BLM bonding rollback could cost taxpayers over $750 billion
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Taxpayers and across the U.S. could be on the hook for more than $750 billion if the Trump administration moves forward with plans to roll back bonding requirements for oil and gas companies operating on public lands, according to a new analysis.
The U.S. Bureau of Land Management requires companies to post bonds to ensure well sites are properly plugged after drilling is complete.
David Jenkins, president of the group Conservatives for Responsible Stewardship, said if bonding costs drop back to paltry 1960 levels, bad actors will continue to skip town and leave messes for taxpayers to clean up.
"If they promise to clean up as a condition of the permit, then we’ve got to hold them to that," Jenkins contended. "Anyone saying we shouldn’t hold them to that is just turning their back on taxpayers."
There are currently some 130,000 abandoned oil and gas wells on public lands, due in part to previous bonding levels as low as $1,700. The actual cost of cleanup is over $70,000. The Trump administration believes rolling back regulations on fossil fuel companies, including bonding requirements, is necessary to "unleash American energy" and achieve its goal of energy dominance.
In 2024, the BLM updated bonding requirements for the first time in 60 years to bring them in line with cleanup costs and protect taxpayers. Jenkins noted many extraction companies incorporate restoration plans in their business models. But he pointed out too many producers, after they get the oil and gas they want, go on to sell their permits to companies which exist only for the purpose of going bankrupt.
"By structuring this shell game, it’s clear the intent is to rob taxpayers," Jenkins argued. "It’s not accidental. It’s not ‘Oops, we forgot to do this.’ It’s an intentional scheme."
Jenkins noted the BLM’s 2024 rules came in response to support from the vast majority of Western voters, across party lines, for increasing bonding requirements.
"Why would anyone who is even remotely fiscally conservative think that adding to the national debt and saddling the American taxpayer with almost a trillion dollars in cleanup costs is anything but a fiscal nightmare?"
