Interior Proposes Updates to Commingling Rules to Boost Energy Production and Efficiency

WASHINGTON — The Department of the Interior is proposing critical updates to Bureau of Land Management oil and gas regulations that would make it easier for operators to combine production from multiple leases—a practice known as commingling. This will implement the One Big Beautiful Bill’s directive to the Secretary of the Interior to approve onshore commingling applications. This approach allows oil and gas to be produced from different leases, often under different ownership, using the same well pad, which reduces environmental impacts, lowers operating costs and increases overall efficiency. 

Current Bureau of Land Management regulations restrict commingling to leases that have identical mineral ownership, royalty rates and revenue distribution. These requirements create unnecessary barriers in many areas of the West where mineral ownership is complex and varied. The proposed changes would allow commingling even when these conditions differ, unlocking energy potential that is currently tied up in regulatory red tape.  

“This is about common sense and catching up with today’s technology,” said Secretary of the Interior Doug Burgum. “The current rules were written for a different era. These updates will help us manage public resources more efficiently, support responsible energy production, and make sure taxpayers and tribes get every dollar they’re owed.” 

Thanks to major advancements in metering and measurement technologies, operators can now accurately track production and allocate royalties even at the individual wellhead. These technologies meet the precision standards required by the Bureau of Land Management and ensure that all mineral owners receive their fair share. By incorporating these advances into its regulations, the agency will better reflect modern industry practices while maintaining its commitment to transparency and accountability. 

If finalized, the updated rules could result in as much as $1.8 billion in industry savings annually. Those savings would give operators the ability to reinvest in new energy production, helping drive domestic energy development while reducing the need for duplicative infrastructure. This rule would also allow for greater flexibility in how production is combined and measured, which will not only increase efficiency but also reduce surface disturbance, benefiting both industry and the environment.

This proposed rule change supports recent directives from the Trump administration and the Department to reduce regulatory burdens, promote energy development, and modernize outdated policies. The Bureau of Land Management intends to move quickly to update the relevant regulations under 43 CFR Subpart 3173, with a formal rulemaking process to follow, including opportunities for public comment.  

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