Utah criticized for selling oil and gas leases in the original Bears Ears monument

President-elect Joe Biden has promise to restore the original Bears Ears National Monument boundaries.

(Zak Podmore | The Salt Lake Tribune) Looking west from a parcel of Utah School and Institutional Trust Lands Administration (SITLA) that was recently leased to an oil and gas company in San Juan County. Four parcels that sold in an October lease sale overlapped with the original boundaries of Bears Ears National Monument, which President-elect Joe Biden has promised to restore. December 16, 2020.

Bluff • Weeks before the November election, a Utah agency leased 33 units of land to mineral and hydrocarbon companies.

The offerings are a routine practice for the Utah School and Institutional Trust Lands Administration (SITLA), which uses the money raised to help fund public schools. But environmentalists criticized the October sale’s inclusion of four oil-gas leases in San Juan County that overlap with the boundaries of Bears Ears National Monument, as they were designated by President Barack Obama in 2016, and could potentially complicate a future land exchange.

Obama’s 1.3 million-acre national monument was created at the request of five Native American tribes with ties to the region, and it included hundreds of thousands of cultural sites dating back 10,000 years. Proponents of the monument, including the Bears Ears Inter-Tribal Coalition, have argued that the area’s rich natural and cultural resources make it incompatible with oil and gas development and the monument designation included a mineral withdrawal.

But the monument also encompassed 109,000 SITLA acres, which are not subject to federal national monument designations. The presidential proclamation establishing the monument directed the secretary of the Interior to explore a land swap with Utah. That would mean the feds would give SITLA valuable federal lands elsewhere in exchange for taking over the state parcels in the monument.

(Zak Podmore | The Salt Lake Tribune) Looking west from a parcel of Utah School and Institutional Trust Lands Administration (SITLA) that was recently leased to an oil and gas company in San Juan County. The parcel was inside the original boundaries of Bears Ears National Monument, which President-elect Joe Biden has promised to restore. The Bears Ears Buttes are just visible on the far horizon. December 16, 2020.

Negotiating such transactions can take years, however. And that process had not been completed when President Donald Trump reduced Bears Ears to 15% of its original size in late 2017, garnering praise from many elected leaders in Utah. The five tribes in the Bears Ears Inter-Tribal Coalition and a host of environmental groups sued the Trump administration, arguing a president does not have the authority to reduce a monument under the Antiquities Act. That case has yet to be settled in court.

“Frankly, it’s distressing that school trust lands would offer and lease tracts of land inside of the boundaries of the original monument,” said Stephen Bloch, legal director for the Southern Utah Wilderness Alliance (SUWA), which was a party to the 2017 lawsuit.

SITLA largely refrained from leasing within the monument boundaries for most the past four years. In January 2019, when SITLA leased several parcels within the original monument near Canyonlands National Park to oil and gas interests, SUWA filed a letter of protest at SITLA’s offices in Salt Lake City.

Within days, the agency announced it would withdraw the 12 parcels and refunded the bids that had already sold. At that time, SUWA celebrated the decision, and encouraged the agency to continue deferring within the original monument until the boundary dispute was resolved.

Wes Adams, SITLA’s assistant director for oil and gas, said in a phone interview that SITLA made the decision to pause hydrocarbon leasing on most of its land after a drop in global oil and gas prices last year that was later exacerbated by the outbreak of COVID-19. The agency offered few oil and gas leases on school trust lands from April 2019 to October 2020, according to Adams, but he said there was never a formal policy to abstain from leasing in Bears Ears National Monument.

At the time of the October sale, Joe Biden was campaigning on a promise to restore Bears Ears to its 1.3 million-acre boundary, a move that is supported by San Juan County’s new leaders.

“I sort of chalk [the leases] up to one of two things,” Bloch said. “One, it’s a deliberate act to salt the ground essentially before they would engage in an exchange. Or it was simply neglect that the parcels ended up being offered, that whoever made them available simply didn’t check and confirm that they were located within the boundaries of the monument. Either way, those monies should be returned, and the leases should be canceled.”

The agency did not indicate a refund was being considered, but officials there stated SITLA was open to land exchanges if Biden reinstates the Obama-era boundaries.

“SITLA has a long history of exchanging trust lands out of national monuments, parks, and other federal conservation areas, and will address land exchange possibilities in the event the original monument boundaries are restored,” Deena Loyola, the agency’s information officer, said.

“SITLA is not certain of federal interest in exchanging these particular tracts,” she added, “but is considering options for a mechanism to account for the potential exchange of these lands if the former monument boundary in this area is restored.”

The parcels in question are located roughly 10 miles north of Bluff, a 260-person town that has branded itself as the “Gateway to Bears Ears.” In February, the Bluff Town Council opposed an application for a permit to drill two oil and gas wells on Bureau of Land Management land just outside of the original monument and near the SITLA leases that sold. That application was withdrawn in March after the company stated the parcels were no longer in its drilling priorities.

“The town was totally left out of the loop with SITLA on these leases,” said Bluff Mayor Ann Leppanen, explaining that the town was not aware of the sale until after it happened. “We have a new president coming in, and [SITLA is] just jamming it through. It’s going to be in the monument soon.”

Three of the leases sold for just over the minimum bid of $2 per acre, and SITLA received a total of $11,800 for the four leases that include 2,460 acres.

“These leases were sold for bare minimum bids,” Bloch said. “And so this isn’t really an issue of, ‘We’re making money for the schoolchildren.’ The money for the schoolchildren is going to be more well realized in that land exchange.”

But Adams said the leases are sold on what the industry would consider exploratory “wildcat acreage,” or areas that don’t necessarily have a proven oil and gas potential and typically lease for closer to the minimum bid, and they do not mean an exchange is off the table.

If the companies behind the leases — Kirkwood Oil & Gas and Wolcott LLC — were to drill and begin producing oil, gas or helium, which are all present in the region, the agency’s beneficiaries would receive a 16.67% royalty, according to Adams. In the meantime, the leaseholders will pay a yearly $2 per acre rental fee.

Zak Podmore is a Report for America corps member and writes about conflict and change in San Juan County for The Salt Lake Tribune. Your donation to match our RFA grant helps keep him writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.