Wyoming is in talks to buy millions of acres of land from Occidental Petroleum Corp. in what lawmakers say would be the biggest land purchase since the U.S. bought Alaska from Russian tsar Alexander II.

The U.S. state is advancing bills authorizing the use of state funds to acquire the properties. People involved say the price ranges between $1 billion and $3 billion.

Oil and gas producer Occidental has put the land on the block as it pays down debt from its $55 billion acquisition of Anadarko Petroleum in 2019. The company is under pressure, with U.S. oil prices sliding below $50 a barrel and activist shareholder Carl Icahn agitating for change.

The land lies on either side of the Union Pacific railroad, which originally received it from the federal government during the frontier era before its sale to Anadarko.

“Opportunities like this don’t come along very often,” state governor Mark Gordon and leaders of the Republican-controlled legislature wrote in a column last week. “It’s likely that this would be the largest government purchase of private land since the United States purchased Alaska.” Critics at first panned the 1867 U.S. purchase of Alaska as “Seward’s folly,” after U.S. secretary of state William Seward who negotiated it.

Wyoming’s interest in an area this large is also raising questions. The land on offer—more than 1 million acres of surface land and 4 million acres of underground mineral rights—could deepen the Wyoming economy’s exposure to natural resources. State finances are deteriorating as taxes on coal and natural gas decline.

State officials view the land as a potential bonanza for oil and gas extraction, wind and solar farms, power transmission lines, soda-ash mining, livestock grazing and big-game hunting. 

Houston-based Occidental has confirmed the auction for the acreage, which cuts mostly through Wyoming’s arid southern tier.

“While the state has clearly communicated a lot of interest in this asset, it is a competitive process and there’s a large number of qualified participants in that,” said Oscar Brown, Occidental senior vice-president. “The winner of that asset will be one of the largest land and mineral owners in the United States.”

Several energy-focused private equity groups and at least two publicly listed exploration and production companies have expressed interest, according to people briefed on the sale process.

Shannon Anderson, staff attorney at the Powder River Basin Resource Council, said the Wyoming conservation group was “very concerned about the risk to our state if we spend our savings to acquire this land and minerals that Occidental can’t wait to get rid of.”

Gordon first discussed a potential land deal with Occidental CEO Vicki Hollub last May, at a conference on carbon capture and storage technology held in Jackson, Wyo., a state official said.

The state government owns 3.5 million acres of surface land and 3.9 million mineral acres. Leases and royalties generate almost $200 million in annual revenue for the government, according to its Office of State Lands and Investments. The U.S. federal government owns another 29 million acres of land in Wyoming, almost half the total.

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