Federal oil-and-gas leasing returns about $333 per leased acre in royalties, but $591 per producing acre and up to 4,900x more in New Mexico than West Virginia

Summary

In FY2024, federal onshore oil-and-gas leasing returned about $333 in royalty revenue per leased acre nationwide ($7.34 billion in royalties / 22.05 million acres under lease), or about $591 per acre that was actually producing ($7.34 billion / 12.42 million producing acres — only 56% of leased acreage produces at all). But that average hides enormous variation: New Mexico's Permian Basin leases returned roughly $1,462 per producing acre, while low-volume Appalachian and interior states such as West Virginia, Kentucky, and Pennsylvania returned only a few cents to a few dollars per producing acre — a spread of roughly 4,900-to-1 between the highest- and lowest-yielding states with meaningful acreage. New Mexico alone, with 17% of producing federal acreage, generated 76% of all federal onshore oil-and-gas royalty revenue.

Data and method

Royalty revenue comes from the askamerica warehouse table lands.onrr_revenues (source: ONRR/revenuedata.onrr.gov), filtered to land_class='Federal', mineral_lease_type='Oil & Gas', revenue_type='Royalties', fiscal year 2024. This isolates the actual per-barrel/per-mcf royalty payments companies make to the government for produced oil and gas — separate from one-time lease bonus bids and annual rental payments, which are a different kind of federal revenue (rent for holding a lease, not a return on production).

Acreage is not carried in this warehouse (confirmed via search_catalog and describe_table — no BLM leased-acreage table exists in the askengine corpus), so it was sourced directly from BLM's own primary data: the FY2025 release of 'Tables 1-10 National Totals by State' (bureau.gov/oil-and-gas-statistics), which is BLM's official Public Land Statistics series. Table 2 ('Acreage in Effect') gives total acres under lease at fiscal year end; Table 6 ('Producing Acres') gives the subset of leased acreage that is actually in production. Both were read directly from BLM's own XLSX workbook for FY2024 by state.

Sanity check against independent published totals: summing the state-level BLM acreage figures gives 22,051,882 total leased acres and 12,420,221 total producing acres for FY2024 — both match BLM's own independently reported national totals ('about 22 million Federal acres were under lease... about 12.4 million acres are producing') almost exactly. The $7.34 billion royalty total from ONRR is consistent with (a bit under) the CRS-reported ~$7.6 billion in total federal onshore oil-and-gas revenue for FY2024, which is expected since that CRS figure also includes bonus bids and rents, not royalties alone. Both cross-checks passed, which validates combining these two independently sourced series.

State-by-state variation

The variation is driven almost entirely by geology and well productivity, not policy: the Permian Basin (New Mexico, and to a lesser extent Texas) and offshore-adjacent Gulf Coast fields (Louisiana) produce far more oil and gas per acre than the thin, marginal Appalachian gas wells common in West Virginia, Pennsylvania, and Kentucky, or Wyoming's large but lower-intensity Powder River/Green River basin gas acreage. Wyoming, despite having the single largest producing acreage of any state (3.83M acres, essentially tied with New Mexico), earns only about one-seventh the per-acre royalty of New Mexico, because much of its leased land is lower-value natural gas rather than Permian-grade oil.

Why 'per leased acre' understates the concentration

Averaging royalty revenue over all 22 million leased acres ($333/acre) is the more common way this statistic gets reported, but it mixes in the roughly 44% of leased acreage (about 9.6 million acres) that is not currently producing at all — held by companies for future development, tied up in permitting, or simply uneconomic. The producing-acre figure ($591/acre) is the more meaningful 'return on acreage that is actually working' measure, and even that average is not representative of any typical acre: the distribution is extremely right-skewed, with a small number of Permian Basin counties in New Mexico generating the bulk of total federal royalty revenue from a modest share of total federal producing acreage.

Every query behind this report

1 warehouse call ran in this session, in order. Each is reproducible against the same snapshot.

SELECT fiscal_year, state_name, SUM(revenue) AS royalty_revenue
FROM lands.onrr_revenues
WHERE mineral_lease_type = 'Oil & Gas' AND revenue_type = 'Royalties' AND land_class = 'Federal' AND fiscal_year >= 2020
GROUP BY fiscal_year, state_name
ORDER BY fiscal_year DESC, royalty_revenue DESC
LIMIT 60