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Mineral and Energy Board Opens Discussions on Natural Resources Trust Authority

Gov. Landry’s DRIVE Initiative to reform Louisiana’s management of natural resources

BATON ROUGE – The Louisiana Department of Energy and Natural Resources (DENR) announced that the State Mineral and Energy Board has begun establishing the Natural Resources Trust Authority (NRTA) under its oversight. The NRTA is designed to bring targeted financial expertise to the State’s interaction with oil and gas operators, particularly in using state-backed financial assurances to address orphaned wells.   

“We are ushering in a new era for Louisiana's natural resources management,” said Secretary Tyler Gray. “At the heart of this transformation is the NRTA, a statutory body created to enhance the financial sustainability of responsible oil and gas operations across the state.”

The NRTA is a key component of Governor Jeff Landry's Departmental Review for Innovation & Visionary Enhancement (DRIVE) Initiative, launched through Executive Order JML-24-13. During the recent legislative session, the Administration, in collaboration with lawmakers, passed House Bill No. 810 by Rep. Bret Geymann, now Act No. 727. This Act lays the foundation for the first major reorganization of DENR since 1976, including the creation of the NRTA under the State Mineral and Energy Board's oversight.

“As envisioned, the NRTA will be instrumental in addressing challenges within Louisiana's oil and gas industry,” Gray added. “By expanding the authority of an existing board, the State can change its approach ensuring that financial obligations for plugging and abandonment in existing and new oil and gas developments are met.”

Commissioner of Conservation, Ben Bienvenu also emphasized the importance of the NRTA: "The establishment of the Natural Resources Trust Authority marks a transformative moment for Louisiana's stewardship of its natural resources. This initiative allows the Office of Conservation to work in tandem with DENR, providing a framework that encourages operators to re-engage idle wells, knowing that protections are in place to support the integrity of their operations. This approach balances economic growth with environmental responsibility and is an important step in improving certainty for oil and gas operators."

The NRTA will oversee state-backed financial assurances by collateralizing existing funding streams, which will reduce costs across the entire value chain. This state-backed financial instrument offers oil and gas operators a lower-cost option to meet financial security requirements under Conservation’s regulations, while also ensuring the availability of funds needed to close any sites the State is obligated to remediate. If operators fail to plug their wells, the Office of Conservation can declare them "orphaned," requiring the state to cover the costs using the Oilfield Site Restoration Fund. With this new tool, Conservation can confidently ensure the financial resources are in place to remediate sites, thereby improving enforcement outcomes.

“Louisiana introduced financial security requirements in the early 2000s, but it wasn’t until about 10 years ago that a significant portion of operators were required to comply,” Gray said. “The NRTA will help ensure that new developments are supported by a comprehensive financial plan, thereby managing and ideally reducing the number of orphaned wells by viewing them as assets.”  

The State Mineral and Energy Board is the appropriate body to manage the NRTA due to its longstanding role as the agent for the State’s mineral rights. NRTA’s establishment is the first step in guaranteeing that oil and gas developments in Louisiana proceed with the assurance that both operators and the State will meet their obligations promoting responsible development and long-term sustainability.

Additionally, the State Mineral and Energy Board welcomed the appointment of Richard Nelson as Secretary of the Louisiana Department of Revenue. 

“Secretary Nelson will play a key role in our tax reform efforts, and his appointment highlights our commitment to collaboration across agency boundaries,” Gray said. “By establishing the NRTA, we are creating a long-term source of revenue from interest that can be allocated to meet additional state needs.”

Andrew Young, Assistant Secretary for DENR’s Office of Mineral Resources, noted the significance of the NRTA for Louisiana's future.

“This initiative ensures that we can continue to harness the economic benefits of oil and gas production while protecting the environment,” Young said. “By creating a robust financial mechanism to address the long-term impacts of energy development, we are securing the future of our state's natural resources.” Young also added that the NRTA will allow DENR to promote sustainable planning and decommissioning practices for alternative energy developments. “The NRTA gives us more flexibility as we create regulations for financial assurance and decommissioning of non-traditional energy infrastructure.?That flexibility will allow the Department to ensure prompt and effective oversight in line with the evolving needs of these industry.”

“The launch of the Natural Resources Trust Authority represents a bold and innovative approach to managing Louisiana's energy future,” Gray concluded. “This initiative strengthens our regulation of the oil and gas industry while ensuring that we proactively address the environmental responsibilities that come with energy development. By aligning economic growth with sustainability, we are laying the groundwork for a more resilient and prosperous Louisiana.”  

Contact: Patrick Courreges 225-342-0510

Synopsis of NRTA here.

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