The Highlights

• Second federal oil & gas lease sale in Nevada this year. 

• All parcels were sold at just $10 per acre, the legal minimum bid required at auction. 

• In total, 10,211 acres of public land were offered and leased, all at below market royalty rates.

On June 23, the federal government offered 4 parcels of public land in Nevada, each covering about 2,500 acres, for oil and gas development. All parcels were leased for just $10 per acre.

Nevada is not a major federal oil and gas producer — but that has not stopped thousands of acres from being offered at auction, with the little that is actually leased often selling at rock bottom prices. The most recent auction in Nevada, held this March, leased 20,000 acres at the legal minimum of $10 per acre. The auction before that attracted no bids on the 7,000 acres offered. Today's sale results follow a similar trend.

Results from today's lease sale: 

Continuing to lease areas with low development potential ties up public lands while delivering little return to taxpayers. Federal lease sales in Nevada have never been competitive. Over the last decade, auctions in the state generated an average bid of $4.72 per acre — far below the nationwide average of $500 per acre. Despite this, the federal government offered 2.7 million acres of public land at public auctions between 2016 and 2025, the second most in the country behind Wyoming. Less than 10% of what was offered actually sold. And of the more than half a million acres currently leased for oil and gas development in the state, only 5.7 percent are actually producing.

Leasing and production decisions are driven by development potential and market conditions, both of which depend heavily on the specific parcels offered. The three most recent auctions in Nevada, including today’s sale, offering leases with a 12.5% royalty rate received an average bid of $10 per acre. The four auctions that offered leases with a 16.67% royalty rate received an average bid of $10.24 per acre.

The same trend is true nationwide; average bids were actually higher in 2023 and 2024 under a 16.67% royalty rate ($2,149 and $1,085 per acre, respectively) than they had been in the previous decade under a lower 12.5% royalty rate ($288 per acre from 2013 to 2022).

While the lower royalty rate does not make leases more competitive, it does reduce future royalty revenue. The Bureau of Land Management estimates that only one well will be drilled and enter production over the next 10 years. Based on past production data and the White House budget office’s 2026 price projections—used to estimate federal royalty revenue from onshore leases—that well could produce $1.5 million worth of oil and gas. At the 12.5% rate, taxpayers would receive about $189,000 in royalty revenue, roughly $63,000 less than we would under a 16.67% rate.

Federal oil and gas belong to the American people, and leasing terms should ensure taxpayers receive a fair return from the development of our valuable resources. Offering and leasing public land that is unlikely to ever produce oil and gas is a waste of our tax dollars and our public lands.