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Despite low prices and demand, companies are stocking up on oil and gas leases ahead of November's presidential election. Oil prices dropped sharply in March due to a glut of supply and decreased demand, and despite modest increases over the past few months prices dipped again yesterday. Despite the industry's weakened state, companies continue to buy up leases for oil and gas development on public land. In the Permian Basin, federal permitting is up 80 percent in the past three months, even as the outlook for oil remains uncertain.
There will be six lease sales spanning 300,000 acres in September. With prices remaining low, these sales shortchange state budgets that rely heavily on revenue from oil and gas leasing. In New Mexico, where one-third of the state's budget comes from oil and gas development, lease bids averaged $169 per acre last month, compared to an average of $1,386 per acre in February of this year. The trend—companies paying bargain rates to lock up land—shortchanges taxpayers and demonstrates the outdated nature of the oil and gas leasing system.
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So we haven’t, as a species, sufficiently heeded the warnings of our scientists, and now we are seeing the costs of that intransigence... We need to end this reliance on fossil fuels if we’re going to have any hope of mitigating the damage we have already done to the global environment, and to ourselves. We need to stop building communities in places that we know will burn.”
