Idaho made $290,426 last month, just from oil and gas companies bidding for the right to lease state land for oil and gas exploration. Several bidders snapped up exploration rights on 87 parcels of state land in four southern Idaho counties – even though no oil or gas has been found on state lands before.
Top state officials were surprised by the news, and Gov. Jim Risch said if the bidders hit oil or gas, Idaho could end up “awash in money” like Wyoming and Montana. “The biggest problem Wyoming has is how to spend all the money,” Risch said, adding that Wyoming Gov. Dave Freudenthal told him at a just-concluded Western Governors Association meeting that his state is offering college scholarships to virtually every Wyoming student.
Idaho’s top elected officials, gathered as the state Land Board on Tuesday, received the report on the oil and gas exploration auction from state Lands Director Winston Wiggins. Wiggins said after receiving inquiries, the lands department set up the auction last month – and all 87 parcels went. The tracts in Canyon, Gem, Payette and Washington Counties total 27,713 acres.
The “premium bids” pledged by the oil and gas companies are just for the right to lease the state lands for exploration. Annual lease fees follow, and more payments if they strike oil or gas. Wiggins said, “There would be royalty payments to the state – I can’t tell you what they would be, because it’s never happened. That’s on top of the lease fee.”
The Land Board is required by the state Constitution to manage state endowment lands for the maximum long-term financial return to the state’s school endowment fund. When the lands bring in more money – most typically from grazing fees, logging, and leases – there’s more money for schools.
Wiggins said this morning that the department has had additional inquiries about oil and gas exploration just in the last few days, “so the interest continues.”
Risch said back in the 1970s – the last time the nation was suffering through an extreme crunch on gasoline – companies came in and leased thousands of acres of private land in Idaho for oil and gas exploration, including many who signed leases with farmers for exploration in their fields. But nothing came of it, and the leases simply expired.
“They never found anything anywhere,” Risch said. But, he said, “Now they have more sophisticated ways of exploring.”