Interior Secretary Cecil Andrus has canceled a controversial non-competitive lease for drilling rights at Fort Chaffee, Ark., and ordered a moratorium on similar leases.
Andrus said he was dropping Chaffee leases because they had been approved before the required regulations governing such acquisitions had become effective.
The issue gained public attention in September when Senate hearings showed a Texas oil company had acquired the Chaffee drilling rights for $1 an acre when nearby land had brought bids as high as $200 an acre.
At the hearing Guy R. Martin, an assistant secretary, defended the department's no-bid lease. But a department official said yesterday that a recent review of the decision revealed the failure to meet the technical requirements.
Texas Oil & Gas Co.'s application for the 33,000 acres at Fort Chaffee was approved in May 1977. The regulations needed for leasing such land on military reservations didn't go into effect until September 1978.
Andrus also announced last Friday that he has ordered further leasing on such property held up while the larger issue of non-competitive leases is studied. Sen. Dale Bumpers (D-Ark.) had complained at the hearing that the government was losing millions of dollars by accepting such no-bid leases.
In 1977, more than 10,000 non-competitive leases on public lands were approved, while only 334 leases on such land were acquired through bidding. The Carter administration is backing a bill to broaden the definition of lands open to competitive bidding.