The U.S. Bureau of Land Management (BLM) has botched oil and gas lease sales and allowed environmental groups to disrupt the process but needs to get back to work, the Western Energy Alliance said in a lawsuit filed Aug. 11 in a U.S. District Court.

Several oil and gas lease sales have been canceled or postponed, including one Aug. 11, due to weather, an unprepared staff or, more frequently, protestors.

The Federal Onshore Oil and Gas Leasing Reform Act of 1987 requires the BLM to hold quarterly oil and natural gas lease sales in each state where land are available and of interest to the industry. In states such as New Mexico, where the Permian Basin is a likely draw for bids, only two auctions have been held in the past seven quarters. A third is scheduled this quarter.

Protest groups such as Keep-It-In-The-Ground have been particularly disruptive at lease sales, prompting canceled sales. Kathleen Sgamma, vice president of government and public affairs at the Alliance, said protestors are attempting to coerce the BLM into canceling auctions.

Sgamma added, however, that the BLM needs little help in derailing lease sales.

“For example, today’s (Aug. 11) lease sale in Colorado was canceled because BLM can’t get through the bureaucratic process in time,” Sgamma said. “Likewise, in New Mexico only two lease sales were held in 2015 and one planned in 2016, despite the requirement to hold four every year. Who needs loud protests when bureaucrats are doing the same thing by simply not doing their job?”

A spokeswoman for the Interior Department, which oversees the BLM, said she is aware of the lawsuit but that the department does not comment on pending litigation.

In March, Neil Kornze, director of the BLM, testified before a congressional subcommittee exploring problems in the management of oil and gas lease sales.

He said that the BLM sometimes receivesno expressions of interest (EOIs) from industry and doesn’t schedule a sale. In the case of protests, a meeting was canceled to ensure the safety of those who attended, he said.

Kornze also noted that the oil and gas industry already has thousands of well permits but only about 38% of the permits are actively drilled. Nevertheless, 7% of the nation’s oil and 11% of its natural gas originate from federal lands.

“In the last year, the BLM approved 4,228 drilling permits, yet industry only drilled 1,620 wells,” Kornze said. “As result of the agency’s robust permitting effort in recent years, there are currently over 7,500 approved drilling permits in industry’s hands that are available for use today with no additional action or review from the Bureau.

“In other words, at current activity levels, industry has more than four years’ worth of drilling permits approved and ready to go.”

In other cases, Kornze said, companies notify the BLM of lands for interest that don’t receive bids at auction.

Since 1988, industry has only acquired 34% of the acreage offered by the BLM, even though much of the acreage offered is based on industry EOIs, Kornze said. As of March, the industry had 32 million acres leased—an area roughly the size of Alabama and “only 12 million of those acres (40%) are producing,” he said.

In fiscal 2015, Kornze said the BLM also made significant progress to reduce the number of pending permits and strategically invested in technology to streamline its review process.

One area where the agency still lags is online lease sales. Far more active private companies routinely offer auctions on the internet, Kornze said. He said the department was actively working on an online leasing system.

BLM manages mineral rights across 700 million acres of public and split-estate lands in the United States.

The Alliance said that BLM misses out on valuable revenue that benefits the federal government, states and taxpayers by not holding oil and natural gas lease sales quarterly. Since January 2015, BLM has received $170 million from lease sales.

BakerHostetler, which is representing the Alliance and successfully overturned the BLM’s hydraulic fracturing rule, said that even when lease sales occur, BLM frequently fails to offer parcels in all states where lands are available. The process is also muddied by the BLM’s lack of openness on how it manages and administers its federal leasing program.

“The failure to hold regular lease sales consistent with the Mineral Leasing Act’s mandate results in unnecessary delays for—and can completely halt—development of certain federal minerals,” explained Alex Obrecht, a Denver-based member of the firm’s national Energy team. “But more important, limiting leasing restricts operators’ ability to plan projects so that waste is reduced and development is executed in the most environmentally sensitive manner.”

Darren Barbee can be reached at dbarbee@hartenergy.com.