Oil and gas companies must pay more to drill on federal lands under new Biden administration rule

By MATTHEW DALY
Associated Press

WASHINGTON (AP) — Oil and gas companies will have to pay more to drill on federal lands and satisfy stronger requirements to clean up old or abandoned wells under a final rule from the Biden administration. The Interior Department rule finalized Friday raises royalty rates for oil drilling by more than one-third, to 16.67%, in accordance with the sweeping 2022 climate law approved by Congress. The previous rate of 12.5% paid by oil and gas companies for federal drilling rights had remained unchanged for a century. The federal rate was significantly lower than what many states and private landowners charge for drilling leases on state or private lands.