Peter Shelton

Yard Sale

Posted in Gas Pains, Watch columns by pshelton on October 17, 2009

In 2005 we learned that the mineral rights beneath our home were about to be sold to the highest bidder. I wrote this column after the auction at Bureau of Land Management headquarters in Denver.

Seven fifty-eight am. Bureau of Land Management State Office in Lakewood, Colorado. Two faded fiberglass Bambis cavort beside a closed-loop brook that emerges from behind the glass front doors. Inside, the brook burbles antiseptically. “They ought to put fish in there,” says a man in unscuffed cowboy boots. We’re early. Other bidders, some in western gear and some crossing their soft, Italian loafers, idle in line. In the awkward silence I flip a penny into the water, thinking about fountains and luck. It is the only foreign object, the only shiny thing in the dim hallway.

I am here at the quarterly BLM mineral lease auction to defend our Montrose County neighborhood. Or a portion of it, if I can. Three of the six property owners in our parcel have decided to pool what money we can afford and try to buy the lease ourselves. Try, in other words, to tie up the mineral rights for the ten-year life of the lease in order to prevent some oil-and-gas company from coming in and having its way with us.

We had been stunned a couple of weeks before to find that our private lots—some big, some small, and including two full-time family homes—had been packaged as available for lease by the BLM, and that the auction would happen May 12 in Denver. As I was the only one of the three in Colorado at the time, I became the designated bidder and, should our bid succeed, our check writer and lease signer as well.

The I-70 corridor had never seemed so sad. Between Parachute and Silt, gas wells and equipment overran the landscape. Of course, I was looking with new eyes, but the dominance seemed more widespread and menacing than I remembered. On the road, I passed convoys of red-and-white drill rigs from Haliburton headquarters in Grand Junction. Off either side I saw new well pads, some as dense as one-per-ten acres, new house-size compressors, new roads slashing up the steep piñon-juniper hillsides. Where hay once grew now sprouted trailer park ghettos for roughnecks and acre after acre of steel pipe, like missiles aimed at the heart of the land.

I thought about the Bells, Orlyn and Carol, who had come to a timely meeting on oil-and-gas in Norwood from their ranch outside Rifle. A ranch that in the last three years has unwillingly acquired five gas wells, endured constant noise and stink, diesel spills and traffic. Lord, the traffic. Carol told of sitting outside to write one recent morning and counting 27 semis and 15 blue company pickups traversing their neighborhood dirt road. In an hour and a half. I stopped taking notes while the Bells talked, it was so gut-wrenching. I just wrote in the margin beside their names: “Living Hell.”

After signing in with the uniformed Homeland Security guy beside the locked interior doors, I am told I have to wait to be escorted upstairs. The escort cuts an arresting figure: blue blazer, beefy, about six foot two. And blind. He feels for the lock on the doors, pokes the wall with his white cane, and reads the Braille on the elevator pad with his fingers. The irony is too much: I could have been cheaning my Uzi on the way up to the fourth floor.

After standing in line for a bidding number, I learn that our parcel is among several whose lease sales have been deferred. Apparently, a letter from Congressman John Salazar to the BLM asking for a delay on the entire sale has been read and at least partially heeded. It’s a relief. We have 90 days now to figure out how to fight this thing. On the other hand, that’s 90 more days of grinding uncertainty.

A guy from National Public Radio wants to interview me. He has heard that citizen action and congressional pressure has forced a hiccup in the BLM/oil-and-gas Juggernaught and figures that this is news. “Oh no,” says the Chief of Fluid Minerals Adjudication when she sees the microphone. “No interviews now.” (The sale isn’t due to start for another 50 minutes.) “There will be a ten-minute question period following the sale. Nothing now. Oh, no.” The NPR guy is very cool, mentions that this is a public meeting in a public space and so on until finally a higher-up from upstairs comes down and says, yes, you may use this room here. And then she stands there, arms crossed on her chest, not ten feet from us and monitors the entire conversation.

Which just underlines the fact that for 20 years this has been a closed shop. The BLM and the oil-and-gas boys—a simple symbiosis. The bureaucrats even refer to the industry as “our customers.” Energy companies “nominate” the lands they’d like to drill on, public surface and private. The agency bundles the properties into parcels. Then they get together here once every three months, along with a lurking crew of speculators, to bid on the spoils. Operators can look forward to as much as $25,000 a day in production from each well. The government gets its lease fee and a 12.5 percent royalty. Cozy. Neither of them is used to having the public—surface owners, press, any foreign object—insinuate itself into what has become a de facto secret society.

How cozy is it? The auctioneers, a brace of fast-calling cowboy-hatted pros, joke with the bidders, many of whom they know from past sales. Rules require the bidders not be identified by name, so they are referred to by their bid numbers and their position on the floor: “Sold! Parcel number five-oh-seven to buyer number two hundred, out there in short right field, for a hundred and forty-two dollars an acre.”

That particular parcel includes parts of four sections in Routt County up near Steamboat Springs. Eleven hundred plus acres, leased for $156,000. No way to tell if there is any private property involved. Doesn’t matter if there is; the law says there need be no compensation to surface owners. (Neither does the BLM have to notify landowners that their minerals are up for lease. We only learned of the sale involving our place because a local community group, Western Colorado Congress, took it upon themselves to alert surface owners.)

Despite their old-hands experience, many of the buyers tremble perceptibly during the competition. Pens shake, eyes dart furtively left and right. These are big stakes gamblers, and there’s big money on the table. A 900-acre parcel in Moffat County goes for $213,000. A smaller Moffat County piece fetches $950 an acre. In San Miguel County, a 200-acre piece goes for $215 an acre, $43,000 total. Gas developers obviously want these properties more fervently than others, a handful of which sell for the minimum $2 per acre. How badly do they want my Beaton Creek parcel? Thanks to the deferral, there is no way to know. One thing is clear: If they want it, our neighborhood fund will be exhausted, outbid in the first 30 seconds.

It takes less than 90 minutes to dispose of 29,000 acres in 55 parcels. The total spent exceeds $1.3 million. The bidders are all men but one, a blonde in a cream power suit. The BLM staff running the sale are all women. When it’s over, the Chief of Fluid Minerals Adjudication reminds everyone that payment is due immediately and that credit cards will no longer be accepted for amounts larger than $99,999.99.

Handshakes replace shaking pens. Faces locked in concentration are now allowed to relax. Another cycle in the game, still largely hidden from prying eyes, is complete. On the wall, two framed, smiling faces look down on the scene. One is a beady-eyed frat boy. The other wears the crooked, slash-and-burn grin of Haliburton Man.

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2 Responses

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  1. Marty Selfridge said, on October 22, 2009 at 3:42 pm

    Hi Peter Shelton,
    This gave me goosebumps. Two reasons. 1. You’re a good writer. Able to capture so perfectly the idea, ithe image, the feeling in a few well-choosen words. 2. We’re fighting an oil company right now. Venoco wants to build a slant drill not far from our house. Since they were unable to get through the regular permitting process, they have gone the petition route. Putting it on a ballot to let the citizens of Carpinteria decide. They have promised millions of dollars to Carp. Roylaties and donations. It has already divided our little town. It’s going to get uglier. Reading your account of dealing with oil company deep pockets is daunting. Wish us luck. M.

    • pshelton said, on October 22, 2009 at 4:12 pm

      Marty, so sorry to hear that your “tar sands” are up for exploitation. Sigh. It seems that things have to get worse before they get better. I heard a great quote on NPR yesterday from a farmer who is trying to cross wheat with perennial prairie grasses. He said, “If you’re working on a problem that’s going to be solved in the next 50 years, you’re setting your sights too low.” One does what one can. Love to you and Zjak-o, -P


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