Low-water yards

DENVER–The Bureau of Land Management’s (BLM) quarterly oil and gas lease sale in Colorado generated over $8 million, the most successful such sale the federal lands agency has enjoyed in recent years. The BLM, as well as energy policy experts credit the successful lease sale in large part to the Trump administration’s pro-energy production policies.

According to its recent press release, the BLM on March 31 leased 68 parcels of federal land for drilling in Colorado, generating $8.1 million. Over 42,000 acres were leased across Weld, Jackson, Routt, Arapahoe, Delta, Mesa, Rio Blanco, Gunnison, and Garfield counties.

This sale was conducted with lower royalties embedded in the One Big Beautiful Bill Act(OBBB), which reduced the royalty rate of onshore oil and gas production on federal lands to a minimum of 12.5%. Previously, the royalty rate sat at 16.67% under former President Biden’s Inflation Reduction Act.

“The One Big Beautiful Bill Act reduces the cost of doing business on public lands, making oil and gas development more economically attractive to industry,” the press release reads, predicting that the sale will spur on additional leasing and drilling.

The BLM sale is also congruent with Trump’s day-one Executive Order 14154 ‘Unleashing American Energy,’aiming for energy dominance and increased domestic drilling.

Amy Cooke, Director of the Energy and Environmental Policy Center at Independence Institute, a free market think tank in Denver (as well as publisher of Complete Colorado) says that the surge in Colorado leases is a sign that energy markets are responding well to energy friendly policy.

“The size and scope of the lease sale are a clear signal that markets are responding to both stronger price conditions and the shift in federal policy toward energy abundance under President Trump, Energy Secretary Chris Wright, and Interior Secretary Doug Burgum,” Cooke told Complete Colorado. “For the first year of the Trump administration, an abundant supply kept oil prices low for consumers. As prices have risen, producers are doing what markets are designed to do: invest in new production.”

Cooke predicts the new drilling will help Colorado’s energy sector back on its feet, as production has declined over the last several years due to significant new restrictions on energy development put in place by a Democrat-controlled legislature and Gov. Jared Polis.

“What’s important to note in Colorado is that all these leases are on federal land. It’s where investors are comfortable putting their money,” said Cooke. “That’s because state regulation has made it increasingly difficult to permit new wells on private or state property, effectively stifling new production.”