Salazar orders BLM to reject bids on 77 Utah leases

US Interior Secretary Ken Salazar directed the BLM on Feb. 4 not to accept $6 million in successful bids on 77 tracts offered in the bureau's Dec. 18 oil and gas lease sale in Utah.

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Feb. 5 -- US Secretary of the Interior Ken Salazar directed the Bureau of Land Management on Feb. 4 not to accept $6 million in successful bids on 77 tracts offered in BLM's Dec. 18 oil and gas lease sale in Utah.

"The 77 parcels that the Bush administration offered on the doorsteps of some of our national icons raised several troubling questions. I have directed the BLM not to accept the bids. We will take time to review the processes behind their inclusion in the lease sale," he told reporters in a teleconference.

Salazar indicated that he does not expect his decision to be legally challenged. "The government contract is not formally completed until the BLM accepts the bids, which has not happened in this case," he said. Payments for the winning bids on the 77 parcels will be returned and leasing will proceed on the 39 remaining tracts from the sale, he added.

The decision was the secretary's second action involving a BLM oil and gas lease sale in less than a week. He ordered the DOI agency on Feb. 2 to remove eight tracts from a Feb. 3 lease sale after Wyoming Gov. Dave Freudenthal expressed concerns about them (OGJ Online, Feb. 4, 2009). The offering of 137 remaining parcels went ahead as scheduled, raising nearly $2.4 million from the sale of leasing rights and from rental fees on 112 parcels.

Salazar did not rule out some of the 77 Utah tracts ultimately being leased. "I don't necessarily believe that all of them won't go into oil and gas development sometime in the future. I do believe that the proximity of Arches National Park, Dinosaur National Monument, and Nine-Mile Canyon raised serious questions about the planning process that was used," he said.

But he stopped short of saying that the resource management plans which Utah's BLM office completed prior to the December lease sale could be overturned. "We'll look at them as we get our feet better planted on the ground," he said.

Additional actions likely
Salazar also suggested that further actions could be forthcoming. "At this point, we are looking at many of the Bush administration decisions. Some of them are probably going to be good decisions. Others we will disagree with. There were a number of decisions that were made without going through the proper environmental reviews and using sound sciences to develop them. We are reviewing all of those and expect to have additional announcements in the days and weeks ahead," he said.

Environmental organizations applauded Salazar's move. "Today's announcement signals a new era in the way our natural resources are managed," said Sierra Club Deputy Director Bruce Hamilton. "The Obama administration clearly understands that instead of allowing the oil industry to destroy places like Arches National Park, we should be investing in the kind of clean energy solutions that curb global warming and leave our natural treasures intact."

Stephen Bloch, conservation director for the Southern Utah Wilderness Alliance in Salt Lake City, called the secretary's action "a critical first step in bringing balance back to public lands management in Utah's remarkable red-rock country. This decision rescues the stunning landscapes of Desolation Canyon and the White River from the ravages of oil and gas development."

Oil and gas trade association officials had the opposite reaction. "The decision runs counter to President Barack Obama's stated goal of reducing US reliance on foreign energy sources and is at odds with the judgment of most Americans that the nation should develop more of its own oil and natural gas," said American Petroleum Institute Pres. Jack N. Gerard. "With US domestic oil production declining, we need to develop more and keep more jobs and economic activity in this country," he added.

Kathleen Sgamma, government affairs director for the Independent Petroleum Association of Mountain States in Denver, said, "At a time when the Utah legislature has contemplated cutting a day from the school year to address the budget shortfall, the state is losing income from its share of the lease sale, not to mention royalty and other tax revenue from forfeited production. With this decision, our government is denying access to American energy that belongs to all Americans and making it even more difficult to increase energy security and tackle climate change."

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