Flagstaff City Council Terminates Agreements with Energy Company

Feb 13, 2019

The Flagstaff City Council has canceled two agreements with a Canadian energy company testing for helium and hydrocarbons. The move follows concerns by officials and community members over the effects on Flagstaff’s future water supply. KNAU’s Ryan Heinsius reports.

Flagstaff voters approved a $15 million bond to purchase Red Gap Ranch east of the city in 2004 partially for a future water source. Desert Mountain Energy has 19 leases on adjacent state land to explore for helium, oil and gas.
Credit City of Flagstaff

Desert Mountain Energy has 19 leases on a checkerboard of state land east of Flagstaff. They’re adjacent to Red Gap Ranch, which the city purchased partially as a future groundwater source. The company would have to cross city property to access its leases.

Last month City Manager Barbara Goodrich signed two agreements to allow Desert Mountain access while conducting seismic testing. She told the council Tuesday that the now-terminated deals don’t involve any drilling.

However, some environmentalists, residents and council members worry about the potential effects of helium, gas and oil extraction. One is Vice Mayor Adam Shimoni.

"I think that this is going to be potentially very threatening to our water source even if it’s not done on city land, and I question any engagement and cooperation and with the company. Time is of the essence; once you contaminate the water, it’s gone," he says.

Desert Mountain Energy says preserving the local environment is a priority, along with not significantly impinging on the rights and customs of indigenous communities. The company will still have six months to test and cross city property before its license is canceled.

The company also has leases on nearly 40,000 acres near Holbrook for helium, oil and gas development.