Feds Lease Land in Five States for Exploration

A total of 236 parcels of federal subsurface brought in almost $12 million during a competitive auction of oil and gas leases earlier this month, the U.S. Department of Interior Bureau of Land Management (BLM) reported Thursday.

The parcels were within the Talladega National Forest in Alabama; the Ouachita and Ozark National Forests in Arkansas; the Kisatchie National Forest in Louisiana; the Manistee National Forest in Michigan; the Bienville, DeSoto and Homochitto National Forests in Mississippi; and 80 acres underlying privately owned surface in Mississippi. BLM conducted the sale on March 15, 2007, in Springfield, Va. Approximately $9 million will go to the U.S. Treasury and $3 million will be shared by the affected states.

The BLM has responsibility for leasing the federally owned minerals and offers selected parcels at quarterly competitive auctions. Regulations require the bidding to open at $2 per acre. The highest per-acre bid of the auction was by Manassas, LLC of Jackson, Miss., with a bid of $1,930 per acre. Manassas also paid $1,159,030 for a 600- acre parcel in Logan County, Ark.

Leases are awarded for a term of 10 years and as long thereafter as there is production of oil and gas in paying quantities. The federal government receives a royalty of 12 1/2 percent of the value of production. Also, each state government receives a 25 percent minimum share of the bonus bid and the royalty revenue from each lease issued in that state.

The next competitive oil and gas lease sale is scheduled for June 18, 2007, in New Orleans, La.

    State       # of Parcels   Acreage          Federal        State Revenue
                Offered/Sold   Offered/Sold     Revenue                  
    AL          60/60          75,694.77/       $831,391.88    $274,530.62 
    AR          27/27          9,145.19/        $6,083,613.75  $2,026,701.25 
    LA          1/1            300.00/300.00    $24,092.50     $7,987.50
    MI          12/12          3,925.13/        $14,255.50     $44,326.50 
    MS          134/134        59,354.88/       $1,943,609.75  $642,063.25
    Total       234/234        148,419.97/      $8,927,034.38  $2,965,538.12

The BLM manages more land -- 258 million surface acres -- than any other federal agency. Most of this public land is located in 12 Western States, including Alaska. BLM, with a budget of about $1.8 billion, also administers 700 million acres of subsurface mineral estate throughout the nation. The BLM's multiple-use mission is to sustain the health and productivity of the public lands for the use and enjoyment of present and future generations. It accomplishes this by managing such activities as outdoor recreation, livestock grazing, mineral development, and energy production, and by conserving natural, historical, and cultural resources on the public lands.