HELENA, Mont. – Along with the Montana Department of Natural Resources and Conservation (DNRC), Governor Greg Gianforte, as chair of the Montana Land Board, today announced an oil and gas lease sale on state trust lands totaling more than $2.1 million in revenue.
“Montana provides key energy resources to make our state and nation energy independent and secure,” Gov. Gianforte said. “The funding generated by this sale represents a sustaining investment in Montana’s public schools to ensure our kids have access to the best education possible.”
The State Board of Land Commissioners, also known as the Land Board, this morning approved the sale that included 12 tracts located in Musselshell, Sheridan, and Toole counties. The tract in Sheridan County solely generated $2.14 million. This high bid was made possible as a direct result of the technological advancements the industry has made in horizontal drilling, opening wide underground layers from one surface location.
“Advances in the oil and gas industry are contributing to higher lease sales that generate more income for the beneficiaries of Montana’s state trust lands,” explained DNRC Director Amanda Kaster.
Funds generated by leases on state trust lands contribute to the education fund for the state. Oil and gas leases are for possible future exploration and production and 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 or gas, they generate additional royalty revenues.
“It is now common to see Bakken formation wellbores drilled up to four miles,” explained DNRC State Trust Lands Petroleum Engineer Zack Winfield. “Areas that were historically considered uneconomic for development are becoming very attractive to the industry. Provided that oil prices remain strong, I expect to see increased leasing activity and production from Sheridan County tracts into the future."
DNRC manages state trust lands, including the auction of oil and gas leases, to produce revenues for trust beneficiaries while considering environmental factors and protecting the future income generating capacity of the land. To learn more about mineral leasing on state trust lands, see here.
This content is sourced from
State of Montana Newsroom
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