August 15, 2008 05:39 PM UTC

Oil and Gas Industry Full of Crap

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• by: Colorado Pols

Do you remember a year ago when the oil industry confidently predicted “a billion dollars” in Roan Plateau lease revenue would go to Colorado, if we would just go along with their demands to “drill here, drill now?”

Only off by $885 million or so, as the Grand Junction Sentinel reports:

Both opponents and supporters of a federal drilling plan for the Roan Plateau are lamenting what they say is disappointing revenue from Thursday’s leasing of the area for oil and gas development.

The Bureau of Land Management’s lease auction of more than 55,000 acres in its Roan Plateau planning area near Rifle Thursday yielded about $114 million, or an average of $2,084 per acre.

That’s well below the $300 million high-end estimate the BLM had said the leasing of the Roan might generate, not to mention the $2 billion the industry advocacy group Americans for American Energy had said last year might be bid for the leases.

In a news release, Colorado Gov. Bill Ritter said the BLM’s actions shortchanged Coloradans. He had called for phasing leasing of the plateau top, which he says would have increased revenue and better protected the environment.

The lease revenue will be split between the federal and state governments.

“Today is a sad day for Colorado. It’s a missed opportunity – one we will never get back, one that falls squarely on the shoulders of the Bush administration, which is rushing through bad fiscal policy in its waning days,” Ritter said.

U.S. Reps. John Salazar and Mark Udall, and Sen. Ken Salazar, all Colorado Democrats, also criticized the outcome of the leasing of the Roan. But Americans for American Energy president Greg Schnacke said politicians such as Ritter and Ken Salazar depressed values of the Roan leases through their efforts to stop the leasing from going forward…

Which is completely ridiculous. The Democrats failed to get their plan for phased drilling enacted, and this lease auction took place on the energy industry’s terms. They got exactly what they wanted, and apparently at a shocking bargain. All of this in an economy where natural gas is about to become much more important (spelled Pickens Plan)–how are these leases depressed in value by a few Dems who carped about conditions they didn’t even get?

Bottom line: the energy industry lied to the public about the net value to Colorado of drilling the Roan Plateau. They lied, and a gaggle of mostly GOP elected officials helped them do it. Blaming the Democrats for something they didn’t succeed in doing, especially as nasty as industry mouthpieces got yesterday when these pitiful numbers were announced, is a pretty sure sign they know how it looks.

These are the same people who are about to put the hard-sell on the same voting public to divert energy revenue to a single pork-barrel project in a few weeks, while insisting they will curl up and die if they lose decades-old tax subsidies that help make Colorado one of the cheapest states by percentage in energy production taxes.

We think the energy lobby has opened itself up to a devastating credibility hit here, and Democrats would be idiots not to climb all over the industry’s now-proven laughable earlier estimate. This impugns the credibility of pro-energy industry ballot initiative positions, as well as politicians who used this BS to justify their own.