News6 Investigates


6 Investigates follow-up: Fracking Choke Canyon generates millions for the city

Posted at 6:34 PM, Nov 12, 2018

While the federal government moves ahead with plans to open Choke Canyon up for more oil and gas exploration, 6 Investigates finds the city’s earning millions in royalties from it.

And it’s raised questions on whether the city knows its own business, given its formal protest of the government’s plans, last year.

That’s when 6 Investigates discovered the Bureau of Reclamation’s notice of a plan to auction about 1,600 acres around Choke Canyon to oil and gas developers.

It raised alarms with environmental groups, who worry that oil and gas “fracking” could jeopardize not only the integrity of the water supply, but, the stability of the Choke Canyon Dam.

Those concerns, in part, prompted the city manager last year to file a formal protest with the bureau. It held the auction, anyway.

But, we’ve since found that, while city leaders protested, the city was also cashing in at the same time.  

Buried deep in the city’s Comprehensive Annual Financial Report is a line item showing revenues of $5.6 million from the city’s mineral interests. Interests we’ve confirmed are from oil and gas leases in the Choke Canyon area.

According to the city’s Finance Department, that money was applied to what the city owes the government for the cost of building the reservoir, in the first place. It’s created a quandary for elected leaders like City Councilman Greg Smith, who tells 6 Investigates the city council has not been properly briefed on the risk-reward proposition of fracking around the city’s largest freshwater supply.

“We have the potential of millions of dollars sitting here, so, we have to ask ‘Do we have a safety risk, or not?,'” Smith said. 

He says he plans to push the City Manager’s office to add the topic to an upcoming city council agenda, to allow the public to weigh-in on the topic.

Meanwhile, the Bureau of Reclamation that owns tens of thousands of acres worth of mineral rights around the reservoir plans to auction 4,000 plus acres, in December. The city water department has said it will not protest that decision any further.






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