The BLM struggles to get ahead of oil and gas development in the West

  • 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.

  • 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

    National Wildlife Federation/Jack Dempsey
  • Oil development has occurred in North Park for several decades, but interest in tapping the Niobrara Formation has spurred new wells like these.

    National Wildlife Federation/Jack Dempsey

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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