Site search
sponsored by
News
ENLARGE
The Bureau of Land Management held an oil and gas lease sale for 54,631 acres on the Roan Plateau on Thursday. Thirty-one parcels were sold, raising about $114 million.
GOLDEN, Colorado — Reaction from state leaders, the oil and gas industry and environmentalists over the Roan Plateau lease sale Thursday was swift and strong.
Right after the sale was finished, they began issuing statements about it, with many of them full of withering criticism for the Bureau of Land Management, Colo. Gov. Bill Ritter, the oil and gas industry and state environmental organizations. Just about everyone involved in the debate over oil and gas development in the area got whacked.
Thursday’s sale of 31 federal mineral parcels, which encompass about 54,631 acres in the Roan Plateau Planning Area, brought in about $114 million. About half of that money will be returned to Colorado.
The BLM sold all parcels in the area at once, an action that Ritter, a Democrat, U.S. Ken Salazar, D-Colo., Rep. John Salazar, D-Manassas, and Rep. Mark Udall, D-Eldorado Springs, have all criticized.
The three congressional Democrats introduced legislation earlier this year that would have called for phased leasing of the area, a process they believed would have brought the state more money. Phased leasing means auctioning a set of leases one after another over time.
Ritter said the BLM’s decision to lease the entire top of the Roan Plateau all at once “has severely shortchanged Colorado citizens.”
“The federal government has done a tremendous disservice to our state and to every Western Slope community impacted by drilling,” he said.
But Meg Collins, president of the Colorado Oil and Gas Association, said “thanks to the actions” taken by Ritter, the Salazars, Udall and out-of-state environmental organizations in the months before Thursday’s lease sale, “the great state of Colorado was robbed today.”
“Today’s $114 million sale illustrates key losses for Colorado and its citizens,” she said.
Collins said residents should compare the average acreage price in Thursday’s sale, which she said was $2,087, to Marathon Oil Co.’s May 2007 purchase of 8,700 acres for nearly $354 million or about $40,690 per acre. It wasn’t exactly clear from Collins’ statement late Thursday where that acreage is located.
“If industry believed it could produce the full volume of natural gas present beneath the Roan anytime soon, values much closer to the market comparables would have been obtained,” Collins said. “Today’s lease sale garnered national attention, and its outcome sends a clear message that Governor Ritter’s attempts to slow down the production of domestically produced, clean-burning natural gas are working.
Pete Morton, senior resource economist for the Wilderness Society, said Collins’ statements are just “more exaggerations trying to cover up (industry’s) past exaggerations.” He said that when lobbyists for the oil and natural gas industry estimated that $2 billion dollars could be generated from the sale, “they knew full well of the stipulations included in the Roan plan for protecting wildlife, water and the environment.”
“And yet they still insisted the sale would bring in $2 billion,” Morton said. “So it is very disingenuous of industry lobbyists to now say that the stipulations were the reason the bids were so low.”
Morton said one reason for the low bids could be the supply glut of domestic natural gas that “may be on the horizon.”
“With our domestic proven natural gas reserves at a 30-year high and with increasing competition from gas plays around the nation, it is not surprising that bid prices were lower than expected,” he said.
Colorado’s two United States senators also weighed in on the lease sale.
U.S. Sen. Wayne Allard, R-Colo., in a statement, said, “Development of the oil and gas resources on the Roan Plateau will do more to lower fuel prices than this drill-nothing-Democrat-Congress has done all year.”
Allard’s statement was a sharp rebuke to Salazar, who has disagreed with Allard on several energy-related matters this year, including development of the Roan Plateau and about whether to finalize commercial oil shale leasing regulations this year.
“While I am pleased that the lease sale took place, I am disappointed that it didn’t generate more money for Colorado,” Allard said. “The efforts of anti-energy politicians took their toll in the form of lower bids than we expected and cost Coloradans millions of dollars by pandering to the extreme environmentalists.”
Salazar, in his statement, said the Roan lease sale showed that the Bush administration and the “BLM turned their backs yet again on Western Slope communities.”
“The BLM’s decision to cover its eyes and ears and rush ahead with today’s auction not only puts our land and water and wildlife at risk, it has shortchanged the American taxpayer,” Salazar said. “Someone got a bargain in today’s sell-off, and it wasn’t the American people.”
Right after the sale was finished, they began issuing statements about it, with many of them full of withering criticism for the Bureau of Land Management, Colo. Gov. Bill Ritter, the oil and gas industry and state environmental organizations. Just about everyone involved in the debate over oil and gas development in the area got whacked.
Thursday’s sale of 31 federal mineral parcels, which encompass about 54,631 acres in the Roan Plateau Planning Area, brought in about $114 million. About half of that money will be returned to Colorado.
The BLM sold all parcels in the area at once, an action that Ritter, a Democrat, U.S. Ken Salazar, D-Colo., Rep. John Salazar, D-Manassas, and Rep. Mark Udall, D-Eldorado Springs, have all criticized.
The three congressional Democrats introduced legislation earlier this year that would have called for phased leasing of the area, a process they believed would have brought the state more money. Phased leasing means auctioning a set of leases one after another over time.
Ritter said the BLM’s decision to lease the entire top of the Roan Plateau all at once “has severely shortchanged Colorado citizens.”
“The federal government has done a tremendous disservice to our state and to every Western Slope community impacted by drilling,” he said.
But Meg Collins, president of the Colorado Oil and Gas Association, said “thanks to the actions” taken by Ritter, the Salazars, Udall and out-of-state environmental organizations in the months before Thursday’s lease sale, “the great state of Colorado was robbed today.”
“Today’s $114 million sale illustrates key losses for Colorado and its citizens,” she said.
Collins said residents should compare the average acreage price in Thursday’s sale, which she said was $2,087, to Marathon Oil Co.’s May 2007 purchase of 8,700 acres for nearly $354 million or about $40,690 per acre. It wasn’t exactly clear from Collins’ statement late Thursday where that acreage is located.
“If industry believed it could produce the full volume of natural gas present beneath the Roan anytime soon, values much closer to the market comparables would have been obtained,” Collins said. “Today’s lease sale garnered national attention, and its outcome sends a clear message that Governor Ritter’s attempts to slow down the production of domestically produced, clean-burning natural gas are working.
Pete Morton, senior resource economist for the Wilderness Society, said Collins’ statements are just “more exaggerations trying to cover up (industry’s) past exaggerations.” He said that when lobbyists for the oil and natural gas industry estimated that $2 billion dollars could be generated from the sale, “they knew full well of the stipulations included in the Roan plan for protecting wildlife, water and the environment.”
“And yet they still insisted the sale would bring in $2 billion,” Morton said. “So it is very disingenuous of industry lobbyists to now say that the stipulations were the reason the bids were so low.”
Morton said one reason for the low bids could be the supply glut of domestic natural gas that “may be on the horizon.”
“With our domestic proven natural gas reserves at a 30-year high and with increasing competition from gas plays around the nation, it is not surprising that bid prices were lower than expected,” he said.
Colorado’s two United States senators also weighed in on the lease sale.
U.S. Sen. Wayne Allard, R-Colo., in a statement, said, “Development of the oil and gas resources on the Roan Plateau will do more to lower fuel prices than this drill-nothing-Democrat-Congress has done all year.”
Allard’s statement was a sharp rebuke to Salazar, who has disagreed with Allard on several energy-related matters this year, including development of the Roan Plateau and about whether to finalize commercial oil shale leasing regulations this year.
“While I am pleased that the lease sale took place, I am disappointed that it didn’t generate more money for Colorado,” Allard said. “The efforts of anti-energy politicians took their toll in the form of lower bids than we expected and cost Coloradans millions of dollars by pandering to the extreme environmentalists.”
Salazar, in his statement, said the Roan lease sale showed that the Bush administration and the “BLM turned their backs yet again on Western Slope communities.”
“The BLM’s decision to cover its eyes and ears and rush ahead with today’s auction not only puts our land and water and wildlife at risk, it has shortchanged the American taxpayer,” Salazar said. “Someone got a bargain in today’s sell-off, and it wasn’t the American people.”
Roan Plateau timeline
1910s — A series of executive orders sets aside government-owned petroleum and oil shale reserves, including Naval Oil Shale Reserves (NOSR) No. 1 and 3 on and below the Roan Plateau.
1977 — Naval Oil Shale Reserves are transferred to the Department of Energy (DOE). In the following years the DOE develops 24 natural gas wells below the Roan Plateau in NOSR 3. All proceeds go to the national treasury. January 1984 — The Bureau of Land Management Glenwood Springs Field Office completes its Resource Management Plan. Under this plan, 17,364 acres of Bureau of Land Management (BLM) lands that will later be included in the Roan Plateau Planning Area are available for oil and gas leasing. November 1997 — The 56,238 acres of NOSRs 1 and 3 are transferred to the U.S. Department of the Interior through the National Defense Authorization Act. The “transfer act” states that the Secretary of the Interior shall enter into leases with one or more private entities for the purpose of petroleum exploration, development and production as soon as “practicable.” It also requires that the 12,029-acre area primarily below the rim already containing wells be leased within one year. March 1999 — The BLM signs a Record of Decision making the 12,029-acre production area available for oil and gas leasing. November 2000 — The BLM begins public scoping on the Roan Plateau Resource Management Plan Amendment. The planning area covered in the amendment includes the 56,238 acres of NOSRs 1 and 3 transferred in 1997, as well as 17,364 acres of lands previously managed by BLM. A public scoping meeting is held in Rifle. October 2002 — A 30-day public comment period on six “preliminary alternatives” is held to fully address public issues and concerns through the range of alternatives. Public meetings are held in Rifle, Parachute and Glenwood Springs. This was an additional public comment period exceeding the minimum required under the National Environmental Policy Act and BLM planning regulations. November 2004 — The BLM releases the Draft Roan Plateau RMP/EIS for a 90-day public comment period. The draft outlines five alternatives. February 2005 — BLM extends the public comment period an additional 30 days to ensure the public has ample opportunity to comment on the plan. June 2007 — The BLM issues a record of decision for the Roan Plateau, giving the green light for drilling on about 70 percent of the 73,602-acre planning area that is rich in natural gas and prized for its scenery and wildlife. Dec. 20, 2007 — Colorado Gov. Bill Ritter responds to the BLM’s record of decision, which allowed for drilling on top of the plateau. He sought increased protection of sensitive areas, more use of technology to minimize environmental disturbances, and incremental leasing of federal lands — a policy he said would better protect the environment, increase state revenues and pace future development. The federal plan for the Roan called for all leasing to come all at once. March 13 — Natural gas lease sales for federal minerals underneath the Roan Plateau were expected to occur in late summer following a second BLM Record of Decision for the Roan Plateau. Colorado Gov. Bill Ritter, Democrats from Colorado’s Congressional delegation and area environmentalists were disappointed in the decision, with some saying the agency flatly rejected the governor’s proposals for drilling in the area. April 17 — U.S. Sen. Ken Salazar, D-Colo., Rep. Mark Udall, D-Eldorado Springs and Rep. John Salazar, D-Manassa, introduce federal legislation that called for “phased leasing” of federal mineral leases on the Roan Plateau and increasing the acreage for areas of critical environmental concern (ACEC), a special area given a higher level of protection, to 39,338 acres. Currently there are 21,034 acres designated as ACECs. The legislation largely follows what the governor proposed for the Roan Plateau. Aug. 14 — The BLM auctions off 31 parcels encompassing 54,631 acres in the Roan Plateau Planning Area, bringing in $113.9 million. About half of that money is expected to be returned to Colorado. |
