Is the deficit fix right beneath our feet?

Nearly $130 trillion in oil and gas resources are buried under US government land, worth about 8 times our national debt. But tapping it isn't so easy.

By Aimee Picchi Feb 6, 2013 1:13PM

Oil derricks -- Comstock/CorbisA solution to the country's growing national debt sits right beneath Americans' feet, according to a report from the nonprofit Institute for Energy Research.


That's the $128 trillion in technically recoverable oil and gas resources below 41 million acres of federally owned land, according to the group, which advocates for "freely-functioning energy markets." The chief executive of the group is a former director of policy analysis at Enron.


The "federal government’s mineral estate land holdings surpass the total surface land area of the nation of Canada," according to the report. "These holdings, as we will see, are vastly underutilized."


Most of those below-ground assets are mineral and energy resources, such as oil and coal. Among those hidden deposits are 10.4 billion barrels of oil in the Arctic National Wildlife Refuge and 420 trillion cubic feet of natural gas in the continental shelf off the lower 48 states, the report notes. 


Right now, the government leases only about 2% of federal offshore areas and 6% of onshore lands. 


But tapping those resources isn't so easy. 


For one, not all federally controlled lands are open to leasing, as noted by the Congressional Budget Office in a study last year.


Leasing is statutorily prohibited in the Arctic National Wildlife Refuge, for example, the CBO noted. It estimated that opening the land up to development would lead to about $5 billion in additional revenue over the next decade. 


And opening the refuge and other wilderness areas to drilling and mining would undoubtedly spur a backlash from Americans who believe such areas should remain undisturbed by mining and other human activities.


One such group is the Defenders of Wildlife, a national nonprofit conservation organization that advocates protecting the area. According to its site, "the Arctic Refuge is under assault. The oil industry and its political allies continue to launch attacks to open this national treasure to destructive oil and gas drilling, while climate change threatens to disrupt its habitats faster than wildlife can adapt." 


It's not as if U.S. taxpayers aren't already benefiting from minerals hidden under the country's federally owned land. Revenue from all oil and gas leases on public lands will amount to $150 billion over the next 10 years, according to the CBO. 


With the Institute for Energy Research pushing for greater development, it may be taking the advice of oilman J. Paul Getty, who said, "The meek shall inherit the earth but not its mineral rights."


More on moneyNOW


355Comments
Feb 6, 2013 6:01PM
avatar
I read some where that Obama promised rights  to china because of our debt
Feb 6, 2013 5:53PM
avatar
Been in Oil and Gas industry since 1977.  A very responsible, technology driven and hard working industry.  There have been recent discoveries in US Shale formation that could dwarf North Dakota's Bakken Shale. It will make us the world leader in oil and gas.  So if obama wants to finally do something right, get this economy on the move, create millions of jobs he has to, "Cut Her Loose"!
Feb 6, 2013 5:45PM
avatar
Norway, took the right approach to drilling on Federal land, they started a mostly Federally owned oil company to do it, so all Norwegians benefit from there natural resources. Today Norway has the highest standard of living in the world and they balance there budget almost every year. All Americans should benefit from our Federal land recourses, not just an elite few like Ray Irani who makes about $76 million per year as CEO of Occidental. Lets build a smarter future together.
Feb 6, 2013 5:39PM
avatar

Ok so a lot of people don't understand how oil & gas leasing work and how the government would make money from this.  There are a ton of erroneous comments in here.  here's how it works if you want to understand it

 

The o&g companies lease the land from the government,  somewhere from $1-2000 an acre for the "right" to explore and develop the minerals.  The government gets also gets a % of the well but they dont have to put any money into exploration or deployment in the form of "Royalties".  usually around 12.5%

 

the o&g company spends all the money, gets the o&g out of the ground then send s check to the royally owner in the mail, in this case its the government for 12.5% of the revenue made on the well.  The % can vary by the area.

Feb 6, 2013 5:37PM
avatar

Shhhhhhhh don't announce that.

Congress might hear about it and spend it while its still in the ground.       

 

avatar
Tap it!!! relocate wildlife.  Once we pay off huge deficits we can build more wildlife refuge..:)
Feb 6, 2013 5:25PM
avatar
$5 Billion from the Arctic National Wildlife Refuge over 10 years? That's on the average $500,000 per year which one presumes is all gross , not net. Doesn't really sound like much on then scale of a national economy does it?
Feb 6, 2013 5:25PM
avatar

The State of PA has granted schale gas companies tax wavers for several years. The money lining the political offices out weighs the peoples choices. So how would this benefit the defecit !

Feb 6, 2013 5:24PM
avatar
Dig all the holes you want....but in the end......it's STILL a 'finite' supply.....We need to get off the dime, and start thinking about advancements that can be made in solar & wind.   It amazes me when I see what a lot of the European countries have already accomplished...in the way of THEIR progress in these areas.  
Feb 6, 2013 5:23PM
avatar
thats what you get for hiring a drunk as a night watchman for a brewery
Feb 6, 2013 5:23PM
avatar
Lease it to the oil companies at a rate equivilent to whatever the debt is now and the future . Also include a cap on the prices we pay here at home .
Feb 6, 2013 5:18PM
avatar
Just think, If we burn up everyone elses oil and gas reserves first then we will have the upper hand in the end!
Feb 6, 2013 5:17PM
avatar
We also thought we would never run out of white pine forests , buffalo , etc . Sell the house through the money grabbing oil companies . What the heck , I'm starting to like the pantsuit lady every Sunday , telling us how much we will enjoy energy !
Feb 6, 2013 5:17PM
avatar

The oil companies will make all the profit and the deficit will remain high.

 

  Oil is set on the world market and not by the countries that produce the oil.

Feb 6, 2013 5:15PM
avatar
Why does our government have to lease the land to somebody else to pump out the oil?  Why can't they invest in the infrastructure to pump it out them self and make all the profit?  Then they could use the revenue to pay down the debt.  Federally owned land = your land as americans.  Use "your" land to pay off your bills.
Feb 6, 2013 5:11PM
avatar
the last thing the gov. wants is cheap fuel for the publick, with the stocks being held by our politicians they wouldn't be rich anymore. so they will fight to keep the big oil making 20-100billion a year case closed
Feb 6, 2013 5:08PM
avatar
"Sitting" is a good way to describe it.  I am sure there are many economical, enviromentally-safe ways for us to extract and use this resource.  Too bad it is going to "sit" there year after year while what to do or what not to do gets tied up in court battle after court battle; more millions, if not billions wasted on lawsuit after lawsuit while OPEC continues to tighten the noose around our neck(s). 
Feb 6, 2013 5:04PM
avatar
Drill and drill, but oil and natural gas are still all finite resources. We still must explore other renewable resources of energy too.
Feb 6, 2013 5:00PM
avatar

Younger people in America, sadly, have been fed a load of B.S about the ENTIRE global warming/climate change B.S.! This is really sad. The $ 9 Billion dollar, 20,000 government employee EPA. has had America in a strangle-hold since the 70s. Their first HOAX was "acid rain." Which turned out to be Pine Beetles.killing the  trees in the remote Northeast. But, the EPA had already destroyed our eastern Manufacturing Corridor and millions of jobs, with fines and regulations.

Their next SCAM was the "ozone hole/ozone layer. Our NASA Shuttle Astronauts did some REAL research on this and found it to be a completely NORMAL activity in Earth's atmosphere! What REALLY happened, was that DuPont's patent had run out on R22 refrigerant. So, their lobbyists carried briefcases full of $100 dollar bills to D.C. and got R22 and R12 banned, so DuPont could come up with a replacement. [more expensive] The damned EPA claimed that Freon was destroying our ozone layer! This is only the tip of the iceberg!! Look up what's in our poisonous gasoline!

Feb 6, 2013 4:57PM
avatar
Thats the answer, just rape the earth. Shouldn't of went so far in debt in the first place. Drilling will put underground drinking water in jeapardy.
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

Trending NOW

What’s this?

MARKET UPDATE

[BRIEFING.COM] The Nasdaq Composite (+0.5%) and S&P 500 (+0.2%) posted modest gains on Thursday, but not before enduring a morning dip into the red, which took place in reaction to reports indicating Russia has commenced military exercises on the Ukrainian border.

The news from Europe knocked the key indices from their early highs, while giving a boost to safe-haven assets like gold futures (+0.5% to $1290.80/ozt), Treasuries (10-yr yield -1 bps to 2.69%), and the Japanese yen (102.30 ... More

MSN MONEY'S