Navajo Nation president vetoes a plan to explore for helium near 2 tribal communities

On his last day in office, Navajo Nation President Jonathan Nez vetoed a resolution that would have approved operating lease agreements between the Navajo Nation and Navajo Oil and Gas to explore for helium near two communities. 

Nez informed the council of his decision Monday in a memo.

The Navajo Nation Council approved the measure last week, despite concerns about the threat of water contamination and the legacy of abandoned uranium mines. Proponents had said helium extraction could produce millions of dollars a year on revenue.

The legislation would have authorized Navajo Nation Oil and Gas Co. to enter into an operating lease agreement for helium exploration in the Tohachee Wash near Teec Nos Pos and in Beautiful Mountain and Porcupine Dome, near Sanostee.

“It is in the best interest of (Navajo Nation Oil and Gas) and the Navajo Nation for NNOGC to continue exploration and production of Navajo Nation oil and gas resources,” the legislation stated.

But in his veto memo Monday, Nez said one reason he could not support the measure was that there was no consensus from the chapters that would be affected by the legislation. 

“Community members have raised serious concerns regarding affects on the environment and their health that have not been answered, and the Navajo Nation Council raised issues over how the future profit sharing from Navajo Nation Oil and Gas Company (NNOGC) would be addressed,” Nez wrote in his memo, obtained by The Arizona Republic. 

“If there had been more public education and planning in place, such as Profit Sharing Agreements, and a commitment from NNOGC regarding health assessments, it may be possible to sign legislation such as this into law,” he continued.

"Also, Chapter concerns should be heard and considered in future legislation regarding this form of operating agreement. I encourage the parties to come back to the table with the 25th Navajo Nation Council to address the concerns that were raised during the development of this legislation.”

Measure was met with criticism, questions

The 800-page measure was first introduced in 2021, and sponsored by former Speaker Seth Damon, who recently resigned as speaker and was reelected for the next council. The legislation was also co-sponsored by Council Delegate Elmer Begay, who wasn’t reelected. Both delegates are Navajo Oil and Gas shareholders.

The proposal has been met with many criticisms and questions from community members and advocates. Some have argued that resource extraction of any kind should not be considered because of Navajo Nation’s traumatic history of such mining operations and its aftermath. Several people complained that delegates were making this decision despite the opposition of community members.

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“They should’ve made this lease a referendum vote on these kinds of issues. There’s a lot of questions there,” said newly elected Council Delegate Curtis Yanito, who will be taking his oath of office Tuesday, along with other incoming council delegates and the new Navajo Nation president and vice president. “What everyone is concerned about is contaminating water. In that case, that means the whole reservation is contaminated.”

Yanito will represent five chapters, including the Teec Nos Pos chapter, which is one of the two communities in the Navajo Oil and Gas lease agreement where helium exploration will take place. During the primary, Yanito unseated incumbent delegate Charlaine Tso, who was in support of this legislation and is a Navajo Oil and Gas shareholder. In the end, Yanito went up against another former delegate, Davis Filfred, and won a seat on the 25th Navajo Nation Council.

“Anything to extract minerals, anything beyond 600 feet where the water tables are at, there will be another contamination of drinking water,” said Curtis. “A lot of concerns across the reservation all have the same concerns of contaminated water.”

Like many, Curtis believes that delegates who are shareholders of entities like Navajo Oil And Gas and are voting on legislation similar to this one would have a conflict of interest. Speaker Pro-Tem Otto Tso, who is also a shareholder of Navajo Oil and Gas, explained that shareholders are appointed by the five standing committees of the Navajo Nation Council.

“They are enacted by legislation, by law, to serve as shareholders,” said Tso. “It is legislated.”

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Helium royalties could top $100 million

Council members and representatives of Navajo Oil and Gas have worked to educate community members about helium exploration. One of the most recent events took place in October, when Navajo Oil and Gas held a Helium Exploration Summit at the Phil Thomas Performing Arts Center in Shiprock, New Mexico.

“Fifty years of coal mining, we are all aware of the coal activity that has taken place on Navajo Nation. It has been said that the coal mining industry has created a Navajo middle class,” said William McCabe, vice president of Navajo Petroleum. “It provided great jobs for hundreds of people for 50-plus years and it had its benefits and it had detriments such as outside interest that came in and took a majority of the profit for their own use. The Navajo Nation was left with, on average, one-eighth of revenue.”

McCabe said for the past 75 years, there has been helium development on Navajo Nation, for the most part a result of oil and gas exploration. Since 1943 at least 1 billion cubic feet of helium has been recovered from Navajo Nation lands, with at least 6 billion cubic feet of possible helium found. Additional studies suggest there is as much as 20-40 billion cubic feet.

“The companies were looking for oil and couldn’t find oil but they found natural gas,” said McCabe. “They found natural gas that didn't have the value that it does today. They found there was a percentage of helium in that gas stream. We have an abundant supply of helium.”

In 2021, Navajo Transitional Energy Company (NTEC) acquired Tacitus LLC, a U.S.-based helium development company, and its related subsidiaries. This acquisition consisted of helium wells and infrastructure in the Tocito Dome Field on the Navajo Nation as well as federal and state leases for additional exploration in Utah.

Since NTEC acquired the company, there was no assignment of Tacitus’ agreements or anything else that would have required Navajo Nation approval. NTEC simply stepped into the shoes of Tacitus. NTEC is subject to all the terms and conditions of the Tacitus agreements.

If NTEC wants to conduct additional drilling under any of these agreements, it will have to follow the same drill permit application procedures as any other company, Navajo Department of Justice attorney April Quinn told The Republic. 

Through royalties dating back to 2018-2021, Tacitus has provided an unaudited $7.1 million in royalties to the Navajo Nation, but Tacitus has not paid any share to chapters.

Navajo Oil and Gas estimated helium production royalties in over a span of 7-10 years, or the life of the project, could total well over $100 million for the Navajo Nation.

"We estimate the Teec Nos Pos chapter could yield $15 million of royalties to the Navajo Nation," said James McClure, chief executive officer for Navajo Oil and Gas. "For the Sanostee chapter we estimate the royalties to be $100 million. That's successful efforts, that's assuming our geological models are accurate."

Helium can’t be chemically manufactured, and most estimates are that the world's helium reserves will only last another 20-50 years. The U.S. stockpiled and regulated pricing since 1925, but under the Helium Stewardship Act of 2013, had begun the selling of the government's helium reserves at auction prices. This has allowed for the market to catch up with the scarcity of the resource, but as of 2021 the government began exiting the helium business, leaving it to the private sector.

Residents worry about the long-term effects

For people who have seen and been directly affected by the long-lasting ramifications of mineral extraction on the Navajo Nation, helium exploration is seen more as a perpetual sacrifice, one that has continued for at least 100 years since the formation of the Navajo Nation tribal government. Many people fear that the land is too often left stripped of its natural goodness, leaving behind an unusable mess.

“I am calling out our leaders to recognize the proposed legislation between Navajo Nation and Navajo Nation Oil and Gas is replete with egregious facts, tactics of manipulation, and situating the context in favor of NNOG and its constituents, shareholders, partners, and allies,” lifelong Teec Nos Pos resident Christina Morris wrote to the council.

She pointed to communities such as Red Water Pond, which has been dealing with the effects of the 1979 Church Rock Uranium Mine spill, the largest radioactive spill in the U.S. She also wrote about communities such as Huerfano and Counselor, areas of oil and gas production where methane rich natural gasses have been pumped into the atmosphere.

There are also communities where Navajo Generating Station, Peabody Coal Mine and Kayenta Coal Mine once sat. These communities still lack basic infrastructure, roads, electricity and have watched as water resources have been depleted. The effects also remain from the thousands of Navajo citizens who were relocated for the mines. Critics of the current proposal say it was a sacrifice of land, people, traditional and sacred sites, animals and water, all to develop Phoenix and generate electricity for cities as far as California.

But these sacrifices are usually forgotten, the critics have said. During an Arizona Corporation Commission debate, then-candidate Nick Myers, who was recently sworn in, talked about the idea that the state or utility ratepayers should compensate the Navajo Nation for the closing of NGS.

“It’s not the job of the ratepayers in Arizona to get into foreign aid," he said. "If you’re talking about tribal lands, foreign aid comes under the federal government.”

But Morris, from Teec Nos Pos, said the costs are far higher.

“History should be reminded here of the cost to human lives and suffering, the fact that many communities were exposed and forever changed the trajectory of the people, their DNA, their generations,” Morris said. “The air and soil they live in is considered unlivable.”

Although there were hundreds of names on the petition against helium exploration, others supported Navajo Oil and Gas helium exploration. The company has said it is committed to developing helium resources in an environmentally responsible manner and preserving and protecting sacred places, cultural resources, and respecting Diné culture and environmental values.

It also stated it will be fully regulated by the Navajo Nation's Environmental and Cultural Departments and by the federal government. And it promises that Navajo Oil and Gas will contribute $3.7 million to the Sanostee community.

Amendments voted down

During the council debate over the proposal, two amendments were discussed at length, and in the end they both were voted down. One amendment, proposed by Council Delegate Amber Kanazbah Crotty, asked that 25% of what Navajo Nation receives from the helium agreement be placed in a fund for affected communities.

“Historically, in the last 100 years this council was established to create oil and gas leases, with the boom and bust of many extractive energies companies but no coordinated effort or direct funding to the impacted communities, except for minimal support like maybe holiday dinners, or maybe fixing a road,” said Crotty. “There has been no direct investment to communities that have to endure the industry.”

The council denied Council Delegate Daniel Tso’s request to allow three people from the affected communities to address the council. Tso then proposed another amendment to allow for 5% of monies received from this agreement to be put into a new helium health and environmental impact fund, so that health and environmental impact of helium exploration and production could be made, allowing for recommendations to the council to mitigate these impacts.

“I spoke about the experiences of my communities of Torreon, Star Lake, Ojo Encino, Counselor chapter having health impacts and that no other community should endure health impacts without the council knowing about it,” said Tso. “The other aspect is the environmental impact. There are certain environmental justice issues that come out from the oil and gas extraction industry.”

The council voted both amendments down and voted to pass the leasing agreement for Navajo Oil and Gas.

Arlyssa Becenti covers Indigenous affairs for The Arizona Republic and azcentral. Send ideas and tips to arlyssa.becenti@arizonarepublic.com.

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