Utah sues U.S. government over trust lands

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Utah's School and Institutional Trust Lands Administration (Usitla) has filed a federal lawsuit against the U.S. government in a land use dispute stemming from a national monument designation by President Clinton in 1996.

Usitla is an independent state agency responsible for managing lands granted to Utah by Congress under the Utah Enabling Act of 1894 for the support of the state's common schools and other beneficiary institutions.

Said Usitla, "The creation of the monument means that mineral leasing will be sharply curtailed...it is more likely that companies holding leases will relinquish them rather than pay rentals on leases where a minimum of a 3-year delay is required and the chances of development are uncertain or minimal.

Monument designation

The suit, filed June 25 in the U.S. District Court for the District of Utah Central Division, stems from President Clinton's designation last September of 1.7 million acres of federal lands in Kane and Garfield counties of southern Utah as the Grand Staircase-Escalante National Monument (OGJ, May 5, 1997, p. 62).

Most of the land within the monument boundary either belongs to Usitla-scattered throughout the area-or is held by the U.S. Bureau of Land Management (see map).

The suit names as defendants President Clinton; Department of Interior (DOI) Sec. Bruce Babbitt and the Interior department; Kathleen McGinty, chair of the White House Council on Environmental Quality and the council; and Sylvia Baca, interim BLM director and the BLM.

Before OGJ presstime, officials at Interior had not issued a statement regarding the lawsuit.

What's involved

More than 176,000 acres of school trust lands and 25,000 acres of trust mineral lands are located within the boundaries of the monument.

Income from the trust lands has totaled more than $100,000/year.

Although these trust lands were technically not covered by the monument designation, withdrawal of surrounding federal lands affects the use of state trust lands by making large scale mineral development-particularly for coal and natural gas-difficult or impossible to develop.

The White House has pledged that existing mineral leases would be honored.

The Usitla suit alleges the proclamation resulted from an effort "to further the ongoing efforts of DOI to preclude a proposed coal mine located on federal leases and state school trust lands on the southern edge of the monument and to override Congress's unwillingness to designate large areas within the monument as wilderness under the Wilderness Act of 1964."

Resources affected

Andalex Resources Inc. proposed an underground coal mine on the Smoky Hollow property, which is part of the Kaiparowits coal field in southern Utah. Officials said the mine would affect less than 60 surface acres.

At the time of the monument designation, the mine's environmental impact statement was being circulated and was due to be published in fall 1996. But, the suit claims, "Since taking office in 1993, defendants Sec. Babbitt and DOI have launched a series of legal maneuvers to prevent the...mine from opening."

The suit notes the Kaiparowits coal field is estimated to contain more than 62 billion tons of coal, of which at least 11.3 billion tons are recoverable, according to estimates by the Utah Geological Survey (UGS).

UGS estimates the trust lands also contain 2.6-10.5 tcf of coalbed methane gas.

Conoco Inc. and partner Rangeland Exploration Inc., Midland, hold more than 100,000 acres of federal and trust lands within the monument.

Conoco, which has staked two wildcat wells in the region, says that monument postulated reserves, based on state estimates, could be as much as 4 billion bbl of oil.

The company is preparing to drill a 14,000-ft well on trust lands, and Conoco and Rangeland have also filed a federal application for a drilling permit with BLM.

All approvals have been received on the state-permitted well, and the companies are awaiting word from BLM for the well planned on federal lands.

Allegations

The Usitla action alleges various breaches of U.S. law and the Constitution by the defendants and the Congress.

It seeks a declaratory judgment and an injunction to prohibit DOI from implementing changes in federal land use practices based upon the national monument designation.

Usitla also seeks for the federal court to set aside the proclamation creating the Grand Staircase-Escalante National Monument and enjoin its implementation.

Usitla claimed, "The effect of the monument designation was to trap the state's school trust lands within the monument.

"The school trust lands...contain billions of tons of coal and large quantities of oil, natural gas, and other minerals. Because of the reservation and purposed withdrawal of federal lands... several large development projects overlapping both state and federal lands have been impacted, resulting in the loss of millions of dollars in present and prospective bonus, rental and royalty income...to the detriment of Utah's school children."

According to the suit, "The mineral withdrawal effected by the monument proclamation unreasonably denies the State of Utah the ability to achieve full value from school trust lands..."

Usitla maintains creation of the monument-without planning, public input, or notice to those most affected-violated the National Environmental Policy Act and went far beyond the authority granted to the President by the Antiquities Act of 1906, the law used by the president to justify his action.

Usitla also claims withdrawal of mineral lands within the monument from mineral leasing-and entry without notice to Congress-violates the Federal Lands Policy and Management Act.

The 1906 Antiquities Act was the original basis for a number of national parks and protected areas in Utah and elsewhere, according to Usitla.

Usitla claims internal federal documents obtained by the trust lands administration indicate that special priority was given to keeping the monument designation secret from Utah officials beforehand, including officials of Usitla.

Copyright 1997 Oil & Gas Journal. All Rights Reserved.