and BLM offices.