Oil and gas lease sales on state trust land hit $15.3 million in November

• Roswell outfit high bidder for three tracts in Lea County

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The State Land Office Tuesday collected $15.3 million from the November oil and gas lease sale bringing fiscal year earnings from monthly lease sales to $72.5 million.

Public schools and public buildings are the beneficiaries of the lease sale.

State Land Commissioner Aubrey Dunn offered 26 tracts covering 6,757 acres of State Trust Lands in Chaves and Lea counties.

The monthly lease sales, which are held on the third Tuesday of every month, are conducted online in sealed and open bidding formats. This month, 31 bidders from eight states bid on the offered tracts.  Sealed bids generated $11,847,261 and open bids brought in $3,484,600 for an average per acre price of $2,269.

Manzano LLC, of Roswell, was the highest winning bidder in the sealed format, acquiring three 320-acre tracts in Lea County for $1,325,000 each. Grey Wolf Oil and Gas, of Houston, was the highest bidder in the open format, paying $1,000,100 for 320 acres, also located in Lea County.

Oil and gas lease sale earnings are paid into the Land Maintenance Fund, which covers the State Land Office’s operating expenses. The agency is self-funded and spends about five cents of every dollar it earns. The remaining revenue is distributed directly to the beneficiaries, with the exception of public school monies, which are paid into the state’s General Fund and distributed to each school district as appropriated by the Legislature.

Revenues earned by the respective lease sale beneficiaries are  Public Schools: $14,411,012 and public buildings, $920,850.

Oil, gas, and mineral production, ranching and farming, and commercial development on State Trust Lands support public schools, seven universities, New Mexico Military Institute, New Mexico School for the Deaf, New Mexico School for the Blind and Visually Impaired, three hospitals, correctional facilities, water conservation projects, and public building construction and repair.  In fiscal year 2017, the State Land Office collected $663 million from lease payments, oil and gas lease sale earnings, rights-of-way, permits, interest, fees, and oil, gas, and mineral royalties.