Oil and Gas Range Improvement Funds

Story and photos by Floyd Thompson, Montana/Dakotas State Office Range Management Specialist

As public land managers we may think about the impacts of oil and gas exploration and development activity on rangeland resources. Or, we may think about gas prices as one of the expenses to consider when we planning and implementing a range improvement project. However, what we may not realize is the impact that revenues from oil and gas development have on range improvement funding.

One objective of the range program is to promote healthy sustainable rangeland ecosystems as well as restore and improve public rangelands to proper functioning condition. Range improvements are one tool the range program uses to attain this goal. 
Range improvements are authorized physical modifications or treatments designed to enhance or improve livestock grazing management, improve watershed conditions, enrich wildlife habitat, or serve similar purposes. Examples include fences, wells, hardened creek crossings, prescribed burns, and weed treatments. 

The BLM authorizes and constructs range improvement projects on public lands to further multiple-use management objectives established in land use plans and activity plans. The BLM, grazing operators, and other persons, organizations, and government entities can individually or collectively fund or contribute labor or materials to the cooperative construction of range improvements. 

BLM funds for many range improvements come from range improvement monies provided for by law. The Taylor Grazing Act directs that 50 percent of grazing fees collected on the public domain be used for range improvements. The Bankhead-Jones Farm Tenant Act directs that 50 percent of grazing revenues collected on lands acquired in the 1930s be used for range improvements. (Acquired lands are known as Land Utilization Project lands or LU lands—the “pink” lands on the surface management maps.)

In addition to grazing fee receipts, range improvement funds generated from LU lands also include funds from rents, rights-of-way fees, materials sales, and oil and gas leases.
Range improvement funds derived from the public domain rise and fall in relation to the grazing fee changes each year. On LU lands, oil and gas revenues make up a significant percentage of the receipts for the range improvement project fund and impact the amount we receive accordingly. Six field offices and the Upper Missouri River Breaks National Monument manage LU lands. 

As oil and gas exploration activity and prices rise and fall, so has the amount of LU-generated range improvement funds we receive each year. As an example, oil and gas revenues contributed 89 percent to the LU range improvement fund in 2008 as compared to 55 percent last year. As the following chart shows, LU range improvement funds are closely correlated with the price of natural gas.

Like many of the multiple use programs BLM manages, there are often many aspects to the impacts programs have on one another. The inter-relationship between the range improvement and oil and gas programs is another interesting case in point.