The Bureau of Land Management collected a record $11.8 million Thursday from leasing oil and natural-gas prospects in Colorado.
The record revenue reflects high energy prices and the increasing national prominence of Colorado’s oil and gas fields, federal officials and energy-industry representatives said.
But environmentalists said some of the leases are risky because drilling on the properties could put watersheds and wildlife habitats in danger.
The quarterly BLM auction delivered 134,582 acres to energy companies – an area equivalent to about 42 percent of metro Denver. Most of the awarded leases were in western Colorado, although a few were in eastern Colorado’s Weld and Yuma counties.
Proceeds collected topped the previous record of $10.3 million in May 2001. Revenue from the lease auction is split evenly between the state of Colorado and the federal Treasury.
About half of the leases are in the Piceance Basin of western Colorado, an area gaining national renown for its natural-gas fields.
“We’re seeing a very strong industry interest in the Piceance Basin,” said Ken Wonstolen, senior vice president of the Colorado Oil and Gas Association. “It’s becoming one of the great natural-gas plays in North America.”
Earlier this week, the BLM agreed to postpone the sale of leases on about 7,300 acres along the San Miguel River after environmental groups, politicians and local governments filed protests. But the federal agency allowed the lease of 12,000 acres in Mesa County that the cities of Grand Junction and Palisade had protested because of potential damage to water supplies from drilling.
“All of the applications for permits to drill on public lands receive a thorough review by environmental and technical experts before development occurs,” said Lynn Rust, deputy Colorado director for the BLM.
Some of the leases also carry stipulations that limit the scope and seasonal timing of drilling.
But those stipulations may not be adequate, said Steve Smith, assistant regional director of the Wilderness Society.
“We would take comfort in those stipulations if they are enforced,” he said. “But many of those end up getting waived.”
Staff writer Steve Raabe can be reached at 303-820-1948 or sraabe@denverpost.com.
