For Immediate Release: August 12, 2004
Contact: Beverly Derringer 303-239-3765
Steven Hall 970-244-3052
Vaughn Whatley 303-239-3766

August 12, 2004 O&G Lease Sale Fact Sheet
The August 12, 2004, lease auction involves 132 parcels covering 159,453 acres.

Of the 132 parcels being offered for oil and gas leasing, 91 parcels (120,688 acres) contain special wildlife protection stipulations. Also, all leases contain a stipulation for the protection of threatened and endangered species habitat.

BLM policy allows managers to consider wilderness values as one component of multiple-use land management. Stipulations may be added to leases to protect other resources. For example, No Surface Occupancy stipulations can protect against any surface disturbance. Other stipulations can protect viewsheds, water quality, cultural resources, or may require operations only during certain seasons to protect wildlife or wildlife habitat in winter or during breeding season or birthing times.

Federal and State protections are in place to minimize potential impacts from oil and gas exploration, development and production. Oil and gas development is one of the most regulated activities on public lands.

Our goal is sustainable energy development. We aim to meet the resource needs of the current generation, without compromising the future generation’s ability to meet their resource needs. The U.S. Department of the Interior is a significant contributor to America’s energy supplies. About one-third of all energy produced in America originates from lands managed by the Department of the Interior.

Energy development and protection of natural resources are not mutually exclusive on public lands. BLM ensures that development of energy resources is done in an environmentally sound manner on all lands we manage.

BLM consults with other Federal, State and Local agencies, partners, environmental groups and industry throughout the land use planning process on lands available for energy production. These collaborations result in measures to protect all uses and resource values, such as wildlife, threatened and endangered species’ habitats, recreation, grazing, etc., while still allowing for environmentally sound oil and gas development.

The land use plans for all the areas where parcels were offered for lease, allowed for oil and gas leasing. When preparing land use plans, revisions, or when parcels are nominated for leasing, the BLM considers available new information, such as wilderness surveys conducted by environmental groups, to determine if any significant new circumstances or impacts have occurred since the completion of the most recent land use plan. All parcels offered for lease in this sale were analyzed on a case-by-case basis to determine whether existing environmental analysis was adequate.

BLM manages more than 8 million acres of public lands for multiple-use in Colorado. This often includes energy development. BLM also acts as the mineral leasing agent for other Federal agencies with lands throughout the State. For all the federally managed lands in Colorado, about 1.6 million acres of land contain 2,265 producing leases, while more than 3 million acres hold 3,105 non-producing leases. Therefore, a total of 4.645 million acres of federally managed land in the State is subject to oil and gas development.

Issuing a lease doesn't necessarily result in drilling. The drilling of an exploratory well doesn't guarantee there will be widespread development of wells. Economics, supply versus demand, drive industry to nominate areas for leasing, exploration and mineral resource development.

In Colorado, BLM has five existing Wilderness Areas, comprising 147,274 acres, and 55 Wilderness Study Areas, encompassing 623,021 acres.

None of the parcels involved in the August sale are within congressionally designated Wilderness Areas or BLM identified Wilderness Study Areas. BLM’s authority to identify Wilderness Study Areas expired in 1993. Wilderness Areas can only be designated by Congress.

A coalition of environmental groups has proposed areas for wilderness status. Over time, their proposals have added additional areas for consideration, or, in some cases, added additional lands around existing wilderness or wilderness study areas.

Nineteen parcels in the August sale contain acreage within 5 of the 61 areas identified by the environmental community for wilderness designation (9,252 acres). A number of these areas already have been leased and developed. These include lands within the Dolores River Canyon, Sagebrush Pillows, and areas around Maverick, Palisade and Unaweep, and some Forest Service acres. For example, Dolores River Canyon currently has existing roads, a number of plugged and abandoned gas wells, as well as existing mineral leases.

Nearly 26,000 acres of land proposed for leasing by the oil and gas industry did not make it into the August oil and gas lease sale for a variety of reasons. For instance:

• BLM has deferred offering leases for three nominated parcels in the Gunnison Gorge National Conservation Area (4,515 acres) pending the signing of the Land Use Plan Decision, which is anticipated to be completed in 2004.
• Fourteen parcels (17,494 acres) located in South Shale Ridge, and three parcels (2,476 acres) in Hunter Canyon areas were not included in the lease auction pending an updated Environmental Assessment.
• Proposed leases in the Roan Plateau have been deferred pending the completion of the Draft Resource Management Plan (RMP)/Environmental Impact Statement (EIS).
• Additionally, BLM has deferred the offering of parcels near the Dinosaur National Monument Headquarters Office pending further consultation with the National Park Service.

The Federal Onshore Oil and Gas Leasing Reform Act of 1987 require BLM to offer lands for lease on a quarterly basis.

BLM is mandated, by the Federal Lands Policy and Management Act, to manage the public lands for multiple uses -- which may include energy development -- under existing, approved land use plans developed with considerable public input, and extensive environmental analysis.

When parcels of land are leased for oil and gas development, one-half of the money received for the leasing rights and rental fees, as well as one-half of the royalties, are given back to the State, which sends a percentage of the funds to the counties.

Any U.S. citizen, 18 years-old or older, may bid on the parcels offered at the quarterly lease auctions, provided the individual is a registered bidder. Typically, BLM does not select lands to offer for lease. In Colorado, lands nominated by an interested party are made available for leasing, if oil and gas development is allowed by the approved land use plan. In years past, all land available for lease was offered at auction regardless of the interest from industry.

Lease sales can be protested. The sale notice is posted in the BLM’s public room 45 days before the sale date. Anyone can file a protest up to the start of the sale. Protests of a parcel(s) in a sale must be made before the auction begins; once the sale has started BLM will not accept additional protests. The parcels can still be offered with the bidders being notified that no lease will be issued until the protests are resolved.

When a protest is made, the standard process is for it to be reviewed by the appropriate BLM Field Office and/or Colorado State Office. BLM Colorado attempts to resolve all protests within 60 days and no longer than 120 days; however, some protests have taken as long as a year to resolve. Only after the protests are reviewed and resolved can a lease be issued (provided a decision is made to dismiss the protests). If a protest is denied, the protesting party has 30 days, from receipt of the decision, to appeal to the Interior Board of Lands Appeals in Washington, D.C.

Information about the oil and gas lease sales, as well as the posting of the final results (available August 20, 2004) can be obtained in the BLM State Office Public Room or on-line at www.co.blm.gov/oilandgas/leasinfo.htm

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