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A midsummer thunderstorm rolls across Beaver Rim near Carmody Lake in Wyoming. The area is one of the first to make it through master lease planning — a key oil and gas reform introduced by the Obama administration in 2010. -
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Bob Meulengracht of Trout Unlimited and Sportsmen for Responsible Energy Development and environmental activist Barbara Vasquez stand in front of an oil well drilled near the Michigan River in North Park, Colorado -
Oil development has occurred in North Park for several decades, but interest in tapping the Niobrara Formation has spurred new wells like these.
About 20 miles east of Lander, Wyo., cliffs rise from a sagebrush-laden basin between the Wind and the Sweetwater rivers. The erosion-carved rocks display unusually intact geological layers from 10 to 53 million years ago. Golden eagles and ferruginous hawks soar high above; greater sage grouse and pronghorn winter at the base.
All this helped make the area — known as Beaver Rim — one of the first to receive a master leasing plan, or MLP — a key onshore oil and gas reform announced by Interior Secretary Ken Salazar in January 2010.
Generally, oil and gas lease sales start with a resource management plan — the high-level document that governs industrial, recreational and other uses of the millions of acres overseen by a Bureau of Land Management field office. Site-specific environmental scrutiny of proposed drilling projects follows once the land is leased. But that approach can lead to a “death by a thousand cuts,” says Wyoming Wildlife Federation public-lands organizer Matthew Copeland, with development proceeding piecemeal and ultimately transforming entire landscapes. A master leasing plan exists somewhere between the two, allowing officials to closely coordinate leasing and development in an area with special resource conflicts. And it allows the BLM to add extra layers of rules to protect wildlife, waterways and other potentially vulnerable resources before an auction ever happens.
Ideally, this approach will improve overall land management, sparking fewer lease protests and saving the agency the time and money it spends defending its decisions in court, says BLM Director Bob Abbey. Forty-seven percent of all the oil and gas parcels the agency identified for leasing in 2009 were protested; the BLM later withdrew more than half. In Wyoming, nearly 100 percent of parcels have been protested in recent years.
An MLP is called for if an area meets four criteria: It’s mostly unleased, the mineral rights are mostly in federal hands, there is at least moderate energy potential that companies want to develop, and there are conflicts with other resources that will likely require a closer look. The criteria were intentionally left open to interpretation, and field and state BLM offices were given broad discretion to decide what local conditions warrant.
That flexibility cuts both ways. Although the BLM had determined that Beaver Rim has essentially no oil and gas potential, it went ahead with the process anyway. Other areas that failed to meet the criteria were passed over, even though conservation groups felt they merited the plans for other reasons.
Such inconsistency is just one of the growing pains as field offices begin to implement new reforms on the ground. Many offices were already engaged in multi-year revisions of their land-use plans when the reform was introduced, so most MLP proposals have been tacked on to those efforts with mixed results. It’s still unclear what a full-fledged master lease plan will look like.
Even so, federal officials and some environmentalists remain optimistic. “In spirit, yeah, absolutely, it’s oil and gas done right or certainly a gateway step in that direction,” says Copeland. “In practice, we just don’t know yet.”
The MLPs and other BLM oil and gas reforms were inspired by a December 2008 oil and gas auction in Salt Lake City, where companies bought 77 Utah leases environmentalists said were too close to national parks and other sensitive resources. A team of federal agency lease veterans sent out to explore the landscape confirmed that many of the parcels were within park viewsheds, in wilderness-quality land, or contained rock art or valuable habitat. Only 17 were approved for release to buyers; 52 were deferred for further study, and eight were cancelled. To prevent future problems, the officials urged the BLM to do more thorough, on-the-ground examination of parcels and more coordinated lease planning.
That could give energy companies more certainty. Under an MLP, more thorough environmental review and development planning happens before a lease auction is held, so companies know what they have to deal with before they bid, says Jim Perry, the BLM’s senior natural resource specialist for the Minerals, Realty and Resource Protection Directorate in Washington, D.C.
But the extra analysis also offers another opportunity to sue, says Dan Naatz, vice president of federal resources and political affairs at the Independent Petroleum Association of America, a trade group. It may delay an already lengthy process, he says, and hurt small, independent drillers, who often lack the money for court battles.
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In fall 2010, the BLM asked state offices to nominate areas for lease planning. The public also gave input. The state offices arrived at substantially different conclusions on what warrants the extra layer of protection. Wyoming BLM, for example, initiated master lease planning for Beaver Rim and five other areas of 21 nominated, even though the only candidate that met all the criteria was Jack Morrow Hills, which the agency passed over because it concluded that the area already had an up-to-date, adequate protection plan. The agency invoked its discretion in part because Wyoming’s long history of energy development has left little of its federal land unleased.
Perry says the reform’s flexibility also allows officials to consider whether advances in drilling technology could change low-energy-potential sites into high-potential ones. If that happened to Beaver Rim, its master lease plan could come in handy. None of the MLP area’s nearly 144,000 acres would be closed to leasing, but all would be more strictly protected. For example, no structures would be allowed on the surface of about 30,000 acres near the rim’s edge, which has the most sensitive views, cultural sites, geology, soils and a majority of raptor sites and unique vegetation. Leasing would start outside core sage grouse habitat, and setbacks greater than the standard 500 feet would limit sediment and dust from clouding waterways and wetlands. Additional consultation with tribes would keep oil and gas a quarter mile from sacred sites.
Of course, that’s only true if the plan’s adopted. It has a good chance, since it’s incorporated in the preferred alternative of the four within the Lander office’s draft resource management plan, which won an excellence award from The Wilderness Society for its balance between protection and development. A final decision is expected this fall.
In Colorado, officials have interpreted the open-ended MLP criteria in such a way that what seemed to many a likely candidate ended up getting passed over for a freestanding plan last fall — creating yet more confusion over what should and shouldn’t qualify.
North Park is a 35-by-45-mile mountain-hemmed glacial basin in north-central Colorado. The North Platte River, which hosts renowned trout fisheries, begins there. The area also holds plenty of sage grouse, elk, pronghorn antelope and mule deer habitat. Oil companies are beginning to explore the Niobrara Formation, which runs along the basin’s eastern edge. Drilling equipment and bright gas flares already contrast starkly with the otherwise unmarred landscape. “I have a hard time finding places that fit the spirit of the regulation (more) than North Park,” Copeland says.
But because 52 percent of North Park’s federal minerals are leased — and because much of what’s left underlies national forest rather than BLM land — the agency decided that the area was not “substantially unleased.” “What we’ve seen so far from BLM is a fairly narrow interpretation and application of the MLP criteria,” says Ti Hays, a conservation land-use attorney formally with The Wilderness Society’s Central Rockies Regional Office in Denver. “MLPs are supposed to address development as well as leasing; the BLM is missing an opportunity to guide development in heavily leased areas through the MLP process.” In another twist, a recent request for MLP analysis in central Colorado’s South Park was denied in early February because the area has seen little oil and gas activity.
Depending on how its resource management plan turns out, however, it may not matter for North Park. The Colorado BLM says it is conducting an “MLP-like analysis” for the site — integrating elements of the MLP approach into the larger document. “We have a lot of protections in our alternatives that would produce the same results as a master leasing plan,” says Dave Stout, manager of the Kremmling Field Office, which oversees North Park. The state’s BLM has also applied this approach to four other areas. Environmental groups say the efforts fall short. They define how many acres will be protected, but not which specific areas will be affected, says National Wildlife Federation public-lands organizer Bill Dvorak, something an MLP would achieve. “They’re not MLPs.”
Complicating all this is the fact that many BLM offices were already up to their necks in revising their resource management plans, a process that takes years of intense public process. The further along a revision, the harder it is to integrate a complicated new element. And some field offices may lack the necessary resources. “Our staff is stretched pretty thin right now, and this is a tremendous additional workload,” said Brent Northrup, Utah’s Canyon Country District nonrenewable resources advisor. A single master lease plan under way near Moab, Utah, is expected to cost roughly $1 million with a contractor and take three years. The state BLM office, which approved MLPs for six of the 13 sites nominated, received $750,000 to cover all such efforts in 2011. Colorado and Wyoming received $300,000 each. Montana, which received $150,000, plans to conduct an MLP analysis on one of 11 sites nominated.
That Moab master lease plan — the largest in progress at more than 783,000 acres — may ultimately be the best test case, not least because it covers the same area that inspired the reform. It envelops Arches National Park and borders the scenic and popular Green River and Canyonlands National Park to the west. A draft is expected by July 2013. Given the sensitive resources involved, it will likely focus more closely on how oil and gas development will proceed rather than simply on which areas should or shouldn’t be leased, Perry says. And since the Utah BLM is not currently bogged down in revising its RMPs, all of its MLPs will be standalones, likely offering a clearer picture of whether the reform can meet the high expectations of both the BLM and environmentalists. The proof “is in the pudding,” says Larry Claypool, Wyoming BLM deputy state director of Minerals and Lands.
No matter what happens, though, it appears that the Petroleum Association’s Naatz could be right in his assessment that at least one major goal — avoiding lawsuits — is still out of reach. Last March, before Utah’s master lease planning efforts were announced, a coalition of Utah counties sued the Interior Department over the plans, pegging them as the result of “secret negotiations” conducted as part of the settlement of a different lawsuit.
This article appeared in the print edition of the magazine with the headline The BLM struggles to get ahead of oil and gas development in the West.
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