In the Rush to Drill, Colorado shortchanged by BLM Auction

GOP, Dems agree state loses out, disagree on why

By Burt Hubbard, Thursday, August 14, 2008

Democrats and Republicans alike agreed Thursday the state was shortchanged hundreds of millions of dollars on the Roan Plateau energy lease auction.

But both sides point the finger at each other as the reason why.

Gov. Bill Ritter and U.S. Sen. Ken Salazar blasted the Bush administration for rushing to lease the 55,000 acres on the Roan all at once at depressed prices.

"Today the administration and the BLM turned their backs yet again on Western Slope communities," Salazar said.

Republican state lawmakers charged that formal protests against the lease auction, including those by Ritter's administration, scared bidders away.

"Of course the protests had an impact," said state Sen. Josh Penry, R-Fruita. "The circus was complete when the governor joined environmental legal challenges that in the end massively undercut the financial returns on the Roan that the governor once claimed to be so concerned about."

Less than six hours after the BLM auctioned off 55,000 acres on the Roan for energy development for $114 million, Ritter called a news conference to denounce the meager returns. The state will get $57 million for higher education and mitigating the impacts from drilling instead of the hundreds of millions officials expected.

Ritter wanted to phase the auction of the leases over decades instead of leasing all the federally owned portion of the Roan at once, as happened Thursday. But the BLM overruled him. Ritter didn't agree with industry estimates that the leases would bring $2 billion, but he said he thought the revenue to the state should have been a lot higher than the $57 million it will get from the auction.

"Yes, I'm upset," Ritter said. "This is our resource. By leasing it all at once you get an undervalued price. The federal government has done a disservice to our state."