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April Reese, E&E reporter
Published: Thursday, July 18, 2013

SANTA FE, N.M. — Several of the oil and gas leases sold at a Bureau of Land Management lease sale here yesterday fall under an almost 30-year-old management plan and therefore should have stayed on the shelf, critics say.

At its quarterly lease sale, which included parcels in New Mexico, Oklahoma and Texas, Red Dirt Energy LLC of Oklahoma City snagged leases for five parcels in southern New Mexico’s Otero County totaling 1,166 acres. Another seven that were originally on the list for the region were deferred because they are in an area that has wilderness characteristics, said Donna Hummel, a spokeswoman in BLM’s New Mexico office.

Several environmental groups said the agency should not have leased the five Otero County parcels because they are managed under a resource management plan that dates back to 1986, before industry showed much interest in the area.

BLM itself has acknowledged that the analysis in the 1986 White Sands RMP, which covers Otero and Sierra counties, is “insufficient for the management of the resource.” The agency crafted an amendment to the plan in 2004, but it was struck down by a federal court. In that 2009 decision, the 10th U.S. Circuit Court of Appeals said the agency had failed to fully consider the potential environmental impacts of the proposal, including its effects on the Salt Basin aquifer.

“To say we’re going to ignore our self-evaluation, it doesn’t make any sense,” said Trevor Kincaid of the Center for Western Priorities, a year-old Denver-based organization that advocates for a balance between energy development and conservation.

“This is not our proudest moment in terms of resource management planning going back to ’86, but if you look at the flip side, until the new plan is completed, we do have to go back to the most recent plan,” Hummel said. “We don’t really have an option. We are obligated to use the most recent plan.”

The five parcels in question were designated for mineral leasing in the 1986 plan, she added.

And the parcels that were leased yesterday underwent a careful vetting process that included examination of the individual parcels by various resource specialists to make sure there wouldn’t be significant impacts to the water table, soils or wildlife if the leases are developed, Hummel added.

“The reason they went forward was because we found no resource conflicts,” she said.

Still, Kincaid questioned the wisdom of leasing parcels under such an antiquated plan.

“It’s not a question of whether or not they’re allowed to; it’s a question of whether they should,” he said.

Contested leases

In April, BLM issued a draft RMP for Otero, Sierra and Dona Ana counties, but oil and gas development is not included in the plan. Instead, BLM says it will include oil and gas leasing and development in a separate amendment to be completed within five years.

The next month, the New Mexico Wilderness Alliance, the Wilderness Society and other groups filed a protest over BLM’s offering of the original 12 parcels, saying no leases should be put on the auction block until an updated resource management plan that includes oil and gas leasing is in place.

BLM has drawn criticism for offering parcels under outdated management plans in other states, as well, including at a lease sale in Montana on July 16 and recent sales in Colorado. But BLM officials say that they have an obligation to continue offering leases until new plans are finalized, particularly given how long the revision process takes.

Oil and gas leases, which must be obtained to drill on federal lands, are awarded for a period of 10 years and “as long thereafter as there is production in paying quantities,” according to BLM. The revenue from the sale of the leases, as well as the 12.5 percent royalties collected from production on those lands, is shared between the federal government and the states, with 52 percent of the revenue going to the federal government and 48 percent going to the state where the leases are located.

Over the past 10 years, New Mexico has received more than $4 billion from energy production on BLM-managed federal leases, which the state heavily relies on to fund public education.