The U.S. Bureau of Land Management on Thursday leased 33,000 acres for oil and gas development on the Front Range and in the Pawnee National Grassland for $32.1 million.
The sale was held in the face of challenges by environmental groups who said the impacts of drilling on air quality and climate have not been assessed.
Sales inside the Pawnee Grassland accounted for three-quarters of the acreage and $30.8 million of the auction total.
The high bid was $19.4 million for a 1,919-acre parcel in the grassland by Ironhorse Resources LLC.
Ironhorse, based in Cherry Creek North, acquires acreage for oil and gas companies. Program manager Will Smith declined to comment Thursday.
Eighty-six parcels were offered and 73 sold, according to the BLM. Parcels also were offered in Arapahoe, Adams, Logan and Weld counties. It was the largest oil and gas lease sale in Colorado since the 2008 auction of the Roan Plateau on the Western Slope, which raised $114 million.
The BLM manages oil and gas lease auctions for all federal agencies. The auction proceeds are split, with the federal government getting 51 percent and Colorado receiving 49 percent.
Under terms of the leases, operators can access the oil and gas through horizontal wells but cannot bring drill rigs and tanks onto the grassland.
The 193,000-acre grassland is in northern Weld County, near the Wyoming and Nebraska state lines. It is a vast expanse of high plains prairie dotted with buttes and bluffs.
“The Pawnee is a healthy prairie ecosystem, and federal lands on the plains are far and few between,” said Jeremy Nichols, head of WildEarth Guardians’ climate and energy program.
Santa Fe-based WildEarth Guardians challenged the lease sale, saying the BLM did not assess the air quality and climate impacts of more wells in Weld County, the most heavily drilled area in Colorado.
The BLM rejected WildEarth Guardians’ formal protest, saying that at this early stage, it couldn’t project impacts.
In its response, the agency called the environmental group’s argument “too speculative to be useful.”
The grassland, which sits atop the oil-rich Niobrara shale, is a patchwork interspersed with private land from which operators can drill into the federal leases.
Wells are now being drilled horizontally as far as 2 miles underground in the Niobrara, according to industry executives.
Wells are being drilled on private land adjacent to the grassland, and there are 63 active oil and gas wells on the grassland, according to the U.S. Forest Service.
In 2014, Colorado produced a record 95 million barrels of oil — 85 percent of it from Weld County. There are 22,000 operating wells in the county.
The Forest Service decided in December to lease but not allow surface occupancy.
“Allowing mineral access with no surface occupancy allows for resource development while minimizing the overall environmental impact on the Pawnee,” Forests and Grassland supervisor Glenn Casamassa said at the time.
Mark Jaffe: 303-954-1912, mjaffe@denverpost.com or twitter.com/bymarkjaffe
