BLM proposes changes to federal oil-and-gas leasing and “lost gas” royalties—comments due Aug. 24, 2026

On June 22, 2026, the U.S. Department of the Interior announced two coordinated proposed rulemakings in the Federal Register that would change how the Bureau of Land Management (BLM) runs federal and Indian onshore oil and gas leasing and how certain gas losses are treated for royalty purposes under a lost-gas / waste-prevention framework. The proposals were published June 24, 2026, and the public comment deadline for both is August 24, 2026.

What’s in the package (and what’s not yet decided)

These actions are not final rules. They are written to guide future BLM decisions after it reviews public comments and publishes final Federal Register text. The near-term, confirmed action for interested stakeholders—operators, landholders, service providers, and public-interest commenters—is submitting comments before August 24, 2026.

Rule 1: Proposed changes to BLM onshore oil & gas leasing

The Federal Register proposal for leasing would revise multiple parts of the leasing process, including financial assurance and timing/public-participation steps. Among the changes described in the Federal Register text:

• Bonding: BLM proposes to restore minimum bond amounts to earlier levels, returning to $10,000 for lease/individual bonds and $25,000 for statewide bonds (while also discussing whether nationwide bonds could be reinstated and at what minimum level).
• Public participation timing: BLM proposes to remove certain NEPA-related scoping and comment periods from the leasing rule, and it also proposes shorter protest timing—reducing a protest period from 30 calendar days to 10 calendar days.
• Process timing and posting: the proposal would adjust posting timeframes for notices tied to competitive lease sales (described as 60 calendar days to 45 calendar days in the rule text).
• Lease activity siting/timing values: BLM proposes to return siting-distance and surface-disturbance timing limitations to earlier values (described in the Federal Register as moving back from 800 meters and 90 days to 200 meters and 60 days).

Rule 2: “Lost gas” royalties and waste-prevention framework

The second Federal Register proposal focuses on what happens when gas is lost—such as venting, flaring, leaks, or other circumstances—and whether those losses trigger royalty obligations. The Federal Register text describes changes aimed at streamlining compliance and clarifying standards tied to avoidable versus unavoidable losses. Key elements described include:

• Less administrative burden for some permit-to-drill filings: BLM proposes removing requirements that would have required either a waste minimization plan or a form of self-certification for certain oil-well drilling applications.
• A framework built around avoidable vs. unavoidable losses: the proposal defines when lost oil or lost gas is treated as royalty-free (unavoidable) versus royalty due (avoidable), tying those determinations to operator actions and compliance.
• Venting/flaring handling and limits: BLM proposes adjusting how limitations apply in some unavoidable-loss contexts. For example, the Federal Register text discusses moving emergency-related allowable royalty-free flaring timeframes from a 24-hour limit to a 48-hour limit, with further extension possibilities in emergency situations.
• Measurement standards: the proposal describes measurement requirements for gas used in flaring/venting contexts, including how measurements can be taken at defined equipment points and how operators must meet those measurement requirements.

Why this matters for readers (practical effects and what to watch next)

For people and businesses affected by federal and Indian onshore development, the proposals set up how future compliance work could look—especially around bonding, process timing, and the standards used to determine whether royalties apply when gas is lost.

For the broader public, the practical point is this: until the rules are finalized, the most concrete “next step” is the comment period ending August 24, 2026. After that, BLM will review submissions and publish the final rule language, including any effective-date and implementation details.

Sources

• U.S. Department of the Interior (DOI) press release (June 22, 2026): Interior advances revisions to oil and gas leasing and waste prevention rules
• Federal Register (June 24, 2026): Oil and Gas Leasing (proposed rule 2026-12734)
• BLM background explainer: Waste Prevention, Production Subject to Royalties, and Resource Conservation (framework overview)