Nonproducing lease definition needed, DOI's Salazar told

US House Interior Appropriations Subcommittee leaders asked Secretary of the Interior Ken Salazar a basic question when he presented his department's fiscal 2010 budget request on May 13: How does Interior define a nonproducing lease? Salazar couldn't supply an answer, but promised to develop one soon and consult with subcommittee members about it. He's already under pressure because the Obama administration's proposed federal budget includes $122 million of annual revenue from fees on nonproducing leases starting Oct 1. Salazar doesn't question the idea behind the assessment. "I've practiced water law in the West. States' water laws have a similar use-it-or-lose-it feature. Oil and gas are similarly precious commodities," he told the subcommittee. But Salazar also couldn't answer the question when Rep. Michael K. Simpson (R-Ida.), the subcommittee's ranking minority member, asked what DOI considers a nonproducing lease eligible for collection of the proposed $4/acre fee. "I think this is important, particularly if someone could be penalized for bureaucratic or legal delays which aren't his fault," Simpson said. Officials from one of DOI's major agencies, the US Bureau of Land Management, told the subcommittee last year that it can take up to 4 years for a federal oil and gas lessee to simply get a drilling permit, he added...PennEnergy