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Drilling crunch

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Drilling lease is a problem for Santa Fe Opera

By Associated Press

Residents of pastoral Mora County have been watching records in the county clerk’s office ever since the oil and gas industry began eyeing a big swath of land in the area.

What they found recently was surprising:  the Santa Fe Opera had given permission to drill on nearly 27,000 acres (10,925 hectares) in Mora and neighboring San Miguel counties.

Turns out the opera company had been given the mineral rights in 2002 as part of a bequest from a longtime donor. She specified that it be used to support an apprentice program for young singers.

Drilling foes worry that oil and gas wells will pollute water and air, harm wildlife and ruin the quality of life in the agricultural area. They are outraged that an internationally recognized institution like the Santa Fe Opera could potentially profit from oil and gas drilling.

“I was shocked to see that the Santa Fe Opera’s name was on this lease,” said Kathleen Dudley, an artist and musician who has a small farm near the community of Ocate and co-chairs the watchdog group Drilling Mora County.

“To see an art company sell out the environment, that was a very egregious act as far as I was concerned,” Dudley said.

When the opera lease, signed in April, came to light a few weeks ago, general director Charles MacKay said the opera was simply making a financially responsible decision. The opera received an upfront payment of $150,000 and stands to get a cut of future proceeds from the lease.

But the ensuing outcry has the opera changing its tune, with officials saying they will try to find a resolution that addresses people’s concerns.

“We believed we were acting in accordance with the donor’s wishes, that her gift would generate long-term support for the apprentice program,” MacKay told The Associated Press.

MacKay said he didn’t know what options might be considered.

The 52-year-old company is one of the nation’s foremost summer festivals, known for its championing of new works, its artistic excellence and its apprentice programs for singers and technical staff.

The opera was approached about leasing at a time when the economic downturn was a concern, but the decision was driven more by wanting to honor the donor’s intentions, MacKay said.

Drilling has been a contentious topic in Northern New Mexico for the past couple of years, as oil and gas companies take a second look at areas once written off as unsuitable for exploration.

There is no active drilling in the two counties northeast of Santa Fe where the opera owns mineral rights, but that could be changing as companies take a closer look at what could be a profitable new area.

“Individuals have the right to do with their property what they wish, in this case maximize dollars for the benefit of the opera,” said New Mexico Oil and Gas Association President Bob Gallagher. “Publicly picking on people who have signed leases is a new low.”

The opera’s lease was signed with J Bar Cane Inc., an independent company that acquires leases on behalf of oil and gas producers.

Company president John Michael Richardson declined to identify the firm involved in the lease.

The opera signed a 10-year agreement for a one-eighth royalty. That means if wells ultimately produce oil or gas, the opera would get 12.5 percent of the net proceeds.

“All I know is, the poor old opera is getting beat up on a regular basis for conducting normal business, in my opinion,” Richardson said.

The opera doesn’t own the surface of the property, just the mineral rights — and only a fraction of those. Other mineral rights owners on the 26,747 acres (10,824 hectares) include three individuals and the College of Santa Fe, which also received mineral rights from the same opera donor.