BLM to hold online oil and gas lease sales

James Fenton, jfenton@daily-times.com
The Farmington Field Office of the Bureau of Land Management is pictured in February 2012. The federal agency is expected to release rules for wind and solar projects in the near future.

FARMINGTON — The federal government is taking the auction of public lands for oil and gas development online.

Earlier this week, U.S. Bureau of Land Management officials said the change was in line with its ongoing efforts to modernize the oil and gas program by delivering added participation, competition, efficiencies and taxpayer savings.

In an Aug. 30 press release, officials with the agency — which manages more than 245 million acres of public land and more than 700 million acres of sub-surface mineral estate — said the move was authorized by Congress under provisions in the 2014 National Defense Authorization Act.

The act amended the federal Mineral Leasing Act. Prior to the amendment, the Mineral Leasing Act authorized federal onshore oil and gas lease sales only by oral auctions. The BLM can choose whether to hold auctions online or in person.

A successful online auction pilot conducted by the BLM in Colorado in 2009 also paved the way for the online sale option, according to the release.

Online auctions, according to the release, could boost aggregate lease sale revenues by about $2 million annually.

The first online sale is scheduled to occur Sept. 20 through the BLM’s Eastern States Office when the agency will be offering 14 parcels of public lands in Kentucky and Mississippi. The BLM is evaluating other opportunities to hold additional online sales, according to the release.

Rebecca Sobel, senior climate and energy campaigner with the Santa Fe chapter of the environmental group WildEarth Guardians, said the BLM's new online auction option is a strike against transparency and public input. Sobel said federal officials have made it easier for the industry to buy more public lands for its own use at the expense of others.

"We absolutely see this as a direct response to mounting keep-it-in-the-ground protests, and ... an effort from the Obama Administration to avoid public scrutiny and to cater, still, to oil and gas industry interests," Sobel said.

Andrew Browning of the Consumer Energy Alliance, a Houston-based pro-industry group, said the BLM's option to hold lease sales was a sign of progress, and he said disruptive behavior by protesters at prior sales has been a factor.

Kathleen Sgamma, vice president of government and public affairs for the Western Energy Alliance, a Denver-based industry advocacy group, agreed. In February, Sgamma wrote a letter to BLM Director Neil Kornze suggesting the online lease sale option be adopted to mitigate the recent number of canceled or postponed lease sales by the agency. This summer, WEA sued the BLM over the lack of lease sales held by the agency and welcomed the news of the added digital option to the agency's lease sales.

“We sympathize with the pressure BLM is often under from protesters overwhelming available facilities, disrupting sales and threatening the safety of staff," Sgamma said in an emailed statement. "Online auctions also have cost-savings benefits as venues and security personnel do not have to be enlisted to handle unruly crowds. The public will still have the opportunity to participate at multiple points in the leasing process, but the actual sale will use up-to-date technology that has been around for over a decade since eBay became ubiquitous."

James Fenton is the business editor of The Daily Times. He can be reached at 505-564-4621.