Montana had a record oil and gas lease on state land, officials said this week.
The State Board of Land Commissioners on Monday approved the nearly $1.2 million sale, which includes 36 tracts in Daniels, Phillips, Roosevelt, Rosebud, Toole, and Valley counties.
“Ramping up American-made energy in Montana is one of many ways to reduce our reliance on foreign energy sources,” Gov. Greg Gianforte said in a press release. “Additionally, proceeds from these oil and gas lease sales will benefit our schools, ensuring our kids have access to the best education possible.”
The state Department of Natural Resources and Conservation (DNRC) said moving the sales and bidding process to an online format is the reason for the record sale.
“Moving sales to an online format allows more bidders to participate in auctions, increasing competition and bid amounts,” DNRC Director Amanda Kaster said.
Montana Petroleum Association Executive Director Alan Olson said the lease sale “shows the benefits of true multiple use management of government owned lands.”
“Along with agriculture leases, timber harvest, recreation, and mineral development, these state lands produce much needed revenue for Montana’s School Trust,” he added.
The state collected $6 million in revenue from oil and gas royalties last year, according to Olson.
Oil and gas leases are comprised of a set annual leasing fee per acre, plus a one-time competitive bid, known as the bonus amount. If the leases are developed and produce oil, they generate additional royalty revenues.
While oil production from the lease sale won’t be seen immediately, it comes at a time when Montana’s motorists are looking for relief at the pump. The average price for a gallon of regular gas in Montana is currently $4.05, up from $3.44 last month, and $2.71 this time last year, according to AAA.
The global price of crude oil shot up following Russia’s invasion of Ukraine, which cause lawmakers in Washington, D.C., including U.S. Sen. Jon Tester, D-Mont., to push for a ban on Russian oil imports.
President Joe Biden announced a U.S. ban on the importation of Russian oil, coal and gas earlier this month.
This article was originally posted on Montana sees record $1.2M oil and gas lease sale