Protesters march in opposition to BLM auction of oil, gas leases

RENO — About 40 protesters marched down Virginia Street on Tuesday in opposition to a competitive oil and gas lease sale conducted by the U.S Bureau of Land Management.

The sale included 39 parcels totaling 50,415 acres in Elko and Eureka Counties. The auction had a handful of potential bidders, but all the parcels went by without any offers. The auction ended after only about 15 minutes.

The currently low price for oil is considered to be a major reason why there has been a lack of interest in the BLM lease sales.

Holding signs saying “Keep it in the Ground” and “Oil Coal Gas = Climate Chaos,” the protesters representing such groups as the Sierra Club Toiyabe Chapter, the Progressive Leadership Alliance of Nevada and the Rainforest Action Network walked from the Reno Arch to the Silver Legacy where the auction was conducted.

Bob Fulkerson, state director of PLAN, called on state lawmakers and those running for office this year to support a legislative ban on hydraulic fracturing, also known as fracking.

Critics say the process can pollute groundwater. Hydraulic fracturing uses a high-pressure stream of water, sand and chemicals to tap into oil and gas reserves in rock formations.

“Our water is more precious than oil or gold,” Fulkerson told the assembled protesters before the march.

The previous BLM Elko District sale was held on March 10, 2015. That sale generated $63,181, selling 16 parcels covering 19,631 acres through competitive and noncompetitive sales.

The BLM offers quarterly oil and gas sales. Parcels included are nominated by industry representatives well in advance of a sale. The BLM reviews each parcel location for any resource conflicts, which can result in stipulations placed on the parcel, deferral or partial deferral of a parcel.

A minimum bid of $2 per acre is required.

The leases are valid for a period of 10 years with annual rentals of $1.50 per acre for the first five years and $2 per acre after that until production begins. Once a lease is producing, a royalty of 12.5 percent is charged. Half of the bid and rental receipts go to the state of Nevada.

Nevada has produced some oil over the past several decades, primarily in an area called Railroad Valley in Nye County but in a few other locations as well.

Richard Perry, administrator of the Nevada Division of Minerals, said oil production began in the mid-1950s, with a peak of 4 million barrels of oil produced in 1990. But many of those wells have been exhausted, and new finds have been limited, he said.

In 2015 Nevada saw production of only 281,000 barrels of oil.

“Since the first oil exploration well was drilled in Nevada, there have been about 830 wells drilled,” Perry said. “There are about 120 wells that have produced so most were not successful.”

Two oil wells were drilled in Nevada in 2015 but neither resulted in production, he said.

The most recent oil find was in Elko County where Noble Energy put in wells to produce oil from hydraulic fracturing but the price of oil has made the effort impractical and no activity is underway now, Perry said.

Contact Sean Whaley at swhaley@reviewjournal.com or 775-461-3820. Find him on Twitter: @seanw801

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