US Sen. Jeff Bingaman (D-NM), chairman of the Senate Energy and Natural Resources Committee, was scheduled to preside over a field hearing in Bloomfield, NM, May 31 that should be of interest to US oil producers within and outside New Mexico.
Lawmakers were planning to take a second look at the Bureau of Land Management's oil and gas lease inspection program.
Permits
Bingaman met May 15 with BLM Director Kathleen Clarke following complaints by some ranchers in the Four Corners area (Colorado, Utah, New Mexico, and Arizona). Ranchers said BLM needs to increase the number of permit inspectors sooner rather than later because of environmental damage from operating leases that caused either injury or death to their livestock.
Clarke, who has been on the job only a few months, affirmed to Bingaman that inspection and enforcement of drilling permits is a top priority of her agency. In 2001, BLM administered more than 50,000 oil and gas leases nationwide. Of that total, about 21,000 leases produce oil and gas.
Earlier this year BLM's Farmington office in northwestern New Mexico had just 12 inspectors to oversee 18,000 BLM-regulated oil and gas wells in the Farmington area. That meant that each inspector was responsible for about 1,500 wells.
The national average is 300 wells/inspector.
BLM plans six new hires this year, which will drop the well enforcement ratio to about 1,000 per inspector, and the agency says it is committed to doing more. BLM told Bingaman that it wants to hire 36 employees so that each inspector can oversee about 500 wells, but the process could take several years because of budget constraints.
Producers also would like to see more staff if it means the permit approval process can be shortened.
Congressional funds
Congress may step in to try and speed things along to keep ranchers and oilmen happy.
The White House budget request for the new fiscal year beginning Oct. 1 seeks $10 million more than last year for BLM energy and minerals activities. Of that, oil and gas management under BLM's jurisdiction would get $8.3 million, an 11% increase in funding from last year (OGJ Online, Feb. 15, 2002).
Currently, it's unclear whether Congress will boost or trim that request.
The Interior appropriations bill, which funds the Department of the Interior and the fossil energy portions of the Department of Energy, is still in draft form, with a final bill likely in the fall.
White House officials are hoping Congress honors their request to increase funding to streamline permitting, add staff, and conduct environmental impact studies.
Under the White House proposal, about $3 million is earmarked to support a 2004 lease sale in the northeastern sector of the National Petroleum Reserve-Alaska, along with a sale in the Arctic National Wildlife Refuge 1002 coastal plain area, if authorized.
BLM also needs money to support the Joint Pipeline Office's repermitting of the Trans-Alaska Pipeline System.
