On June 9, the federal government leased 114,439 acres of public land in Wyoming for oil and gas development at the recently reduced federal royalty rate of 12.5%. The result is an estimated $50.4 million in lost royalty revenue assuming that these leases have a conservative 10-year productive lifespan.

This sale adds to mounting losses. TCS estimates that taxpayers have already lost more than $1.2 billion in projected royalty revenue from leases sold since July 4, 2025, when the FY2025 reconciliation law reduced the federal onshore royalty rate to 12.5%, below what states and private landowners typically charge. In Wyoming alone, taxpayers have lost $83 million in projected royalty from leases sales at the reduced rate.

Today’s sale offered 108 parcels totaling 119,595 acres of public land in Wyoming. Sixty-two percent of the offered acreage was located in Natrona and Carbon counties, which combined accounted for 11% of federal oil production and less than 5% of federal gas production in the state over the last decade.

Wyoming has been the second largest producer of federal oil and the largest producer of federal gas over the last decade. Lease sales in the state have consistently been competitive regardless of the royalty rate, and oil and gas development generates significant revenue for federal and state taxpayers.

Results from today’s lease sale:

Leasing decisions are driven by development potential and market conditions. Competitiveness in today’s sale varied widely. Nineteen parcels, totaling over 20,000 acres sold for the legal minimum bid of $10 per acre. The highest bid, $8,101 per acre, was received for a parcel in Converse County, the largest producer of federal oil and gas in the state. Parcels in Converse County sold for an average of $3,234 per acre, while parcels in Campbell County, the state’s second largest producer of federal oil, sold for an average of $1,635 per acre. Operators lease where there is development potential—a factor that is heavily dependent on the specific parcels offered in a sale.

Competitive, market-based royalty terms do not deter industry interest or production decisions. The sale’s average bid of $297 per acre is on par with historical leasing trends in the state, both under the previous 12.5% royalty rate and the more recent 16.67% royalty rate.

The lower royalty rate did not make these leases more competitive. It simply reduced future royalty revenue. In Wyoming alone, taxpayers lost an estimated $3.6 billion in revenue from FY2013 to FY2022 under the 12.5% rate. With record high production across the U.S., losses could continue to grow larger. Because revenue is shared between the federal treasury and states, Wyoming taxpayers will also lose funding for schools, infrastructure, and other local priorities.

The Bureau of Land Management estimates that the parcels sold today could yield 7.1 million barrels of oil and 184 billion cubic feet of natural gas over a conservative 10-year lifespan. Based on the White House budget office’s 2026 price projections, which are used to estimate federal royalty revenue from onshore leases, that production could be worth roughly $1.2 billion. At the 12.5% royalty rate, taxpayers would receive about $151 million in royalty revenue, roughly $50.4 million less than they would under a 16.67% rate.

Oil and gas developed on federal lands belongs to the American people, and leasing terms should ensure taxpayers receive a fair return from the development of these valuable resources.