Moffat County Commission OKs mineral sale bids

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Also at the meeting

At is regular Tuesday meeting, the Moffat County Commission:

• Approved, 3-0, a transfer of payment of warrants for November totaling $350,990.36.

• Approved, 3-0, payment of payroll warrants ending Nov. 13 totaling $655,791.54.

• Approved, 3-0, a core services contract addendum with Kari Billette of Steamboat Springs adding court testimony services including authorized preparation time and report writing at $76 per hour.

• Approved, 3-0, an audit services engagement letter.

• Approved, 3-0, an author publishing agreement for the Museum of Northwest Colorado with Lifetime Chronicle doing business as London Publishing for various services and printing of 2,000 copies of the book “Buster Brown and the Cowboy” totaling $6,715.

• Approved, 3-0, department of social services accounts payable and electronic transactions totaling $304,855.91.

• Approved, 3-0, a grant support letter for the Yampa Valley Off Highway Vehicle Trail Riders club for purchase of a trail dozer and other equipment to be used by various land agencies for trail maintenance.

• Approved, 3-0, allowing the Moffat County Balloon Festival committee to host the 2011 Moffat County Hot Air Balloon Festival in Loudy-Simpson Park, to close the park for the three days of the festival and to waive the park use fee for the festival other than county personnel and other expenses.

• Approved, 3-0, a request from the Wyman Living History Museum that snow plowed by the county road and bridge department be brought to the museum for the Wyman Winter Festival.

• Approved, 3-0, Oct. 19 meeting minutes for the department of social services.

• Approved, 3-0, to proceed with a final technical energy audit with the Aurora-based Ennovate Corporation.

• Approved, 3-0, to enter into executive session regarding the lease of the Moffat County Public Safety Center.

• Approved, 3-0, to enter into executive session regarding negotiations and strategy of negotiations for Moffat County Road 47.

• Approved, 3-0, to offer the City of Craig a one-time purchase price for the Craig Police Department’s space in the Moffat County Public Safety Center totaling $1.083 million.

The offer includes city ownership rights of the 2,258 square feet of exclusive office space the police department currently occupies, one-third of undivided interest of 9,000 square feet of common space and continued access to the safety center garage and parking lot, among others.

• Heard monthly updates and various presentations from department of social services director Marie Peer.

Christmas came early for Moffat County this year.

Or, at least that’s how Moffat County Commissioner Tom Mathers feels about a recent county mineral lease sale, which netted various county organizations an estimated $3.2 million.

At its regular Tuesday meeting, the commission approved, 3-0, to accept the results of a sealed bid auction and recommendation for sale of 13,463.65 acres of minerals, which provided an estimated $2.49 million in revenue to the county and $785,983.81 to the Museum of Northwest Colorado.

The high bidders awarded leases were Hannon & Associates, Axia Energy, Jack Overstreet and West Point Energy.

“It’s a bonus,” Mathers said. “It’s a big chunk of money that we had not expected that came at a good time in a bad economy.”

Moffat County Natural Resources Director Jeff Comstock and museum director Dan Davidson presented the commission with the results of the sealed bid auction.

The sealed bids were opened Monday, the day the commission “called Christmas all week long,” Mathers said.

“We had no idea what they were going to come out (as), but we knew that some companies wanted them pretty bad,” Mathers said.

Comstock said the county has seen significant interest from companies regarding leasing minerals owned by the county and the museum.

In most other cases, Comstock said the county or museum negotiates with the companies interested in leasing to get the best deal they can. But, Comstock said, the two organizations decided to put their minerals up for auction several weeks ago due to the amount of interest.

The county and museum placed 15,770.32 acres of minerals, located in southeast Moffat County, up for bid, 13,463 of which were leased. The price of the minerals leased averaged $350 to $450 per acre and reached a high of $605 per acre, Comstock said.

“It’s actually very interesting to see the revenues that were $400 to $600 an acre,” Comstock said. “Those are numbers this county has not seen in history.”

Comstock also said the recent auction was the largest leasing effort the county has seen at one time in recent history.

However, Comstock said it is impossible to know how much, if any, mineral exploration and development will occur on the leased mineral acres.

“But, you know that when something is getting leased that there will be some effort for exploring it in the future,” he said.

The leasing companies’ interest in Moffat County minerals is confined to a portion of land known as the Niobrara formation, Comstock said.

“Niobrara is basically a geologic layer … and recently companies have figured out how to extract oil out of that,” Comstock said. “There has been a leasing spree on the Niobrara formations of un-leased areas across the state, and we are seeing the results of that here.”

The local portions of Niobrara formation oil companies are interested in run from the Craig area east to Milner, Comstock said.

“My hope is that land owners and mineral owners benefit from our lease auction,” he said.

The various taxing districts benefiting from the lease sale include the Moffat County School District, Moffat County Affiliated Junior College and The Memorial Hospital, among others, Comstock said.

The school district will receive an estimated $1.31 million, the college will receive an estimated $132,891.02 and TMH will receive an estimated $130,397.76 allocated from the county’s estimated $2.49 million in revenue.

Moffat County will pocket an estimated $866,908.24 from the sale — money Comstock said is restricted to the county’s capital improvement fund.

However, the final revenue numbers allocated to the county from the sale will be determined after required title work has been done, Comstock said.

Mathers said he hopes oil production in Moffat County will follow in the wake of the mineral leasing activity.

“We have always had a lot of leases, but we’ve never really got to the production stage,” he said. “We are hoping that this time, it’ll go all the way and we’ll actually be producing some money here.”

Mathers said the mineral lease sale could have “huge” economic benefits to the community and could create a number of jobs depending on possible production of the minerals.

“This is just a win-win,” he said. “Everybody wins on this deal. I mean even the community and there is a lot of (other) leases going to ranchers and farmers and mineral owners out there that are decent leases.”

Davidson was lost for words when he was asked how he felt about the benefit the mineral lease sale would provide to the museum.

“I don’t know what to say about that — those are just amazing numbers,” he said.

Davidson said he felt the county did the mineral auction at the right time.

“Nobody could have ever foreseen that those would bring in that kind of potential money,” he said.

Comments

justateacher 4 years ago

I wonder what happens to the look of the land after all the minerals have been drained? After landscape after landscape has been altered in Moffat County, one must wonder what will be the draw to attract tourists...

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GreyStone 4 years ago

As a result of all these minerals being drained, there will be nothing growing in Moffat County but a bunch of scraggly sagebrush, grease wood, oak brush and a few starving jackrabbits. The landscape will sink, Denver will no longer be known as the “mile high city”, all the deer will move to Utah, However we will all become a bunch of “Jed Clampits”, wealthy beyond our wildest dreams. Bring it on, ”Big Oil”.

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onewhocares 4 years ago

Like I've said before, the County Commissioners are blinded with greed. You've mentioned the money the county will receive from these companies, but you haven't mentioned what happens when these companies poison & completely destroy the aquifers that supply water to our homes from the chemicals they use in "fracing" to get to the oil & gas, leaving homes & towns with zero value once our water is thoroughly compromised & our land polluted. This has all ready happened to a number of towns across the Midwest where a few benefited from the money (the politicians) but the rest of the town was rendered dead, or poisoned either from the contaminated water and /or the non-functioning drilling wells that are left behind & uncared for with horrible chemicals seeping out of their casings. Why didn't you mention that aspect of it Tom & again where was the public vote on this issue? Once the oil & gas runs out, what is left in Moffat but abandoned wells & eye sores as far as the eye can see.

When these companies destroy the value of our land since we the homeowners do not make a dime off the drilling (even on our own land) since most of us don't own the mineral rights, will the companies pay us for the loss of our homes? And don't say yes, cause I all ready know they won't. I asked a representative from Geokinetics (who does the 3-D surveying for the oil & gas companies) about this issue, lo & behold, not a dime. There will be no financial compensation for the abuse of our land & neighborhoods from these companies that come in destroy & leave. I think you the Commissioners that made these decisions, should be directly responsible for financial compensation to all of us that will suffer horrible financial losses to our homes when our water is compromised.

Politicians, when will you learn you can't drink money, or eat money or breathe money? When the water, food and air is destroyed by contamination what will you do with it other than roll around in it completely mentally ill in delusion. What have you left your grandchildren and what have you done to the masses??

I, personally will go to war with any one of these companies that take one step on our property --- I will not let them destroy our property without a fight.

Kerrie Clarke

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Vermillion 4 years ago

Wasn't it just a few months ago that Commissioner Mathers and Mr. Comstock were ranting and raving of how Governor Ritter had destroyed the oil and gas development in Moffat County? If those regulations were so bad, why are these companies spending all of this money to get oil and gas leases in Moffat County? It leads one to believe that Commissioner Mathers and Mr. Comstock don't know what they are talking about or were they just being a shill for oil and gas companies?

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calloway 4 years ago

It is always amazing that land owners who do not own the mineral rights are ready to trample property rights of the mineral owner.

If you didn't want exploration on your land you should have made sure you owned the mineral rights.

Wining about it now is pointless. The mineral estate has precedence. The country was set up that way get over it.

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