Policies adopted during the Obama administration have created unnecessary and unproductive obstacles to oil and gas activity on onshore federal lands, witnesses told a US House Natural Resources Committee subcommittee. Other witnesses defended the more prudent approach adopted by the US Bureau of Land Management.
“BLM’s current approach to management of the public lands is misguided,” suggested L. Poe Leggette, who heads the Norton Rose Fulbright law firm’s energy practice for the Americas. “The agency has failed to demonstrate any supportable need for the policies it is currently promoting.”
The US Department of the Interior agency continues to add operational complexity without identifying any commensurate environmental, social, or financial benefit to offset that complexity, Leggette said.
“The results threaten to derail the promise of America’s energy future and represent an impermissible attempt to exercise powers beyond the carefully circumscribed authority Congress has granted BLM over the federal public lands,” Leggette told the Energy and Mineral Resources Subcommittee on Feb 5.
Kathleen M. Sgamma, vice-president of government and public affairs at the Western Energy Alliance in Denver, meanwhile, said, “Rather than responding rationally to a lack of funding and personnel at a time of declining budgets, BLM has piled more paperwork onto an overburdened staff who cannot process leases, environmental analyses, or permits in a reasonable timeframe.”
She maintained, “More time is now being spent pushing paper and less in the field ensuring protection of the land while enabling responsible energy development.”
Heightened regulation, decreased access, and permitting delays can discourage development on federal lands, warned Kathleen Schroder, an attorney at Bjork Lindley Little PC in Denver who helps producers navigate the federal onshore oil and gas regulatory framework.
She told the subcommittee that BLM, in draft resource management plans (RMP) in Wyoming and Colorado, has proposed aggressive measures to regulate air quality which oil and gas operators have challenged as beyond the agency’s statutory authority. The federal Clean Air Act charges the US Environmental Protection Agency with regulation of the nation’s air resources, Schroder noted. EPA in turn has delegated this authority to states, and Colorado and Wyoming have used it to regulate emissions from oil and gas development, she said.
“In these RMPs, BLM also has proposed to limit access to federal lands for future oil and gas leasing and development,” Schroder testified. “These issues are then compounded by delays that operators experience in obtaining drilling permits from BLM.”
A. Lynn Jackson, chairman of the Grand County Council in Moab, Utah, said, “Red tape and overregulation, in virtually all BLM resource management programs, has never been greater and continually grows worse by the year.”
Jackson said recently, an oil company operating in the county required 3 years to obtain permission to drill nine development oil wells on federal leases. The wells were successfully drilled in 2012, and added nearly $1 million dollars in royalty payments to the county’s budget, he said.
The same company identified 15 more wells it would like to develop on its remaining Grand County leaseholds in this area and submitted an application to BLM in August 2013, Jackson continued. BLM initially balked at processing the new application since the wells were within an identified Master Leasing Plan area, initiated under a 2010 order from then US Interior Sec. Ken Salazar, according to Jackson.
Offer to pay more staff
Jackson said the company, after several months of negotiation, was able to persuade BLM that the master leasing process was developed to analyze unleased federal lands. “[It was] recently told BLM will proceed with processing, but to expect delays due to limited staffing,” he said, adding, “The company offered to pay for staffing, to help not only with this project, but others in the local BLM office. BLM has yet to decide if they will accept the company’s offer.”
But another witness, who said he worked for close to 35 years for BLM, urged subcommittee members not to blindly accept charges of mounting bureaucratic obstacles at the agency. “What is burdensome red tape to some are critical protections, due process, rules of fair play, and economic lifelines for others,” said Dennis Willis, a Price, Utah, resident who testified as a private citizen.
“Our laws, the rules of the game, can’t be upended simply because of an inconvenience to one stakeholder, one industry, or one interest; they need to work for all the stakeholders at the table,” he said. “What one industry sees as ‘red tape’ another industry sees as a lifeline, a local community sees as their ability to have their voices heard, and a parent sees as the future western landscape and lifestyle their child inherits.”
Nicholas Lund, who manages the Landscape Conservation Campaign at the National Parks Conservation Association in Washington, told the subcommittee that the master leasing plans initiated under Salazar’s order were a response to plans the Bush administration developed in 2008 to offer oil and gas leases near Canyonlands and Arches National Parks in southeastern Utah.
“MLPs allow BLM, in conjunction with other federal land managers, to more fully account for the multiple values present in a landscape where drilling is proposed—ecological, economic, and recreational—before lands are leased for drilling,” he explained. “By identifying conflicts before they arise, MLPs empower BLM managers to direct leasing to areas with the lowest potential for impairment of national parks and other lands of high ecological and recreational value.”
The smaller scale of an MLP also helps fix a flaw in BLM’s RMPs, which are too large to facilitate effective planning and updated so infrequently that they’re not useful in trying to resolve immediate conflicts in particular areas, Lund said.
“By focusing on the most controversial areas before they are developed, MLPs can help not only protect national parks and the economies they support, but also provide agencies and developers with a measure of assurance that they can avoid lengthy challenges down the line,” he indicated.
Contact Nick Snow at [email protected].