New Mexico has higher percent of oil and gas producing federal land than most western states - Albuquerque Journal

New Mexico has higher percent of oil and gas producing federal land than most western states

Millions of acres of public land across the American West, including New Mexico, sold each year to the oil and gas industry for extraction remain undeveloped.

Environmentalists argued unused leases block proper land management and conservation efforts, while the low price land if often sold for could cost taxpayers millions in potential revenue.

A study from the Center for Western Priorities showed about 22 million acres of public lands in western states were leased to the industry.

Leases in Arizona, California, Colorado, Idaho, Montana, Nevada, Oregon, Utah, Wyoming in New Mexico were included in the report.

Since the last major amendment to the Mineral Leasing Act in 1987, the study reported 30 percent of all public lands leased to the oil and gas industry were sold for just $2 per acre – the minimum price when a bid is received – totaling about 3.7 million acres.

And 57.2 percent of all leases since that year, totaling 38.4 million acres, were leased for $2 or less, as leases can be sold for $1.50 an acre if no bids are received.

More than 90 percent of those leases were no longer active, per the report.

“Such low cost leases shortchange taxpayers and incentivize speculation on public lands with little or no potential for oil and gas development,” the report read. “Compared to leases that sold for more than $2 per acre, low cost leases have significantly higher rates of termination.”

Arizona led the West in leases sold for the minimum prices, with 3,040 acres or 70 percent of its 4,201 acres leased to the industry going for $2 per bid, while 1,161 went for the $1.50 no-bid price, records show.

That meant all of Arizona’s federal land leases went for the bottom prices.

Behind Arizona came Oregon, with 98 percent of its land leases going for the bottom rates, followed by Nevada with 84 percent.

New Mexico had by far the lowest percent of land sold for the low prices at 3 percent, but also had the fourth-highest total acreage sold at about 1.1 million acres leased to the oil and gas industry since 1987.

Just 24,516 acres of New Mexico federal land when for the $2 minimum bid, and 4,635 acres went for the $1.50 no-bid rate.

New Mexico also had the lowest percentage of acres leased but sitting idle, with 11 percent or 474,121 acres unused of the 4.3 million total acres currently leased for oil and gas operations – the second-highest among the states studied behind Wyoming’s 9.2 million acres.

Bu the study warned that even more land could be leased to industry in all 10 states as 90 percent of the public lands managed by the federal government through its Bureau of Land Management were available for oil and gas development, but only 10 percent were prioritized for alternative uses such as recreation or wildlife management.

“The industry’s footprint is excessive, locking up public lands and encroaching on national parks, imperiled wildlife habitat, and critical migration corridors,” the report read.

But U.S. Secretary of the Interior David Berhhardt said the agency that oversees the BLM was able to generate record-breaking revenue from oil and gas in recent, despite using less acreage.

In 2018, the BLM produced $1.1 billion in revenue from oil and gas operations on federal land, while using about 25.5 million acres – lowest since 1985, per records from the U.S. Department of the Interior.

That year, the BLM also broke the record for the most oil produced onshore, with about 214 million barrels generated, records show.

About 7,808 leases took effect in fiscal year 2018, per the latest data from the DOI, putting the state in second after Wyoming’s 12,780 acres.

New Mexico was also second in the nation for acreage leased by the BLM with 4.3 million acres as of the last day of FY 2018m behind about 8 million in Wyoming.

About 3.8 million of those BLM-leased acres in New Mexico were considered producing, records show, for a production rate of about 88 percent.

Meanwhile, Wyoming had about 4 million producing acres for a production rate of about 50 percent.

Adrian Hedden can be reached at 575-628-5516, achedden@currentargus.com or @AdrianHedden on Twitter.

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©2020 the Carlsbad Current-Argus (Carlsbad, N.M.)

Visit the Carlsbad Current-Argus (Carlsbad, N.M.) at www.currentargus.com

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