[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
LAND-USE ISSUES ASSOCIATED WITH ONSHORE OIL AND GAS LEASING AND
DEVELOPMENT
=======================================================================
JOINT OVERSIGHT HEARING
before the
SUBCOMMITTEE ON NATIONAL PARKS, FORESTS
AND PUBLIC LANDS
joint with the
SUBCOMMITTEE ON ENERGY AND
MINERAL RESOURCES
of the
COMMITTEE ON NATURAL RESOURCES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
Thursday, April 26, 2007
__________
Serial No. 110-21
__________
Printed for the use of the Committee on Natural Resources
Available via the World Wide Web: http://www.gpoaccess.gov/congress/
index.html
or
Committee address: http://resourcescommittee.house.gov
--------
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COMMITTEE ON NATURAL RESOURCES
NICK J. RAHALL II, West Virginia, Chairman
DON YOUNG, Alaska, Ranking Republican Member
Dale E. Kildee, Michigan Jim Saxton, New Jersey
Eni F.H. Faleomavaega, American Elton Gallegly, California
Samoa John J. Duncan, Jr., Tennessee
Neil Abercrombie, Hawaii Wayne T. Gilchrest, Maryland
Solomon P. Ortiz, Texas Ken Calvert, California
Frank Pallone, Jr., New Jersey Chris Cannon, Utah
Donna M. Christensen, Virgin Thomas G. Tancredo, Colorado
Islands Jeff Flake, Arizona
Grace F. Napolitano, California Rick Renzi, Arizona
Rush D. Holt, New Jersey Stevan Pearce, New Mexico
Raul M. Grijalva, Arizona Henry E. Brown, Jr., South
Madeleine Z. Bordallo, Guam Carolina
Jim Costa, California Luis G. Fortuno, Puerto Rico
Dan Boren, Oklahoma Cathy McMorris Rodgers, Washington
John P. Sarbanes, Maryland Bobby Jindal, Louisiana
George Miller, California Louie Gohmert, Texas
Edward J. Markey, Massachusetts Tom Cole, Oklahoma
Peter A. DeFazio, Oregon Rob Bishop, Utah
Maurice D. Hinchey, New York Bill Shuster, Pennsylvania
Patrick J. Kennedy, Rhode Island Dean Heller, Nevada
Ron Kind, Wisconsin Bill Sali, Idaho
Lois Capps, California Doug Lamborn, Colorado
Jay Inslee, Washington
Mark Udall, Colorado
Joe Baca, California
Hilda L. Solis, California
Stephanie Herseth Sandlin, South
Dakota
Heath Shuler, North Carolina
James H. Zoia, Chief of Staff
Jeffrey P. Petrich, Chief Counsel
Lloyd Jones, Republican Staff Director
Lisa Pittman, Republican Chief Counsel
------
SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES
JIM COSTA, California, Chairman
STEVAN PEARCE, New Mexico, Ranking Republican Member
Eni F.H. Faleomavaega, American Bobby Jindal, Louisiana
Samoa Louie Gohmert, Texas
Solomon P. Ortiz, Texas Bill Shuster, Pennsylvania
Rush D. Holt, New Jersey Dean Heller, Nevada
Dan Boren, Oklahoma Bill Sali, Idaho
Maurice D. Hinchey, New York Don Young, Alaska ex officio
Patrick J. Kennedy, Rhode Island
Hilda L. Solis, California
Nick J. Rahall II, West Virginia,
ex officio
------
SUBCOMMITTEE ON NATIONAL PARKS, FORESTS AND PUBLIC LANDS
RAUL M. GRIJALVA, Arizona, Chairman
ROB BISHOP, Utah, Ranking Republican Member
Dale E. Kildee, Michigan John J. Duncan, Jr., Tennessee
Neil Abercrombie, Hawaii Chris Cannon, Utah
Donna M. Christensen, Virgin Thomas G. Tancredo, Colorado
Islands Jeff Flake, Arizona
Rush D. Holt, New Jersey Rick Renzi, Arizona
Dan Boren, Oklahoma Stevan Pearce, New Mexico
John P. Sarbanes, Maryland Henry E. Brown, Jr., South
Peter A. DeFazio, Oregon Carolina
Maurice D. Hinchey, New York Louie Gohmert, Texas
Ron Kind, Wisconsin Tom Cole, Oklahoma
Lois Capps, California Dean Heller, Nevada
Jay Inslee, Washington Bill Sali, Idaho
Mark Udall, Colorado Doug Lamborn, Colorado
Stephanie Herseth Sandlin, South Don Young, Alaska, ex officio
Dakota
Heath Shuler, North Carolina
Nick J. Rahall II, West Virginia,
ex officio
------
CONTENTS
----------
Page
Hearing held on Thursday, April 26, 2007......................... 1
Statement of Members:
Costa, Hon. Jim, a Representative in Congress from the State
of California.............................................. 3
Grijalva, Hon. Raul M., a Representative in Congress from the
State of Arizona........................................... 1
Prepared statement of.................................... 2
Pearce, Hon. Stevan, a Representative in Congress from the
State of New Mexico........................................ 7
Peterson, Hon. John E., a Representative in Congress from the
State of Pennsylvania...................................... 4
Statement of Witnesses:
Adami, Steven M., Rancher, Powder River Basin Resource
Council, Sheridan, Wyoming................................. 77
Prepared statement of.................................... 78
Response to questions submitted for the record........... 80
Bisson, Henri, Deputy Director, Bureau of Land Management,
U.S. Department of the Interior............................ 17
Prepared statement of.................................... 18
Response to questions submitted for the record........... 22
Emmerich, John, Deputy Director, Wyoming Game and Fish
Department, on behalf of the Western Governors' Association
and The Association of Fish & Wildlife Agencies............ 43
Prepared statement of.................................... 45
Ferguson, Tony L., Director, Minerals and Geology Management,
National Forest System, Forest Service, U.S. Department of
Agriculture................................................ 11
Prepared statement of.................................... 13
Response to questions submitted for the record........... 15
James, Jewell, Policy Analyst, Lummi Indian Nation........... 47
Prepared statement of.................................... 49
Jurrius, John, Financial Advisor to the Ute Tribe,
representing Maxine Natchees, Chairwoman, Northern Ute
Tribe...................................................... 63
Prepared statement of.................................... 65
Response to questions submitted for the record........... 69
Korenblat, Ashley, President, Western Spirit Cycling......... 81
Prepared statement of.................................... 83
Response to questions submitted for the record........... 86
Moseley, Claire M., Executive Director, Public Lands Advocacy 87
Prepared statement of.................................... 88
Response to questions submitted for the record........... 96
Muggli, Roger, Manager, Tongue and Yellowstone River
Irrigation District, Miles City, Montana................... 98
Prepared statement of.................................... 100
Utesch, Peggy, Western Organization of Resource Councils &
Western Colorado Congress.................................. 102
Prepared statement of.................................... 104
Additional materials supplied:
Devaney, Earl E., Inspector General, U.S. Department of the
Interior, Letter submitted for the record by Hon. Stevan
Pearce..................................................... 8
Hoeven, Hon. John, Governor of North Dakota, Chairman,
Interstate Oil & Gas Compact Commission, Letter submitted
for the record by Hon. Stevan Pearce....................... 112
Natchees, Maxine, Chairman, Business Committee, Ute Indian
Tribe, Uintah & Ouray Reservation Utah, Letter submitted
for the record by John Jurrius............................. 63
OVERSIGHT HEARING ON ``LAND-USE ISSUES ASSOCIATED WITH ONSHORE OIL AND
GAS LEASING AND DEVELOPMENT''
----------
Thursday, April 26, 2007
U.S. House of Representatives
Subcommittee on National Parks, Forests & Public Lands,
joint with the Subcommittee on Energy and Mineral Resources
Committee on Natural Resources
Washington, D.C.
----------
The Subcommittees met, pursuant to call, at 10:08 a.m. in
Room 1334, Longworth House Office Building. Hon. Raul M.
Grijalva [Chairman of the Subcommittee] presiding.
Present: Representatives Grijalva, Costa, Pearce, Holt,
Lamborn, Shuler, and Udall.
STATEMENT OF THE HONORABLE RAUL M. GRIJALVA, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF ARIZONA
Mr. Grijalva. Let me call to order the joint hearing of the
Subcommittee on National Parks, Forests and Public Lands, and
the Subcommittee on Energy and Mineral Resources on land uses
associated with onshore oil and gas leasing and development.
Our colleagues, the Ranking Members, will be here shortly.
One is testifying and one is on the Floor, but we will begin
with our opening statements and by the time we are done I think
they will be arriving.
I am pleased today to join Chairman Costa in welcoming our
witnesses and audience to this joint oversight hearing. Today's
hearing will examine how the accelerated pace of oil and gas
development on public lands in recent years is affecting other
public uses and resources.
Today, we will hear from witnesses who have come a long way
to tell us about what the oil and gas boom has meant to the
ranchers, their homes, their health, and their livelihoods.
Most have never testified before Congress. One is a living
descendent of Chief Seattle, and another has never traveled
east of the Mississippi. At least two of our witnesses have had
to sell their homes because of oil and gas development that
drove them off the land that they loved. Other witnesses will
tell us of leasing operations that have been permitted to
undermine Federal and state investments, and clean water,
endangered species protection, and invasive species control.
It is not surprising that regular citizens can't get
satisfaction out of BLM when they complain about the harm that
their cattle, property, and water is suffering. The BLM
sometimes can't even be bothered to address concerns of the
National Park Service, its sister agency in the Interior
Department. I have here copies of numerous letters sent to BLM
from park superintendents in Utah, Colorado, and New Mexico who
wrote to express worries and possibly unacceptable damage to
park resources.
The letters talk about threats to the park's pristine air
and sparkling waters, to views of starlit night skies and
majestic western panoramas, to the backcountry solitude, and
the quiet that visitors treasure when they visit these sights,
to the archeological jewels and to the wild creatures that call
the parks their home. In most cases, the superintendents did
not request that the parcels be withdrawn, merely that the
leases be delayed until stipulations could be put in place to
protect those park values.
In some cases, BLM made changes reflecting the parks'
concerns. In others, BLM ignored the superintendents' pleas,
belittled their concerns, or simply did not respond.
I would like to enter these letters into the record.
[NOTE: The letters submitted for the record have been
retained in the Committee's official files.]
Mr. Grijalva. We also will hear today from a representative
of the Western Governors' Association, which has called for the
repeal of a provision in the Energy Policy Act of 2005, that
exempted more than a thousand new permits to drill annually
from any environmental review and public comment.
Industry supporters are always asking those who worry about
the impact of oil and gas development if we drive gas-powered
cars or heat our houses with natural gas. They imply that if we
use oil and gas, we have no right to complain about how these
products are produced. That is a false choice. Our
irreplaceable natural resources and critical wildlife
populations are paying the price not for our energy needs but
for the lack of vigilance and oversight.
There are right places and right ways to develop our energy
resources, and there are wrong places and wrong ways to
undertake that development. Balancing energy production with
the care of our parks, our wildlife, and the livelihoods of our
Western citizens is possible. We simply need the resolve to
meet that standard.
At this point let me turn to my colleague, Mr. Costa, for
any opening remarks he may have.
[The prepared statement of Mr. Grijalva follows:]
Statement of The Honorable Raul Grijalva, Chairman,
Subcommittee on National Parks, Forests and Public Lands
I'm pleased to join Chairman Costa in welcoming our witnesses and
audience to this joint oversight hearing of the National Parks, Forests
and Public Lands Subcommittee and the Energy and Mineral Resources
Subcommittee.
Today's hearing will examine how the accelerated pace of oil and
gas development on public lands in recent years is affecting other
public uses and resources.
Today, we will hear from witnesses who have come a long way to tell
us about what the oil and gas boom has meant to their ranches, their
homes, their health and their livelihoods. Most have never testified
before Congress. One is a lineal descendent of Chief Seattle and
another has never before traveled east of the Mississippi.
At least two of our witnesses have had to sell their homes because
oil and gas development drove them off the land they loved. Other
witnesses will tell us of leasing operations that have been permitted
to undermine federal and state investments in clean water, endangered
species protection and invasive species control.
It's not surprising that regular citizens can't get satisfaction
out of BLM when they complain about harm to their cattle, property and
water. The BLM sometimes can't even be bothered to address concerns of
the National Park Service, its sister agency in the Interior
Department.
I have here copies of numerous letters sent to the BLM from park
superintendents in Utah, Colorado and New Mexico who wrote to express
worries about possibly unacceptable damage to park resources.
The letters talk about threats to the parks' pristine air and
sparkling waters, to views of starlit night skies and majestic western
panoramas, to the backcountry solitude and quiet that visitors
treasure, to archeological jewels and to the wild creatures that call
our parks home.
In most cases, the superintendents did not request that the parcels
be withdrawn, merely that the leases be delayed until stipulations
could be put in place to protect those park values. In some cases, BLM
made changes reflecting the parks' concerns. In others, BLM ignored the
superintendents' pleas, belittled their concerns, or simply did not
respond. I would like to enter these letters in the record.
We will also hear today from a representative of the Western
Governors Association, which has called for the repeal of a provision
in the Energy Policy Act of 2005 that exempted more than a thousand new
permits to drill annually from environmental review and public comment.
Industry supporters are always asking those who worry about the
impact of oil and gas development if we drive gasoline-powered cars or
heat our houses with natural gas. They imply that if we use oil and
gas, we have no right to complain about how those products are
produced.
But that is a false choice. Our irreplaceable natural resources and
critical wildlife populations are paying the price not for our energy
needs, but for lack of vigilance.
There are right places and right ways to develop our energy
resources, and there are wrong places and wrong ways to undertake that
development. Balancing energy production with the care of our parks,
our wildlife and the livelihoods of our western citizens is possible.
We simply need to resolve to meet that standard.
______
STATEMENT OF JIM COSTA, A REPRESENTATIVE IN CONGRESS FROM THE
STATE OF CALIFORNIA
Mr. Costa. Thank you very much, Mr. Chairman. It is indeed
my honor to hold this joint hearing between the two
Subcommittees, the Subcommittee on National Parks, Forests and
Public Lands. I know what passion and energy you and your staff
and your committee members bring to your efforts in the 110th
Congress, to focusing on prioritizing the needs of our national
parks, our forests, and public lands.
Our Subcommittee on Energy and Mineral Resources, as it
relates to our efforts on public lands, complements the efforts
that you work on, and so it is fitting and appropriate that
this morning the two Subcommittees meet together in a joint
hearing to examine how we can better be stewards, responsible
stewards in producing the necessary energy for our country, for
our citizens to maintain our ability to provide a quality of
life, and to continue economic opportunities for all. But, as
we know, therein lies the challenge of the balance between
providing the sustenance for our economy and at the same time
protecting that quality of life that all of our citizens, I
think, feel very serious about, and concerned.
So as we look about producing energy from a variety of
resources, as we talk about the overlapping jurisdictions
between these two Subcommittees, we need to look at how we do
so in a responsible way that allows for sustainability. So we
will have witnesses testifying this morning in three panels
that we are all looking forward to hearing from, including our
first witness, a colleague of ours, Congressman Peterson, that
talks about this balance, that talks about the sustainability,
that talks about how we do so in a responsible fashion.
Certainly we know that the effect of oil and gas
development impacts our quality of life. It impacts our lands,
our water, communities--especially in the West where it is
predominant. So this morning will give us a chance to better
understand and collaborate how we deal with the effects, for
example, of coalbed methane production that are associated with
``split-a-state'' concerns.
We will have a chance to look at the impacts of the 2004
1.5 trillion cubic feet of coalbed methane that was produced in
five Rocky Mountain states that provides an important source of
energy. Six percent of the total U.S. natural gas supply, of
course, by the Western Governors' Association account, is
derived from there. We know that oil and gas currently provides
63 percent of the U.S. consumption needs.
We held a hearing with our Subcommittee on March 14.
Testimony was added from the acting Bureau of Land Management
Director Jim Hughes that 44 million acres of onshore bedroll
lands nationwide are currently under lease out of 270-million-
plus acres of Federal lands. You can do the math and understand
clearly what percentage 44 million acres is of 270 million
acres.
In five Rocky Mountain states, 85 percent of all the oil
resources and 88 percent of all the natural gas resources on
Federal lands are currently available for leasing. There is
always the argument we are not doing enough. Well, I would
submit for the record that 85 percent of Federal lands that
currently are available is quite a bit.
Finally, let us talk about where we go from here, and I
think that is something that we are looking forward to in the
testimony this morning, because this hearing is about balance,
it is about sustainability, and it is about being good stewards
of our environment.
So, Mr. Chairman, I am pleased that we could hold the two
Subcommittees in a joint hearing for the purpose of doing good
public policy, and I look forward to hearing the testimony from
the witnesses. Thank you.
Mr. Grijalva. Thank you very much, Mr. Chairman, and let me
by way of an announcement, when Ranking Member Pearce and
Ranking Member Bishop arrive from the commitments that they
have outside this hearing, wherever we are in the process, I
will suspend that and allow the gentlemen to give their opening
statements.
With that, let me turn to our first witness today, our
colleague from Pennsylvania, Representative John Peterson.
Representative Peterson, thank you so much for being here, and
we look forward to your comments.
STATEMENT OF JOHN E. PETERSON, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF PENNSYLVANIA
Mr. Peterson. Thank you very much. It is a delight to be
back at my committee, or what I have been a part of for 10
years. I fought to stay here, but got bumped off. I want to
thank Chairman Grijalva, Chairman Costa, and Ranking Members
Bishop and Pearce for allowing me to come back to my old
committee and testify today.
I spent 10 years here, and represent the most rural
district east of the Mississippi, a district that looks an
awful lot like the West. My district is home to Pennsylvania's
only national forest, abundant supply of coal, natural gas,
some oil, and I live five minutes from Drake Well, the first
oil well ever produced in the world, and I want to just talk
about that a minute.
Oil Creek Valley that culminated from Drake Well is a
valley between Titusville and Oil City, Pennsylvania, and the
City of Oil City was where Quaker State, Pennzoil and Kendall,
and all the major refineries, Standard Oil, they all started
there. That valley was decimated. Back then they didn't know
how to produce oil. They punched holes in the ground and oil
sprayed everywhere. I have pictures of that valley and the
hillsides surrounding it where there was not a blade of grass,
not a tree alive; just dead snags and nothing alive.
Today, that is a state park. It is a mature hardwood
forest. The springs are clear. Three are brook trout streams
which is a pretty good symbol that water quality is back, and
Oil Creek itself, which was called Oil Creek before they
produced oil there because oil pressure pushed oil up out of
the ground, and so there was always a scum of oil on Oil Creek
historically because of the oil sand being close to the
surface. It was only 68 feet deep there when they discovered
oil. That is why they discovered it there.
That valley today, that stream today, trout and small-mouth
bass both propagate there naturally. That is not very common.
It is one our best fisheries in eastern Pennsylvania. It shows
you what nature does when allowed to recuperate.
My district is the shining example of how we can both
produce energy responsibly while preserving the natural beauty
of our land. I know this is the purpose of the hearing today,
to help us strike this balance.
However, I fear the committee may be moving beyond
mitigation of energy production on our public lands toward
decreased access, which I hope will not be the case. It will
cause serious economic security, energy security, and national
security issues, and I will try to explain that more clearly.
So that is why I am here, to hopefully remind us all that
energy production on our public lands can be done responsibly
while supporting our economy, enhancing our security, and
maintaining wildlife habitat and recreation right along side of
it.
Today, our energy consumption in this country is 86 percent
fossil fuel. I know that is what distresses us all, 86 percent.
We have 8 percent nuclear. That leaves us a small percentage of
renewables, which I will talk about in a minute. About 90
percent of America's energy is on public land, and as it is
under our prevail. Thus, we must have access to our public
lands in order to have affordable domestic energy to heat and
cool our homes and businesses, and to employ workers, and
produce goods in America.
Much of this public land is already locked up for energy
production, and the numbers were just given, and locking up
more I think would be bad public policy. It needs to be
produced right, by the laws, by the rules. It can be done
correctly. The resources in the West do not belong to the West.
They belong to all Americans. My constituents need access to
those resources as the rest of America does.
I am a strong supporter of renewables. I have worked with
my staff all year on how we can increase renewables, and the
farther I dig into it the more concerned I get. There is no
silver bullet when it comes to renewables. I wish there were,
and we have the chart here of today's consumption, and when you
get down the renewables the number is scarcely small: 86
percent fossil fuels, 8 percent nuclear, 6 percent renewables,
and 5 percent of that is hydroelectric or biomass. One percent
makes up all the ones we are trying to build our future on--
wind, solar, biofuels and hydrogen, and I haven't found one of
them that can double in the next 10 years in volume, though we
are increasing our use of energy 3 percent a year.
I think we need to be careful how we target big oil also. I
am not a fan of big oil, but some may criticize so-called big
oil and say they don't need increased access to oil and gas.
Policies aimed at hurting big oil, whether they are tax
increases by Ways and Means, or decreased access to public
lands by this committee, don't reach their intended targets
because independent oil and natural gas producers drill 90
percent of the nation's oil and gas wells.
These small business operators are responsible for
supplying 68 percent of American's oil and 82 percent of
overall American natural gas. At the same time increased taxes
and decreased access here at home simply serve to push
production overseas. When we produce energy at home, lots of
Americans make money, lots of people make livings, it is a part
of our economy. When we buy energy from overseas, there are no
American jobs, there is no American economy. We just send our
money to foreign countries.
So let us be careful when we use big oil as an excuse to
block production because in reality it is the small producers
who we are hurting most.
The negative impacts from decreased access to domestic
energy are felt across our country. I believe the biggest
threat to America's economic future is not terrorism. It will
be available, affordable energy. The world's energy supplies
are very tight. We have never faced this before. We have never
had China and India that are soon going to be larger consumers
of energy than us, and we are going to fight--and probably the
word is fight--to have energy for this country, affordable
energy for this country.
American businesses are already being driven offshore by
rising prices and specifically natural gas. Polymers, plastic,
chemicals, fertilizer, glass, steel, aluminum are struggling to
compete in America because they pay the highest natural gas
prices in the world. When oil is $70 a barrel, the whole world
pays. But we have had the highest natural gas prices in America
now for six years, and it is causing our major companies to
decide whether they are going to remain here or whether they
can remain here, and be competitive when other countries have
natural gas at a fraction of the cost that they pay here.
They are crying for Congress to make it easier to harness
energy here at home, not harder. I can also point to the trade
deficit as an example of inadequate domestic energy supply
hurting our economy. A third of our trade deficit comes from
buying foreign energy from unstable governments, countries who
don't support us, countries who could very quickly be our
enemy.
I don't know about you, but I don't feel very comfortable
with that.
There is a world shortage of energy. We must conserve. We
waste a lot of energy, and we must do everything we can to use
energy more wisely. What has concerned me--I have been in
Congress, this is my eleventh year--is that we have increased
dependence on foreign oil by 2 percent a year from unstable
foreign countries who don't like us and whose governments are
not even friends of ours.
I am not advocating that industry have carte blanche with
our public lands. We can have access to plentiful domestic
energy while also improving our environment and public lands
thanks to improved technology.
Yes, we should mitigate environmental impact on public
lands from oil and gas production, but we should do so in a
reasonable manner that doesn't have the end result of shutting
down production, moving jobs overseas, increasing our reliance
on foreign energy, and decreasing our security.
It is my view that if we don't find a way to have more
affordable energy and prevent the next spikes of energy costs
in this country, we will be saying to the working men and women
of America you won't have a job here. We won't make bricks
here. We won't make glass here. We won't bend steel here. We
won't bend aluminum here. We will not make petrochemicals
because 55 percent of their cost is natural gas. Seventy
percent of the cost of some kinds of fertilizer is natural gas.
Affordable natural gas is the mother's milk of the future
of America, and we have to somehow figure out how to produce
natural gas for this country, both onshore and offshore. In my
view, those who think buying LNG from unstable foreign
countries is the answer should look in another direction. I
don't think we should because we have ample supplies of natural
gas.
We must look at these issues like a three-legged American
stool made up of energy, environment, and economy. If one leg
collapses, we all fall. The chair cannot stand.
I thank you for the chance to speak with you and will be
glad to take any of your questions.
Mr. Grijalva. Let me see if there are any questions? Mr.
Pearce, Gentlemen?
Thank you very much, sir.
Mr. Peterson. Thank you.
Mr. Grijalva. At this point let me turn to Ranking Member
Peace for any opening comments he may have.
STATEMENT OF STEVAN PEARCE, A REPRESENTATIVE IN CONGRESS FROM
THE STATE OF NEW MEXICO
Mr. Pearce. Thank you, Mr. Chairman. I apologize for being
late, testifying in another committee actually, so appreciate
the opportunity to visit, appreciate Mr. Peterson's comments
also. He has been dedicated to the idea of affordable energy
for the entire career that I have seen him here.
Before I start, Mr. Chairman, I would like to submit a
letter for the record. You know, we that get into this business
we know that there are going to be scraps and scrapes, but we
have a lot of public servants out there who work year after
year after year, and sometimes we thoughtlessly pull them in.
We play our games with them, and one of our witnesses today,
Mr. Bisson, from the BLM had an allegation made a year ago that
he was somehow breaking the law by meeting with state and local
officials, and coordinating with them.
After a year-long investigation, the IG put a report out
that completely exonerates him, and said he was doing a job. He
wasn't meeting with state and local officials. He was
coordinating Federal government affairs. So I would request
unanimous consent to submit this for the record so that his
good name has been cleared in an official way in this
committee.
Mr. Grijalva. Without objection.
[The DOI letter submitted for the record follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Pearce. Thank you.
We have had a series of hearing today, and as we have the
different panels come up I would like to note that we had a
hearing called ``The Evolving West'' where we described maybe
the production should not be oil and gas production, mining
those activities maybe should not be a part of the West; that
there were people calling on the new West, the evolving West.
We also had a hearing called ``Access Denied'', and then
the third title was a little curious, ``Implementation of Title
3, Oil and Gas of the Energy Policy Act,'' but the letters that
went out inviting asked if you would like to testify about
anything you would like to repeal instead of implementing that
Act, and today we are having the hearing called ``Land-use
Issues Associated with Onshore Oil and Gas Leasing and
Development.''
Now, my caution is that I would like for you to think about
to an earlier time in our history when we began to talk about
the timber industry as if it we exploiting, as if it were doing
an illegal and an immoral thing, and we used the words of fine
people who came into these rooms and testified to create an
illusion that an industry needed to be gone, and today it is.
Over 20,000 jobs just in the timber mills, we had 22 timber
mills in New Mexico. We are down to two, and they can't get
enough boards to actually do their business, and that decision
was made on words that were casually and innocently spoken in
these hearing rooms, and then used to justify.
So contemplate very deeply where we as policymakers might
be wanting to move. I will tell you that as I look and listen
to Mr. Peterson I remember the testimony from last week or the
week before that said that we were giving away over 3 million
manufacturing jobs. We have outsourced them because of the high
cost of energy.
Now, if we continue to that, we have to realize our
standard of living is going to change, that we won't have the
time for the leisure activities or the money. So as we describe
the oil and gas industry, I appreciate your objectivity, but
also remember, if I could get my staff to hold up a chart, we
are not producing nearly--I mean, when we look at the amount of
public lands, the large piece of that pie is what is not
produced. The small piece is what we actually have a footprint
on, what we actually lease.
So when people are telling me that we are using all of our
public lands and destroying them with oil and gas and mining, I
will tell you it is simply not true. The facts speak otherwise.
The American people deserve more because right now we are in a
tremendous race with China and India. They would like our jobs,
and we have people, frankly, in this country that are willing
to them our jobs to them. They have given our timber jobs to
Canada, to other nations. Now they would like to give our oil
and gas jobs away, and you contemplate if you want to pay three
or four times as much for your energy.
For instance, if you are a mountain bike firm, how do your
people get there? Your customers come because they fly. Your
customers come and stay in hotels that are heated with natural
gas. If the price of gasoline, the price of oil goes up to
three and four times, how many of your people are going to come
visit?
So let us be working for the balance here. Let us talk
about the truth, and while we are trying to turn this country
away from oil and gas and coal, remember that the Chinese are
building 10 plants in the next year, one plant per week, 544
coal plants already being built. So they are willing to have
cheap energy while we are trying to move toward expensive
energy. It is a contemplation that all should spend a lot of
time on, and that we should be very thoughtful about.
Mr. Chairman, I appreciate the opportunity to make a couple
of statement, and I yield back.
Mr. Grijalva. Thank you, sir, and let me at this point call
our first panel forward, please.
Mr. Ferguson, Mr. Bisson, let me welcome you. Thank you
very much for being here today, and I would like to also advise
you that your full statements will be made part of the record,
and we would like to ask you to limit your oral statement to
five minutes, and let me begin with Mr. Ferguson. Sir.
STATEMENT OF TONY L. FERGUSON, DIRECTOR, MINERALS AND GEOLOGY
MANAGEMENT, UNITED STATES FOREST SERVICE, U.S. DEPARTMENT OF
AGRICULTURE
Mr. Ferguson. Thank you for the opportunity to discuss this
important topic and the role of the Forest Service in natural
and oil and gas leasing and development. I am very pleased to
be with you today.
The Forest Service manages 193 million acres in the natural
forest system. More than 7,200 authorized oil and gas leases
covering over 6.1 million acres are located on natural forest
and grass lands. The Forest Service works in partnership with
the Bureau of Land Management to manage oil and gas resource
development on the Forest Service lands. The BLM, through the
authority of the Secretary of the Interior, has management
responsibilities for the Federal mineral estate, which includes
leasing Federal minerals that underlie national forest system
lands. The Forest Service is responsible for the management of
the surface resources on oil and gas projects proposed and
operating on Forest Service.
Before the BLM may lease oil and gas resources underlying
national forest system lands, the Forest Service completes
broad-scale leasing analyses to determine which land are
appropriate for development. When Forest Service lands are
nominated by industry for leasing, the leased parcel may be
offered for sale subject to Forest Service validation and
verification of consistency with planned requirement, Forest
Service planned requirements in compliance with the National
Environmental Policy Act and other environmental laws. BLM
cannot issue a lease on Forest Service lands over the objection
of the Forest Service.
After the lease has been issued, the lessee must submit an
application for permit to drill, and you will commonly hear
this called an APD, to the BLM prior to the surface disturbing
activity. The application consists of two parts or plans. The
first part is a surface use plan of operation, and that is
commonly called the SUPO, S-U-P-O. The second part is the
drilling plan.
When the application for drilling on Forest Service land is
received by the Bureau of Land Management, they send us, the
Forest Service, the surface use plan of operation for
processing. The Forest Service establishes the terms and
conditions of approval for both the surface use plan and any
necessary associated authorizations.
Concurrently, the BLM processes the drilling plan. After we
have notified the BLM that the surface plan has been approved,
the BLM can approve the application for drilling. When the well
is drilled and operating, agencies share inspection and
enforcement responsibilities.
Today, I would like to focus on a couple of sections in the
Energy Policy Act of 2005 that also relate to oil and gas
operations on national forest system lands. There is some
additional information in my submitted statement.
Tasks described in Section 362 of the Energy Policy Act
resulted in the update and re-issuance of the Gold Book, which
is sometimes called--it is the Surface Operating Standards and
Guidelines for oil and gas exploration and development. This
book specifically addresses best management practices for oil
and gas operations, and this was a joint effort by the BLM and
Forest Service.
Section 366 resulted in the update and recent re-issuance
of the Onshore Oil and Gas Order No. 1, which is a set of rules
for conducting operations on Federal oil and gas leases. The
Forest Service worked closely with the BLM to revise the
onshore order and the Gold Book as joint authors. We are also
coordinating with the BLM to develop a training module for oil
and gas operators which will explain changes in the onshore oil
and gas order.
Section 390 of the Energy Policy Act directed the
Secretaries of Interior and Agriculture to use five new
categorical exclusions for approving oil and gas activities
conducted pursuant to the Mineral Leasing Act. The Section 390
categorical exclusions are limited to oil and gas activities in
existing areas of development, previously analyzed through a
National Environmental Policy Act process with full public
notice and comment.
New activities must be within land use plans approved
within the previous five years or with surface disturbance
limited to five acres and a previous NEPA project decision. To
date, the Forest Service has used the Section 390 categorical
exclusion to approve about 300 projects.
In addition to the categorical exclusions in Section 390,
the Forest Service has also promulgated a new administrative
categorical exclusion for limited oil and gas exploration and
development activities in newly identified fields. The Council
of Environmental Quality, upon review of this exclusion, found
that it was in conformance with NEPA and its implementing
regulations.
Since approval of this new categorical exclusion in
February of this year, February 15th of this year, the category
has only been used two times. For the 2007 program, the Forest
Service will continue to process and coordinate energy mineral
projects on national forest system lands in accordance with the
Energy Policy Act, the agency's strategic plan, and the
Department of Agriculture's priorities. We will also continue
to process new lease applications and surface use plans within
the established time frames, and finally, the Forest Service
will continue to coordinate closely with the BLM to meet the
mandates of the Energy Policy Act.
I want to thank you for this opportunity to briefly discuss
the Forest Service oil and gas program, and I am happy to
answer any questions you may have.
[The prepared statement of Mr. Ferguson follows:]
Statement of Tony L. Ferguson, Director of Minerals & Geology
Management, National Forest System, U.S. Forest Service, U.S.
Department of Agriculture
Mr. Chairman and members of the Subcommittee, thank you for the
opportunity to discuss land use issues related to the Forest Service's
role in the federal oil and gas leasing and development program. I am
pleased to be here with you today.
Forest Service Oil and Gas Resources
The Forest Service manages 193 million acres in the National Forest
System (NFS). More than 7,200 authorized oil and gas leases which cover
over 6.1 million acres are located on national forests and grasslands.
Forest Service Oil and Gas Program Authorities
The Forest Service works in partnership with the Bureau of Land
Management (BLM) to manage oil and gas resource development on NFS
lands. The BLM through the Secretary of the Interior has management
responsibilities for the federal mineral estate including federal
minerals that underlie NFS lands. The Forest Service is responsible for
management of surface resources on oil and gas projects proposed and
operating on NFS lands.
Before the BLM may lease oil and gas resources underlying NFS
lands, the Forest Service completes broad scale leasing analysis to
determine lands that are appropriate for development and made
administratively available. This leasing analysis process is conducted
with public involvement and in compliance with the NEPA. When analysis
is completed, the Forest Service informs the BLM of the available lands
and under what surface resource protection stipulations they may be
leased. When NFS lands are nominated by industry for leasing, the lease
parcel may be offered for sale, subject to validation and verification
of consistency with forest plan requirements and adequacy of NEPA and
other environmental law compliance completed by the Forest Service. BLM
cannot issue a lease on NFS lands over the objection of the Forest
Service.
When the lease has been sold--and prior to development and surface
disturbing activities such as drilling, the lessee must submit an
application for permit to drill, commonly called an APD, to the BLM.
The APD includes a surface use plan of operations (SUPO) and a drilling
plan. The BLM sends the SUPO portion of the APD to the Forest Service
for processing with appropriate environmental analysis and public
involvement. At the same time BLM continues to process the drilling
plan. The Forest Service establishes the terms and conditions of
approval for both the SUPO and any associated special use
authorizations. After the Forest Service notifies the BLM that the SUPO
is approved, the BLM can approve the APD. When the well is drilled and
operating, agencies share inspection and enforcement responsibilities.
National Energy Policy and the Energy Policy Act
In May of 2001, the President's National Energy Policy included
goals to diversify and increase energy supplies, encourage
conservation, and ensure adequate energy distribution. The National
Energy Policy goals include increasing energy supplies while protecting
the environment. Increasing energy supply means to ensure that, where
appropriate, lands are made available for energy mineral development
and production, as well as for the necessary infrastructure such as
energy facility corridors for pipelines. Development of domestic energy
supplies will be an essential component to meet future national energy
demands. This goal to increase energy supplies while protecting the
environment is consistent with the mission of the Forest Service to
sustain the health, diversity, and productivity of the Nation's forests
and grasslands to meet the needs of present and future generations.
Today I will focus on the portions of the Energy Policy Act of 2005
related to oil and gas operations on National Forest System lands. The
Act tasks Federal agencies to help facilitate energy development and
encourage the efficient use of resources within the U.S. borders,
consistent with economic growth and environmental responsibility, and
to work to improve energy use and efficiency from both traditional
sources, such as oil and gas, and from new resources such as wind and
solar power. The Act directs agencies to emphasize efficiencies to
facilitate the timely processing of energy leasing and permit
applications.
As previously described, the Forest Service, as a surface
management agency, works closely with the BLM to implement those
portions of the Energy Policy Act affecting National Forest System
lands. The Secretaries of the Interior and Agriculture signed the
Memorandum of Understanding required under Section 363 to coordinate
timely processing of lease applications and permits to eliminate
duplication and coordinate stipulations to protect the natural
resources. We are making significant progress in developing the joint
data tracking and retrieval system and GIS mapping system for tracking
lease parcel requests and permit applications. The joint GIS mapping
system will provide a critical spatial component that will help to more
easily analyze the relationship and management of surface resources
across land ownership boundaries.
Section 366 of the Energy Policy Act sets timeframes and other
provisions for processing permit applications. Section 362 provides for
development of Best Management Practices for improved enforcement and
inspection of oil and gas activities and terms and conditions of
permits to drill. These two sections combined resulted in the update
and re-issuance of the Onshore Order #1 and the Gold Book--Surface
Operating Guidelines. The Forest Service worked with the BLM to revise
the Order and Gold Book. We are working with the BLM to develop a
training module that will be delivered via satellite to oil and gas
operators explaining changes and the update to the Onshore Order Number
1.
To implement Section 365, the Forest Service, Department of the
Interior and other federal agencies entered into an interagency
Memorandum of Understanding that has improved energy permit
coordination on Federal lands and included assignment of personnel to
pilot project offices. The Forest Service participates in four pilot
project offices located in areas with a high volume of development and
project proposals. Six Forest Service personnel are located in the
Farmington, New Mexico, Buffalo, Wyoming, Vernal, Utah and Glenwood
Springs, Colorado Pilot Offices.
The Forest Service through the Program Assessment Rating Tool
process developed a definition of ``backlogged'' lease applications and
surface use plans as those pending approval at the end of FY 2003. By
the end of FY 2007, we anticipate eliminating all of these older
``backlogged'' lease applications and SUPOs. Beginning in FY 2008, the
Forest Service will continue to measure program success by evaluating
processing efficiency measured against timeframes established in
Section 366 of the Energy Policy Act and incorporated into the revised
Onshore Order Number 1.
Section 390 of the Energy Policy Act directs the Secretaries of the
Interior and Agriculture to use five new categorical exclusions (CEs)
for approving oil and gas activities conducted pursuant to the Mineral
Leasing Act. The Section 390 CEs are limited to oil and gas activities
in existing areas of development with previously approved development,
analyzed through a NEPA process. The new activities must be within
existing areas with land use plans approved within the previous five
years, or with surface disturbance limited to 5 acres and a previous
project with a NEPA process decision. To date, the Forest Service has
used the Section 390 CEs to approve about 300 projects.
CEs are part of full compliance with the National Environmental
Policy Act (NEPA). The Council on Environmental Quality regulations (40
CFR 1500 et seq.) for implementing the NEPA allows agencies to include
categorical exclusions in agency NEPA procedures. Agencies are to
reduce excessive paperwork and delay by using categorical exclusions to
define categories of actions which do not individually or cumulatively
have a significant effect on the human environment and which are
therefore exempt from requirements to prepare an environmental impact
statement. (Sec. 1500.4(p)) and (Sec. 1500.5(k)).
In addition to the CEs provided under Section 390, the Forest
Service has promulgated a new CE for limited oil and gas exploration
and development activities in newly identified fields. This CE does
not, and is not intended to, overlap or duplicate the activities
contained in the Section 390 CEs. It is complementary to Section 390
and taken in concert, this CE and the five statutory CEs provide the
authorities to analyze and approve a full range of small projects with
non-significant environmental effects in existing and new fields or
corridors. In approving this new CE, the Forest Service followed a
public notice and comment process. The Forest Service reviewed the
effects of small oil and gas exploration and development projects which
occurred over a five year period. Based on general program experience
and the results of this review, the Forest Service determined those
activities with limited road-building and utility-laying do not have
significant effects and therefore would not require documentation in an
environmental assessment or environmental impact statement. The Council
of Environmental Quality, upon review of this CE, found that the CE
conformed with NEPA and it's implementing regulations. This CE is to
approve a surface use plan of operations for oil and gas exploration
and initial development activities, associated with or adjacent to a
new oil and/or gas field or area, so long as the approval will not
authorize activities in excess of any of the following: one mile of new
road construction; one mile of road reconstruction; three miles of
individual or co-located pipelines and/or utilities disturbance; and
four drill sites. Since approval of this new CE on February 15, 2007,
the category has been used two times.
FY 2007 Program
The Forest Service will continue to expedite and facilitate energy
mineral projects on National Forest System lands in accordance with the
Energy Policy Act, the agency strategic plan, and Department of
Agriculture priorities. The Forest Service will continue to process new
lease applications and the Surface Use Plan of Operations portion of an
APD within the established timeframes. The Forest Service will continue
to coordinate closely with the BLM to meet the mandates of the Energy
Policy Act and direction in the National Energy Plan.
Conclusion
Thank you for this opportunity to discuss the Forest Service oil
and gas program. I am happy to answer any questions that you may have.
______
Response to questions submitted for the record by Tony L. Ferguson
Question from Congressman Raul Grijalva:
1. How many acres of National Forest System lands has the Forest
Service determined to be unsuitable and therefore not available
for oil and gas leasing?
Prior to identifying lands administratively available for oil and
gas leasing to the BLM the Forest Service must conduct a broad scale
area or forest-wide leasing analysis. At the conclusion of this
analysis the authorized forest officer shall identify on maps those
lands:
1. Open for development subject to the terms and conditions of the
standard oil and gas lease form.
2. Open to development but subject to constraints that will
require the use of lease stipulations such as those prohibiting surface
use.
3. Closed to leasing, distinguishing between those areas that are
being closed through exercise of management direction and those closed
by law and regulation.
All forests are required to conduct such an analysis. There are
several factors that may influence the distribution of acres into each
category such as oil and gas potential, resource concerns and special
area designations. The specific information requested is not readily
available. BLM maintains a database for all federal minerals of lands
currently under lease and areas with pending lease applications.
See the leasing information below for the Bridger-Teton National
Forest as one example of acres determined to be unavailable for oil and
gas leasing.
Questions from Congressman Mark Udall:
1. How does the Forest Service feel about using the EPAct Section 390
Categorical Exclusions and the WGA Resolution?
The Forest Service views the Energy Policy Act Section 390
Categorical Exclusions as a useful tool in processing the surface use
plan of operation when applicable. The Section 390 CEs are limited to
oil and gas activities in existing areas of development with previously
approved development analyzed through a NEPA process. The new activity
must be within existing areas with land use plans approved within the
last five years, or with surface disturbance limited to five acres and
a previous project with a NEPA process decision. When it is appropriate
to use one of the CEs the Forest must still ensure that the proposed
project is in compliance with all other laws and regulations such as,
the Endangered Species Act and the National Historic Preservation Act.
To date the Forest Service has used the Section 390 CEs to approve
about 300 projects. This tool has added to our ability to meet
processing timelines established in Section 366 of the Energy Policy
Act while still limiting resource disturbance.
The Forest Service is aware of the concerns expressed by the
Western Governors Association in their resolution. We are committed to
working with the states and their resource agencies to ensure that
resources are being protected in accordance with laws and regulations.
2. What is the status of oil and gas leasing on the Wyoming Range of
the Bridger-Teton National Forest? How much production of oil
and gas is occurring?
Here is a summary of the status of oil and gas leasing on the
Bridger-Teton National Forest, including the Wyoming Range.
Forest Land Management Plan (LMP) Approved March 1990
Total National Forest Acreage - 3,465,000 acres
Wilderness Acreage - 1,300,000 acres
Unavailable for leasing in LMP - 223,000 acres (non-wilderness)
Available for Leasing--1,900,000 acres
Supplemental Information Review completed re: leasing decision
adequacy--spring of 2004
Determined that 1990 leasing decision adequate and still
current.
Acres currently under lease - 186,770 acres (including 95,675
suspended).
5.4% of the National Forest acres
5.7% of the National Forest acres if August sale acres included
27,301 acres within producing leases (primarily Riley Ridge
field) (0.7% of the National Forest)
Acres approved for lease, sent to BLM but later withdrawn - 164,553
acres
(4.7% of the National Forest)
(Withdrawn at Governor's request)
Resubmitted to BLM for sale after additional review in 2005 -
44,720 acres
(1.3% of the National Forest)
Results of lease sales of 44,720 acres:
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Note: The parcels for the December and April sales have been
issued and therefore listed as leases; the parcels for the June and
August sale are under lease sale protest and therefore have been sold
but not yet been issued by BLM.
2006 lease sale results:
Bonus Bid on April lease sale = $114.12/acre. ($2.246 million)
Bonus Bid on June lease sale = $104.55/acre. ($1.306 million)
The IBLA issued stays on leases on September 21, 2006. Stays have
been issued by IBLA for the December and April Sales of 12 leases for
20,908.75 acres. As noted above, the lease sale protests for the June
and August sales have not been resolved yet and therefore no IBLA
appeal rights exist until the protests are resolved. Once the protests
are resolved by the BLM, their decision could then be appealed to the
IBLA for consideration.
The production and value data below was provided by the Minerals
Management Service for 2001, the most recent data received. We would
expect the numbers for 2005 and 2006 would be higher than 2001 based on
additional wells being drilled with increased production and increases
in the market values for the commodities.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The Bridger-Teton National Forest was scheduled to complete
their forest plan revision in September, 2008 under the new 2005
Planning Rule. However, a recent court order has stayed implementation
of the 2005 Planning Rule. At this time it is unknown exactly what
effect the litigation will have on the schedule and revision activities
for the Bridger-Teton. Litigation activities are on-going to clarify
and resolve the court order. The Bridger-Teton is not conducting oil
and gas leasing analysis as part of their revision process.
______
Mr. Grijalva. Thank you very much, sir.
Mr. Bisson.
STATEMENT OF HENRI BISSON, DEPUTY DIRECTOR, BUREAU OF LAND
MANAGEMENT, U.S. DEPARTMENT OF THE INTERIOR
Mr. Bisson. Chairman Grijalva and members of the
Subcommittees, thank you for inviting me to testify at this
hearing.
My name is Henri Bisson, and I am the BLM's deputy director
for operations.
Lands managed by the Department of the Interior produce
one-third of all domestic coal, oil and natural gas. Demand for
natural gas is expected to increase 50 percent over the next 20
years, and oil consumption 30 percent. Much of the oil and gas
that American consumers and businesses depend upon comes from
foreign sources. This is a huge drain on the nation's economy.
For this and many other reasons the Nation is looking more and
more at domestic resources from public lands. Consider a few of
these facts:
Since 1970, the size of the average house increased 55
percent while the size of the American family decreased 13
percent. Many of us use natural gas to heat our homes and power
our modern conveniences. Use of natural gas for power
generation has nearly doubled over the last 10 years. Ninety
percent of all planned electrical plants intend to use natural
gas in some capacity. Almost all natural gas is produced
domestically or imported from Canada.
The Phase II study conducted under EPCA, as amended by the
Energy Policy Act of 2005, found that Federal lands in the 11-
basin study contained 187 trillion cubic feet of natural gas,
enough to meet the current residential consumption in this
country for 39 years.
The BLM manages this vast pool of energy under a multiple-
use mandate that we take seriously. Of the 700 million-acre
Federal mineral estate we manage, only 42 million acres or 6
percent are leased. Of that, 12.3 million acres, less than 2
percent of the Federal mineral estate are in producing status.
Nine major laws regulate BLM leases and development permits for
oil and gas. Less than 1 percent of the 258 million surface
acres managed by the BLM experience a surface impact from
disturbance from oil and gas activity.
Land that is leased does not always see development.
Companies explore leases and usually end up excluding more
lands from being developed than are included, but leasing is
still essential to exploring for new domestic development and
for in-filling existing fields.
Interest in leasing is reflected in the amount of land
nominated for lease sales over the past few years. What was
typically nominated in a year-long period several years ago is
now nominated for a single quarterly lease sale in many western
states. Recently sales have been much larger than they were
prior to this boom cycle, but the amount of land under lease is
actually much lower than historic highs during the eighties.
As of 2006, the BLM had just over 48,000 leases, totaling
approximately 42 million acres. In 1984, the BLM managed over
115,000 leases, totaling about 131 million acres. In simple
terms, there were almost two and a half times as many leases in
effect in the mid-eighties and three times as many acres under
lease.
Leasing decisions are not arbitrary, but are based upon
land use plans where decisions are made on availability of
areas for leasing, and consider new information, new
circumstances before any decision is made to offer these lands.
Where other important uses of resources exists, BLM may protect
the resources and lease the land using a variety of tools and
stipulations, or BLM may decide not to lease the land.
Leasing is only the first step in this process. We require
additional permitting, further environmental analysis if a
company wants to explore or develop, and in these reviews we
determine site-specific needs for mitigation measures. These
measures may include re-vegetation, strategic placement of
structures and machinery, colors that blend in the landscape,
buffer zones to protect wildlife, and burying of utilities
under or adjacent to access roads to protect wildlife and
minimize visual impacts. These are some of what I referred to
as best management practices in my written statement.
With new technology and innovative management tools,
recreation, wildlife, energy, and a variety of other uses can
co-exist. Development has become drastically lighter on the
land than in the past.
This concludes my opening remarks, and I will be happy to
answer any questions, Mr. Chairman.
[The prepared statement of Mr. Bisson follows:]
Statement of Henri Bisson, Deputy Director,
Bureau of Land Management, U.S. Department of the Interior
Messrs. Chairmen and Members of the Subcommittees, thank you for
the opportunity to appear here today to discuss Oil and Gas Impacts on
the Public Lands.
Background
The Bureau of Land Management (BLM) is the steward of 258 million
surface acres of public lands and 700 million acres of subsurface
mineral estate and manages them in accordance with the 1976 Federal
Land Policy and Management Act. These public lands contain a myriad of
important resources and provide for a variety of our Nation's needs and
interests, such as outdoor recreation, domestic energy, wildlife
habitat, livestock grazing, timber, and the enjoyment and protection of
other natural, cultural, and historical resources. With the rapid
population growth in the west--from nearly 20 million people in 1950 to
more than 60 million today--the pressures to meet complex, and
sometimes competing, demands for public land resources also has grown
exponentially.
As one of the Nation's oldest land management agencies, the BLM
also delivers value on a daily basis to the American public. Each
dollar spent by the taxpayer on BLM activities is an investment, not
only in the land, but also in an ongoing revenue stream. The BLM is an
important source of revenue to the Treasury. Royalties collected from
energy leasing, and fees collected from other public land uses, all
serve to benefit the taxpayer. In 2008, public lands will generate an
estimated $4.5 billion in revenues, mostly from energy development.
Approximately 44 percent of these receipts are provided directly to
States and counties to support roads, schools, and other community
needs. These activities also contribute to a more secure and reliable
energy future for our country, providing a mix of both renewable and
conventional energy supplies from the public lands.
At the same time, BLM-managed public lands are being used for
recreation by the American public in increasing numbers. We also have
important responsibilities in managing for critical wildlife habitat,
cultural resources, our National Monuments, and wilderness values, to
name a few.
The BLM is dedicated to ensuring that all Americans benefit from
the agency's multiple-use mandate. This means ensuring that
environmental and other recreational interests are considered when
making decisions about renewable and conventional energy development on
our public lands. We appreciate the opportunity to discuss our efforts
toward this end. Our top priorities in the upcoming fiscal year are to:
Maintain or restore the health of the land and enhance
vital habitat;
Provide the Nation with dependable, affordable energy
developed in an environmentally-sound manner; and
Improve the efficiency of the BLM's operational and
administrative functions.
Healthy Lands Initiative
A high priority of Secretary Kempthorne is the Healthy Lands
Initiative, which was included in the President's FY 2008 budget
request. As activities on public land increase, we are seeing growing
conflicts among recreation users, energy developers, hunters, ranchers,
and others all competing to protect, access, and use these public
lands. Through the Healthy Lands Initiative, the BLM will join with the
U.S. Geological Survey and the U.S. Fish and Wildlife Service to
identify, restore, and mitigate the potential impacts of increased
energy production in wildlife-energy interface areas and increase
available habitat for specific species, including sage grouse.
The Initiative represents a new concept for meeting emerging
challenges in managing natural resources with flexible, landscape-level
approaches for continued multiple-use. Landscapes are land areas
composed of diverse habitat types that include winter range and
migration corridors.
Land health is being affected by pressures such as community
expansion, wildfires, unprecedented demands for energy resources, ever-
expanding recreation uses, and weed invasion. These pressures often
interact among themselves to affect large landscapes and ecosystems,
particularly those in the growing wildlife-energy interface.
A different management approach is urgently needed to meet these
challenges. Taking aggressive steps now will help avoid the need for
future restrictions on uses of public land that would directly affect
the Nation's economy and quality of life.
The goals of the Initiative are to:
Continue to provide access to energy resources, thereby
enhancing energy security;
Manage landscapes to ensure sustainable habitat for wide-
ranging species, such as the sage grouse, and prevent future ESA
listings; and
Sustain public lands and wildlife habitat, and
traditional activities on public lands.
The BLM will begin aggressive, landscape-scale habitat enhancement
projects in six geographic areas: southwest Wyoming; northwest and
southeast New Mexico; south-central Idaho; southwestern Colorado; Utah;
and the three-corner area of Idaho, Oregon, and Nevada.
The BLM will concentrate a large number of treatments in each
emphasis area, resulting in significant improvements to habitat in an
entire watershed or landscape-wide area within one to three years. The
BLM will also utilize existing budget authority, as well as leverage
funding with other Federal agencies and our partners at the state and
local levels.
The Green River Basin in Wyoming
One of the six priority areas of the Healthy Lands Initiative is
the Green River Basin in Wyoming. It is representative of areas in the
West where landscapes and habitats are undergoing changes in response
to pressure from multiple-use. Southwest Wyoming possesses some of the
most diverse wildlife habitats in the Intermountain West, which
attracts hunters, fishermen, and other outdoor enthusiasts each year.
While these interests represent important sources of income for
surrounding rural communities, this region, principally the Green River
Basin (Basin), is also under pressure from natural gas development. The
15 million-acre Basin, characterized by sagebrush (sage grouse
habitat), mountain shrub, aspen, and riparian communities, also has an
estimated 83 trillion cubic feet of recoverable natural gas.
The BLM together with the U.S. Fish and Wildlife Service and U.S.
Geological Survey, are teaming up to protect these important habitats
while natural gas production takes place in the Basin through the
Wyoming Landscape Conservation Initiative (WLCI). Rather than
conducting separate and uncoordinated impact studies and mitigation
efforts, these partners will:
Conduct efficient, science-based species monitoring and
habitat enhancement;
Facilitate best reclamation and mitigation practices for
areas affected by current natural gas development;
Integrate existing data with new knowledge and
technologies to forecast future development of energy resources and
assist in habitat conservation planning; and
Conduct habitat enhancement in all habitat types with a
special focus on sagebrush, mountain shrub, aspen, and riparian
communities.
The partnership, which also includes efforts underway by the
National Park Service, Bureau of Reclamation, Forest Service, and
Wyoming Game and Fish, will also provide a broader understanding of the
valuable Green River Basin ecosystem.
By using this landscape-level approach and using the WLCI
partnership, the BLM expects to be able to leverage funding for key
projects that will mitigate the pressures these habitats face from a
combination of energy, industrial, and residential development in both
the short- and long-terms. In Wyoming, partners have already identified
funding priorities including vegetation treatments (sagebrush, aspen
trees), water projects such as building or restoring water sources for
wildlife, and improving riparian areas. Funding for the WLCI will be
long-term and include leveraging funding with other Federal agencies
and our partners at the state and local levels.
Land Use Planning
The BLM's land use planning process seeks to ensure that domestic
oil and gas development on public lands is done in a way that protects
the environment. Some of the recently developed land use plans have
been among the most restrictive ever developed for oil and gas leasing
on Federal lands.
For example, the BLM recently issued an innovative Resource
Management Plan (RMP) for limited, environmentally-sensitive oil and
gas development on public lands in Otero and Sierra Counties in New
Mexico. The plan will allow carefully monitored activity, leading to a
maximum surface disturbance of only 1,589 acres from well pads, roads
and pipelines--less than one-tenth of one percent of the total surface
area of 2 million acres. At most, there will be 141 exploratory wells
drilled, resulting in up to 84 producing wells. Almost 36,000 acres of
grasslands with the highest potential as habitat for the endangered
Aplomado falcon will be closed to leasing and permanently protected. In
addition to these measures and overall limits on development, leasing
will not be allowed in six existing and eight proposed Areas of
Critical Environmental Concern and four Wilderness Study Areas--
bringing the total number of protected acres to 124,000. This new plan
amends a 1986 RMP that would have allowed leasing with few restrictions
on oil and gas activities, would have used standard lease terms and
conditions for leasing, and would not have provided the protections for
grasslands and other sensitive areas developed in the BLM's current
plan amendment.
The BLM continually seeks new ways to minimize, mitigate, or
compensate for any adverse impacts from development activities.
Innovation of the type envisioned in Energy Policy Act of 2005 (EPAct)
is already underway at the BLM. For example, the BLM is:
Initiating a pilot block survey in the Carlsbad Pilot
Office to identify cultural resource properties in the area; and
Evaluating an experimental drilling technique proposed by
the operator in the Jonah Field in Wyoming using temporary wooden
pallets for roads and well pads to determine if this technology reduces
impacts to surface vegetation and soil.
Best Management Practices and Performance-Based Standards
The BLM is employing Best Management Practices (BMPs) to enhance
its ability to protect the environment and reduce long-term impacts on
the land from oil and gas activity. The focus of BMPs is smart upfront
planning and solid implementation of best practices to reduce
environmental impacts on public and private lands and resources. The
new policy guidelines require BLM project managers to consider
incorporating BMPs into all Applications for Permits to Drill (APDs)
and associated rights-of-way. Additionally, the policy encourages oil
and gas, geothermal, and helium operators to meet with BLM field office
staff during project planning to incorporate BMPs at the earliest
possible stage of the permit application process.
Typical Best Management Practices include:
Reducing the ``footprint'' of roads and well heads by
choosing the smallest safe standard and best location for facilities,
and by employing interim reclamation.
Selecting appropriate color, shape, size and/or location
for facilities to reduce visual contrast.
Discouraging raptor predation on sensitive species by
installing perch-avoidance structures or burying power lines on the
lease area.
Reducing wildlife disturbance by centralizing or
automating production facilities to reduce frequency of travel to each
well head.
Using common utility corridors or burying flowlines in a
roadway or an adjacent right-of-way.
Drilling multiple wells from a single location;
centralizing production facilities or relocating them offsite.
For example, in the Pinedale area of Wyoming, concerns about
impacts to wildlife have resulted in reduced surface disturbance
compared to past development by implementing such measures as the
consolidation of infrastructure, such as roads, pipelines, and
production facilities. As a consequence, the BLM has achieved an
overall reduction in the footprint of development involved in winter
drilling projects in the Pinedale Anticline relative to what would
otherwise have resulted.
Final reclamation of all disturbed areas, including access roads,
to either their original contours or a contour that blends with the
surrounding topography is a BMP that planners should consider in nearly
all circumstances.
The BLM has included BMPs in the 2005 update of the Gold Book of
``Surface Operating Standards and Guidelines for O&G Exploration and
Development'' (posted at www.blm.gov/bmp). Through three separate
Instructional Memorandum, the BLM also has:
Established offsite compensatory mitigation guidelines
for oil and gas authorizations to provide additional opportunities to
address impacts of proposed projects;
Established oil and gas process improvement teams in BLM
Field Offices; and
Provided guidance on the review of bonding requirements
for oil and gas operations.
To encourage widespread adoption of BMPs and to recognize good
environmental stewardship through their use, BLM has established an
annual ``Best Management Practices'' awards program. Annual awards
recognize industry and BLM offices that best incorporate BMPs into
their oil and gas activities. Recipients are to be selected by a panel
including representatives from government, industry, and environmental
and wildlife conservation groups.
The BLM is also using performance-based standards to challenge
industry to reduce emissions, minimize surface disturbance, and develop
quick and effective reclamation techniques to improve restoration of
disturbed areas. If on-site mitigation measures do not achieve the
desired conditions, companies have the option of undertaking off-site
mitigation measures. For example, in March 2006, the BLM announced that
EnCana is contributing up to $24.5 million over ten years toward an
office dedicated to funding offsite mitigation and monitoring in the
Jonah Field. The BLM believes that offsite mitigation can potentially
become an increasingly useful tool for improving habitats adjacent to
certain natural gas development areas.
Inspection and Enforcement and Monitoring
The FY 2008 President's budget request includes an increase of $3.1
million to support increased oil and gas inspections and monitoring to
better ensure that oil and gas operations are conducted in an
environmentally-sensitive manner and that leasing permit terms are
enforced. The BLM's oversight capabilities are being increased in
response to the pace of industry's on-the-ground operations. BLM has
increased inspection and enforcement by more than 30 percent since
2001. In FY 2001, the BLM completed just over fourteen thousand
inspections, and in FY2006, the BLM completed just under twenty
thousand inspections.
This year, the Buffalo and Rawlins Pilot Office in Wyoming received
funding to hire 15 additional surface environmental compliance and
reclamation inspectors. These inspectors will allow Buffalo to exceed
its target of approximately 3,600 inspections and will allow Rawlins to
increase its inspections by 8 percent to 700 inspections.
The BLM also is improving inspection and enforcement efforts
through cooperative arrangements with the State of Wyoming. For
example, a cooperative assistant agreement with the Wyoming Fish & Game
Commission would establish two wildlife biologist positions in each
Pilot Office; these individuals would monitor the effectiveness of BLM
lease stipulations and permit conditions of approval as well as make
adaptive management recommendations to ensure that fish and wildlife
resources are protected. Another cooperative assistant agreement, in
the process of being developed with the Wyoming State Historical
Preservation Officer, would establish a position to support the
electronic data capture of the large volume of cultural survey reports
and site information. The BLM also is collaborating with the Governor
of Wyoming's Energy Permit Strengthening and Streamlining Initiative.
The working groups have addressed such issues as split estate,
coordinated reclamation bonding, watershed-based permitting and impacts
to local communities, supporting interagency electronic permitting
information technology. We look forward to continuing these cooperative
efforts, and hope to expand these efforts in other states.
Onshore Order #1
The BLM's Onshore Order #1 will be updated effective May 7, 2007.
The Order is a set of rules that direct the conduct of operations,
applications to drill on a lease, subsequent well operations, other
miscellaneous lease operations, environmental and safety obligations,
and abandonment on all Federal and Indian onshore oil and gas leases
nationwide (except for those on lands of the Osage Tribe). The previous
Order was over 20 years old, and conditions, regulations, policies,
procedures and requirements have changed a great deal since that time.
The Final Rule clarifies regulations and procedures to be used when
operating in split estate situations. Under the revised final order,
operators are required to make good faith efforts to reach surface
access agreements with private surface owners. Private surface owners
are also being provided with opportunities to participate in onsite
inspection meetings between the BLM and the operator. The Final Rule
also states that on split estate lands, the BLM will comply with
cultural and endangered species regulations in essentially the same way
it does when the surface is Federally-owned.
Conclusion
The BLM manages 13 percent of the total land surface of the United
States. These lands contain a wide variety of incredible resources, and
the public has a wide range of interests in those resources. Our
testimony today has outlined the ways in which the BLM is working to
provide the Nation with dependable, affordable energy that is developed
in an environmentally-sound manner. The BLM will continue its efforts
to ensure that all Americans benefit from the agency's multiple-use
management of our public lands.
Mr. Chairman, thank you for the opportunity to testify today. I
will be pleased to answer any questions you may have.
______
Response to questions submitted for the record by Henri Bisson
1. In response to a question from Mr. Pearce, you stated that out of
more than 19,000 wells, only 20 were ``bonded on.'' To clarify,
is that 20 wells, or 20 surface owners? If 20 surface owners,
how many wells? What time period does that figure cover? (For
example, last year, or since enactment of EP Act, or other?)
Please list the location of those cases.
At your request, the BLM completed a detailed review to further
clarify and quantify bonding statistics:
To date, the BLM holds a total of 42 surface loss and
damage bonds, covering 19 surface owners. The nature of a surface loss
and damage bond is that it is a tool to ensure compensation of loss and
surface damages in the absence of a surface use agreement.
During calendar year 2006, the BLM accepted 25 surface
owner loss and damage bonds from operators/lessees. Each bond is linked
to a specific well. A total of 15 surface owners are covered by these
bonds for loss and damages (some surface owners have more than one bond
allocated to them.) The bonds accepted in calendar year 2006 are held
in the following States: CA--17 bonds, MT--6 bonds, UT--1 bond, and
WY--1 bond.
After an APD is approved, operators typically continue
their negotiation efforts with surface owners to reach a surface use
agreement. Once an agreement has been reached, the bonds are released.
This explains the small amount of surface bonds the BLM holds today. A
summary of the location of the 42 existing bonds is as follows: CA--17
bonds, MT--12 bonds, NM--1 bond, UT--1 bond, WY--11 bonds.
2. In your oral remarks, you stated that many more acres were under
lease in 1984 (131 million acres) than currently (42 million
acres). Isn't that because oil and gas companies have a much
better idea now of where they want to explore, and do not
nominate, or bid on, lands that they don't consider to be good
prospects?
That is not the primary reason for the significant reduction in
leased acres. The Federal Onshore Oil and Gas Leasing Reform Act of
1987 (Act of 1987) changed the way the BLM offered onshore oil and gas
leases to the public, and this reduced the speculative demand for
leases. Prior to the Act of 1987 it was the BLM's policy to offer for
lease as much acreage as was available for leasing. Much of this
acreage was offered in a lottery format. The BLM would send out a list
of parcels to be leased and for $75 dollars members of the public could
have their name put into a pool of potential lessees. The BLM would
then randomly select one to be the lessee. The Act of 1987 was passed
to change the leasing program. Now only parcels that are nominated by
the public are considered for lease and if offered, it is done through
an oral auction. Areas of interest continue to change for oil and gas
companies as technology and new discoveries of oil and gas occur.
3. Where has BLM NOT required Best Management Practices--and why--in
the past three years.
The BLM did not require the use of Best Management Practices (BMPs)
until June 2004, when BLM issued a directive to All Field Offices,
directing them to use BMPs after an appropriate environmental analysis
for not only oil and gas resources but for energy development related
lands and realty actions, i.e. power lines or pipelines to an oil and
gas well (see attached policy). Since that time the BLM has
increasingly incorporated appropriate BMPs into new Applications for
Permit to Drill, energy related rights-of-way, and other related
permits.
BLM has always required Lease Stipulations and Conditions of
Approval on drilling permits to mitigate potential impacts to surface
disturbing activities on the ground. However, older oil and gas fields
have the least application of best management practices. Examples would
include older fields in the Uintah Basin of Utah and the Permian Basin
of New Mexico. Many oil and gas operators have voluntarily adopted Best
Management Practices and have included them in their permit
applications.
4. You noted in your oral remarks that the footprint of oil and gas
development is quite small, because not all lands that are
leased are developed. In terms of gauging the footprint, to
what degree is the BLM using landscape fragmentation metrics
that take into account roads and other infrastructure to gauge
the footprint of development?
There are multiple ways of gauging the ``footprint'' of
development, and all provide useful information. It is the BLM's intent
to reduce the footprint of energy development and thereby reduce
environmental impacts including loss of vegetation, soils, visual
quality, air quality, habitat, or others. When measuring an
environmental impact, such as vegetation loss, it is appropriate to
measure the direct footprint of vegetation disturbance. When measuring
habitat loss, it may be important to measure not only direct vegetation
loss, but also the indirect effect of noise, dust, and traffic on a
wider area. In either case, the BLM has identified environmental Best
Management Practices (www.blm.gov/bmp) that are effective in reducing
the direct and indirect footprints of energy development.
5. Abandoned and Inactive Sites/Wells
How many sites have been abandoned each year in the past 10 years? For
each, what is the location, the operator, the type and amount
of financial assurance, the number of wells, and the projected
reclamation cost?
The BLM defines an abandoned well as one in which the well has been
properly plugged to the surface but the reclamation has not yet been
inspected and accepted as final.
The total numbers of Federal wells plugged (abandoned) for the last
10 years are:
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The detailed listing of each well and operator is provided in a
table contained in Appendix A. BLM does not track the projected
reclamation cost for abandoned wells. The operators, not the BLM, are
responsible for their reclamation.
6. What was the total number of abandoned and inactive wells in each
of the past 10 years? For each year, what is the number of new
abandoned and inactive wells, the number of abandoned and
inactive wells reclaimed, the number of abandoned and inactive
wells brought back into production, the production from each of
those wells, and the total projected reclamation cost from
those wells?
This question, as well as questions 7 and 9, requests comprehensive
data which is not accessible through our standard records systems. We
will acquire the data through a physical review of records located at
multiple BLM field offices in several States. A request to our field
offices to initiate this data collection was sent out during the week
of June 4, 2007. We expect to be able to respond to questions 6, 7, and
9 in October.
7. What expenses were incurred in each of the past 10 years due to
inadequate financial assurance amounts? For each, what is the
location, the operator, the number of wells, and the type and
amount of financial assurance?
Please see answer to question 6, above.
8. How many sites achieved final reclamation, final inspection, and
final bond release each year in the past 10 years? For each,
what is the location, the operator, and the number of wells?
Summary:
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The detailed listing of each well and operator is provided in a
table contained in Appendix B.
9. For how many operators, projects and wells has BLM increased
financial assurance amounts in each of the past 10 years? For
each, what is the location the operator, the number of wells,
the type and amount of financial assurance (both before and
after the increase), and the projected reclamation cost?
Please see answer to question 6, above.
Cultural Resources
10. In response to a question about Nine Mile Canyon in Utah, you
stated an expectation that the management plan area would
address cultural resources concerns. However, the problem may
be that oil and gas leasing simply isn't compatible with the
historic and sacred resources in that canyon. Many of the
leases which Bill Barrett Corporation now seeks to develop in
Nine Mile Canyon and on the plateau above were issued or
renewed in the late-1980s and early 1990s. Now, with respect to
the proposed 750-plus well development, BLM seems to believe
that it has limited alternatives available to prevent the
proposed development or to minimize the impacts because it
issued the leases many years ago. Does the agency believe that
it cannot revisit the terms of old leases when renewing them,
and if so, why? In the past five years, has BLM identified
areas that, for cultural or habitat reasons, should not be open
to leasing at all? If so, please specify. How can BLM prevent
the future occurrence of a situation like that of Nine Mile
Canyon?
The BLM has several options available for mitigating oil and gas
development-related impacts to cultural and habitat resources.
Mitigation developed through the consultation and environmental review
processes could result in the relocation of development or the
mandatory application of site-specific mitigation and best management
practices to individual drilling permits. Regardless of the age of oil
and gas leases, the BLM must comply with applicable statutes, such as
the consultation requirements of Section 106 of the National Historic
Preservation Act. The BLM must also comply with the National
Environmental Policy Act, Endangered Species Act, Migratory Bird Treaty
Act, the Clean Water Act, Clean Air Act, and many other Federal
statutes. Lease operations are also subject to regulations, such as the
oil and gas ``Environmental obligations'' regulatory provisions found
in 43 CFR 3162.5-1. In addition, the Price Field Office is currently
revising their Resource Management Plan and will address leasing and
other land use planning considerations related to cultural and habitat
resources in Nine Mile Canyon and the West Tavaputs Plateau areas.
Specific to Nine Mile Canyon, very little oil and gas development
is being permitted in the canyon where the most important cultural
resources are found. The BLM is restricting drilling locations in the
canyon and the majority of the oil and gas resources within the canyon
will be developed by directional drilling from centralized locations.
Currently, there are four wells and one large compressor station in the
bottom of Nine Mile Canyon. Three of these wells are located on private
surface (two of the private surface wells have private mineral
ownership and one has minerals owned by the State), and one well is
located on Federal surface (BLM). That well was approved and drilled in
July 1962. All of the other wells associated with oil and gas
production in the area are located outside of Nine Mile Canyon proper
and most are located on the benches to the south. The one large
compressor station is located on private land.
The following chart contains examples of lands that have been
deferred or closed to leasing in land use plans during the past five
years primarily to protect cultural or habitat resources. More
commonly, in practice, the BLM makes land with habitat and cultural
resource values available for leasing, but may include major or
moderate resource protection lease stipulations in the oil and gas
lease. When an actual request for a drilling permit is received, the
BLM conducts an environmental review and may move the well and road
location to protect cultural and habitat values and will typically
attach additional resource protection constraints to the approved
permit.
Chart: Examples of BLM-managed lands that have been deferred or closed
to leasing in land use plans during the past five years primarily to
protect cultural or habitat resources. The figures are approximate.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
11. How often-in what percent of APDs-does the BLM attach a
cultural resource stipulation to leases? Can the stipulation
resolve potential conflicts between oil and gas development and
the protection of significant cultural and historic resources?
How often does BLM later deny an APD or activities within a
lease due to a cultural resource stipulation and eventual
finding that there is a threat to cultural resources?
Section 6 of the standard oil and gas lease form includes
requirements for the protection of cultural resources. Regardless of
the lease terms and conditions, the BLM is required under Section 106
of the National Historic Preservation Act to complete consultation with
the State Historic Preservation Officer (SHPO) for all subsequent
permitting actions that affect cultural resources eligible or
potentially eligible for the National Register of Historic Places. As a
result of the consultation process, the proposed activity may be
relocated or mitigation requirements may be attached to the permit.
This process has been very effective in mitigating conflicts between
oil and gas development and protection of important cultural resources.
It is extremely rare that impacts cannot be mitigated or the site
avoided altogether. In consultation, the BLM works with the oil and gas
operator and the State Historic Preservation Officer to develop an
alternative that allows some form of the action to proceed (even if it
must be relocated) with little or no impact to cultural resources.
Subsequent to consultation, denial of an APD is rare.
Follow up commitments
During the hearing, Mr. Bisson stated for the record that BLM would
supply information on the following:
Issue 1: Where BLM is using Section 390 categorical exclusions, and
where that information is made readily available to the public.
The following information reflects BLM Field Offices that have used
categorical exclusions (CXs) during Fiscal Year 2006 (10/1/05 to 9/30/
06).
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Issue 2: Where the agency is considering the cumulative impacts of
the use of CXs on wide-ranging species and wildlife corridors?
The Section 390 CXs essentially tier to existing NEPA analysis
which includes a cumulative impact analysis.
The BLM analyzes the cumulative impacts of oil and gas exploration,
development, production, and abandonment on resources, including
wildlife and its habitat, either at: (a) the land use planning stage
through the Environmental Impact Statements (EIS) associated with BLM's
Resource Management Plans; or (b) the development stage through
geographic area NEPA analysis that looks at all or a portion of an oil
and gas field.
a. Cumulative Impact Analysis at the Land Use Planning Stage:
At the land use planning stage, the BLM determines where and under
what conditions oil and gas exploration, and development activities
will be permitted. Before these determinations are made, the impacts
associated with these determinations must be analyzed in the EIS
prepared with the RMP. To support the cumulative impact analysis
associated with the RMP, a reasonable foreseeable development scenario
(RFDS) for oil and gas development is generated. The RFDS projects
management activities and actions likely to occur in the planning area
over the life of the RMP (typically 15 to 20 years).
Information within an RFDS includes:
Number of wells expected to be drilled over the life of
the RMP;
typical surface and subsurface activities that are likely
to take place if these wells are drilled;
average amount of acres typically disturbed to drill,
complete, and produce a well (includes well pads, access roads, and
pipelines);
waste disposal needs - produced water, H2S,
CO2 venting, and flaring; and
sequence, timing and duration requirements needed for
exploration, drilling, and production phases.
An interdisciplinary team uses the RFDS as a guide to analyze what
the cumulative impacts of oil and gas development would be to other
resources (i.e., ecological, aesthetic, historic, cultural, economic,
social, and/or health) so as to develop mitigation measures to avoid or
reduce adverse impacts.
b. Cumulative Impact Analysis at the Development Stage:
The subsequent method for analyzing cumulative effects is through a
geographic area NEPA analysis, which is an activity-level analysis of
an entire oil and gas field or a logical portion of a field where
proposed multiple wells, access routes, production facilities,
utilities, etc. have been identified. These types of analyses take a
broad scale, yet site-specific look at a defined area and known or
likely development proposal. The primary advantage is the ability to
look at a broad area in a site-specific manner and analyze the
cumulative effects of oil and gas development in relation to other
resource uses in one public process rather than individual development
proposals.
Issue 3: Examples of areas where BLM is ensuring that mitigation
occurs on the site of former oil and gas facilities (versus
habitat enhancement elsewhere).
Jonah Field of Pinedale, Wyoming: New discoveries have been made in
different formations and at greater depths of an existing field. New
mitigation the operators have applied to the existing older field
include:
Reducing the physical footprint of well pads by
centralizing operations. Centralization eliminates the need to disturb
a large amount of surface area at each well pad location to support
equipment.
After wells are drilled and completed, all facilities
associated with the production of these wells are strategically placed
at centralized locations to reduce vehicle traffic and needed roads.
Producing wells are monitored electronically through
remote telemetry, which eliminates the need for field visits to well
site locations on a continuous basis. This decreases vehicle traffic
and associated wildlife disturbance.
Operators are experimenting and developing improved
reclamation techniques that would ensure not only the reclamation, but
the restoration of disturbed areas. These practices are also being
implemented at the production phase of operations through interim
reclamation of disturbed areas not needed for the production phase of a
well.
Furthermore, operators within the Jonah Field have
contributed funds to a centralized organization (Jonah Interagency
Mitigation and Reclamation Office) that provides overall management of
field monitoring and on-and off-site mitigation of oil and gas
development. For further information please refer to the following
website: http://www.wy.blm.gov/jonah_office/index.htm.
Carlsbad, New Mexico: The BLM has identified areas (well pads and
access roads) within old oil and gas fields where past reclamation
efforts were unsuccessful due to obsolete practices or lack of
stringent environmental standards that didn't exist at the time. These
abandoned locations are being reclaimed and reseeded with native
vegetation to stabilize severely eroded soils and reduce the amount of
habitat fragmentation that has already occurred. These efforts are part
of a statewide effort by the New Mexico BLM to restore its lands at a
landscape level. For further information associated with this project
please refer to the following website: http://www.nm.blm.gov/
restore_nm.
Issue 4: Examples of successful adaptive management efforts.
Pecos District Office, New Mexico: The BLM is in the process of
amending the current Carlsbad and Roswell Resource Management Plans
(RMP) in response to changing resource conditions and new issues in the
context of habitat management for the lesser prairie-chicken and sand
dune lizard while at the same time providing for energy production. New
monitoring information from the local BLM Field Offices and cooperating
agencies revealed that these two species are on the brink of being
listed as threatened or endangered under the Endangered Species Act
(ESA). This plan amendment was designed to establish new conditions and
prescriptions that would protect and enhance lesser prairie-chicken and
sand dune lizard habitats while allowing other uses to continue.
Anticline of Pinedale, Wyoming: The BLM Field Office is revising
its current land use plan in response to concerns of declining wildlife
populations. The revised plan calls for additional mitigation
including:
reducing the number of pads through multi-well pad
development;
requiring directional drilling and simultaneous
completion operations;
requiring operators to develop the oil and gas field in a
``phased approach'' by dividing it into core areas where the location
and intensity of drilling activities could occur at only one core area
at any given time;
reducing residual wildlife impacts and air quality
impacts by:
use of liquids gathering systems, centralized facilities,
and centralized production tanks where feasible to reduce truck
traffic;
increased use of remote telemetry further reducing trips
and traffic during production;
management of traffic through busing and scheduling during
seasonal stipulation periods; and
reducing rig moves on and off pads.
These efforts are anticipated to reduce impacts to wildlife
populations by decreasing the expected period for development in core
areas under seasonal restrictions.
Issue 5: The number of leases the NPS has requested that BLM withdraw,
and the number which were subsequently withdrawn.
The BLM does not lease National Park Service lands for oil and gas
development. Occasionally the National Park Service will request that
the BLM not lease a parcel near Park lands. On other occasions, the BLM
will proactively notify the National Park Service that parcel
nominations have been received for parcels near Park lands. The BLM
typically discusses impacts, mitigation, and seeks the opinion of the
National Park Service prior to leasing the lands.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
A. In previous hearings, there has been criticism that oil and gas
production in Wyoming is threatening to sportsmen's activities.
Has BLM performed any analysis to determine to big game trends
in that area? Have the numbers been increasing or decreasing
and by how much? Have the hunter numbers been increasing or
decreasing? Has the hunter success rate been increasing or
decreasing?
Major oil and gas development activity began in the Jonah/Anticline
fields in Sublette County, Wyoming in calendar year 2000. We have
reviewed Wyoming Game and Fish Department (WG&F) trend data from 1996
to 2005 to determine if impacts may be occurring in Sublette County in
addition to those occurring on a statewide basis. The following data
from WG&F shows that overall big game populations and hunting
opportunities in Sublette County generally mimic statewide results.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
*Over the past ten years, the difference between population
estimates and population objectives for deer has ranged statewide from
23% below to 3% below objective and for antelope has ranged from 15%
below objective to 10% above objective.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
B. In previous hearings, there has been criticism that the
Department has a ``lease at all costs'' approach to managing
Federal lands. Is this true or false? And can you explain why?
We disagree with this assertion. The BLM is a multiple-use agency,
and domestic energy production is only one of the many uses for which
we manage the Federal lands under the multiple-use mandate. However,
the numbers show that leasing is not the predominant use of the lands
under BLM management. The BLM manages a subsurface mineral estate of
700 million acres. Approximately 42 million acres of that total, or 6
percent, are under lease for oil and gas. Of the leased acreage,
approximately 12.3 million acres are in producing status. This
represents approximately 1.8 percent of the 700 million acres of
Federal mineral estate.
Furthermore, approximately 25 million acres of the 258 million
surface acres the BLM manages are effectively closed to leasing because
of special designations such as National Monuments, Wilderness and
Wilderness Study Areas. In comparison, only 12.3 million acres, or less
than half the protected number, are under lease and in producing
status; and of the lease acreage that is in producing status, only
about 240,000 surface acres have direct surface disturbance from
activity associated with energy production.
UNITED STATES DEPARTMENT OF THE INTERIOR
BUREAU OF LAND MANAGEMENT
WASHINGTON, D.C. 20240
June 22, 2004
In Reply Refer To:
3100 (310) P
2800 (350)
EMS TRANSMISSION 06/22/2004
Instruction Memorandum No. 2004-194
Expires: 09/30/2005
To: All Field Officials
From: Director
Subject: Integration of Best Management Practices into Application for
Permit to Drill Approvals and Associated Rights-of-Way
Program Areas: Oil & Gas Operations; Geothermal Operations; Helium
Operations; Lands & Realty.
Purpose: The purpose for issuing this Instruction Memorandum (IM)
is to establish a policy that Field Offices consider Best Management
Practices (BMPs) in National Environmental Policy Act (NEPA) documents
to mitigate anticipated impacts to surface and subsurface resources,
and also to encourage operators to actively consider BMPs during the
application process.
Background: BMPs are innovative, dynamic, and economically feasible
mitigation measures applied on a site-specific basis to reduce,
prevent, or avoid adverse environmental or social impacts. BMPs are
applied to management actions to aid in achieving desired outcomes for
safe, environmentally sound resource development, by preventing,
minimizing, or mitigating adverse impacts and reducing conflicts. The
early incorporation of BMPs into Application for Permit to Drill (APDs)
by the oil and gas operator helps to ensure an efficient and timely APD
process.
Policy/Action: All Field Offices shall incorporate appropriate BMPs
into proposed APDs and associated on and off-lease rights-of-way
approvals after appropriate NEPA evaluation.
BMPs to be considered in nearly all circumstances include the
following:
Interim reclamation of well locations and access roads
soon after the well is put into production;
Painting of all new facilities a color which best allows
the facility to blend with the background, typically a vegetated
background;
Design and construction of all new roads to a safe and
appropriate standard, ``no higher than necessary'' to accommodate their
intended use; and
Final reclamation recontouring of all disturbed areas,
including access roads, to the original contour or a contour which
blends with the surrounding topography.
Other BMPs are more suitable for Field Office consideration on a
case-by-case basis depending on their effectiveness, the balancing of
increased operating costs vs. the benefit to the public and resource
values, the availability of less restrictive mitigation alternatives,
and other site specific factors. Examples of typical case-by-case BMPs
include, but are not limited to the following:
Installation of raptor perch avoidance;
Burying of distribution power lines and/or flow lines in
or adjacent to access roads;
Centralizing production facilities;
Submersible pumps;
Belowground wellheads;
Drilling multiple wells from a single pad;
Noise reduction techniques and designs;
Wildlife monitoring;
Seasonal restriction of public vehicular access;
Avoiding placement of production facilities on hilltops
and ridgelines;
Screening facilities from view;
Bioremediation of oil field wastes and spills; and
Use of common utility or right-of-way corridors.
A menu of typical BMPs can be found on the BLM Washington Office
Fluid Minerals website. The website is updated frequently and
submission of new BMPs and photos is encouraged. http://www.blm.gov/bmp
BMPs have been developed and utilized by numerous oil and gas
operators throughout the nation. When implementing new BMPs, Field
Offices are encouraged to work with affected operators early, to
explain how BMPs may fit into their development proposals and how BMPs
can be implemented with the least economic impact. Discuss potential
resource impacts with the operators and seek their recommended
solutions while encouraging operators to incorporate necessary and
effective BMPs into their proposals. BMPs not incorporated into the
permit application by the operator may be considered and evaluated
through the NEPA process and incorporated into the permit as APD
Conditions of Approval or right-of-way stipulations.
Field Offices must be cautious to avoid the ``one size fits all''
approach to the application of BMPs. BMPs, by their very nature, are
dynamic innovations and must be flexible enough to respond to new data,
field research, technological advances, and market conditions.
Following implementation, Field Offices should monitor, evaluate, and
modify BMPs as necessary for use in future permit approvals.
The overall goal of the Bureau is to promote the best examples of
responsible oil and gas development. Public lands should be showcases
of good stewardship while providing for responsible, sustainable, and
efficient development of the nation's oil and gas resources. BLM will
use the Quality Assurance Team (QAT) and General Management Evaluation
(GME) processes in order to review our progress. To recognize good
environmental stewardship work through the use of BMPs, BLM is
establishing an annual ``Best Management Practice'' awards program with
annual awards for industry and BLM offices, the details of which will
be available subsequently.
Timeframe: Immediately.
Budget Impacts: Minimal.
Manual and Handbook Sections Affected: None.
Coordination: AD-200.
Contact: Please direct policy questions to Tom Lonnie, Assistant
Director, Minerals, Realty, and Resource Protection (AD-300) at (202)
208-4201; or by E-mail at [email protected]; and technical
questions to Jim Perry, Washington Office Fluid Minerals Group (WO-
310), at (202) 452-5063; or by E-mail at [email protected]; or to Tom
Hare, Washington Office Fluid Minerals Group (WO310), at (202) 452-
5182, or by E-mail at [email protected].
Signed by:
Francis R. Cherry, Jr., Acting Director
Authenticated by:
Barbara J. Brown, Policy & Records Group, WO-560
______
Mr. Grijalva. Thank you very much. I want to thank the
witnesses, and if I may, Mr. Bisson, request that the statement
that you presented to us orally, if you could submit that also
for the record because it is somewhat different than the
statement that we have.
Mr. Bisson. I will do that, sir.
Mr. Grijalva. Thank you. Or a lot different. Let me begin
with some questions. Mr. Bisson, and it was mentioned as part
of Mr. Ferguson's testimony, let me begin with that area. You
know, Section 390 of the Energy Policy Act allows BLM to
categorically exclude certain wells and other sites from the
project level environmental analysis. My questions is, is your
agency tracking and mapping where the Section 390 categorical
exclusions are being used? And the second part of that question
is, is that information readily available to the public?
Mr. Bisson. I don't have that information with me today. We
can certainly supply it, but we know exactly where those
decisions are being made using categorical exclusions. We can
provide that information, sir.
Mr. Grijalva. And the second part of the question is, is
that readily available to the--the information that you are
going to provide this committee on the mapping and tracking,
that is readily available to the public is the other part of
the question.
Mr. Bisson. I can't answer that question. I think each
state probably handles it a little bit differently, but I
believe that the notices, you know, the activity that is going
to occur, that an APD is going to be approved are published and
are a matter of record. But I do not believe that there is a
public involvement process on the actual CXes because the CXes
are intended to simplify the process where we have already done
extensive NEPA analysis in former documents that looked at the
very same area.
Mr. Grijalva. OK. And your agency, Mr. Bisson, are you
incorporating the recommendations of your wildlife biologists
in the decisions as to whether to use or not use categorical
exclusion?
Mr. Bisson. I believe that we are.
Mr. Grijalva. And in that process of the cumulative effects
of those exclusions, especially in the wide-ranging issue of
species and wildlife quarters, is that being collected in a
cumulative way as well in the agency?
Mr. Bisson. We can provide that information.
Mr. Chair, if I might.
Mr. Grijalva. Please.
Mr. Bisson. The use of these categorical exclusions does
not exclude the application of other environmental laws or
regulations, environmental best management practices,
endangered species consultation or mitigation, protection of
sensitive wildlife species such as sage grouse, all of these
protection measures are still utilized and supplement the
decisions that we make when we use the CX, and we provide a
specific guidance to the field that requires our managers to
consult with the game and fish agencies, as appropriate.
Mr. Grijalva. Let me follow that. So how much mitigation is
done on a site of former oil and gas facilities in the form of
enhancement of habitat elsewhere? What is your agency doing to
assure that this mitigation has taken place? What are the
requirements or the stipulations in place to assure that
enhancement takes place?
Mr. Bisson. First of all, when facilities are removed, and
these are the permits of development that we are approving now,
we will require reclamation of the areas that were disturbed.
In many cases, we are requiring interim reclamation where
disturbance has occurred even before a field is taken down. But
there are so many new fields that we are years away from
actually carrying out those activities. We are monitoring the
activities that are happening on the ground, and fully intend
to require the companies to restore their lands when they
leave.
Mr. Grijalva. For additional submittal to the committee, I,
and I think the members of the committee would be curious if
you could provide information to the examples of successful
adaptive management efforts that have gone on.
Mr. Bisson. Yes, sir.
Mr. Grijalva. OK. One more and then turn it over to my
colleague. How many leases has the National Park Service
requested that BLM withdraw?
Mr. Bisson. I can't answer that question. I don't have that
information with me, but I can tell you that as an example last
year when I was acting state director in Utah, a Utah-specific
case. We had a lease sale in August. We had requests from the
Park Service to not consider leasing nine lease tracts adjacent
to Arches National Park, and we consulted with the Park
Service. We set a standard of four miles distance that might
impact the park, and we removed lease tracts within that four-
mile distance from the lease sale.
Mr. Grijalva. And my time is up, but also if you could
submit to the committee how many have been requested, and you
gave an example of nine by the Park Service, and how many of
these--of the requests, how many of them were subsequently
withdrawn.
Mr. Bisson. We will provide that information for you, sir.
Mr. Grijalva. Thank you. With that, let me turn to Ranking
Member Pearce for any questions he might have.
Mr. Pearce. Thank you, Mr. Chairman. Thank you, Mr. Bisson,
again appreciate your service, and I would apologize in public
for the one of our members who submitted that request that took
you through a year-long investigation for doing your job. That
was uncalled for. Thank you.
We have heard characterizations of the Bush Administration
is just an oil friendly leasing, they are going to lease every
ounce of land up, and that they are out there destroying the
environment, and you as an agency are not checking them up.
Give me a progression, if I can, for the last five or six years
of the number of inspections, number of inspections for
remediation, number of inspections for compliance.
Mr. Bisson. Yes, sir. In 1988, the BLM completed 11,500
inspections of oil and gas.
Mr. Pearce. That was how many?
Mr. Bisson. Eleven thousand four hundred and eight-six to
be exact.
Mr. Pearce. OK.
Mr. Bisson. In 2006, we completed 16,967 inspections. That
is a 47 percent increase. In addition----
Mr. Pearce. Yes. So what you are saying that under the Bush
Administration we are up almost 5,000, which is almost a 50
percent increase over the Clinton Administration. I am not
pointing fingers at the Clinton Administration, but if anybody
was guilty of not checking, it would be actually the
administration before this one because my understanding you
have gone up by almost 6,000, 5,500 inspections.
Mr. Bisson. It will actually be more this year as well. We
are going up to 21,000.
Mr. Pearce. So we are even going to have another 3,000
increase.
We have also heard testimony that the Bush Administration
is a ``lease at all cost'', lease everything you can get, lease
it, lease it, lease it, lease it. We hear that testimony in
front of this committee. Can you give me any impression of what
is happening under leases because I know, I am from the oil and
gas business, I am from that section of the country, I know the
problems that we are having leasing, so can you tell me what
has happened to leases since the eighties to the present?
Mr. Bisson. Well, in my testimony a few minutes ago, I
talked about the fact that in the eighties we actually had
three times as many acres leased as we do now.
Mr. Pearce. So you are actually decreasing leasing?
Mr. Bisson. We have much fewer acres leased now than we did
back then.
Mr. Pearce. But what were the numbers?
Mr. Bisson. It was 131 million acres were leased in 1984,
and we are down to about 42 million acres right now.
Mr. Pearce. So from 131 down to 42. If our income had
decreased from 131 to 42, we would think our income had
dramatically fallen, yet I continue to hear testimony in here
that says the Bush Administration is trying to lease up the
whole world, and sometimes the facts get in the way, I know
that, but appreciate that information.
Mr. Ferguson, you had--again we are hearing the categorical
exclusions are the problem. The categorical exclusions actually
were worked out in this committee, the Resources Committee down
in the other room that we meet in. It was actually Mr. Peterson
who testified, and myself, who were sitting, he was on the
upper dais, I was here, Mr. Miller, Mr. Abercrombie, and we got
into a discussion late in the day, it was about a seven-hour
markup when we were amending the bill, and we actually worked
that section out word by word, the five categorical exclusions,
because we saw that the language was actually being used as a
tool to bludgeon companies.
So what we did, and these gentlemen on the minority at that
time, the majority now, they came to the conclusion that no, we
think the bill--that the Environmental Protection Act had been
used to reach too far. The Endangered Species Act was being
used as a tool, and so they were trying to reach some business
compromise.
Can you tell me how it is actually working out because we
are going to hear testimony today, and we have previously heard
it, that you need to get rid of those evil categorical
exclusions?
Mr. Ferguson. Well, as I mentioned in the testimony, Mr.
Pearce, we have records that indicate that we have used that
Section 390 categorical exclusion on about 300 projects, but I
think Mr. Bisson made a very good point. Those are not just
what sometimes is called a rubber stamp. When a project comes
in, we have requirements to make sure they are in compliance
with all other environmental laws, and we actually have
situations where we add additional conditions of approval for
operations to occur when we use that categorical exclusion.
So we have had some pretty good success with it, and we
feel like we are taking the right approach to how we are
processing those. We are not just--it is not a factory output
type thing, it is a case-by-case situation.
Mr. Pearce. Sure.
Mr. Ferguson. On the ground.
Mr. Pearce. We are trying to do the best we can.
Mr. Chairman, my time has lapsed, but I have questions for
a second round if you get them.
Mr. Grijalva. Thank you. Mr. Udall.
Mr. Udall. Thank you, Mr. Chairman. I would like to welcome
the panel. Thank you for taking your time to come up to the
Hill. Mr. Bisson, if I could start with you, and direct some
questions your way, and particularly focused on Colorado, of
course my home state.
There have been some instances when the BLM has leased
lands in the areas the communities depend on for their water
supplies, and my understanding is that some of those
communities have asked the BLM not to lease in those areas, but
those requests have been denied. My question is a two-part
question. Is that true, and if so, why? And I think you
probably are aware of at least the situation in Palisade and
Grand Junction.
Mr. Bisson. I am aware of it. I have not been briefed on
it, sir, but I am aware that a decision was made in Colorado to
proceed with leasing those several tracts that you are speaking
about.
Mr. Udall. Could you tell me why you would ever deny such a
request when water is so crucial, particularly in the West
where we have limited supplies?
Mr. Bisson. I can speculate. I would speculate that the
state director decided that the mitigation measures they put in
place should be sufficient, and that at the time that any
drilling or development would occur, that they could add
additional requirements that would protect the water.
Mr. Udall. I can understand the approach to be taken. I
would just for the record point out that there was a broad
swatch of communities, of groups within those communities who
said, please give us a little bit more time. This is so
important to us.
Can you provide a complete answer for the record?
Mr. Bisson. Yes, sir, I will.
Mr. Udall. Appreciate that. If I could, let me move to
``split estate'' situations. How much advanced notice does the
BLM give to surface owners before offering minerals under those
lands for leasing?
Mr. Bisson. I can't answer that question, but if I could
take a second, what I would like to do is explain that last
year as a result of the Energy Policy Act BLM was required to
do a split estate analysis, and we went through a five-month-
long process where we held nine listening meetings across the
West. We accepted more than 3,000 public comments about this
issue, and one of those issues was that public notice that
lessees are provided, and we have instructed our field offices
to take every step possible to make sure there is advance
notice to landowners about pending lease sales.
Mr. Udall. Are there any specific requirements for
consultations with the surface owners?
Mr. Bisson. Prior to the lease sale?
Mr. Udall. Prior and after, yes, sir.
Mr. Bisson. Yes. I can't answer that. I do know that the
first place where decisions are made about leasing is in the
land use plans, and we have instructed our field offices again
to pay for ads in the papers, to do whatever they have to do to
get the word out about the land use plans that are underway,
and the decisions that are going to be made about where leasing
may or may not occur.
Mr. Udall. At least one conclusion I could draw is because
you don't have any specifics, you don't have any requirements,
but I would certainly like you to respond fully for the record,
if you would.
Mr. Bisson. I absolutely will, sir.
Mr. Udall. If I could direct a question at you, Mr. Bisson,
and also Mr. Ferguson. Another witness, Mr. Emmerich, will
testify on behalf of the WGA, the Western Governors'
Association. Have you had a chance to review his testimony?
Mr. Bisson. Yes, I have.
Mr. Udall. Mr. Ferguson?
Mr. Ferguson. I have not.
Mr. Udall. If so, what do you think about the Governors'
proposal to amend the categorical exclusion provision of the
2005 energy act?
Mr. Bisson. We feel that the use of the categorical
exclusion is a very important tool for us in terms of
completing our permitting activities. We use it judiciously. We
have instructed our field offices to consult with the game and
fish departments. We require interdisciplinary review. We don't
shortcut the process. What we are doing is taking advantage of
existing NEPA work that has been, and that is where the savings
in time comes from. We think we need the tool.
Mr. Udall. Mr. Ferguson, if you would like to reply for the
record later, that would be great, once you have had a chance
to look at the testimony.
Mr. Ferguson. I can do that. Thank you.
Mr. Udall. Is the BLM giving special consideration as to
whether or not to use a CE where BLM-sensitive species and/or
candidates for ESA listings are present, specifically sage
grouse?
Mr. Bisson. Absolutely.
Mr. Udall. So you are considering it?
Mr. Bisson. We absolutely consider all the resource values
on a site where a CX is proposed to be used, and in some cases
we determine that a CX is not appropriate.
Mr. Udall. Actually, I maybe have--you are not considering
using a CE for these situations with sage grouse?
Mr. Bisson. Again, I don't want to emphatically say yes or
no because I don't know, but if we had a BLM-sensitive species
that could be affected by a project, that would likely elevate
the NEPA requirement.
Mr. Udall. Thank you again. Thanks, Mr. Chairman.
Mr. Grijalva. Thank you, Mr. Udall.
We are going to do one more round of questions. Mr.
Ferguson, if I understand your testimony, the Forest Service
conducts broad-scale leasing analysis to determine which lands
are suitable for leasing, and then informs the BLM about those
lands that are available. So can the committee infer that the
agency, your agency has the authority of determining some lands
to be unsuitable for development? Would that be a correct
inference?
Mr. Ferguson. I think that could be an inference that could
be made. We go through--our planning process at the Forest
Service is a little different from the process that is followed
at the Bureau of Land Management. The leasing analysis is
specifically targeted toward the oil and gas resources when I
referenced the leasing analysis. So it is identifying lands
that our specialist and through the public process have
identified as being available or suitable, and that is again at
a very broad level. Once that parcel, if there is an interest
expressed on a Forest Service parcel, then we have another
opportunity to look at that parcel and make sure it is in
compliance with our plans, and conditions haven't changed.
Mr. Grijalva. Thank you. Let me just follow up on that
point. So can you answer now or submit for the record for the
committee how many acres based on that analysis have been
withheld from leasing because the Forest Service determined
that that oil and gas development would be inappropriate? How
many acres, and if you can give us an example of where?
Mr. Ferguson. I will have to submit that for the record. I
am not sure that we have that available right now. We will have
to do some research with our regional offices and get that
information for you.
Mr. Grijalva. Thank you very much.
One last question, Mr. Bisson. In the Nine Mile Canyon, BLM
seem to take the position that the agency was very limited in
its ability to say no to proposed development because the
leases had been issued even though the development will
substantially affect the historical, cultural, archeological
resources, the valuable rock art panels and the landscape
within the canyon will be affected.
What can you suggest to this committee that BLM can do to
prevent a recurrence of a situation similar to the Nine Mile
Canyon?
Mr. Bisson. Mr. Chairman, we are doing all we can to
prevent unnecessary impacts on archeological resources and
other sensitive resources in Nine Mile Canyon and elsewhere.
The BLM right now is going through a revision of its land use
plan in both the Vernal and the Price field offices. There will
be measures included in the final outcome of that process, I
believe, that will provide additional protection for those
areas.
Mr. Grijalva. I have no other questions. Mr. Pearce.
Mr. Pearce. Thank you, Mr. Chairman. I would like to follow
up a couple of the questions that have been asked.
Mr. Bisson, you know, we get the question of split estate,
and the next panel really goes into that, or the panel after
really goes into that in great detail, and it is referred to my
good friend from Colorado. If you consider all the well that
have been drilled on the lands that are subject to the split
estate, how many problem wells do you actually have? How many
contentious situations? How many failed to get an application?
Mr. Bisson. Mr. Pearce, right now we have about 19,500
wells on split estate, Federal minerals private surface. Of
that amount I have been told that it is less than 20 wells that
have been--you know, where there has not been a surface use
agreement able to be negotiated, and where companies chose to
bond up instead of going through the surface use agreement
process. That is a pretty small number.
Mr. Pearce. You have 19,000 something wells.
Mr. Bisson. Twenty.
Mr. Pearce. And you have 20, so if I put 20, divide that by
19,000, I get a couple of zeros, a decimal and a couple of
zeros, and one-tenth of 1 percent.
Mr. Bisson. That sounds about right, sir.
Mr. Pearce. And yet the testimony that we are going to hear
today leads us to believe that it is catastrophic out there. Do
you see the catastrophic nature of the split estate occurring?
Mr. Bisson. We feel that the great majority of operators
want to be good neighbors. They need to live in those
communities. They need to work. They want to work with the
private surface owners to reach satisfactory conclusions to the
process, and we think that is the attitude that most of the
operators take into their discussions.
Mr. Pearce. You are saying most of the operators.
Occasionally there are operators like anybody who are bad
neighbors. Do you have tools to----
Mr. Bisson. I would have to believe that there are, sir.
Mr. Pearce. You what?
Mr. Bisson. I have to believe that there are people like
that, but we----
Mr. Pearce. Do you have tools to deal with them is my
question.
Mr. Bisson. Yes, we do. Yes, we do.
Mr. Pearce. So you can make them be reasonable even if they
don't want to be reasonable?
Mr. Bisson. We work hard to get the parties to try to work
things out.
Mr. Pearce. Are there ever any people on the other side of
the equation, the people with the lands that get unreasonable?
Mr. Bisson. Having not been personally involved in it----
Mr. Pearce. Let me tell you about a situation I was
personally involved in. My company, we did oil wells, but we
did work down the hole. So we were called down to around Taos,
New Mexico. We were out on this lease, and we were on the pad.
Then one of the trucks, not ours, but one of the other trucks
on location, you always have a lot of equipment moving in, so
maybe five or six big 18-wheelers dropping equipment off to do
the work down hole. One wheel got off on the grass, and the
rancher was sitting there, and he cocked his gun, had his
rifle, and he said, ``Everything shuts down here, my friends.''
Our trucks were trapped out there for hours.
These kind of things do need balance. I am very familiar.
You had a question earlier about habitat. You did not know
specifics, but I do because again I have worked in the
industry. I have watched while the big companies--Texaco,
Chevron--the big companies began to build quail habitat because
quail can't exist without water, and they need a little
watering troughs around a lot of the locations, little watering
troughs, automatic things, just pump water out there. So we
have seen actually quite a lot of interest in this.
Now, I grew up in this area of New Mexico, and we hunted
arrowheads all the time just growing up, so we were always
wandering around through the sand hills. Not once, not one time
earlier than my twenties did I ever see a deer. Now, I am not
saying that the oil and gas exploration has caused the deer,
but I can tell you that the biggest deer that are being killed
right now are about five or six, seven, ten miles from my
house, and we never used to see them. So what I am saying is
that oil and gas production is not exclusive. It does not force
the game away.
Also, on the habitat restoration, the highest land point in
Lea County, the highest point in my home county is actually
where they are cleaning up something because my dad was from a
different generation. I used to go with him when I was eight-
nine years old. We would go to the oil fields and they were
different. The people my age are saying we are not going to
mess up the environment. We are going to get the oil and gas,
but we are not going to mess it up, and the highest point in
Lea County is from an excavation, one of those sites from the
twenties, and they are actually doing the right thing, and that
is the thing I see.
Mr. Bisson, do you ever see that kind of thing play out?
Mr. Bisson. In fact, much of the clean up that we are doing
right now are wells that are a remnant of that time period. We
don't see hardly any--in fact, I am not aware of any operators
who have walked away from leases right now without carrying out
the reclamation responsibilities.
Mr. Pearce. The walk-awayers were a different generation.
Mr. Bisson. It was a different time.
Mr. Pearce. And it was not excusable then.
Mr. Bisson. And we won't let them.
Mr. Pearce. All right. Thank you, Mr. Chairman.
Mr. Grijalva. Thank you. You got me there, Mr. Pearce. My
daddy never took me to the oil fields to have fun.
[Laughter.]
Mr. Pearce. That was bonding that was occurring.
Mr. Udall. Thank you, Mr. Chairman.
I wondered if the gentleman from New Mexico is now in favor
of some greater form of gun control given the way his ranchers
are behaving.
[Laughter.]
Mr. Udall. To turn more whimsical here. Mr. Bisson, what is
the status of the leasing in the Wyoming Range? I am sorry. Mr.
Ferguson. I don't want to just pick on Mr. Bisson today, my
Forest Service friend. What is the status of the leasing in the
Wyoming Range or the Bridger-Teton? And a couple of question
that follow on there. How many acres are currently in
production or under lease, and how many more acres are slated,
being considered for leasing, and what is the status of
planning on those lease sales?
Mr. Ferguson. Let me get to my information here. The
current status, as I understand it right now, is that we are in
a holding pattern and there is work being processed--the plan
is being evaluated and an EIS is being conducted.
In terms of some of the information, there have been
several lease sales over the last couple of years, and there
are about 20,000 acres that are currently involved in a stay by
the Interior Land Board of Appeals, and those are just in a
stay position, and there is another 23,000 plus that have been
appealed, and there is no action being taken on those right now
pending this action with the environmental impact statement,
and making sure that the planning document is up to date, and
accurate.
That is the basic information that I have right now in
terms of those parcels. I can provide you some more detailed
information if you would like, but I do know that there is a
very concerted effort going on right now with getting that plan
up to date, and the plan revision is scheduled for completion
in September of 2008.
Mr. Udall. And you will submit additional information for
the record?
Mr. Ferguson. I can do that. Sure can.
Mr. Udall. Thank you. Mr. Bisson, if I could turn to
another Wyoming question.
Mr. Bisson. Sure.
Mr. Udall. When do you anticipate completion of the final
EIS on the year-round expanded drilling situation in the
Pinedale Anticline?
Mr. Bisson. The Pinedale Anticline.
Mr. Udall. And particularly what provisions have been
proposed to protect the migration corridor for the prong horn
and other animals?
Mr. Bisson. Well, we have just concluded the public comment
process on the draft EIS, and we are in the process right now
of moving toward a final. We got more than 40,000 comments
which we are analyzing. We have made no final decisions as to
which alternative we would propose or exactly what measures
would be involved.
We have 14 different cooperating agencies that we are
working with before we make those decisions. We will be sitting
down with them and discussing it, but we are looking at
strategies that involve companies agreeing to defer their
development on the flanks of the Anticline. We have stage
development that is being proposed where parts of the Anticline
would not be developed, and be available for migration
corridors while other parts are developed. We are looking at
directional drilling. We are looking at lots of different
strategies to try to do it in the most sensitive way that we
can.
Mr. Udall. If I could editorialize for 30 seconds perhaps
on that particular area, I have great respect for my colleagues
from New Mexico, Mr. Pearce. He and I have worked together on
some legislative initiatives, and I do take him at his word,
particularly in the drier area of New Mexico that some of the
larger wildlife are not as present as they are in other areas,
but certainly this area is remarkable in its wildlife
abundance, and many of us, all of us, I think, want to get this
right, whether it is on the industry side, the BLM side, the
Congress, and I just urge you to everything possible here and
to go slow.
As a follow on, at last week's hearing a witness, Mr.
Simpson, who testified for the NWF, National Wildlife
Federation, said that while the BLM has the best management
practices requirement, those requirements are seldom
implemented--or if it is included in permit stipulations, if
the measures cost too much, the companies will demand that the
stipulation be scrapped. Would you respond to that statement?
Mr. Bisson. Yes, sir. Best management practices are a tool
that we instruct our field managers to utilize at the time that
they are making decision to approve permits to drill, and we
require them to look at them and made decisions about which
ones ought to included as conditions of approval. Simply
because a company doesn't want to do something is not a reason
not to require them to take protective steps that we feel are
necessary.
Mr. Udall. Good.
Mr. Bisson. Thank you.
Mr. Udall. Thank you, Mr. Chairman.
Mr. Grijalva. Thank you, and let me thank both our agency
witnesses, appreciate it very much. If the committee has
further questions, we will be submitting those to you, and the
information that you indicated you would submit for the record,
we would like to request that that be within the next two weeks
insofar as the full committee will be drafting an energy bill
in May, and as soon as we can have that information and
incorporate it into the deliberations.
Mr. Bisson. Yes, sir, Mr. Chairman.
Mr. Grijalva. Thank you so much.
Mr. Bisson. Thank you.
Mr. Grijalva. Let me call the next panel up, please, if I
may.
Thank you very much, gentlemen, and as I indicated to the
previous panel, your full statements will be made part of the
record, and if at all possible to limit the oral remarks to
five minutes, and let me begin with Mr. Emmerich. Sir.
STATEMENT OF JOHN EMMERICH, DEPUTY DIRECTOR,
WYOMING GAME AND FISH DEPARTMENT
Mr. Emmerich. Chairman Grijalva, I am John Emmerich. I am
the Deputy Director with the Wyoming Game and Fish Department,
and I thank you for the opportunity to address the
Subcommittees regarding Section 390, subpart [b][3] of the
Energy Policy Act of 2005 on behalf of the Western Governors'
Association and the Association of Fish and Wildlife Agencies.
The West, including Wyoming, is a national focus for energy
development. The current scale and the intensity of energy
development is unprecedented in many western states and experts
predict this development will continue for several decades. The
Western Governors are strong advocates for environmental
responsible energy development as demonstrated by the
development and implementation of the Western Governors'
Association Clean and Diversified Energy Initiative.
Much of the West also has world-class wildlife resources
and a wildlife-oriented culture that the state and the Nation
value very highly. From the current projected levels of energy
development in Wyoming, it is estimated that roughly 25 percent
of the state will experience direct surface disturbance or the
effects of indirect wildlife disturbance caused by increased
human, vehicular, and development activities associated with
this level of development. Specific wildlife impacts are
documented and are contained in the written statement.
Energy development and fish and wildlife conservation are
mutually achievable goals if development decisions are based on
sound information and early continual engagement between the
Federal land management agencies, state fish and wildlife
agencies, and the energy development industry. The level of
analysis, disclosure and recommended mitigation as appropriate
for sensitive wildlife corridors and crucial habitat is not
provided in programmatic land use plans such as RMPs or forest
plans. This can only be achieved to the more in depth analysis
provided by an EA or in most cases an EIS developed with full
state participation.
Subpart [b][3] of the Section 309 of the 2005 Energy Policy
Act is worded in such a manner that oil and gas wells could be
drilled under a categorical exclusion with no additional
analysis if, and I quote, ``in an approved land use
plan...prepared pursuant to NEPA analyzed drilling as a
reasonably foreseeable activity...'' That could include an RMP.
Of the 10 BLM field offices in Wyoming as an example, five
are currently revising their resource management plans, and
four of these are scheduled for completion by the end of 2007.
The geographic area managed by these field offices contain very
significant oil and gas resources, including the Continental
Creston-Divide area that covers by itself over 1 million acres.
The Governors believe that the categorical exclusions
authorized broadly under paragraph [b] of the Energy Policy Act
may often be appropriate. However, with specific regard to
subpart [b][3], the Governors did not want their ability to
require adequate mitigation in areas that the states have
identified as sensitive wildlife corridors and crucial habitats
to be diminished or eliminated.
The Department of the Interior has worked fairly and
inclusively with the states to date. However, the categorical
exclusion provision in subpart [b][3] of the 2005 Energy Act
appears to provide a legal option to deny state fish and
wildlife agencies the opportunity to protect and adequately
manage fish and wildlife resources on BLM lands by authorizing
oil and gas development without adequate analysis, disclosure
and state agency involvement.
In February 2007, the Western Governors' Association
adopted Policy Resolution 0701, protecting wildlife migration
corridors and crucial wildlife habitat in the West. The
resolution urges Congress to amend Section 390, subpart [b][3]
of the Act to remove the categorical exclusion for NEPA review
for expiration or development of oil and gas in wildlife
corridors and crucial wildlife habitat on Federal lands.
By removing the categorical exclusion, appropriate
environmental site analysis will be completed as necessary to
protect these crucial habitats. The Wyoming Governors or the
Western Governors' Association and the Association of Fish and
Wildlife Agencies would be happy to work with the committee
staff on these proposed amendments.
A second possible solution, especially as an interim step,
would be to have the BLM develop a memorandum of understanding
or policy document requiring a companion process with subpart
[b][3] that would provide the opportunity for state fish and
wildlife agencies to review those permits that could be
excluded from a formal NEPA analysis in these sensitive
wildlife corridors and crucial habitats. It will also provide
BLM with an informal assessment of impacts and mitigation
responses.
Mr. Chairman, the Western Governors' Association and
Association of Fish and Wildlife Agencies believe that more
informed decisions that provide for both conservation of a
fish, wildlife, and their habitats and efficient delivery of
energy, and this can be achieved through early and meaningful
coordination and information sharing among all involved.
A second part of their resolution deals with the efforts to
try to collect more information on migration coordinators,
crucial habitats to facilitate the analysis and decision-making
process.
In conclusion, Governors and state fish and wildlife
directors are solution-oriented. These landscape level
activities are complex and cut across several governmental
jurisdictions and private interests. However, we believe that
solutions are available if all parties rely on the best
available information, coordinate often at the earliest stage
and throughout the process, and develop relationships of trust,
integrity, and mutual commitment to meeting both fish and
wildlife conservation objectives and the delivery of energy for
our citizens.
Thank you for this opportunity to share our perspectives,
and I am glad to take any questions.
[The prepared statement of Mr. Emmerich follows:]
Statement of John Emmerich, Deputy Director, Wyoming Game & Fish
Department, on Behalf of The Western Governors' Association & The
Association of Fish & Wildlife Agencies
Chairman Grijalva, Chairman Costa, and members of the
Subcommittees, my name is John Emmerich, I am the Deputy Director of
the Wyoming Game and Fish Department. Thank you for the opportunity to
address the Subcommittees regarding Section 390 subpart B(3) of the
Energy Policy Act of 2005, on behalf of the Western Governors'
Association (WGA) and Association of Fish and Wildlife Agencies (AFWA).
The Western Governors' Association is an independent, nonprofit
organization representing the governors of 19 Western States, American
Samoa, Guam and the Northern Mariana Islands. Through their
Association, the Western governors identify and address key policy and
governance issues in natural resources, the environment, human
services, economic development, international relations and public
management. AFWA represents all 50 State Fish and Wildlife Agencies.
The West, including Wyoming, is a national focus for energy
development. Several western states contain large domestic reserves of
coal and uranium, world-class natural gas and wind resources, as well
as significant oil production. There is also potential for oil shale
development. These base energy sources are being tapped, and plans are
underway for power plants, synfuel plants, pipelines and power grids to
process and ship that energy across the west. The current scale and
intensity of energy development is unprecedented in many Western
states, and experts predict this development will continue for several
decades. The Western Governors are strong advocates for environmentally
responsible energy development, as demonstrated by the development and
implementation of the WGA Clean and Diversified Energy Initiative.
While many Western states truly have a world-class energy resource,
much of the West also has a world-class wildlife resource and a
wildlife-oriented culture that the state and the nation value very
highly. For example, about half of Wyoming's residents hunt and/or
fish, 75% enjoy non-consumptive wildlife watching activities, and many
thousands of nonresidents also spend time in Wyoming each year
specifically to take part in those activities. This participation in
wildlife-associated activities is far higher than most other states.
According to the U.S. Fish & Wildlife Service, $21 billion was spent in
2001 on renewable hunting, fishing and wildlife watching activities in
the 19 Western States. At this point in time, energy development is
Wyoming's chief economic resource, but wildlife-associated activities
have long been and will continue to be a very significant part of the
State's second leading economic source, tourism and recreation.
Economic support from tourism and recreation will need to be maintained
to provide economic diversity and continue as a stable and vital part
of the State's economy when development of energy sources inevitably
slows.
The Western Governors' Association and the Association of Fish and
Wildlife Agencies recognize the national energy need and the West's
contribution towards fulfilling that need. They also recognize the
statutory obligations of our State Fish and Wildlife Agencies to
conserve and manage the fish and wildlife resources, which are so
important to the economy, culture and heritage of our citizens. A key
aspect of this obligation is ensuring the sustainability of the
habitats on which these species depend.
Habitat impacts in many Western States have recently occurred as a
result of the unprecedented energy development. In seven major oil and
gas fields in Wyoming, there have been approximately 44,000 wells
developed over several decades with the majority in the last ten years,
and 55,000 additional wells are planned over the next 20 years. From
this activity, it is estimated that roughly 25% of Wyoming will
experience direct surface disturbance or the effects of indirect
wildlife disturbance caused by increased human, vehicular and
development impacts associated with energy development.
Many species associated with the sagebrush/grassland steppe,
including mule deer, pronghorn, sage-grouse, green-tailed towhee, and
Brewers sparrow to mention a few, have experienced long term declines
in productivity and numbers over the last thirty years, despite
periodic, short term increases. Causative factors are many but change
in habitat conditions is certainly one of the major factors. The
unprecedented level and pace of energy development in the West is an
additional impact on already struggling wildlife.
In Wyoming sage grouse numbers have declined by approximately 60%
and their numbers have declined even more so across their entire range
over the last thirty years. Recent research and monitoring information
on sage grouse and mule deer in the Pinedale anticline area of
southwest Wyoming and the Powder River Basin of northeast Wyoming have
clearly documented some of the impacts associated with intensive oil
and gas development. Mule deer use on the crucial mesa winter range
south of Pinedale has experienced a 27% decline since development
started. Wyoming has seen a statewide increase of 68% in sage grouse
numbers across Wyoming from 2004 to 2006, and a 44% increase in
undeveloped areas adjacent to the Pinedale Anticline in this same
timeframe. However, within the gas field there was no increase in
grouse numbers associated with 37 leks and at least four of the leks
were abandoned.
Energy development and fish and wildlife conservation are mutually
achievable goals if development decisions are based on sound
information and early, continual engagement between the Federal land
management agencies, State Fish and Wildlife Agencies and the energy
development industry. With the current pace, scale and intensity of
energy development in many Western States, it is vital that State Fish
and Wildlife agencies have opportunity to be engaged throughout the
NEPA process to ensure accurate information on the location of crucial
wildlife habitat and key migration corridors is identified and
recognized and there is adequate analysis, disclosure and mitigation
provided to minimize impacts and offset unavoidable impacts. It is our
expectation that the BLM, particularly given its multiple use mandate,
would likewise routinely address these issues in RMPs and again at the
leasing and permitting stages.
The level of analysis, disclosure and recommended mitigation that
is appropriate for sensitive wildlife corridors and crucial habitat is
not provided in programmatic land use plans such as RMPs or Forest
Plans. This can only be achieved through the more in depth analysis
provided by an EA or in most cases an EIS developed with full state
participation.
Subpart (b)(3) of section 309 of the 2005 Energy Policy Act is
worded in such a manner that oil or gas wells could be drilled under a
categorical exclusion, with no additional analysis, if ``an approved
land use plan...prepared pursuant to NEPA analyzed drilling as a
reasonably foreseeable activity....'' We are concerned that completion
of an RMP after the five-year period that an EA or EIS covers a
reasonably foreseeable development scenario, or before an EIS is
completed for a developing field, would allow authorization of drilling
under a categorical exclusion (Cat Ex), including in sensitive wildlife
corridors and crucial habitat, with general provisions provided only by
the RMP.
Of the ten BLM Field Offices in Wyoming, five are currently
revising their RMPs, and four of these are scheduled for completion by
the end of 2007. The geographic area managed by these Field Offices
contain very significant oil and gas fields, including Moxa Arch, South
Piney, Jonah, Pinedale Anticline, Atlantic Rim, and the huge
Continental Divide-Creston area that alone covers over 1 million acres.
The Governors believe that the Categorical Exclusions authorized
broadly under paragraph (b) of the Energy Policy Act may often be
appropriate. However, with specific regard to subpart (b)(3), the
Governors do not want their ability to require adequate mitigation in
areas the States have identified as sensitive wildlife corridors and
crucial habitat to be diminished or eliminated. Development of these
sensitive areas obviously needs detailed disclosure and analysis of
impacts to other resources, and the permits need to include avoidance
and mitigation measures to protect those resources.
Although the Department of the Interior has worked fairly and
inclusively with the states to date, the categorical exclusion
provision in subpart (b)(3) of the 2005 Energy Act appears to provide a
legal option to deny state fish and wildlife agencies the opportunity
to protect and adequately manage fish and wildlife resources on BLM
lands by authorizing oil and gas development without adequate analysis,
disclosure and state agency involvement. Unless the problematic
language in Subpart (b)(3) is amended or removed, or an additional
administrative process implemented to allow state fish and wildlife
agencies an opportunity to recommend appropriate protection and
conservation conditions to accompany permits to drill in sensitive
wildlife corridors and crucial habitat, significant wildlife impacts
could occur.
In February 2007, the Western Governors' Association adopted Policy
Resolution 07-01, ``Protecting Wildlife Migration Corridors and Crucial
Wildlife Habitat in the West'' (attached). The resolution urges
Congress ``to amend Section 390. Subpart (b)(3) of the Energy Policy
Act of 2005 to remove the categorical exclusion for NEPA reviews for
exploration or development of oil and gas in wildlife corridors and
crucial wildlife habitat on federal lands. By removing the categorical
exclusion, appropriate environmental site analysis will be completed as
necessary to protect crucial wildlife habitat and significant migration
corridors located in the field of development.''
The WGA and AFWA would be happy to work with Committee Staff on
this proposed amendment.
A second possible solution, which would not involve legislation,
would be to have the BLM develop a memorandum of understanding or
policy document requiring a companion process with Subpart (b)(3) that
would provide the opportunity for state fish and wildlife agencies to
review those permits that could be excluded from a formal NEPA analysis
in these sensitive wildlife corridors and crucial habitat, and still
provide BLM with an informal assessment of impacts and mitigation
responses. These would then result in conditions of approval that BLM
could attach to drilling permits. If this option is pursued, WGA and
AFWA would be happy to work with the federal land management agencies
to that end.
In some manner, whether by these proposed solutions or others, we
strongly recommend that the unintended result of Subpart (b)(3) in
potentially excluding States from discharging their mandated resource
management responsibilities on BLM land be addressed.
Mr. Chairman, WGA and AFWA believe that more informed decisions
that provide for both conservation of fish, wildlife and their habitats
and efficient delivery of energy to our citizens can be achieved
through early and meaningful coordination and information sharing among
all involved. In addition to ensuring language in the 2005 Energy Act
facilitates this sharing it is important to also facilitate the
identification of sensitive wildlife migration corridors and crucial
habitats and make that information readily available to ensure that
significant landscape altering activities, including energy
development, can be done while meeting the State's obligation to
sustain healthy fish and wildlife populations.
The WGA resolution calls for the gathering, assimilation and
mapping of this important fish and wildlife information on an ambitious
schedule. Much of this information already exists in State Fish and
Wildlife Agencies, State Natural Heritage Inventories and other places.
It is the intent of the WGA to first compile the location of existing
information and facilitate its availability across state and agency
lines while initiating inventory and monitoring work to address current
gaps in information. This information, beginning with Federal lands,
will then be used to enable informed decision making regarding energy
development, and other associated development including transmission
corridors, transportation corridors, etc. The interagency,
interdisciplinary Wyoming Landscape Conservation Initiative is using a
very similar process to determine the best places to assess and enhance
wildlife habitats on a landscape scale in southwest Wyoming in a manner
compatible with the unprecedented development occurring on the same
landscape.
Governors and State Fish and Wildlife Directors are solution
oriented. These landscape level activities are complex and cut across
several governmental jurisdictions and private interests. However, we
believe solutions are available if all parties rely on the best
available information, coordinate often at the earliest stage and
throughout, and develop relationships of trust, integrity and mutual
commitment to meeting both fish and wildlife conservation objectives
and the delivery of energy for our citizens.
Thank you for the opportunity to share our perspectives. I would be
glad to answer any questions.
______
Mr. Grijalva. Thank you, sir.
Mr. James.
STATEMENT OF JEWELL JAMES, MEMBER, LUMMI NATION
Mr. James. Thank you, Mr. Chairman. We appreciate the
opportunity to appear here to testify at this oversight
hearing. I am Jewell James of the Lummi Indian Nation,
representing the Office of the Chairwoman.
The Lummi Nation is just one of 525 or more Indian Nations
throughout the United States. The Energy Policy Act of 2005
provided under Sections 501 to 502 Indian participation in the
development of oil, gas, and alternative energies. Under 503,
we see that there are new laws added where there would be an
Indian Energy Development and Self-Determination Office, and we
know that the intent is to provide tribes the opportunity to
participate through loans and grants, but also under 504, we
witness that there is an opportunity for tribal governments to
come forward and be consulted on some of those applications
that will have direct impacts either on the reservations or
within their traditional territories.
The Lummi Tribe is one of the original self-governing
Indian Nations under the Title III amendments to the Indians
Self-Determination and Education Assistance Acts of 1975 that
came out in the 1980s. Since then it has been amended to
include Title IV, and now we are going into Title V.
The idea is that tribes not only are self-determining, but
are self-governing. This required us to begin to develop the
infrastructure, the professional staff that would help us co-
manage not only our government but our own natural resources.
This is one of the questions that is being presented to the
Congress on what we call the Section 139 tribes and the
appropriations process where tribes want to have the authority
to govern their own natural resources.
We know that with regards to government-to-government
consultation the House Concurrent Resolution 331 of 1988
actually defined it, that it is based on the United States
Constitution where it is stated that Article 1, Section 2,
Clause 3 of the U.S. Constitution provided the words
``excluding Indians not taxed.''
We are tribal Indians, not counted amongst the ``We the
people of the United States.'' Article 1, Section 8, Clause 3
provided Congress the power to regulate commerce with Indian
Nations. Article 1, Section 10, Clause 1 limited states' powers
and/or treaties, and Article 2, Section 2, Clause 2 authorized
the President and the Senate to enter treaty relationships with
Indian Nations.
Article 3, Section 2, Clause 1 authorized the Supreme Court
to address treaty questions, and Article 3, Clause 2 made
treaties one of the supreme laws of the land.
Now, just like constitutions, treaties also have reserved
rights doctrines that apply to them. Treaties are usually
interpreted as the Indians would have understood as one of the
doctrines of the Court for interpreting treaty relationships.
Our understanding as Indian Nations and what we believe as
a part of our retained inherent sovereignty is that we have the
right to protect sacred sites and places that may be impacted
within our traditional territories. However, in order to do
that, this would require a better definition under subsection
2602[a] where the Secretary is authorized to give grants to
help develop databases. If that grant goes to an inter-tribal
organization, the Lummi Nation recognizes that the National
Tribal Environmental Council would probably be the best entity
for those funds to go to. However, there is not a specific
amount that is earmarked for it. We are hoping though, because
of the inter-tribal organizations, and because of the various
specialties that we witness amongst the inter-tribal
organizations, that the National Tribal Environmental Council
would be the best fit for organizing the inter-tribal
participation as well as gathering input from all tribes.
The 2005 Act is a national policy and we need to have the
assistance of the Congress and the Subcommittees to develop a
national position of Indian Tribes based on not only pro-
development oil, gas, and energy, but also on organizing our
concerns as pertains to the sacred sites and places. This is
something that we don't have funding for within tribal
governments.
We know that most people believe that Indian tribes are
very wealthy as a result of gaming, but most of that gaming
revenue goes to a few tribes that are located next to major
metropolitan areas. The Lummi Tribe, for example, is one tribe
that is gaming and all of our revenues go back into health and
education because of funding shortfalls on the Federal
appropriations side.
So we see those funds re-invested back into the community,
and we know that most of the tribes are really isolated, don't
have the technology, and cannot access the professional staff
and legal expertise that they would need in order to analyze
the impacts, the applications for energy development, we will
have a part in them with regards to the environment as well as
the sacred sites and places.
We believe that if the tribes are authorized to work with
the National Tribal Environmental Council and the National
Tribal Environmental Council secures funding through the
Secretary's office a mandate, that we would be able to help
develop our recommendations for management regimes that would
incorporate our concerns associated with sacred sites and
places.
Thank you.
[The prepared statement of Mr. James follows:]
Statement of Jewell James, Policy Analyst,
Lummi Indian Nation
The Lummi Indian Nation is located in the Pacific Northwest part of
the United States, northwest Washington State. Lummi is
anthropologically, geographically, and linguistically identified as
belonging to the Coast Salish Culture by academicians. Lummi is a
federally recognized Indian Nation. We have a government-to-government
relationship established by the 1855 ``Peace Treaty'' (12 Stat. 927)
with the United States. The treaty was ratified by the Senate &
proclaimed by President in 1859. Lummi is one of the original ``Self-
governing Compact'' Indian Nations, as authorized by Congress per
amendments to the Self-Determination Act of 1975, under Title III. We
have never disbanded or terminated our tribal relationships. We, as a
native community, maintain our tribal status the same as was recognized
in the Supreme Court decision of Elk v. Wilkins (112 U.S. 94 (1884)).
We lead and represent our nation based on the idea that popular
sovereignty is an inherent trait of our domestic relations. We are a
tribal constitutional government (non-IRA) that provides and protects
the essential governmental functions and services needed by our
populace. In this light, we appear before the Congress to testify on
behalf of our people. While we do not have the authority to testify on
behalf of other Indian Nations, we do recognize and realize that our
nation shares common concerns over the protection of sacred sites and
places and the prevention of the destruction or contamination of such
places by modern development; which include the impacts of oil & gas
drilling, mining development, and other fuel industry or energy
industry activity & operations.
Historical Politics of American Religious Wars Against the Natives:
The Lummi People would be classified as practicing a variant of the
``Mother Earth Religion'' that can be found practiced by indigenous
peoples (of all four races) located all around the world. This
religious classification would be placed on the opposite end of a
religious continuum in reference to the ``Father/Son God'' Religions--
otherwise known as Catholicism, Christianity, Judaism, and Islam/
Muslim. Such native practices and observances would be considered by
the latter religions as ``pagan, heathen and uncivilized practices of
the infidels.'' This historical ethno-religious prejudice has normally
dominated their relationships and opinions about and with the
respective indigenous communities they encounter--in our case, the
Native Americans.
However, the Catholic Church came to dominate the Lummi Indian
Reservation at and about the same time as the treaty negotiations
between the Lummi and the United States. This religious denomination
has had a predominant claim upon the Lummi Populace ever since. When
President U.S. Grant authorized the Christian Churches to assume
control and management over the Indian Reservations, due to BIA
corruptions & fraud in the 1870's, the Catholic Church kept control of
the Lummi Reserve. At one time, the Lummi were supervised by a
federally appointed ``Agent-in-charge'' or ``Farmer-in-charge'' and
after 1872 it became the ``Priest-in-charge,'' until that changed to
the ``Teacher-in-charge.'' These ``Priests-in-charge'' came to dominate
the Indian reservations and tribal societies all across the continent,
as well as help color the views & opinions of neighboring societies
about the need to ``civilize'' the unlearned Indians.
The story of Christian influences upon the traditional & ceremonial
practices of the Indian Peoples is as dated as ``Discovery'' by
Christopher Columbus (1492). In the beginning, Columbus described the
Natives as ``Una gente in dios'' or ``One People in God.'' This was
reworded to become ``indios'' people rather than the reference ``in
dios'' or ``in god.'' Although he characterized the natives as
Christian by any other name, this did not theologically or legally
allow for the anticipated ``Conquest.'' (See: Privileges and
Prerogatives Granted to Columbus, April 30, 1492) needed to recover the
costs of the venture. Thus, the natives were turned into ``heathens,
atheists, agnostics, pagans, savages, infidels, and other convenient
classifications that made them legally and religiously conquerable as a
non-Christian people. In fact, the first classifications, shortly after
discovery, proclaimed the natives to not even be human but
monstrosities. At this time, the Vatican issued Papal Bulls (e.g.,
Papal Bull Inter Cartera of May 4, 1493) that further rationalized the
conquering of the native nations and the pillaging of their
territories, societies, and the destruction of their ``heathen'' ways
and archives of knowledge. The Vatican, per Papal Bulls, authorized the
discovery and conquest of heathen lands by Christian Kingdoms. It
became a ``first come then first served'' campaign. This, eventually,
became enshrined in U.S. Federal Law as the ``Discovery Doctrine'' of
Johnson v. McIntosh (21 U.S. (8 Wheat) 543, 5 L.Ed. 681, (U.S. Sup.Ct.
1823)).
While Father La Casas (who arrived on the third sailing of Columbus
to the New World as a Conquistador and then converted) argued before
the Spanish Crown (from 1530 to 1566) that the rights of the Indians
should be respected and written into the Laws of the Indies for their
protection not conquest and enslavement. It was Francisco de Victoria
(the father of International law) arguing the rights of Indian
possession of their lands & territories that had the major influence on
the development of what latter became U.S. Federal Indian law (as noted
in Felix Cohen's Handbook on Federal Indian Law, at 55-100). This
influence of Spanish jurisprudence held that Indian lands could only be
acquired via treaties that Indians held some form of transferable title
to the land, and that acquisition could only be made by the government.
However, before this jurisprudence could become established in
international law, the conquest bloodied the relationships with the
native nations and people throughout the western hemisphere.
In time, the United States, after the 1776 Revolution and the
ratification of the 1787 Constitution, laid claim to inheriting the
rights of ``Discovery'' in lieu of the repelled King of England (and
all other foreign monarchy claims). Basically, Supreme Court Chief
Justice Marshall said that the claims to the continent were based on a
lie but to acknowledge it as a lie would require the nation to give the
land back, and this it could not do, so it had to act as if the lie was
true. This, then, became the foundation cornerstone to the U.S. claims
to ``Discovery'' of the Indian lands & territories.
This legal fiction, then, was eventually followed by the
institutionalization of ``Manifest Destiny.'' The idea being that the
non-Indians was destined to own the whole continent from the Atlantic
to the Pacific Ocean. This, then, required the taking of Indian lands &
territory by discovery, conquest, or via peace treaties. Congress would
authorize appropriations for the President & the Senate to negotiate
and ratify Indian Treaties (per Article II, Sec. 2, Cl. 2 U.S. Const.).
Over 700 treaties were negotiated (between 1787 and 1871). These
negotiations were in accordance to the proclaimed congressional
regulation for the establishment of new territories (and eventually the
admission of new states, per Article IV, U.S. Const.) under the N.W.
Ordinance (1 Stat. 51, July 13, 1787). A little over half of the
negotiated treaties (370) were ratified by the Senate and proclaimed by
the President; but, while half of the negotiated treaties were not
ratified, the U.S. acted upon all the treaties as if each and everyone
was ratified--in that it used the treaty concessions to completely lay
claim to more than 3.8 million square miles of Indian lands and natural
resources across the continent.
Generally, ``treaties are to be interpreted as the Indians would
have understood them, and not in the way of learned lawyers'' (Winans,
198 U.S. at 380, 25 S.Ct. 664). This has been a basic guiding light for
Supreme Court decisions on treaty rights questions. While the
President/Senate had constitutional powers to enter treaties with the
Indians, the Supreme Court has jurisdiction over legal questions of
interpretations and obligations of the treaties (Article III, Sec. 2,
Cl.1). These treaties, then, would become a part of the ``supreme law
of the land,'' along with the constitution and national legislation
(Art. VI, Cl. 2). It was more convenient for the United States to enter
peace treaties with the numerous Indian Nations than to enter a state
of constant war with the multitude of Indian Nations existing west of
the Mississippi & Missouri Rivers. Conquest by War was not logical or
economical. Still, treaty negotiations had to be authorized first by
the congress and then respective appropriations instituted to implement
the negotiations and commitments made in exchange for the vast
territorial concessions of the tribes.
However, the House of Representatives had control over the
introduction of appropriations/revenue measures (Article I, Sec. 7) and
abused this power in 1871 by attaching an ``Appropriation Rider'' (now,
25 U.S.C. 71, Act of March 3, 1871) that (by the power of political
psychology and not proper constitutional amendment) limited the
President's/Senate's treaty-making powers under Article II. While the
whole Congress had constitutional authority to ``Regulate
Commerce...with the Indian Tribes'' (Article I, Sec. 8, Cl.3), this
Appropriation Rider began a near-complete congressional take over of
Indian Affairs by statutory authority rather than constitutional
delegation & treaties-made. But, the limitation did not have complete
immediate effect, since the various presidents following then
instituted a series of ``Executive Agreements'' with the Indian Nations
or composed various ``Executive Orders'' that created additional Indian
reserves, with associated federal obligations and expenses.
Being as it may, treaties and the constitutions (states and the
national) have a commonality in that there exists the ``Reserved
Rights'' doctrine (which was enshrined in the U.S. Constitution by the
Tenth Amendment, in response to state attempts to limit federal
encroachments upon state jurisdiction). A part of the ``peace
treaties'' then is the reserved rights of the Indians Nations. If a
right or ownership is not given by specific treaty to the United States
then the language should be interpreted to hold that such right or
ownership is reserved to the Indian Nation. As Indian Nations, we would
argue that there were residue or reserved rights associated with the
treaty land concessions. However, in the case of Tee-Hit-Ton Indians
(348 U.S. 272 (1955)), during the Terminationist Era (See: HJR 108 of
1953, effective from 1948 to 1975) the Supreme Court turned the Peace
Treaties into ``Conquest'' by the United States. The Supreme Court
retroactively conquered every Indian Nation in North America by a
simple decision dealing with a small band of federally unrecognized
Indians in Alaska. For the Peace Treaty Nations, this retroactive
conquest did not abrogate the U.S. treaty obligations or nullify their
reserved rights. The Terminationist-minded court simply rewrote the
history of US/Indian relations into a new fiction.
In addition, keep in mind that when a lesser nation enters a treaty
relationship with a greater nation there exists a legal relationship by
which the ``Greater Nation'' has a duty and responsibility to the
lesser nation; i.e., a ``sacred trust of civilization'' is created.
This concept means that the greater nation must assure that the lesser
nation has the same opportunity to move forward and progress socially,
economically, politically, and legally as the greater nation and its
populace does. Nor does the lesser nation divest itself of its inherent
rights to self-determination and self-government (See: Worcester v.
Georgia, 31 U.S. (6 Pet.) 515 (1832)). But, working with ``church
dogma'' and institutionalized racism over time, the Indian nations have
become classified as ``dependent domestic nations'' (Cherokee Nation v.
Georgia, 30 U.S. (5 Pet.) at 17 (1831)) under U.S. law and policy. The
congress, by ending treating making, has assumed ``plenary power'' over
the dependent Indian communities/nations via acts of legislature,
without constitutional foundation or in reference to specific treaty
agreement. The ``Greater Nation'' (the US) in fact has taken advantage
of the changed conditions of the Indian Nations and has instead
marginalized their tribal societies, and deprived their membership of
human dignity.
In 1872, President U.S. Grant did turn Indian Affairs over to the
established Christian Churches, under the belief they had a higher
morality and strong values that would induce them to treaty the Indians
humanely and not rob them of their wealth, resources, and dignity. But,
the Church leadership, over the next ten years, in compliance with
racist opinions of the Indians, then had the Department of the Interior
institute the Indian Religious Crimes Code (DOI Circular #1665) in 1883
(See: Comm'r Ind. Aff. Ann. Rep., H.R. Exec. Doc. No.1, 49th Cong., 1st
Sess. 21.23 (1885)), and latter enlarged it to incorporate more fines
and imprisonment in 1921 (See: K. PHILIP, JOHN COLLIER'S CRUSADE FOR
INDIAN REFORM 1920-1954, at 56-57 (Tucson: University of Arizona Press,
1977)). In 1924, the general Indian Citizenship (per congressional
authority under Article I, Sec.8, Cl. 4) was authorized for all tribal
Indians that were not otherwise U.S. Citizens (See: 43 Stat. 253). Even
though this ``blanket naturalization'' was contrary to the intent of
the 14th Amendment (Sec. 1 and Sec. 2) per the 39th & 40th Congresses
(See: Reconstruction Debates), the enactment claimed to have not
deprived the said Indians of their rights or property as tribal
Indians.
Even though the original movement to secure First Amendment
Religious Freedom, via making Indian U.S. Citizens with constitutional
rights, as proposed by Ida May Adams (a Southern California Women's
Suffrage Rights Lawyer), was attained, this citizenship did not provide
Native Americans with First Amendment religious freedom. As a
consequence, the American Indian Religious Freedom Act (August 11,
1978) was enacted by Congress and signed by President Carter. In
Section 2, the President directed the ``various Federal departments,
and agencies, and other instrumentalities whose duties impact Native
American religious practices to evaluate their policies and procedures
in consultation with Native religious leaders in order to determine and
implement changes which may be necessary to protect and preserve Native
American religious cultural rights and practices'' (92 St. 469 (1978)).
Ten years later, the Supreme Court, in review of the G.O. Road Case
from northern California, gutted the AIRFA and concluded that ``the
Constitution simply does not provide a principle that could justify
upholding respondent'' (Indians, et al.) legal claims in that the First
Amendment's Free Exercise Clause had been written ``in terms of what
the government cannot do to the individual, not in terms of what the
individual can exact from the government'' (Lyng, 485 U.S. 439, 451
(1988)). In a separate legal attack via Oregon v. Smith, the Supreme
Court would deprive the Native American Church of its sacrament--
Peyote, in 1990 (See: Smith II as 494 U.S. 872). This sacrament was in
use for more than 10,000 years according to radio-active carbon dating
of associated artifacts--a spiritual practice that predated ``Jesus''
by 8,000 years.
In response to the Supreme Court anti-Indian religious freedom
decisions, the American Indian Religious Freedom Coalition (AIRFC)
formed and sought to amend the weak AIRFA. Senator Inouye introduced
(S.2269) on July 1, 1994, a bill entitled the ``Native American
Cultural Protection and Free Exercise of Religions Act, to over come
the damages done by Lyng and Smith. While this bill failed to pass,
H.R. 4230, which focused solely on Peyote, was enacted into law on
October 6, 1994 (108 St. 3125).
In 1993, broad legislation to reconstruct the ``compelling
interests'' test (called the Religious Freedom Reformation Act of 1993
(107 St. 1488) was enacted on November 16th, 1993. Concurrent to this
period, debates were held as to why there was need for different or
greater protection for Native American religious practices, Senator
Wellstone stated:
``Throughout the series of hearings held around the country on
NAFERA [Native American Free Exercise Religions Act] one theme
repeated itself over and over again: our traditional
understanding of how to protect religious freedom, based on a
European understanding of religion, is insufficient to protect
the rights of the first Americans...The question is not, should
we protect Indian religious freedoms? Instead, we must ask, how
can we best live up to our obligations to protect that freedom?
This is an important question, because one might legitimately
want to ask why we need a bill to address specifically the
religious freedom of Native Americans, instead of a bill that
addresses all religions at one time. There is, of course, such
a bill, the Religious Freedom Restoration Act (RFRA), which has
recently been introduced by my colleagues from Massachusetts,
Senator Kennedy, and which I am an original co-sponsor. I
believe that there is a strong argument to be made that both of
these bills ought to be made into law. RFRA is designed to
respond in a very general way to judicial decisions that have
been made in recent years restricting the right to free
practice of religion...But leaving the definition of such
standards up to the judiciary has not proven very effective for
Native American religions. In NAFERA, on the other hand, we
provide language that makes clear the particulars of Native
religious practices we intend to address.'' (U.S. Congressional
Record (May 25, 1993), 56456).
The Congress was not able to pass a complete reform of Native
American Religions Freedom but has worked to authorize the return of
the Peyote Sacrament to the Native American Church, restored the rights
of native prisoners to access rituals, and restored native rights to
the use of eagle feathers and other animal parts. In addition, the
Native American Graves Protection and Repatriation Act of 1990 (104 St.
3048) was enacted to return the unearthed bodies of Native American
ancestors, stored in government facilities/institutions or
universities, to their respective tribal peoples for reburial. The fact
is, though, the original Indian Citizenship of 1924 did not provide
Native Americans with First Amendment Religious Freedom. The original
1978 AIRFA, according to it's author Morris Udall (D., Arizona), said
that the bill conferred no ``special religious rights on Indians;
changes no existing state or federal law, and has no teeth in it.''
(U.S. Congressional Record (1978), 2144). And, in consequence, the
Supreme Court rendered their anti-Indian religious freedom decisions
(e.g., Lyng, Smith) and prompted years of political battles to secure
Indian religious freedom via piece-meal congressional enactments.
In all of this history, it has generally been forgotten that the
United States, as a role model to over 160 Nation/States member to the
United Nations, has been living the ``sacred vision'' of the Iroquois
Confederacy. The Prophet of the Iroquois, between five hundred to one
thousand years before the 1787 Constitution, proclaimed that the
``Great Tree of Peace'' shall spread its sacred four roots (colored
red, black, white, and yellow) in the sacred four directions. The U.S.
experience of this actually began when the new arrivals colonialized
the east coast of the North American Continent (original 13 colonies),
and lived side by side with the First Americans (i.e., the Natives).
Over time, this social encounter led the colonists to became
``Americanized'' (See: Exemplars of Liberty, by B. Johannson, and
Indian Givers by Jack Weatherford). The vision of the confederacy
(Iroquois and that of the Choctaw) became the ideal vision of a united,
democratic republic founded upon the sovereignty of the People (SCR #76
of 1987 and HCR #331 of 1988). This ``Union'' (of ``We the People of
the United States...'') became the immediate role model for the
revolutionary constitutional liberation of France. The idea of this
``vision'' spread further in the form of the proposed League of Nations
of President Woodrow Wilson (after WWI), who acknowledged that the idea
of the League began with the Indians. While this Wilsonian Proposal
failed, the idea became the originating model for the United Nations
(after WWII). It is with this model in mind that we believe the U.S.
Congress should not disregard the ``Gift of Indian Religious Freedom''
and its importance to humanity.
The battle for individual rights and freedoms, politically and
religiously, has caused millions upon millions of deaths throughout the
``Old World'' over the millenniums. The new world exemplified the
individual freedoms and the concept that government is to be held
accountable to the people, that men and women were equal participants
in government. Included in this the individual Indian had a right to
the spiritual experience and belief. This was foundational to what
could be referenced as making up a main part of individual sovereignty.
In this idea, each person adds to the collective sovereign powers of
the others. People then compacted to live together and to govern over
each other. This compact becomes the foundation to what is known as
popular sovereignty today. This understanding has been exemplified by
the famous May Flower Compact (Nov. 11, 1620) in the history books of
modern America. Such ideas found greater support and value as the
colonists began to experience the First Americans beliefs--living a
form of freedom that could not readily be understood by a people living
under a monarchy. This is a part of the Indian gifts shared with the
vision of popular sovereignty & union (Iroquois Vision). Each
individual had a right to access the spiritual, just as Jesus did by
entering the wilderness and resisting the temptations according to
biblical folklore. It was not a fluke that the revolutionary colonists
chose to model themselves as ``Mohawks'' at the Boston Tea Party. They
(as the Sons of Liberty) simply demanded the freedoms of belief that
the natives already enjoyed.
In 1987, the leadership from nine Christian denominations in the
Pacific Northwest, released an ``Apology'' to the Native Americans for
having either helped institutionalized racism against native religious
freedom or having passively sat back and allowed it to happen. This
statement was released to 1800 northwest congregations. Over time, even
the National Catholic Churches issued a similar statement, as did the
Anglican Church of Canada per the plight of the aboriginals. While such
apologies can be ``google searched'' over the ``www,'' debates have
been held as to whether or not the ``Apologies'' are real and intended
to truly help unravel the web of institutionalized racism against
Native American Religious Freedom. Even the International Council of
Churches on Religion and the Environment had become sensitized to the
religious/spiritual rights and interests of the native communities
before Earth Summit (1992). It has become apparent, today, that many
religious denominations are willing to come forward and to work with
their national organizations to help move for changes in the laws of
the land that shall improve the status of Indian religions amongst a
``Nation'' that considers itself to be predominantly Christian (See:
President Bush's statements justifying the early actions of war in the
middle east).
While modern day corporate and state interests continue to be at
odds with the rights and interests of the Indian Nations and Peoples,
it is the question of Indian rights of access to sacred sites and
places within the natural environment that shall be tested over and
over again as the local economic drive for more profit and development
places the interests of the private person or state/private
corporations against that of the native communities' interests in
sacred sites and places that have cultural, ceremonial, biodiverse, and
environmental integrity in tact. Neither the corporate profit mentality
or that of Euro-American religious dogma allows for the free exercise
of religion by Native Americans--if it is at odds with private property
rights and interests of their constituents or congregational
membership. The Native American Indians, however, believe that they
have a reserved right of access to such sites located inside and
outside the established Indian reservations. They believe that the U.S.
has a mandated ``sacred trust of civilization'' duty to assure this
access. And, that they have an inherent sovereign right to help co-
manage such sites beyond initial consultation between governments and
private interests. However, such sites must have their environmental,
biodiverse integrity in tact in order to have real values so relevant
to Native American traditional culture teachings and ceremonial/
spiritual practices. This testimony seeks to help clarify such concerns
of Indian Country in association with prevention of impacts to the
environment and sacred sites & places that have significance in native
spiritual & cultural practices & beliefs.
Native American Religious Practices and Cultural Continuity:
It has been a stereotypical dilemma for the Non-Indians to
classify, on a continuous basis, the multitude of Indian (treaty)
Nations, and peoples, that exist all across the United States, under a
definition that constantly works over time. Words or names that we
attach to the ``other'' usually carry connotations that are negative
and impacting upon the psychic comfort of the targeted other. The world
vibrates with sounds and the movement of energy. These sounds are
recognized by different societies as having a vibrational pattern. In
time, the parts of the vibrations are given an alphabetical name for
that sound bit. These parts are joined to form words. The words are
formed to make sentences. The sentences are formed to make paragraphs.
The process continues until the collective can communicate, objectively
and subjectively, their experiences of the perceived reality of the
surrounding social & natural environment. The use of language is highly
subjective and bias to the culture that lives it. The idea of the
sacred is expressed by those collective experiences and descriptions.
Those expressions are limited in time and place, and continue to exist
due to the value the collective places upon it for their socio-
religious survival. Native Americans, all to often, state that it is
difficult to translate their concepts of the sacred into the American-
English language that has come to dominate their societies. The
individual sounds of the foreign language(s) do not translate into the
same understandings that their native languages had associated with
their immediate socio-religious natural environment, pre-contact.
Likewise, we have names that identify the sacred for us, in time, in
space, in place, and in our comprehension of reality. Stereotypical
names do not identify the sacred aspects of our living with the natural
world, and depreciate or devalue the meaning of our existence.
There are over 525 Indian Nations that exist throughout the
``territory'' of the United States. Most live on federally-established
reservations. A few live on state-established reservations. Many live,
as individuals or as individual families, in urbanite America--due to
the massive attempts to relocate tribal Indians into the cities in
order to disconnect them from their lands, territories, natural
resources, and the tribal collective that taught them to be ``tribal
people.'' The many fluctuating federal Indian policies, over time, have
failed to destroy or completely disseminate the Native Americans. They
have failed to disconnect them from their ancestral territories, from
their multi-generational teachings of the combined collective knowledge
of the sacred. Tribalism is alive and well in the continental United
States.
Over time, over the millenniums, the tribal peoples have continued
to recognize that song, dance, ceremony, sacred knowledge, and the
collective is absolutely important to each individual member of the
tribal community, and to the constant reestablishment of the sacred
contract they have with nature, creation, and the Great Spirit. The
power of the spiritual is located in sacred places, at sacred times,
and must be accessed during each generation to maintain the
relationship with creation, and this happens via the transmittal of
sacred knowledge to the lone or the multiple initiates taking part in
the ceremonial reenactment of original teachings given to the
collective by a sacred force or being.
The modern world of the traditionalist is plagued by the damages
caused by assimilationist mentalities. The modern Indian leaders are
convinced that economic development is essential to the preservation of
the social/tribal community. The traditionalist, however, place their
faith in the ancestral teachings that taught each generation to not
over-harvest, to not over-use or abuse the abundance or limitations of
nature. The Hopi Traditionalists hold that the Black Mesa is essential
to their spiritual practices, while modern tribal leadership meet at
the negotiation tables of Peabody Coal. The San Francisco Peaks are the
originating homes of the Kachinas, and yet the area is under the
control of Coconino National Forest.
The National Navajo is confronted with competing interests in their
four sacred mountain regions (Mt. Taylor, Blanca Peak, Hesperus Peak,
and Huerfano Mountain lands. Their ancestors arose there. Their
mountain chant came from there. The Navajo had traditionally divided
all of creation up into 27 chapters of sacred creation in specific
timing or order, each chapter governing over certain aspects of
creation, each chapter corresponding to healing of the human mind,
body, and soul. Each chapter has an influence over the governance of
Navajo socio-religious life ways. Each chapter had its complex of
sacred chants that must be preserved in perfect order so as to preserve
the sacredness of creation and life. A medicine person or chanter may
only train one apprentice in his life time and two if he is truly
phenomenal. Impacts to Navajo topography, geology, territory, society,
and practices of the sacred has driven some of the ``chants'' (or
chapters of creation knowledge) into extinction.
Today, the Hopi and the Navajo are living under the mutational
influences of uranium mining. The pilings of discarded uranium
trailings are the playgrounds of the goats and sheep, and even native
children. The flocks become contaminated and the meat and milk is
consumed by the families. The radio-active contaminated wools are woven
into their clothes. Cancers plague the living and babies are born with
deformities. The Hopi and Navajo are a mirror of the ill-health of the
American Society. They are classified as living in the ``National
Sacrifice Zone'' for the enrichment of corporations and the creation of
cheap energy for the rest of society, in addition to the power to bomb
those that do not believe as ``we'' do.
While the Forest Service proposed to construct parking near the
sacred Medicine Wheel near Powell, Wyoming, which is sacred to tribes
of Montana, the Dakotas, and Wyoming, the Badger Two Medicine area of
Montana (sacred to the Blackfeet) has been the subject of oil drilling
and exploitation. Accessing the Black Hills, for energy development,
has caused constant renewal of the historical trauma suffered by the
Sioux Nations by the illegal confiscation of their sacred Black Hills.
The Cochiti Pueblo need access and control over 24,000 acres in the
Bandelier National Monument, in order to continue their sacred
practices. The San Juan Pueblo have been trying to get lands back for
their religious purposes. As have the Santa Clara Pueblo, before the
Claims Commission, as regards 30,000 acres of sacred lands and sites
under the control of the National Forest Service and the Atomic Energy
Commission.
These example tribes and communities can pinpoint their places of
sacred emergence. Their songs, their dances, their regalia, their
sacred instruments, their preparatory herbs & medicines, their rituals,
their communal gatherings of celebration and renewal of the bonds with
creation, as well as the sacrifices of the individuals in questing, all
bind them to their traditional territories that have been confiscated
under the doctrines of discovery and the fallacy of Indian incompetency
as non-Christian peoples. Their sacred words and chants reawaken their
commitment to the natural world that surrounds them. Their
identification with the ``sounds'' of the chants, the songs, or the
words derive from the time, the place, the energy (spirit) of the place
of origin. Displacing them completely and divorcing them from the
``sacred creation place'' forces their knowledge and practices into the
realm of folklore rather than sacred cosmology.
Symbols are directly attached to and associated with the reality of
the ritualistic aspects of native life. The mountains, the rivers, the
rain, the elements, the animals, the plants, the birds, the mineral,
the aspects of the celestial (sun, moon, stars, constellations), the
concepts of time and space are all tied to the ceremonial observances
and ritualistic reenactments. All parts of creation vibrate with
energy, with sounds of the earth. These sounds help form the basic
parts of the songs of creation. All parts of creation, sooner or
latter, is depicted in the traditional practices of tribal peoples of
all four races. These images are carved in many shrines and churches
worldwide, in celebration and remembrance of the Garden of Eden and the
time that their ``God'' talked with humanity. This is not a foreign
concept that is too difficult for the non-Native to comprehend.
However, for the former (the Native Americans) the symbology is alive
and contributive to maintenance of the sacred. We hear and experience
their songs, their vibrates as a part of the collective whole. To the
latter (the non-Natives), the stone and concrete carving symbology is
more within the realm of the folktale of Genesis.
To the Native American, the symbol binds them back to the time of
the original contract with the Great Spirit, or the spiritual
emissaries, to keep creation sacred, to keep alive our acknowledge that
the material world is manifest with the spiritual, and this is a force
that binds the tribal individual to the tribal collective. The symbol
brings them back to the sacred place where sacred knowledge emerged and
emerges. To understand it in terms of physics, then light is composed
of the smallest quantum--the particle or the photon. This makes light
an individual (I). But, it is not alone. It is multiple and forms waves
(we). It is both an individual and a wave in theory. Light does not
``not exist.'' It exists in different places, and exposes the colors as
if they were a part of the material itself, when it fact matter only
has density not color. And, this is an example of the sacred
transmittal of knowledge, it exists some time, some place, and in the
right moment we become aware. It is permanent, continuous, and waiting
to be reflected upon. The particle/wave example same holds for mankind.
We are individuals and a society. Together we create the energetic
forces of sacred belief and practices. But, under the law, the
``individual'' Indian person has a right to (ritualistic) religious
freedom under the First Amendment, but the collective does not due to
its direct ceremonial attachment to large tracks of land or territory.
The Kachinas of the Pueblo are alive. They live and exist with
creation, as an extension of it. The Buffaloo Head dress of the Sioux
is alive with the spiritual forces and teachings that reinforce it from
generation to generation. The Bear or Wolf or Thunderbird or Eagle
masks of the Tribal Nations living along the Pacific Coast of the North
American Continent give meaning to those that participate, that
practice, that live the life-way required to wear such masks in
ceremonial observances. As examples, those that participate in such
rituals and ceremonials must live a life that is model to those that
dependent upon them for keeping the sacred alive. They must access
sacred sites, sacred places, in proper times and under proper elemental
conditions to assure that they are living and reenacting the teachings
that make the sacred a real aspect of daily lives of their community
membership. What they symbolize and how they live becomes the role-
models to the young observers that seek, in their own time, to be
chosen to express these aspects of the sacred for future generations.
The Grandmother that brought Peyote to the People was guided to the
sacred mountain, to the sacred plant, by a deer guide. White Buffaloo
Calf Woman brought the Prayer Pipe and the other essential rituals to
the Plains Indians. Salmon Woman brought the salmon children to the
tribes of the Pacific Northwest. The Hummingbird brought power to the
Navajo. The Butterfly Dance of the Hopi Elders brings forth the
potential harmonic balance that is sought by the community. The
Warriors suffering at the Sun Dance bring hope of peace and balance to
the world by their suffering, no less than was intended by the
suffering of Jesus on the Cross. These few role models that have been
mentioned here are of high importance to the tribal communities that
believe in them. Those that believe in the power of the Kachinas do so
with as much faith, belief, and commitment as does the Christian in
light of Jesus the Role-model (``Christos'').
The Native Americans turn their faith inward, in search of the
sacred that exists inside them. The non-Native, as Christians, turn
their faith outward. They search to find that which is not within them.
The Native Americans accesses the sacred by means of millennium proven
methods of transmittal of knowledge and sacred practices that awaken
the desire, if not the demand, for a balanced life-way. The teachings
that go hand in hand with the ritualistic preparation is no less
important than the teachings contained in the Bible, the Judaic Old
Testament, the Koran, the Toran, the teachings of Buddha. The former
may see the Sun, the Moon, and the Earth. The latter may say the
Father, the Mother, the Son. Or, they may all recognize mind, body, and
soul as the governing, symbolic triad. The Christian Cross is the
sacred four directions of the Native Americans. The teachings, when
translated and transmitted in the forms of symbols, are readily
acknowledged as having validity in the minds and spiritual practices of
the Natives.
As Carl Jung put it, there is a ``collective unconsciousness'' that
all societies tap into at one time or another. This collective
knowledge is universally accessed by those that seek it. Jung may say
that the individual can access the sacred knowledge via their anima or
animus. To the Native, we access knowledge in ritualistic prayer to the
Grandmother or the Grandfather of Creation. In dreams and visions, the
symbols of the collective unconsciousness speaks to us. These force us
inward on to the path to self-discovery, to enlightenment, to seeking
the constant path to balance all conflicting forces inside and outside
of us. Guided by the knowledge of the tribal collective, the individual
can ritualistically and mentally access these sacred inner paths that
shall structure their journey in life outward as well. Access to sacred
sites and places stimulates the reality of the teachings, helping
manifest the experience of the sacred. It is this experience that
allows the individual to incorporate what was learned into their
relationships with all others. They are a part of and no longer
separate from society or creation or the sacred. In fact, they have
assumed a duty to protect the sacred aspects of life, society, and
creation.
Essentialness of Qualified Practices in Natural Environments:
Human disturbance and destructiveness is the same by many names. We
can call it progress, or development or construction. We can call it
profit. We can call it the conquering of the wilderness. We can call it
a greater benefit to humanity or society. What it is not is the power
of God, or the Great Spirit. It is the power of mankind working and
rationalizing his dominance over nature and others. The Northwest Coast
Salish traditionalists have stated that there must exist a quadrant of
essentials for the sacred place to have meaning during access. There
must be continuity. There must be purity. There must be privacy. There
must be isolation. The presence of these four help assure the initiate,
the questing community member that there is integrity tied to the
location. The general understanding is that locations that are natural
have their own undisturbed vibrational patterns, sounds, songs, or
energy that originated with its moment of creation.
Continuity means that it was created that way. It had always
existed that way. That mankind did not disturb the original patterns.
Purity means that it is not contaminated by negative forces, power, or
meaning, or actions of mankind. Privacy assures that the initiate can
focus upon the ritualistic aspects of the sacrifice, the vision quest,
the meditation undisturbed by casual or purposeful disturbance by
others--i.e., humans. Isolation is an essential characteristic of
sacred sites and places that have meaning to the initiate and the
undisturbed journey inward to locate the sacred that shall bind them
with creative power. It is a site that is surrounded by the biodiverse,
geologically intact topography undisturbed by modern development,
sounds, and contaminants.
The initiates that seek access to such sites are guided by sacred
knowledge associated with preparation for the experience. Such a person
must begin their journey to understand the laws of balance (harmonic
living). They begin to seek knowledge and teachings tied with Physical
Balance. They clean their bodies inside (fasting) and outside (bathing
at in natural, sacred pools). They do not contaminate it with poisons
(drugs, alcohol, unnatural foods). They had to begin this journey by
seeking Mental Balance. They are taught to think good of themselves, of
others, and creation. They learn to control their emotions and let love
dominate over fear. They have to practice Social Balance. In this
practice, they have ``love their neighbor as them love themselves.''
They have to not hurt or threaten others in society and undo any
damages or hurt feelings them may have caused. They are not to be
individualistic. They must learn to share with all others, especially
those that are more needy then themselves. They have to practice
Spiritual Balance. On this path to balance, they must believe in the
power of prayer, meditation, and the spiritual powers that give life
meaning. They begin to understand, study, or appreciate the value of
Environmental Balance. That means that they appreciate keeping creation
as it was created, to not contaminate their habitat, to not over
harvest the natural environment. To not be selfish, greedy or
materialistic. Time Balance is another aspect of their teachings. They
is a time for play and a time for work. There is a time for the sacred
as well. They must dedicate the right amount of time to each endeavor.
Sacred practices require a dedication of the time to accomplish the
complete ceremonial observance. Time is infinite as should be their
belief. Space Balance is another law. We all occupy our space, our
location wherever we are. There are sacred places and spaces that have
not been disturbed and in need of protection for future
traditionalists. Space is infinite. But, humanity is quickly destroying
the sacred that was once attached to specific places or spaces. We are
a dot in the massive universe or even omniverse. And, yet, our
protection of our place (as sacred places are a part of the
comprehensive whole) is essential to ourselves and future generations.
All places are created by the power that generated life itself. It is
not our privilege to destroy. We are only temporary keepers or
protectors.
John Dourley (The Illness That We Are, p. 58, 1984) stated, ``The
final goal, then, for both the individual and for mankind, would be
patterns of incredibly wealthy harmonies. And the basis of this, the
unitive powers of the Self, Jung locates not beyond but within the
individual psyche.'' The teachings of the laws of balance (or
harmonies) is a life quest that has been sought after by mankind
worldwide. It is not uniquely Native American. But, it is alive in
Native American practices. For Jung, the West places God (Creative
Spirit by different cultural names) outside of themselves, they are
alienated from their creative power. For Native Americans the spirit is
located inside and is a part of them, and always was accessible. This
awareness, then, forces them to deal with what they are ultimately
responsible for or ultimately contribute to the strife or balance of
society.
The power attached to sacred sites and places that are known have
been made visible or understandable to the knowledge keepers (usually
elders) by intergenerational transmittal of knowledge. The powers of
such sites help to transform the individual practitioner in a whole
(unified in mind, body, and spirit), rather than fractionated (as in
neurosis). Once discovered then the sacredness of the site demands the
greatest protection of those that the knowledge or power of the site/
place has been exposed for or to. In this light, the elders teach the
initiates the requirements of holding themselves accountable to a code
of Respect that is passed to the initiates. They are to learn to
respect all aspects of life, creation, and society. Respect starts with
themselves and is extended to all those outside of the self (human and
non-human). They have to be humble in their accomplishments, actions,
and conversations. They have to have humble pride in doing things right
as positive examples to the young and old alike. They have to learn to
be unselfish, non-materialistic. They have to not take more than is
needed to survive. This is what Buddha would call the ``Middle way.''
They have to be considerate of the feelings and rights of others, and
the sensitivity of the balance of nature. They have to be dedicated to
practicing and living the life-way that keeps them on a permanent path
of enlightenment and self-discovery. They have to be tribally social.
This means that they have to understand and appreciate that they are a
part of the tribal collective which only loaned the knowledge to them.
They are, now, only the temporary keepers of knowledge and obligated to
share it with the next generation. They have to be honest. Their breath
is the source of all words. Their breath is sacred. So, they must use
their words to speak the truth. Native American traditionalists teach
as individuals and as tribal collectives and require that the initiate
keep alive these valued traits and practicing of sacred knowledge. The
means by which they do this, in accordance to the ancestral teachings,
then distinguishes the individual as having matured into a wise elder,
rather than simply growing older and constantly making the same
mistakes in life.
The practitioner becomes a part of the naturalness of the
environment. Their knowledge, their life ways, their preparations,
their ceremonial observances, their songs, their dances, their
thoughts, their emotions, their prayers, their conduct adds to or takes
away from the qualify of the environment. They either enter the sacred
placed prepared, observant, and dedicated or they take away from the
sacredness of the place. The initiate can disturb the sacredness of a
site. The site is that sensitive. Thus, the development of such sites
for modern demands (oil, gas, mineral extraction, etc) is, then,
massive in destructive impacts. It is not something that can readily be
described in native languages. The indigenous knowledge of human
destructive forces acting upon the environment goes back into ancestral
time of the natives. Many native myths are handed down over the
generations about the relationships with nature and the repercussions
when humans are destructive. We know that once we too were destructive.
But, our teachings hold that we learned in the ancient past and have
dedicated our life-ways or social constructs so as to spiritually
institutionalize the prevention of such destruction. We learned to live
with Mother Earth and limit our impacts as much as possible.
John Dourley (The Illness That We Are, p. 58-61, 1984) addressed
Jung's appreciation of the Catholic Marian doctrinal declaration
(Assumption of Mary into Heaven, 1950). It was Jung's view that this
placed the Catholic Church far ahead of the other dominant religions,
in that it was a movement to recognize the feminine principle--which
was missing from the Christian Trinity. The feminine has been a threat,
throughout the history of the male-dominated church, and church
hostility motivated the barbarism and brutality of the witch-hunters
and inquisitors. Native Americans practice ``Mother Earth
Spirituality'' and recognition of the validity of their religious
experiences and beliefs would run counter to church dogma. Any that may
lend support could be considered heretics. Even in light of the debates
of Vatican II (mid-1960's), the Church has not repelled repressive
declarations that forbid liberalism (See: Syllabus of Errors, and the
encyclical Humani Generis, 1950).
Consultation with the Indian Nations on Energy Development Impacts:
In 1987 (via SCR #76), the U.S. Senate recognized that the Native
American Confederacies (Iroquois and Choctaws) were contributors to the
form of constitutional democracy existing in the United States. This
same statement was enacted by the House of Representatives in 1988 (HCR
#331). This was at the 200th Birthday celebration of the United States.
Over the terms of the recent Presidents, since President Johnson's
statement of the ``Forgotten Americans,'' Indian Country has witnessed
and benefited from the enactment of the 1975 Indian Self-determination
and Education Assistance Act (as since amended to incorporate Indian
Self-government, see: Titles III, IV, and V). Over time, the Presidents
have continued to use their chief executive powers to require or
encourage the ``Cabinet'' members, and their various departments, to
issue Indian Policy Statements in alignment with the promises for
``Consultation'' with the tribes.
Consultation requirements with the Indian tribes usually are not
written to be obligatory but discretionary within the departmental
reviews. With the refinement of Indian lobbying efforts, and improved
national coordination, tribes have been slowly securing improvements on
``consultation.'' As tribes become self-determining and self-governing
there is an escalation of tribal demands for access to the programs and
services provided by the respective federal departments and agencies.
While tribal efforts to secure legislative language that guarantees
their access and rights to participate in various projects and
programs, the gray area is in light of ``consultation on traditional
culture impacts.'' Modern tribal leadership is encouraged to look at
development as a positive thing for tribal communities and membership.
But, the more traditional sector sees rapid development as insensitive
and in disregard to the cultural influences and concerns. Thus,
traditionalists are put against the power of the tribal government. It
almost appears that the tribal governments become the buffer zone
between the traditionalists and the federally authorized and encouraged
developments.
By preference, traditionalists would rather stop development and
construction of projects that destroy the natural environmental quality
and integrity so integral to their traditional practices. Their primary
concern is associated with cultural practices and ceremonials
associated with a known environment that is threatened. These cultural
practices could be exercised in the way of hunting, fishing, gathering,
or vision questing at sacred sites and places (in caves, on mountains,
on plateaus, in streams, etc.). Consultation, in those circumstances
that it is required, is readily recognized as going to the negotiation
table--which translates as compromising by the parties involved. The
historically traumatized traditional communities quickly recognize that
consultation will result in more lost of a limited natural environment.
It is the natural environment, not impacted by human activity, that is
becoming more and more rare in modern America. These are the places
Native Americans seek the sacred in general, no less valuable than when
``Jesus went into the wilderness.'' The sacred sites that have already
been identified, and acknowledged via ancestral teachings, are even
more valuable due to their transgenerational recognition of their
legitimate sacredness and place of power.
Both state and federal government agencies have moved toward
undefined ``consultation.'' The problem is the scope of consultation
and the amount of knowledge that the traditionalists must transmit to
be considered as having legitimate interests. Tribal governments have
began to structure and control the choice of traditionalists that are
allowed to represent the tribal collective during these ``government-
to-government'' consultations. This is a necessity since it is the
collective that is the storehouse of the cumulative traditional
knowledge. Federal and state entities must recognize that there are
multitudes of urbanized, individual Indians that are practitioners of
traditional ceremonials; but, they are not representative of the tribal
collectives living on the reservations. In fact, most were relocated
into urban American, by government action and policy, in order to
destroy their tribal knowledge and relationships. Tribal governments
must allowed to choose who represents them at the consultation tables,
with the premise that they realistically choose representatives that
truly are concerned about traditional practices and not chosen because
they support economic development first.
What is to be consulted about? We have attached, herewith, a
proposal by the Lummi Nation that seeks to develop an intertribal
protocol on the protection of Native Children's rights to secure and
learn their traditional culture. But, such guarantees are useless when
the natural environments, the sacred sites and places, essential to
exercising such practices are rapidly being destroyed--outside the
reservation or even inside the reservation. The ``Protocol'' is an
outline of what needs to be protected in order for traditional
practices to continue into time. For those native communities that have
retained a lot of traditional culture then it is a statement of the
minimal that needs protection; but, for those that have lost a lot,
then it becomes an outline for the minimal that needs to be recovered
for manifestation of the traditional, cultural, tribal collective.
In consultation, the non-native parties demand more and more
information in order to justify or rationalize their willingness to
even consider the native concerns. If the law does not mandate that the
Indian views be considered, if it is completely discretionary, then the
information is ``filed away.'' Thus, the natives believe their voices
are not given much credibility. And, the non-native demands more
intimate information about cultural practices, meanings, intent,
locations, and timings but is not willing to prevent disclosure of the
information under the freedom of information obligations. Thus,
traditionalists are hesitant to disclose details because of the history
of their sacred information becoming the main themes of new
publications.
Native Americans, in various regional intertribal organizations,
have considered forming intertribal commissions to address the best
means and processes for structuring ``consultation'' on traditional
culture with non-Indian society (corporations) and government (local,
state, federal). But there has never been the financial means to bring
the parties together, to conduct the necessary dialogues, to conduct
the necessary interviews, to document the concerns, opinions, and
advice. The number of opportunities to be consulted with, with state
and federal agencies, are numerous but the governmental agencies limit
participation to tribes that are being impacted in their traditional,
ancestral territories. The state and federal governments have access to
revenues to cover the costs and expenses of participating in
consultation; but, for the tribes the limited revenues require that
funds are taken for the more needy parts of the tribal community (e.g.,
women, children, elders) to cover on-going consultation dialogues. A
part of the financial burdens for consultation with the tribes will
have to be picked by the departments or agencies that are required to
consult with the tribes. Failure to finance those costs makes
consultation a farce, as regards meaningful tribal participation.
It would benefit both the state and federal governments, as a
service to their departments and agencies that are required to conduct
consultation, to jointly finance the formation of intertribal cultural
consultation teams. Any activities that will impact the natural
environment will impact the Indian traditional communities. Much of the
work can be cooperatively worked out in advance and detailed beyond the
idea of the Protocols, to help streamline the consultation processes.
On-reservation the tribes would need federal grants to help develop
this capacity. And, their success would improve their ability to work
with the off-reservation projects that are outside their jurisdiction
but within their traditional territories. Under self-determination and
self-government management of their natural resource bases, Indian
tribes (e.g., NWIFC tribes, CERT Tribes, NTEC Tribes) have become
experts on environment questions and the science of management of
natural resources and the environment; this same idea could apply in
regards to the collaboration of how to improve their traditionalists
participation in the consultation process and translate those into
recommended cultural management regimes. This would reflect and be
composed of what Dr. Gregory Cajete called ``Native Science.''
As tribes move into control of Indian Self-determination and Self-
governance they begin to assume more and more control over the delivery
of essential government functions and services to the tribal community
and membership. It is well known that Native Americans are constantly
under-funded in congressional appropriations for health and education,
laws enforcement and court services, and all of the other programs that
they qualify for. Most of the available funding goes to administrative
structure with few dollars for providing direct services to the
community. Economic development (as in the success of gaming for half
of the federally recognized tribes) provides tribal governments with an
opportunity to supplement the financial shortfalls in federal funding.
But, very few dollars are available to invest in the time and staff
needed to participate in extensive and time consuming consultation on
impacts to traditional culture. Marginalized tribal communities live
day to day, plagued with challenges to make daily survival. Tribal
leadership is torn apart trying to balance the demands--save culture or
save a life today!
There is a tremendous need to secure congressional authorization
and funds to develop the intertribal cultural consultation teams. These
would work with or could work with the National Congress of American
Indians, the National Tribal Environmental Council, and the Council of
Energy Resource Tribes, as well as the other regionalized intertribal
organizations (e.g., Affiliated Tribes of N.W. Indians, United South
and East Tribes, N.W. Indian Fish Commission, Great Lakes Indian Fish &
Wildlife Commission). In addition, there is the Native American Indian
Graves Protection and Repatriation Act that is being implemented
nationally as pertains to sacred sites and places associated with
ancestral burial sites and cemeteries. Their involvement would add to
the library of knowledge as well. Core funding is needed to coordinate,
plan, structure, and professionalize the discussions and negotiations
to assure that the traditional native voices are heard in a
constructive way. This is a necessity if the traditional values and
culture is to ever have influence over the natural resource harvest
management regimes or those that address oil, gas, ore, or mineral
extractions.
Regardless of which federal department, agency, or commission is
required to consult with the Indian tribes, before impacts or after the
fact, the truth is that unless the tribes have a right to sue and the
burden of proof is carried by the industrial sector or the department
or agency, then there will be constant efforts to disregard the native
consultation rights (or privilege when it has not legal strength) and
recommendations. Several years ago a gas pipeline had leaked 277,000
gallons of fuel into Whatcom Creek (Bellingham, Washington). Not only
did it destroy the creek habitat extensively but it incinerated three
youth that were present in the creek (Liam Wood, 18; Wade King and
Stephen Tsiorva, both 10 years old). It has caused not only extreme
grief but millions of dollars in restoration efforts. Today, the
pipeline companies refuse to disclose information about their lines and
crossings of streams/rivers under the pretense of potential threats if
the information is known. The public has a right to expect the
government to require safety. But, instead, public interests have to
sue to attempt to get the information released. The companies should be
required to bear the burden of proof after a lapse of time, and failure
to make honest efforts to disclose should result in triple damages,
fines, and penalties. Currently, a test case reveals that the gas
companies can continuously stall off public inquiries almost
indefinitely. One of the boys was an adopted out Alaskan Native Indian,
with extended-family located on the Lummi Reservation. We are concerned
for human life and habitat protection, especially for those streams/
creeks that have ceremonial bathing sites located within them. The idea
though is that without penalties and the threat of lawsuits, the energy
companies can afford lawyers to stall the proceedings longer than the
volunteer public interest groups impacted can afford.
The Exxon Valdez oil spill is still the focus of major lawsuits by
the impacted public interests and the company lawyers that have
specialized in stalling the case and judgments/awards are well paid. In
the meanwhile, 1300 miles of shoreline remains destroyed. That same
year the Exxon Philadelphia drifted, without any control due to
mechanical failure, along the Washington coast with 23 million gallons
posing a risk to the environment. A similar threat transpired with the
Cloudsdale, carrying 28 million gallons of oil. The late Senator
Magnuson worked diligently to get double hauled tankers authorized as
the only ones allowed to pass through Washington waters, just in case
hauls were breached. This type of championship is still needed in order
to prevent a Valdez crisis in Washington. The N.W. Indian Fish
Commission and member tribes are very concerned. Not only do the tribes
have a subsistence dependency upon the fish and shell fish that
populate these waters, but there are sacred sites in the waters as
well. Chief Seattle received his Thunderbird Powers from the waters of
Puget Sound. The late Lummi Medicine Man Isadore Tom received his
healing powers from the waters of Bellingham Bay. Tribes have a right
to be consulted on what passes in and through their ancestral,
territorial waters (``Usual and Accustomed Fishing Grounds and
Stations'' of U.S. v. Washington, 1974).
The Gwichan have been demanding, constantly, the right to be
consulted before there are any congressional authorizations associated
with the development, construction, and maintenance of the pipe lines
through their Alaskan territories. Their dependence upon the salmon,
the sea life, and the Porcupine Caribou Heads have been well stated and
voiced time and again within the Houses of Congress. While pipelines
are being constructed, there is on going oil/gas exploration, drilling,
and with phenomenal rates of water contamination throughout Alaska and
the North Slope. The polar ice capes are melting due to global warming
and still the voices of the native peoples are being ignored. Tribal
peoples want meaningful consultation, meaningful mediation, meaningful
negotiation over how to avoid damages to the environment in general and
sacred sites and places in specific. As mentioned above, without
authorization to hold a cause of action against the developing party,
the tribes are powerless. The 1978 American Indian Religious Freedom
Act lacked legal teeth for the tribes; there was no power to sue and
power to hold the corporations accountable.
In the 2005 Energy Policy Act, under section 504 ``Consultation
with Indian Tribes'' is provided. Consultation, however, should not
only address activity that impacts on reservation energy development
projects, as regards renewable or non-renewable resources; but off-
reservation activities should be subjected to the consultation
requirement as well, if it is within traditional tribal territories and
could impact tribes rights and sacred sites and places especially.
George Waters, working with Indian Tribes, stated that ``The
Interior energy program section is encouraging not only because it
requires the Secretary to provide grants to tribes for a number of
different purposes, but also because it envisions the creation of a
database of environmental best practices under subsection
2602(a)(2)(D). Theoretically, tribes and federal agencies could use the
best management practices as references to encourage environmentally
sound resource development and coordinate efforts across federal,
state, and tribal lines.
Technological and Scientific Divide Hinders Progress in Consultation:
The age of the computer has greatly enhanced instant communication
between points in the world, and especially the more developed
countries such as the United States. However, even with the rapid
economic development of those tribes participating in the gaming
industry and located next to major urban centers, most of the tribal
communities are still struggling to connect to the new communication
infrastructure that has become standard daily operations for all levels
of government (local, state, federal, international), society, and
industry. Most of the drilling for oil, gas, or mineral exploration is
not taking place inside of urban centers or next door to major
metropolitan areas. Impacts are felt though by the rurally isolated
communities that have to address potential developments, construction
of developments, or in the aftermath of developments in the energy
industry.
Indian Country has continued to develop their various intertribal
organizations that have become ``special focus'' entities. We have
intertribal organizations that address health (National Indian Health
Board), education (National Indian Education Association of the
American Indian Higher Education Consortium), housing, tribal courts,
and general concerns (as in the National Congress of American Indians).
We have regional organizations that address intertribal regional
concerns (Affiliated Tribes of N.W. Indians, United South and Eastern
Tribes). We have intertribal organizations that specialize in areas
(N.W. Indian Fish Commission, Great Lakes Indian Fish & Wildlife
Commission, Council of Energy Resource Tribes, Intertribal Timber
Council). One of the more recent entities to come into existence is the
National Tribal Environmental Council (NTEC), which began with 8 tribes
and has expanded to nearly two hundred member tribes.
It is more difficult for a tribe that is rurally isolated to
participate in consultation associated with impacts to the natural
environment and culture when they are not able to get the expert advice
that may be addressed in association with their traditionalists
concerns about management regime development. NTEC could be the conduit
that can be geared up to provide the professional staff and research to
advice the ``traditionalists'' and tribal governments when they lack
the same within their tribal systems. It could work with tribes to
organize an intertribal traditionalists advisory team to help structure
the process of consultation associated with impacts to sacred sites and
places. But, NTEC would need additional staff, additional research
funds, access to providing technological assistance and computer
equipment and hardware &software to isolated tribes confronted with
these issues. It would need the funds to help organize, coordinate, and
implement regional planning processes to streamline the consultation
network. Without this then the individual tribes have to re-invent the
wheel each and every time.
In recognition of the national concerns on energy development, it
would be a good decision to use the oversight hearing process to
rationalize, justify increased authorizations and appropriations for a
specific entity (such as NTEC) to coordinate and organize a national
assistance center for tribes confronted with energy development. The
Lummi Nation would recommend that NTEC be authorized and charged with
the task. Funding would be needed annually for the first ten years and
then expanded as needed. It should rationalized as an extension of
tribal self-determination and self-governance rights. Impacted tribes
would join NTEC in order to access the services and benefits. NTEC
would network with the individual tribes and the various intertribal
organizations to assure that the whole system is transparent and
accountable to tribal economic interests as well as tribal traditional
concerns. Tribes that are directly involved in potential or current
impacts by energy development projects would be priority for
technological updates and coordination assistance. The original funding
should start at one million for each of the first three years, and then
increased to two million for the fourth and fifth years, then report to
congress on the progress and participation success, with options to
expand the project indefinitely--provided there are benefits to all
sides of the equation.
While tribes that are impacted directly, on and off-reservation, by
energy development projects, may want to directly access the funding
from the respective ``Secretary's'' office, this funding advocated for
NTEC would require their membership in NTEC--to assess the assistance.
The overall goal is professional coordination services by NTEC to
tribes willing to partake of their services. NTEC, then, would be in
the position to assess the specific member tribe's capacity to respond
to the consultation process and determine where NTEC can provide
professional services. In the experience of Lummi, the N.W. Indian Fish
Commission has become almost indispensable to coordination of the
intertribal projects and voice of concerns--legally, politically,
technically, scientifically, managerially, as well as in the realm of
positive public relations. This is the same opportunity advocated for
the development of such a division within NTEC.
______
Mr. Grijalva. Thank you, Mr. James.
Mr. Jurrius, we will hear your testimony, and then we are
going to recess because I think votes are going to or have been
called already, or are they going to be called? They will be
called shortly, so Mr. Jurrius.
STATEMENT OF JOHN JURRIUS, FINANCIAL ADVISOR TO THE UTE TRIBE
OF THE UINTAH AND OURAY RESERVATION
Mr. Jurrius. Yes, thank you, Mr. Chairman.
Before I start, I have a letter from the Tribal Chairman,
Maxine Natchees, I would like to submit.
Mr. Grijalva. Without objection.
[The Natchees letter submitted for the record follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Jurrius. Good morning. My name is John Jurrius. I
am appearing before you today at the request of Maxine
Natchees, the Chairman of the Ute Indian Tribe and the Business
Committee, the Ute Indian Tribe of the Uintah and Ouray
Reservation.
I thank the Subcommittee for the opportunity to appear
before you this morning to talk about the experience that the
Ute Tribe and the interdependence between the tribe's land
base, associated natural resources, tribal membership, and the
tribe's goals of self-determination, and financial
independence.
The tribe's reservation is located in northeastern Utah.
Exterior boundaries of the reservation represent approximately
4.5 million acres. That represents approximately 8 percent of
the surface of Utah, making the Ute Tribe, the second largest
land-based tribe in the country.
The reservation consists of a matrix of tribal and allottee
surface and mineral estate, intermixed with Federal, state and
private surface and mineral ownership, making the Ute
reservation one of the more complex jurisdictional tribal land
bases in the country.
Even though the reservation overlays four counties in Utah
and falls within the jurisdiction of the BLM Vernal and Price
offices. There are approximately 3,200 members of the tribe
with over 85 percent of the members living on the reservation.
As mentored by the Federal government, the tribe, like most
tribes, has built a central government, but unlike the Federal
and state governments the tribe does not have a tax base and
therefore must rely on resource development to provide for the
organization and tribal membership.
The tribe's annual governmental budget is approximately 62
million, with approximately 85 percent of that budget being
provided directly from energy resource development on the
reservation. In 2000, the tribe decided that in order to
provide a long-term economic stability to its membership they
could no longer afford to play a passive role in resource
development, nor could it depend on the Federal government to
provide vision, leadership, or strategic decision-making, let
alone wherewithal for the well being of its citizenry.
To better serve its members, the tribe decided it must
become proactive in dealing with resource development and the
maximization of its financial resources. The tribe therefore
developed a comprehensive plan to manage all aspects of its
operations of sovereign from providing the basic government
services to engage in revenue-generation activities. The
tribe's leaders knew that it needed a comprehensive structure
necessary to effect these changes would require buy-in from the
members, so the financial plan was subject to tribal
referendum. The membership approved this financial plan by a
factor of ten to one.
The financial plan called for the aggressive deployment of
the tribe's energy resource estate and financial resources.
Similarly, the plan authorized aggressively using the tribe's
financial assets beyond their historic role of simply
subsidizing tribal government operations to that of building
sufficient financial corpus to provide long-term economic
stability, thus enabling the tribe to provide core government
services in perpetuity while providing greater well being for
tribal members.
Since adopting the plan, the tribe has leased over 400,000
acres that had never before been leased acreage, partnering
with companies like Bill Barrett Corporation, Quest, Arberry
Petroleum, Newfield Exploration, Anadarko, Dominion, EOG, to
name a few. The tribe has also participated in administering
the assets, gas-gathering plants, and is currently involved in
a refining project.
The tribe's natural evolution was enhanced by Title V of
the Energy Policy Act, which included in Title V the Indian
Tribal Energy Development and Self-Determination Act. In
addition to that, the evolution seems to be moving forward
under Title V, authorizing Indian tribes and Secretary of the
Interior to negotiate and execute tribal energy resource
agreements. An Indian tribe may enter into leases agreements
right away and other business deals for energy development in
accord on its own land without having the Secretary of the
Interior review and approve them.
However, we have our challenges. We have challenges that
were mentioned here earlier today, split estate issues. We have
EPA issues. We have refining issues. I will say that the tribe
has over 300,000 split estate acres. With the exception of
about 75,000 of those acres, the tribe has worked very
diligently with industry and has resolved all split estate
issues in regards to its deployed assets.
The only remaining split estate issue has to deal with an
exchange with the School and Institutional Trust Lands
Administration of Utah, and by doing this exchange the tribe
will set aside over 150,000 acres of lands in Desolation
Canyon.
We also have environmental challenges such as the tribe
currently doesn't have a minor source permitting program with
the EPA, and therefore must rely on more onerous permitting
than adjacent lands regulated by the state and other agencies.
Mr. Grijalva. Mr. Jurrius, I apologize, but I am going to
have to ask you to wrap up so that we can go vote.
Mr. Jurrius. Yes, sir.
Mr. Grijalva. And then we will come back to this panel for
questions.
Mr. Jurrius. Yes, sir. Thank you.
The point and conclusion as this committee and other
committees look at issues surrounding the nation's energy
policy, those decisions have a great impact to Indian country
and their ability to become self-determined by using their
resource base.
Thank you.
[The prepared statement of Mr. Jurrius follows:]
Statement of John Jurrius, Financial Advisor
to the Ute Tribe of the Uintah and Ouray Reservation
INTRODUCTION
Good morning Chairman Grijalva, Chairman Costa, Ranking Members
Bishop and Pearce, and distinguished members of the Subcommittees. My
name is John Jurrius and I appear before you today at the request of
The Honorable Maxine Natchees, the Chairwoman of the Ute Indian Tribe
of the Uintah and Ouray Reservation. Mr. Chairman, I am the financial
advisor to the Ute Tribe and I am accompanied today by Cameron Cuch, a
tribal member and an energy analyst with Ute Energy LLC, an integrated
energy company formed and owned by the Ute Tribe.
I thank the Subcommittees for the opportunity to appear before you
this morning to talk about the experience of the Ute Tribe and how we
believe other Indian Tribes can take advantage of the resources they
are blessed with and new opportunities under the recently enacted
energy law to develop and implement their own paths to economic
development.
THE PROMISE AND POTENTIAL OF INDIAN TRIBAL ENERGY
In early 2001, the U.S. Department of Interior estimated that
Indian Tribes own an enormous reserve of non-renewable energy resources
such as natural gas, oil and oil shale, tar sands, and coal, as well as
enormous potential to harness renewable energy resources such as solar,
wind, and hydropower. Using then-prevailing market prices, the
department estimated that the development of these resources would
result in some $895 billion in revenues to their tribal owners.
As we all know, the tragic events of ``9-11'' and the ongoing war
in the Middle East have caused the prices of oil, gas, and other energy
commodities to skyrocket. For example, in 2001 the department valued
Indian-owned oil at $35 per barrel. Light sweet crude oil is now priced
at $65 dollars on the New York Mercantile Exchange. That's a $30 per
barrel difference and suffice it to say that if the department revised
its earlier analysis, the value of tribal resources would be in the
trillions.
Because of their geographical remoteness, most Indian reservations
were once seen as undeveloped--indeed incapable of development. Today
the Ute Tribe is one of dozens, perhaps hundreds, of Indian Tribes with
both a natural abundance of energy resources and the determination to
maximize those resources for the benefit of their members.
Combined with the sheer volume of energy resources, there are
regulatory and policy reasons to be excited about the prospects of
tribal energy development. In August 2005 President Bush signed into
law the Energy Policy Act of 2005 (Pub. L. 109-58) which included as
Title V the Indian Tribal Energy Development and Self Determination
Act. Title V is designed to assist Indian Tribes promote the
development of their energy resources in ways that encourage tribal
planning and decision-making, protect the physical environment, and
result in increased employment and revenues to Indian Tribes, their
members, and surrounding communities.
Title V authorizes Indian Tribes and the Secretary of the Interior
to negotiate and execute ``Tribal Energy Resource Agreements'' (TERAs).
With an approved TERA in hand, an Indian Tribe may enter into leases,
agreements, rights-of-way and other business deals for energy
development on its accord and on its own land without having the
Secretary of the Interior review and approve them.
The TERA mechanism reinforces the policy of Indian self
determination and acknowledges in the law what we already know out in
Indian country: armed with accurate information, tribal leaders make
better and timely decisions than the Federal government when it comes
to energy matters.
The Department of Interior's Office of Indian Energy and Economic
Development (OIEED) is taking seriously its responsibilities under the
new energy law and is preparing to publish the final regulation to
implement the TERA provisions. Final publication is due to occur in
June, 2007.
PROFILE OF THE UTE TRIBE OF THE UINTAH AND OURAY RESERVATION
The Uintah & Ouray Reservation (U & O Reservation) is located in
northeastern Utah in the middle of the Uintah oil and gas basin. The U
& O Reservation comprises some 8% of the entire State of Utah and
ranges 120 miles north and south, east and west, and 150 miles
diagonally. The Ute Tribe has become an aggressive energy producer and
has leased tribal land for oil and gas resources for many years. In
fact the Ute Tribe recently opened up an additional 400,000 acres of
tribal land that had never before been developed.
Simply put Mr. Chairman, energy resource development is the
backbone of the Ute Tribe's economy. Thanks to the vision and
leadership of Chairwoman Maxine Natchees and the Tribe's Council, the
Ute Tribe has taken steps from being a passive royalty collector to
vigorously participating in the development of its natural bounty. So
instead of simply leasing its lands to outside companies, the Tribe has
begun to partner with the private sector to take an active position in
the exploration and development of its resources.
THE TRIBE'S GOAL: FINANCIAL SELF DETERMINATION
Before I discuss the Tribe's specific energy projects and plans, it
is important that I share with you the fundamental decision made by the
Tribe's leaders and members several years ago. In 2001, the Tribe
decided that it could no longer afford to play a passive role in
resource development nor could it depend on the Federal government to
provide vision, leadership or strategic decision--making, let alone
wherewithal, for the well-being of its citizenry. To better serve its
members, the Tribe decided it must become pro-active in dealing with
resource development and the maximization of its financial assets.
The Tribe therefore developed a comprehensive plan to manage all
aspects of its operations as a sovereign from providing basic
government services to engaging in revenue generating activities. The
Tribe's leaders knew that accomplishing the kind of restructuring
necessary to effect these changes would require ``buy-in'' from the
members, and so the financial plan was subjected to a tribal
referendum. The membership approved the financial plan by a factor of
10 to 1, giving it the highest status under the Tribe's constitutional
authority.
The financial plan called for an aggressive deployment of the
Tribe's energy resource estate. Similarly, the plan authorized
aggressively using the Tribe's financial assets beyond their historic
role of simply subsidizing tribal government operations.
The financial plan's success required a sophisticated land data
system that would enable the Tribe to identify (1) what it owned,
whether surface or mineral estate; 2) whether those lands or minerals
were leased or un-leased; and (3) whether the underlying agreements
were complied with by the Tribe's private sector partners. In essence,
the Tribe built a tool to allow us to manage our energy resource estate
in real time.
The new land system helped the Tribe to determine that it had not
received the market rate for most of its transactions; that nearly 50%
of the rights-of-way holders were in trespass; and that a large number
of exploration agreements were not in compliance.
The new system now enables the Tribe to show all tribal surface and
mineral ownership, as well as other ownerships, e.g. Forest Service,
Bureau of Land Management, State of Utah, and Fee Lands. The Tribe can
also discern production by producer, by simply ``clicking on'' a well
on an electronic map and reviewing the relevant agreement and
resolution.
The Tribe can now drill down into any particular production field
or well and determine when each well was drilled, determine what
formations were completed, and calculate annual production.
Additionally, the new land system has helped the Tribe demonstrate
to governmental officials and potential business partners that the Ute
Tribe is a sophisticated operator with business savvy that cannot and
will not be exploited.
CURRENT CHALLENGES TO TRIBAL ENERGY DEVELOPMENT
One challenge common in the west and one which Indian Tribes often
face are the so-called ``split estate'' issues involving different
ownership of surface and mineral estates. In these cases access to the
subsurface minerals is an issue that must be resolved.
Mineral ownership is dominant under ``Onshore Order Number One''
which benefits the mineral owner. However, the Ute Tribe has identified
situations where access to non-tribal minerals underlying tribal
surface lands presents a major problem as it may involve access to
sacred sites and areas of cultural and environmental importance to the
tribe that the Tribe may seek to protect from development. As some on
the Subcommittees know, the Ute Tribe is proposing a land exchange with
the School and Institutional Trust Lands Administration (SITLA) of Utah
to rectify a class split-estate problem. The proposal is currently
pending before the Bureau of Land Management.
The SITLA holds some 20,000 acres of mineral lands in the
southernmost portion of the Hill Creek Extension of the U & O
Reservation. The Ute Tribe holds the surface rights to these lands.
These SITLA mineral lands lie in an area of great cultural significance
to the Tribe. In addition, the Ute Tribe maintains these lands as a
wildlife conservation area. Thus, it would be difficult for SITLA to
lease these lands for mineral development. The proposed relinquishment
would protect sacred tribal lands, consolidate tribal ownership, and
reduce potential use of these sensitive lands by third parties. It
would also assure a revenue stream to the SITLA by developing mineral
resources which are not currently being developed.
If the proposed land exchange is not approved, the split estate
problem will prevent the development of mineral resources, wilderness
and culturally significant areas will not receive the certain
protection they would under the terms of the agreement.
LACK OF REFINING CAPACITY HINDERS ENERGY DEVELOPMENT
Another current challenge to developing tribal resources is
inadequate refining capacity to process production from tribal oil
assets. A large volume of the crude oil produced on the reservation is
what is called ``black wax'' crude oil. Black wax crude is a unique
form of crude and is desirable for its low sulfur content and potential
for the creation of high value wax and lube products. Current black wax
crude production and drilling activities within the Uintah basin have
been curtailed due to reductions in what Salt Lake City refiners are
willing to accept for processing. These refiners have instead turned to
imported Canadian crude oil which is fast displacing production from
the Uintah basin and deprives regional refineries of any economic
incentive to make capital investment necessary to process greater
portions of local basin black wax crude.
The importation of Canadian oil, along with the fact that black wax
crude congeals quickly and therefore cannot be transported long
distances by way of pipeline, means that in large part local black wax
crude is ``stranded'' with no refinery to process it.
The intersection of these factors could result in a shut down of
production for the Tribe at a time when the nation needs a boost in
domestic oil production. The only way to prevent stranding this major
energy source is to build new refining capacity in the Uintah basin
that is capable of processing black wax crude oil. As it has done with
other mattes, the Ute Tribe is taking the initiative to build a new
refinery in the Uintah basin.
Last month, the Tribe signed a Memorandum of Understanding (MOU)
with Calumet Specialty Products to explore potential refining solutions
for the Tribe's black wax crude production. As many Members know,
Calumet is a leading independent producer of high-quality, specialty
hydrocarbon products in North America and the Tribe is excited about
the potential for this new collaboration.
On a related note, the Tribe is keenly aware that there is great
interest in the potential of oil shale and tar sands to reduce our
national dependence on foreign oil. There are significant reserves of
oil shale and tar sands on the Ute Tribe's reservation and in the
Uintah basin in general. The Tribe is perplexed as to how we as a
nation can move forward with unconventional hydrocarbon resources such
as these when it does not have the refining capacity to refine its own
domestic energy resources existing resources and continues to depend on
foreign resources.
Nonetheless, the Tribe's refinery blueprint takes the long view and
includes plans to construct oil shale and tar sand processing and
refining facilities at a later date.
ENERGY DEVELOPMENT AND ENVIRONMENTAL PROTECTION
The Ute Tribe and all of its activities are inherently tied to its
land. In a very real sense, the Tribe cannot be distinguished from its
land. These lands are the sole resource for the Tribe, and the sole
source of its economic future. The Tribe protects and cherishes its
land and has set aside a portion of its reservation as a pristine,
untouchable area, preserved for its members alone.
As part of its energy plan, the Ute Tribe is engaged in ongoing
discussions with the U.S. Environmental Protection Agency (EPA) on a
number of issues affecting the Tribe. Because the Tribe is entirely
dependent on revenues from oil and gas operations on Tribal lands to
fund its government, a decrease in those revenues would prevent the
Tribe from providing fundamental governmental services--health care,
education, housing, and law enforcement--to its members.
EPA has requested that the Bureau of Indian Affairs prepare an
environmental impact statement (EIS) addressing additional oil and gas
development on the U & Ouray Reservation. The Tribe is taking an active
role in that process and is designing an approach that assures
development can continue while the review process is underway.
The Tribe is also working to resolve air emissions issues affecting
the U & O Reservation. EPA has been slow to promulgate a minor source
rule governing air emissions for Indian country and, as a result,
operators on tribal lands must comply with overly complex and onerous
air permitting requirements.
As the Members would guess, these operators can avoid the harsh and
untenable air regulations simply by relocating their operations across
the border of the reservation to state-regulated lands. The Ute Tribe
does not want to see the double standards in air standards drive energy
development from its reservation. The Tribe has been actively engaged
with EPA, operators, and other regulators to address this anomaly. To
its credit the EPA has thus far been open to assisting the Tribe in
developing creative approaches to resolving this issue.
Along these lines, the Tribe has reviewed the recently proposed
``Indian Country Minor Source Rule'' and has provided comments on it.
The Proposed Rule is flawed because it fails to recognize the
comparative disadvantage Indian Tribes are burdened with when it comes
to air emissions. Nonetheless, the Tribe remains hopeful that EPA will
promulgate an equitable and meaningful rule that results in a minor air
source permit for Indian country.
CONCLUSION
In conclusion I want to thank you for the opportunity to appear
before you and discuss the great things that the Ute Tribe is doing in
northeastern Utah.
At this point, I would be happy to answer any questions you might
have.
______
May 16, 2007
Dear Chairman Costa and Chairman Grijalva:
In response to the question from Minority Members:
``Would the commercial potential for oil shale development on the
Reservation be improved by encouraging commercial leasing of
oil shale on the considerable public lands where oil shale
formations are found out in the West?''
Yes, leasing for projects on public lands would drive the potential
for development on Indian Reservations. The leasing of public lands
would help Indian Tribes to 1. Learn more about oil shale development,
and 2. To understand the technologies involved as well as determine
which one is best is best suited for Indian country.
The leasing of public lands would also help the Ute Tribe learn
more about the potential of oil shale located in Utah and learn about
the two technologies namely the In-Situ Process and Surface Process or
Mining.
The Ute Tribe is interested in the In-Situ process and feels that
the leasing of public land here in Utah is important in finding out the
result of this technology. Concerns about damaging the earth make it
important that the right technology is perfected otherwise the Tribe
will not be interested in developing its resource. Therefore the pilot
projects help the Tribe quantify the prospective ness of the Tribe's
resource and helps identify the right technology.
Finally, as the federal government continues to cut back on federal
funding to Indian Tribes. Western Tribes in particular, are dependent
on natural resource development to fund core tribal government and to
ultimately reach tribal self-determination.
The Uintah and Ouray Indian Reservation, Utah
The Uintah and Ouray Indian Reservation, located in northeastern
Utah, lies within the Uintah Basin, a structural and depositional basin
of Tertiary age. During Eocene time a thick sequence of kerogen-rich
sediments accumulated along he trough of a lake that occupied the basin
area. Those endurated sediments comprise the oil-shale zones of the
Green River Formation and much of the reservation is underlain by one
or more of the zones. The richest of the oil ``shale zones, the
Mahogany zone, is deeply buried where it best developed within the
reservation (northern part) and crops out where the oil shale grade is
much lower, in the southern part of the reservation. Total oil-shale
resources of the Mahogany zone within the reservation cannot be
accurately determined due to the scarcity of core hole data, however,
assay data from core holes adjacent to the eastern part of the
reservation allow an estimate of the inferred resources of the Mahogany
zone in a part of the Mahogany zone that yields 25 gallons of oil per
ton, is a least 25 ft (7.6) thick, and is overlain by less than 3,000
ft (914) of overburden.
The 1970's and 1980's were characterized by exceedingly high
petroleum prices similar to what is experienced today. At that time,
several efforts began to make both tar sands and oil shale into
commercial ventures that would have contributed to the nation's crude
oil supply. Despite those historic efforts, ventures failed as world
oil prices declined and Federal policies failed to support continued
research and development of the resources. In Utah, the use of the
resources reverted back to satisfying historical objectives. Tar sands
were used once again for paving roads in the Uintah Basin and oil shale
reverted to be the object of grand research projects and to fuel the
plans of future developers. Not surprisingly, the optimism and dreams
of today are every bit as directed and intense as those wishes and
attitudes of yesteryear. Even though oil shale has been historically
referred to as ``the resource of the future that always will be'', we
feel that there is more future at this time for both of these key
resources than there ever has been. Prices for competing fuels and the
availability of those fuels are reaching critical stages in
international markets, as are the unsettled geo-political situations in
countries where conventional fuels are obtained.
Oil Shale and Tar Sands Resource Quantities:
The following tables depict current estimates for national reserve
quantities of oil shale and tar sands.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Utah Resources
Utah contains about 321 billion barrels of kerogen in its oil
shale, kerogen being an immature form of crude oil that requires
treatment prior to refining. This amount is a small part of the total
resource in the Western U.S. (UT, CO, and WY), which totals about 1.5
trillion barrels of kerogen. The vast majority of the oil shale
resource is part of the Federal expanse of land referred to as Public
Domain. There are significant parts of the oil shale resource, about
20% on an acreage basis, which are held in fee (privately owned) and
owned by the School and Institutional Trust Lands Administration
(SITLA). The latter category of resource is held in trust for the
Institutions and school children of the State. SITLA owns about 186,000
Acres and has about 100,000 Acres leased at this time.
As noted, tar sands in Utah contain 11 billion measured barrels of
oil, about 1/5th of the US's 58 billion barrels of tar sands oil. Many
recovery estimates vary as well. In the same way as oil shale,
ownership is a mixed bag among Federal, State, and private interests
with approximate splits being 80%, 10%, and 10%, respectively.
Overburden, or the non-ore material covering the ore, is generally
shallower than in oil shale deposits.
Federal Leasing:
The Bureau of Land Management (BLM) plans to lease and encourage
development of the Federal portion of Utah's oil shale and plans are
now under way to achieve this goal. Maximum lease size under the new
oil shale leasing program to any one individual or company would be
5,120 acres. A per-lessee prototype 5,120 Acre leases which would be
mined by underground methods (in Utah) and have the ore retorted
(baked) to extract about 1/2 of the kerogen from a 48 foot seam would
yield about 250 million barrels of kerogen over 14 years at about
50,000 barrels per day (bpd). As a comparison to today's conventional
oil production, the Utah Division of Oil, Gas, and Mining (UDOGM)
statistics indicate that Utah's crude oil production for 2005 was about
46,600 bpd.
Prior to offering the prototype leases, BLM is planning on leasing
Resource Development and Demonstration (RD&D) Leases to ``jump-start''
the oil shale development process. 1 Utah has one RD&D lease
in its future. It is a 160-acre lease on the same tracts leased in the
1970's as prototypes for oil shale development in Uintah County. An
environmental assessment (EA) has been prepared for issuance of this
lease to Oil Shale Exploration Company (OSEC). Comments on the EA are
now being considered by BLM. The release for the Utah lease is
---------------------------------------------------------------------------
\1\ Lease for the RD&D projects in Colorado were released on 12-15-
06.
---------------------------------------------------------------------------
A Programmatic Environmental Impact Statement (PEIS) is being
prepared by BLM on the long term leasing program. As a program to
address large scale future leasing, it is planned to take more time in
preparation and a draft is scheduled to be available by summer 2007.
Since Utah is a cooperating agency, we expect a maximum amount of input
to the process. The PEIS will evaluate the environmental effects of
BLM's plan for the commercial leasing of oil shale.
Refinery capacity
Capacity to refine crude oil in the State is currently about
160,000 barrels per day. This limit is currently stretched because of
Canadian syncrude coming into the State by way of the Express Pipeline
and by the need to refine heavier black wax crude oil from the Uintah
Basin. In fact, there is a substantial amount of produced oil, which is
not being produced because of this capacity limit. The Ute Indian Tribe
has established an initiative to build a new refinery in the Uintah
Basin to handle Heavy crude namely ``Black wax'' with plans to
establish a foot print for expansion into tar sand and oil shale
refinement when technology to develop oil shale and tar sand becomes
economic.
In conclusion, I hope that I have provided some insight into your
question. Once again, thank you for inviting me on behalf of the Ute
Indian Tribe to testify at your joint hearings.
Sincerely,
John P. Jurrius
Financial Advisor/Energy Expert for the Ute Indian Tribe
______
Mr. Grijalva. I thank the panel, and we are going to recess
for 45 minutes to an hour, and then we will return to this
panel for questions, and the panel that follows. Thank you very
much.
[Recess.]
Mr. Grijalva. Thank you very much and again let me thank
the witnesses, and I want to begin with some questions to Mr.
Emmerich, and when I am done with my allotted time, Mr. Pearce
will have some questions.
You mentioned the Western Governors' Association compiling
a multi-state inventory of information on sensitive wildlife,
migration corridors, critical habitat. That would be tremendous
information. When do you estimate that that inventory will be
if not completed, at least usable by a state or Federal
agencies?
Mr. Emmerich. Mr. Chairman, that portion of the resolution
as you stated is encouraging gathering that information on an
accelerated pace. I don't have a real good time line, but just
based on our own experience in Wyoming where we have collected
a lot of that information, I suspect within a year it will take
to compile that information. A lot of places migration
corridor, crucial ranges are already identified in various
state databases or other types of databases. It is a matter of
just pulling that together, but there are other areas where we
have to do more, the baseline information, the marking animals
or whatever it takes to really define those migration routes.
But I think some initial information we could probably pull
together within at least six months, a year max, but in these
areas where we don't have specific information it is going to
take several years because you have to mark animals, follow
them, and delineate those areas.
Mr. Grijalva. Thank you. One follow up, if I may. The U.S.
Fish and Wildlife Service and the states have spent a
tremendous amount of time and money crafting a plan intended to
help the sage grouse and preventing formal ESA listing for that
particular bird.
My question, is BLM undermining those efforts by not doing
enough to protect the habitat, and are we at this point, if
that isn't protected, heading for a listing?
Mr. Emmerich. Mr. Chairman, there has been a lot of energy
and resources dedicated to completing the conservation strategy
for the western greater sage grouse, and I think all agencies,
and the BLM is certainly a player within that conservation
strategy and working to achieve those results. Currently, one
of the huge challenges is funding. They have identified, I am
not sure of the exact total, but it is like--it is a lot of
millions of dollars to actually implement this strategy.
I believe the BLM recognizes the importance of making sure
we engage in all practices possible to improve conditions for
sage grouse because if we don't and trends continue to decline,
the long-term trends are negative. We actually have seen, at
least in Wyoming, the last three or four years we have seen
some increases in sage grouse number, at least outside of the
intensive development areas, but long term you have
fluctuations, but long term the trends have been negative. And
if we continue to see that, I am sure there will be continued
interest in listing the species.
Mr. Grijalva. Thank you very much.
Let me turn to Mr. Jurrius. The land system that you
described in your testimony, was it developed by the tribe or
the Department of Interior? That is the first part of the
question.
What you described seems like something that could benefit
other nations, other tribes, and are other tribes using a
similar system?
Mr. Jurrius. Mr. Chairman, thank you for the question. No,
their financial plans, so to speak, was generated by a business
consultants. Actually, the Southern Ute Indian Tribe, the
Northern Ute sister tribe started this process back in the
early 1990s, and as the three Ute tribes get together, the Ute
Mountain Tribe, Ute Tribe, and the Southern Ute, they share
that discipline, and that expertise. It is not something that
the BIA or is not a canned project, but it certainly has
received a lot of notice by other western tribes.
Mr. Grijalva. Thank you very much.
Mr. James, and thank you for being here, Indian tribes have
raised similar concerns regarding the siting of cell phone
towers, their effect on sacred sites that have been raised as
well regarding energy development. To address the concerns
raised, tribes have entered into negotiated programmatic
agreement with the FCC and private industry that requires cell
phone companies to notify and work with Indian tribes before
cell phone towers may be built in areas that may have sacred
sites.
Have the Indian tribes used or considering using a similar
programmatic agreement dealing with energy development areas
that may have sacred sites?
Mr. James. I can't really answer conclusively for all
tribes, but I know that it is something that we try to
encourage--to develop a system that would be available to those
tribes that are concerned for sacred sites. Even though tribes
are different in regards to time and location and membership,
and the ceremonial practices, a lot of the core values that
they have associated with sacred sites is fairly common in
their traditional culture.
So if we can develop a system that become a role model
compact, if you may, for dealing with the industries that come
either within the reservation or is developing within
traditional territories of the Indian tribes, then that would
help those tribes that are least developed, move further along
more rapidly, but it has to be developed as a prototype.
Mr. Grijalva. Thank you, and the last question, Mr. James.
In your testimony you made the point that tribes often cannot
afford to participate in the consultation procedures and
decisions that may affect their culture, sacred sites, and you
mention that in your testimony but I want to get specific in
that. Do you think that additional funding for the National
Tribal Environmental Council, a committed revenue stream will
alleviate that problem that we are talking about being there
for there for the consultation and having the expertise
necessary?
Mr. James. We witnessed in our experience where tribes come
together within the inter-tribal organizations where they begin
to share information and database and technology, that they
move rapidly forward. That is why I was saying that. In the
beginning, NTEC, with only eight tribes, now it is about 190
tribes, and so they are dealing with both the science of
environmental management, but they would need to not only be
able to be considered for the grant or the funds available for
providing the gathering of environmental database and making
available to Indian tribes, but also to help coordinate those
tribes' contributions to a database associated with cultural
practices and sacred sites protection.
Mr. Grijalva. Thank you very much.
Mr. Pearce.
Mr. Pearce. Thank you, Mr. Chairman.
Thanks, Mr. James, for your testimony. We have a couple of
tribes in our district that struggle for economic development
the same way, and so I am very familiar with what you are
experiencing.
Mr. Emmerich, on page 2, you have testimony about the
declining numbers of wildlife and things. Would you have this
panel to conclude that the wildlife and the production of
energy on the lands that you have jurisdiction over they are
mutually compatible or incompatible?
Mr. Emmerich. Mr. Pearce, Mr. Chairman, I think energy
development and managing wildlife resources are compatible, as
I stated in the testimony, if we work with the best information
and early on in the development of these resources, we share
that information, and identify the impacts that are occurring.
Intensive development, especially in crucial habitats or
these sensitive migration corridors, do have a negative impact
on wildlife.
Mr. Pearce. So you mentioned the decline of the deer herd,
for instance. Do you think that that is due to oil and gas or
to intense development? Let us use that phrase.
Mr. Emmerich. Mr. Chairman, there is several factors that
cause declines in wildlife. We are doing a specific research
that, by the way, is funded by industry in the Anticline area
south of Pinedale. We have been monitoring closely the mule
deer population that winters there on what we call the Mesa
winter range where the Anticline development is occurring. We
also have a control area just east of there. During the winter
of 2002, which was about the third year of development, there
was about a 49 percent decline in deer numbers throughout that
basin because of weather.
Mr. Pearce. Because of what?
Mr. Emmerich. On the Mesa itself, there was a 49 percent
decline. In the rest of the herd unit, there was about a 23
percent decline or 22 percent.
Mr. Pearce. And you said because what, what did you
speculate was the reason?
Mr. Emmerich. That was weather, but as I pointed out, if
you look at the control area compared to the Mesa area, there
was a 27 percent additional decline in the Mesa area where the
intensive development is occurring.
Mr. Pearce. What was the----
Mr. Emmerich. The only thing that we can attribute that
to----
Mr. Pearce. If you don't mind, what was happening to the
elk population at that time?
Mr. Emmerich. Elk populations don't winter in this area.
The elk populations are stable.
Mr. Pearce. What was happening to the antelope population?
Mr. Emmerich. The antelope populations have been fairly
stable in the same area. They migrate through this area, and do
winter in a portion of what we call the Jonah Field.
Mr. Pearce. So you have a decline in deer but you don't
have a decline in antelope?
Mr. Emmerich. That is correct.
Mr. Pearce. You are in the agency that would decrease the
number of hunting permits during that decline. Did you all
decrease the number of hunting permits?
Mr. Emmerich. If you look at the trends over the last few
years----
Mr. Pearce. I am running out of time. Just a yes or no.
Mr. Emmerich. Yes.
Mr. Pearce. Yes, OK. How much, just roughly? We are just
talking in general terms.
Mr. Emmerich. From 2002, there was--I don't have that
information specifically. I think it is in the range of 20
percent.
Mr. Pearce. So you had a reduction in 20 percent in the
hunting permits, the actual takes?
Mr. Emmerich. In that particular area. I can provide
specific information.
Mr. Pearce. Mr. Jurrius, do you all do hunting? Most of our
tribes have hunting is the reason I am asking. Do you all do
hunting, give hunting tours, and elk permits and all that?
Mr. Jurrius. Yes, sir.
Mr. Pearce. Have you noticed--you all are pretty
aggressive--by the way, your tribe has gone from pretty low
income levels to pretty high income levels, and so I commend
you for that because a lot of tribes are trying to figure out
the--so you do oil and gas exploration as well as hunting. Have
you noticed your animal population is decreasing the way that
Wyoming has?
Mr. Jurrius. First of all, I might say that those energy
revenues that go into the governmental budget, about a third of
it, $62 million budget, is for environmental and mitigation
type projects.
Mr. Pearce. Can you pull the microphone just a little bit
closer?
Mr. Jurrius. Sorry.
Mr. Jurrius. About a third of that governmental budget that
I mentioned earlier, $62 million that is funded by way of
energy revenues would fall into a category of environmental
expense for the government, mitigation of habitat, and so we
have very strong--whether it is bison herds, elk herds, rams in
the Bouk Lifts, sage grouse or mule deer, very strong----
Mr. Pearce. My question is are you seeing declines in
population as you go up on oil and gas, decline over here?
Mr. Jurrius. No, sir.
Mr. Pearce. You don't see the correlation that they are
finding there in Wyoming?
Mr. Jurrius. No, sir, not at all.
Mr. Pearce. You all have expressed some openness to--I see
my time--I will just wait until the second round, Mr. Chairman,
if you don't mind.
Mr. Grijalva. I don't have any further questions, so if you
want to----
Mr. Pearce. Sure, I only have a couple more so we will just
ease through it.
You have expressed as a tribe some interest in developing a
refinery, which is even one layer, more level of complexity in
the development phase of oil and gas. Are you thinking that
that is going to detract from your leased hunting revenues, the
revenues you get from leasing your property to the hunters?
Mr. Jurrius. No, sir. The tribe has done a great job of
partitioning off lands that it considered to have cultural
value or historic value for habitat versus those lands that it
intends to develop.
Mr. Pearce. So do you use the categorical exclusions that
are available to the Federal government in the Energy Policy
Act? Do you use those same types of things?
Mr. Jurrius. Everything on the tribe, of course, is subject
to NEPA and those same processes.
Mr. Pearce. Do you use those categorical exclusions?
Mr. Jurrius. No, sir.
Mr. Pearce. OK. Mr. Emmerich, you had mentioned that you
feel uncomfortable. You stopped short of saying it is a bad
deal, but you were worried about categorical exclusion. Did you
bring language to us?
Mr. Emmerich. Mr. Chairman, yes, there is language in the
testimony in terms of the type of changes that the Western
Governors' Association would like to see. It pertains
specifically----
Mr. Pearce. If you could just provide that in writing, that
is the question. If you have it, then we will take it and wring
it through the mill there.
Mr. Emmerich. You have it in writing.
Mr. Pearce. If you will provide it to our staffs, I am sure
both sides would appreciate having that.
Mr. Jurrius, on the split estate question, do you all run
into that question?
Mr. Jurrius. We run into split estate issues with over
300,000 acres of split estate where the tribe has the surface
and, of course, as you know, other than Onshore Oil and Gas No.
1, tribes not subject to condemnation via imminent domain, and
has seen massive development on its lands, but working with
industry we have been able to--for all deployed lands and all
deployed assets--resolve all split estate issues.
Mr. Pearce. How much of your 300,000 acres is in the split
estate category?
Mr. Jurrius. No. Actually, 1.5 million acre surface estate,
300,000 is in the split estate category.
Mr. Pearce. And you have been able to work some sort of a
compromise on every single thing?
Mr. Jurrius. Yes, sir. It has been a five-year process.
Mr. Pearce. Which would match with our testimony from the
BLM that they have 20,000 wells and only 20 have fallen into a
category where they couldn't come to some agreement.
Well, that pretty well does it for me, Mr. Chairman. I
appreciate this panel here. They have done a great job.
Mr. Emmerich. Mr. Chairman, if I may, I do have those
figures on another sheet. The sublette herd, which is the one
directly affected by impacts on the winter range, in 2000,
which is about the time the development started, we were
issuing about 8,300 licenses, and in 2005, we dropped to 5,415,
which is approximately a 36 percent decline.
But if you compare that to the same time period in other
populations where we don't have energy development, there was
also roughly a 10 percent decline in hunter numbers and
licenses issued, so there was some decline elsewhere, but not
as large as in the sublette herd.
Mr. Pearce. OK. Thank you very much.
Mr. Grijalva. Thank you very much, and I appreciate all of
the testimony. I want to note Mr. Jurrius's comment that the
Nation that you represent is spending a third of its revenue
from those leased lands on habitat, wildlife protection, and
one can wonder if a third was being dedicated by BLM to those
same endeavors, maybe some of the decline that we are debating
about wildlife would be moot, but that is for another time.
Thank you very much, and I will call the next panel. Thank
you very much and welcome, ladies and gentlemen. This is our
last panel, and as you heard, your full statements will be made
part of the record, and we ask you for your oral testimony, if
you could limit that to five minutes and we will proceed
alphabetically. Let me begin with Mr. Adami. Did I say that
correctly?
Mr. Adami. Adami, Mr. Chairman.
Mr. Grijalva. Thank you, sir.
STATEMENT OF STEVEN M. ADAMI,
POWDER RIVER BASIN RESOURCE COUNCIL
Mr. Adami. Mr. Chairman and Subcommittee Members, on behalf
of myself and the Powder river Basin Resource Council, I would
like to thank you for the opportunity to speak to you today.
My name is Steve Adami. I am a rancher and CPA in Buffalo,
Wyoming. I am a life-long resident of Wyoming, and I am here to
address the problems with development of oil and gas minerals
when a split estate exists.
The Stock Raising Homestead Act of 1916 governs the
consideration for the surface.
Mr. Grijalva. If I may, let me interrupt you for just a
second. Could you pull the microphone closer?
Mr. Adami. Is that better, Mr. Chairman.
Mr. Grijalva. Is it on?
Mr. Adami. I think I can hear it. Is that better if I speak
here? OK.
The Stock Raising Homestead Act of 1916 governs the
consideration for the surface which is growing crops and
tangible improvements. This law is 91 years old. Surface uses
and values have changed since 1916. Wyoming's Split Estate Act
in 2005, that Act has proven to be inadequate primarily due to
ineffective default provisions on the bonding requirements.
Furthermore, the BLM has refused to recognize Wyoming's Split
Estate Act where the split estate exists over Federal minerals.
Our ranch was bonded onto where we had fee surface over
Federal minerals, and earlier today Mr. Bisson made a statement
that I hadn't heard before, which is that in the United States
there are only 20 wells where the surface owner and the Federal
government can come to an agreement, and on our ranch we have
12 of those wells. So I represent to you here today 60 percent
of the bonded on split estate Federal minerals in America.
While we were waiting to have our appeal heard, we appealed
that process to the Interior Land Board of Appeals. While we
were waiting, the developer completely drilled and developed
every mineral at issue. There was no additional bond
requirement during that period or any other protection for our
land during that process.
This is not about stopping or slowing oil and gas
development. It is about being fair and responsible with regard
to the treatment of the surface estate.
We have sold our ranch, and left many of our oil and gas
problems behind. However, I have decided to remain involved in
this process so that other landowners don't have to go through
what we did.
The problems are easy to identify. The solutions are
generally much harder. However, I do believe there are a number
of things that can be done to help that will mitigate the
impacts of development of the mineral estate while preserving
the viability of the oil and gas industry.
I urge you to pass Congressman Udall's H.R. 1180 that would
require surface owner notification and input, reasonable use of
the site, accommodation of the surface owner, reclamation to
support the same use as before the development, and
compensation for damages. Personally I would like you to
consider including something in that bill that would put a stay
on development during an Interior Land Board of Appeal or
increasing the bond amount so that would not be preferred
alternative, and would help keep the mineral company at the
negotiating table.
In summary, the oil and gas industry should not be allowed
to off-load their cost, primarily reclamation, onto the surface
owner through their dominant negotiating position. The coal
mining industry not only survived but it has thrived since
legislation require them to act responsibly was enacted. I
believe oil and gas can also. I urge you to pass legislation to
bring our antiquated laws up to date with the realities of our
modern society.
Thank you very much.
[The prepared statement of Mr. Adami follows:]
Statement of Steven M. Adami, Rancher,
Powder River Basin Resource Council, Sheridan, Wyoming
Chairman Costa, Chairman Grijalva and members of the subcommittees,
on behalf of myself and the Powder River Basin Resource Council I would
like to thank you for the opportunity to speak to you today. My name is
Steve Adami. I am a rancher and CPA in Buffalo, Wyoming, and a lifelong
resident of Wyoming. I am here to address problems with the development
of oil and gas minerals when a split estate exists between what has
been the dominant mineral estate and the subservient surface estate.
The idea that the mineral estate is dominant over the surface or
land is the cause of many conflicts. An example of this attitude of
dominance over the land and the landowner was testified to in a recent
court case in our area when the landowner, Mary Brannaman, testified
that an oil and gas company representative told her, ``Mary, it's just
like you and I are married. I can do whatever I want, whenever I want,
and however I want.''
For me, the split estate relationship felt more like that between a
slave and a slave owner, but the result was the same: the developer
felt free to do whatever he wanted, whenever and however he wanted to
do it. This situation, which surface owners are encountering more and
more throughout the Rocky Mountain West, is leading to the passage of
split estate laws in Wyoming, New Mexico and possibly this year, in
Colorado.
Because of the oil and gas industry's political influence in
Wyoming, the split estate law that was passed did not provide adequate
protection for the surface estate. Our ranch in Johnson County was the
first test of Wyoming's Split Estate Law. Since our ranch's initial
test, the CBM industry has found Wyoming's Split Estate Law a safe
haven for inexpensive access to their mineral estate and continued
domination over the surface owner. Furthermore, the BLM refuses to
recognize Wyoming's law, despite its weaknesses and shortcomings (see
attachment.)
State and federal split estate law are based around ``good faith
negotiations'', but in our experience, no good faith negotiations were
required, regardless of state and federal law. The company that leased
the federal minerals beneath our ranch did not want to negotiate and
found the BLM an accommodating and cooperative partner in their effort
to ``bond on.'' BLM's message to landowners in our area is this:
``You'd better take whatever the operator is offering, because if they
``bond on'' you will get nothing.'' This is not good faith negotiating.
In our case, what the operator offered was a one size fits all,
non-negotiable surface use agreement. When we asked for some changes in
the language ensuring proper reclamation, restrictions on water
disposal, and $1.37 per day more money than was offered for the use and
damage of our land, what we received was nothing. The initial offer was
withdrawn and the operator ``bonded on''.
The BLM and CBM operator sat down and made decisions on how my land
was to be developed. Although I was invited to the meetings between the
operator and the BLM, my attendance was simply symbolic. As the owner
of the surface, my input was given only a token consideration--and it
was completely ignored if it conflicted with the operator's wishes. The
ultimate Plan of Development that was approved did not minimize
damages, did not compensate me for those damages, and did not ensure
there would be enough money set aside to reclaim my land when the
developer is finished.
The ``bond'' BLM required for industry to come onto my ranch was
$2,176. This money was not and will not be paid to me or any other
landowner who is forced into this position. The landowner must sue the
BLM for damages and the legal fees would be several multiples of the
bond. Two thousand dollars is not adequate compensation for my losses
or cover the damages caused by drilling 11 wells, bulldozing miles of
roads, installing miles of ``utility corridors'', and constructing five
off-channel water disposal pits of approximately 3 acres each. An
engineer I retained estimated reclamation costs to be in excess of 3 to
4 million dollars, particularly given the overall lack of development
control built into the Plan of Development (POD) approved by the BLM's
Buffalo Field Office. The BLM's response to my protests that they
allowed industry to post a $2,176 bond against a reasonable reclamation
estimate of three million dollars or more, was that they were only
required to collect a bond for loss of grazing value.
The developer had D6 Caterpillars working on our ranch within 48
hours after the approval of their POD and drilling permits by the
Buffalo Field Office. I appealed the BLM approval of the POD and
drilling permits to the Interior Board of Land Appeals. There are no
protections afforded to the surface estate or any additional bond
required of the mineral developer during the time of appeal.
I tried every step of the way to get protection for our land and
water. I lost that battle, and our ranch looks nothing like it did
under our stewardship. What was once open pristine ranch land is
covered with roads, pits, pads, and constant traffic. Our ranch became
an industrial park for the production of CBM gas. Our private deeded
ranch land was sacrificed by BLM for the development of federal
minerals.
We no longer own the ranch I've been talking about today. For a
variety of reasons, we were bought out by one of the CBM companies in
the area. The decision to sell was a very difficult one for our family
to make, but in the end was the only logical solution for us. We were
able to leave most of these troubles behind, but the fight took a
tremendous toll emotionally, physically, and financially for my family
and me. The abuses continue today for my friends and neighbors, because
nothing has changed in the way industry and the Bureau of Land
Management conduct business. You cannot mandate ``good faith
negotiations''. What is needed is a leveling of the playing field
between the dominant mineral estate and the subservient surface estate.
Problems are easy to identify. The hard part is to find solutions,
particularly when the solutions may require an industry with enormous
political and economic influence to make concessions in the way it does
business. However, there are solutions to many of the problems that
will not unduly slow down or add unreasonable costs to development.
This is not about slowing development or making it more expensive, it
is about fairness to landowners and making sure that development is
done in a manner that protects the surface resource.
The Stock Raising Homestead Act of 1916 declares that the surface
estate is entitled to reimbursement for damages to crops (not including
native grassland) and tangible improvements. That 91-year-old law still
rules what protections compensation surface owners receive today when
oil and gas is leased (though surface owners were given greater
protections when coal and hard rock minerals are being developed,
thanks to laws passed in 1977 and 1993.) It is time to revisit the true
value of the surface estate and to provide protections for those who
own the surface over federal oil and gas. The so-called dominant estate
lends itself too easily to the actions of a slave owner or an abusive
spouse, and the federal government should not be a party to it.
A new federal Split Estate Law would clearly have jurisdiction over
federal minerals and provide protection for the landowner where the
local and state governments are unable to provide such protection.
Mr. Chairmen, I urge you to pass Representative Udall's H.R. 1180
that would require:
Notification to the surface owner and opportunities to
comment and participate at key points in the leasing, permitting,
development and reclamation processes.
Reasonable use of the site.
Accommodation of the surface owner.
Reclamation of the site so that the land is capable of
supporting the same uses it was capable of supporting prior to
development.
Compensation for damages.
And I urge you to go further:
A federal law should require adequate compensation for
the use of the land and the mineral development impacts. Requiring a
fixed production percentage, which would be non-severable, to the
surface estate would entitle the surface owner to some reasonable
compensation for the use of their estate.
A stay on development during an appeal to the ILBA would
both provide protection against improper development and discourage
companies from using the ``bonding on'' method of gaining access to
their mineral estate except in a case of last resort.
The best way to defuse the controversies surrounding this
industry are to reconnect the minerals with the surface estate, perhaps
by requiring that minerals not leased or produced over a number of
years, 15 for example, revert back to the surface owner.
It is time to pass legislation to rein in the ``dominant'' position
of the mineral estate which has cultivated the arrogance of the
operators who are running roughshod over surface owners and address the
inequity that exists between the land and the oil and gas beneath it.
We addressed this issue during the boom in coal mining in the 1970s and
it is time to require it of the oil and gas industry. In the 30 years
since the passage of our federal coal law, the Surface Mining Control
and Reclamation Act, which requires surface owner consent before
federal coal is leased, the coal industry has evolved into a prosperous
and relatively non-controversial industry. We believe the oil and gas
industry can succeed and thrive from a similar approach.
Thank you.
______
Steven M. Adami
P.O. Drawer G
820 North Main Street
Buffalo, Wyoming 82834
307-684-5557
May 5, 2007
Representative Raul Grijalva
Subcommittee on National Parks, Forests and Public Lands
House Natural Resources Committee
1626 Longworth House Office Building
Washington, DC 20515
RE: Additional Statements for The Record for the April 26, 2007
Hearing on ``Land-use Issues Associated with Onshore Oil and Gas
Leasing Development''
Delivered VIA email to [email protected] and Fax 202-225-
5225
Dear Chairman Grijalva:
My understanding is that we are able to make additional statements
or clarification for the record. Additionally, the Committee had a
specific question.
A point of clarification to my written testimony is with regard to
the issue of reattaching the mineral ownership to the surface ownership
after an extended period of inactivity. This statement was only
intended to be for fee minerals and not federal minerals.
Additionally, I wanted to address the statements by Mr. Bisson
(Deputy Director of BLM) with regard to there only being 20 wells (or
perhaps 20 landowners) in the nation where an agreement was not reached
with mineral developers. I cannot verify whether this statistic is
accurate or not. Instead, I would like to explain why this statistic
should not be used to rationalize that the current system is working
for landowners. What this statistic is really saying (or shouting) is
that the playing field is so lopsided that there are virtually no
challenges. This is a case where the surface owner has so few rights
that any offer is considered better than the alternative, which is
essentially nothing.
A statistic that would be very helpful, but not available, is the
percent of landowners that have had federal minerals developed under
their property who were happy or satisfied with the agreement they
signed. Among the people that I have had contact with, that percent is
not very large. Operators are currently using the leverage they have
under the Stock Raising Homestead Act to coerce landowners into
agreements that do not adequately protect, or compensate for the use
of, the surface.
BLM's Onshore Order No. 1 requires that an operator makes a ``good
faith'' effort to reach an agreement with the surface owner, but in any
negotiations where one side has absolutely no leverage, it is virtually
impossible for ``good faith'' negotiations to exist. Regardless,
exactly what are ``good faith'' negotiations? BLM does not define the
term. Leaving that determination up to a civil action does a great
disservice to the surface owner.
In my case, the mineral developer's initial offer was withdrawn
when I did not initially accept it and it was never offered again
despite my efforts to restart negotiations. There was no pressure by
the BLM to continue negotiations beyond a few patronizing statements to
the effect, ``we would like to see you guys work something out''. If
the BLM believes they have the tools and procedures in place that
encourage continued negotiations, as Mr. Bisson stated, those
procedures were not apparent in my case.
A specific question from the Energy and Minerals Subcommittee,
House Natural Resource Committee that I received as an email is as
follows:
You have suggested the adoption of a federal law to govern
split estate relationships in regards to oil and gas
production. As you know the needs and requests of a ranch in
Wyoming, Texas and any other state are not the same. How is a
uniform approach to split estate likely to succeed in answering
the specific needs of ranchers when they each have their own
scenario?
My answer to the above question is:
Every ranch is different, regardless of where it is located. My
neighbors directly across the fence have entirely different management
issues than our ranch. Each ranch has to adapt to the ``cards they are
dealt'' which are size, terrain, water, soil, climate, and many other
variables associated with any particular ranch.
That is one the reasons one ranch may be more receptive to mineral
development than another ranch. Some ranches may be in a greater need
of some of the development that accompanies mineral development.
The adoption of federal split estate legislation that recognizes
that the surface and its uses are unique (accommodation) will not
create a ``uniform approach'' but will facilitate an environment where
the unique attributes of each ranch will have an opportunity to be
recognized. Federal legislation that mandates broader considerations be
given to the surface, over the current ``growing crops and tangible
improvements'' to which they are currently entitled, is critical and
necessary.
Federal split estate legislation would create a more level playing
field on which real negotiations between landowners and mineral
developers are possible, by establishing a procedure for negotiation,
and by offering greater protections for landowners than merely
requiring compensation for growing crops or other tangible
improvements.
Until federal legislation is passed, the vast majority of split
estate landowners will continue to be forced to take whatever mineral
developers are willing to offer. Surface use agreements that fail to
adequately protect surface owners' interests, including reclamation,
may ultimately become a taxpayer liability. Please draft and pass
meaningful and responsible legislation to protect the surface owner in
split estate situations.
Sincerely yours,
Steve Adami
______
Mr. Grijalva. Thank you, sir.
The next witness, Ms. Korenblat.
Ms. Korenblat. Korenblat.
Mr. Grijalva. Korenblat, did I get it?
Ms. Korenblat. Yes.
Mr. Grijalva. Oh, good.
STATEMENT OF ASHLEY KORENBLAT,
OWNER, WESTER SPIRIT CYCLING
Ms. Korenblat. My name is Ashley Korenblat. Thank you for
having me. I live in Moab, Utah, with my husband and two-year-
old son. I grew up in Arkansas, went to school at Dartmouth,
got an MBA at the tech school, worked on Wall Street. Then I
made the entrepreneurial leap and ran a bicycle factory that
used aerospace materials to make bikes.
I am not an outfitter on the public lands. I operate guided
bicycle tours in 17 states. I am a former president of the
International Mountain Bicycling Association, IMBA. I am
currently serving my second term on the Utah BLM Resource
Advisory Council, and I am also on a task force for the
Governor of Utah that is exploring outdoor recreation economic
systems--not a good acronym.
I have spent the last 10 years traveling through the public
lands developing bike trips. My company, Western Spirit
Cycling, holds permits from the BLM, the Forest Service and the
Park Service. Our guests join us for week-long trips throughout
the backcountry, and on those trips they need not just a bike
and a helmet, but they need a tent and a sleeping bag and a
good raincoat, making us one of the links in the $730 billion
outdoor industry.
Some of our trips are truly challenging, five days above
10,000 feet on the Colorado Trail, and some are very mellow
like the Grand Staircase, which my mother-in-law did for her
seventieth birthday.
What if every American had the opportunity to spend a week
a year traveling through our public lands under their own
steam, sleeping under the stars? I think that would go a long
way toward solving a lot of problems.
Our public lands are an incredible resource that belong to
all of us, and there are 10,000 companies like mine who take
people into the public lands, and our businesses all depend on
access to land in its natural form.
The restorative powers of a trip to the backcountry are
well known. Companies such as the National Outdoor Leadership
School and Outward Bound run trips in the backcountry 18-day,
21-day trips. Everyone in this room would be a better person if
they did those trips. The outdoors really has the power to heal
and make us stronger people. Being outside in the vast
landscape of our public lands is integral to the human
condition.
Now, many of these lands, of course, were set aside
originally for resource extraction, and the idea of managing
them for recreation is a relatively new idea. In many places
recreation and resource extraction can co-exist, but
increasingly we are being forced to choose. You think what we
could do is just a simple cost/benefit analysis. Well, the
challenge is that by definition an oil well has a projected
life span, but land in its pristine form can provide revenues
to the outdoor industry forever.
So the question is what do we do to make sure that the two
things can co-exist? And you as leaders of our society, one of
the questions I am wondering about is, is it absolutely
necessary to find every last drop of oil on our public lands
when we know that oil is by definition an non-renewable
resource? It is finite. And if this is the curve, aren't we on
the downward slope? Aren't we past the peak?
I don't think my grandchildren are going to be burning oil
to travel, and I also think there is as much money to be made
on alternative sources of fuel as there was in the oil
industry.
Ultimately, it is a long-term versus a short-term question.
Our public lands are the backbone of the $730 billion outdoor
industry which created 6.5 million jobs and brought 88 billion
in tax revenues, and it is going nothing but up. In the last 25
years, we have seen nothing but growth. There are two factors
contributing to the growth: population increase and the fact
that more people want to be outside. But as demands continues
to increase, supply is dwindling, and so at some point we are
going to be in the situation where only the wealthiest
Americans are going to be able to travel to our pristine
landscapes on our public lands.
So despite my plea here today you might look at the map and
say, well, there are millions of acres out there, and an oil
well only takes up a quarter acre. But it is not just the
footprint, it is the roads, it is the gases, it is what it does
to the views. I have a trip where we ride by a giant sign that
says ``Beware of poisonous gases'' as we ride by the oil well,
and I tell my guests if you get a flat tire here, just keep
peddling.
So my real worry is that I am going to have a group call me
from the Kokopelli Trail and say, you know, we are at camp on
night three of the Kokopelli Trail and there is a bunch of
trucks here and they are digging a big hole. So then all of a
sudden I am losing a camp which I may not be able to replace,
so I may lose that whole trip from my product line.
And while I am focusing mostly on permit holders, we
represent only 40 percent of the recreation that is taking
place, and Americans of all types recreate on the public lands,
and while not every land manager has exact data on who is
recreating, they definitely know what the patterns are. So, I
am urging you to include language in the bill that requires the
BLM and the Forest Service to consider the recreation economy
before issuing leases.
[The prepared statement of Ms. Korenblat follows:]
Statement of Ashley Korenblat, President Western Spirit Cycling,
Outdoor Industry Association
Background
Thank you for inviting me. My name is Ashley Korenblat and I live
in Moab, Utah with my husband and two year old son. I am originally
from Arkansas, went to college at Dartmouth and received an MBA from
the Tuck School there. After a stint on Wall Street I was hired to run
a bicycle factory in Massachusetts called Merlin Metalworks. We used
aerospace materials to produce what at that time many felt was the best
bicycle in the world. We sold that company and now I am an outfitter on
the public lands. I own a bicycle touring company which operates in 17
states. I am a former President of the International Mountain Bicycling
Association (IMBA) and am currently serving on the Utah BLM Resource
Advisory Council and on a task force formed by the Governor of Utah to
study Outdoor Recreation Economic Ecosystems.
I have spent the last 10 years traveling through our public lands
developing bike trips. My company, Western Spirit Cycling, holds
permits on all types of public lands: BLM, Forest Service, and both
State and National Parks.
We operate under special use permits, incidental business permits,
and commercial use permits from:
The USDA Forest Service in the following National Forests:
Boise, Coronado, Dixie, Grand Mesa, Gunnison, Kaibab, Manti La
Sal, San Juan, Sawtooth, Sierra Vista, Uncompahgre, Challis,
Clearwater, Beaverhead-Deerlodge, Caribou-Targhee, Black Hills,
Mount Hood, Umpqua, Nantahala, White Mountain, Monongahela, and
Pisgah National Forests and the Dakota Prairie Grasslands.
The Bureau of Land Management in the following resource areas:
San Juan Resource Area; Henry Mountain Field Station; Moab,
Arizona Strip and Grand Junction Field Offices; Grand Staircase
National Monument
The National Park Service in the following National Parks:
Bryce, Zion, Capitol Reef, Grand Canyon, Crater Lake and Blue
Ridge Parkway National Parks. Western Spirit is a
concessionaire in Canyonlands National Park.
Our guests join us for weeklong trips into the backcountry by
bicycle. And on these trips, they need rain coats and pants. They need
tents and sleeping bags. They need bicycles and helmets. Our guests
stay in nearby hotels and eat in local restaurants before and after
their trips, making us just one of the links in the value chain that
makes up the $730 billion outdoor industry.
Some of our trips are for the truly hearty and involve five days
above 10,000 feet on the Colorado Trail, while others are quite gentle.
In fact, my mother-in-law did our trip in the Grand Staircase Escalante
National Monument for her 70th birthday. She had not been on a bike in
years. We got her a good rain coat and a warm sleeping bag and she had
a wonderful time.
The Power of the Backcountry
What if every person in our country had the opportunity to spend
one week a year traveling under his or her own steam through our public
lands camping under the stars? I believe such a development would lead
to progress on some serious problems from rising health care costs to
global warming. Our public lands are an incredible resource that belong
to all of us.
There are over 10,000 companies, like mine, who provide
recreational opportunities on our public lands. From Barb and Harlan
Opdahl at Triple O Outfitters who take people elk hunting on the Lewis
and Clark trail to large river companies, like OARS, who run white
water river trips on many of the major rivers throughout the US. What
do all of these outfitters have in common, besides the fact that we all
make people buy raincoats and pants? Our businesses, and the companies
that make the rain gear, depend on land in its natural form.
The restorative powers of a trip to the backcountry are well known.
As Theodore Roosevelt once said,
``It is an incalculable added pleasure to anyone's sum of
happiness if he or she grows to know, even slightly and
imperfectly, how to read and enjoy the wonder-book of nature.''
Companies such as the National Outdoor Leadership School and
Outward Bound continue to grow and thrive because the trips these
organizations provide make you a better person. There you are, a three
day walk from a paved road. The wind is howling and the storm is
bearing down upon you. You are nervous and unsure, because you are out
here for 18 more days. But you put on your raincoat and your rain pants
and you keep moving. You dig into your suitcase of courage and you make
it over the pass to camp. There, you set up your tent and make a cup of
tea, and then the storm blows away and you are left with a beautiful
sunset.
I have seen it myself many times, people arrive for their bike
trips, clean, a little pale, and nervous. There is a bit of panic
associated with leaving the grid. Their cell phones will not work out
there, and that worries them. Then they come back after having lived
through the storm, having climbed over the pass, having swooped down
the other side, having really seen the stars--and they actually look
different. They are dirty, but they are no longer nervous. They have
reconnected with themselves and the earth and they have a kind of glow.
More than 65% of our customers come back every year.
The proliferation of wilderness therapy programs for at-risk youth
is further testimony to the power of the backcountry. The out-of-doors
has the power to heal and make us stronger. Being outside in the vast
landscape of our public lands is integral to the human experience.
Making a Living on our Public Lands
Many of these lands were originally set aside for resource
extraction, and the idea of managing them for recreational purposes is
relatively new. There are many places where resource extraction and
recreation co-exist. Yet in more and more cases a choice must be made
and a simple cost benefit analysis is difficult to perform. Most
resource extraction has a lifespan, defined by the productive life of
the mine or well, while revenues from recreation can continue and
increase in perpetuity.
In addition, many long-time Westerners deeply resent the federal
lands in their states. How can they make a living if 87% of their
county is public land? Well, one way is to open the lands to oil and
gas exploration. The county government will receive a portion of the
revenues, and in some areas, where the locals have the necessary
skills, they will be employed. In my direct experience, it is more
likely that you will begin to see trucks with out-of-state license
plates and all the hotels will be full just for those few months that
the wells are being tapped. And if the boom continues, some of the
local high school kids will become oil drilling experts and about the
time you think your son is going to settle down, he gets a call to head
to Alaska or maybe the Middle East to make some serious money, and the
bust has begun.
Meanwhile, Grand County, Utah where I live, is 94% public land and
that is exactly why I can make a living there. If my son chooses both
he and his children could also make a living there. Our company started
with bicycle trips on nearby BLM lands and in Canyonlands National
Park. I have been in many meetings with county commissioners who
express great interest in how our company works. Many of them have
begun to see the business opportunities which recreation on our public
lands can provide. The bottom line here is that land in its pristine
form has long term economic value.
The Maah Daah Hey Trail in North Dakota
In 1999 a 96 mile multi-use trail was built to link both districts
of Theodore Roosevelt National Park through the Little Missouri
National Grasslands which are managed by the U.S. Forest Service. The
Forest Service issued a competitive prospectus for permits on the
trail, and my company, Western Spirit Cycling, was awarded a permit.
The state of North Dakota began a marketing campaign to promote the
trail. Advertisements showing the trail snaking through the grass in
and out of the badlands geology appeared in all the outdoor magazines.
The International Mountain Bicycling Association gave the trail the
coveted ``Epic'' designation. Everything was on track to put North
Dakota on the map as a world class mountain bike destination.
There was only one problem, this area of the National Grasslands is
an oil field with more than 250 active wells. The trail was put in
around these wells, and while there are many pristine vistas, there are
not many places to camp that are not in sight of the wells. In fact,
there is one section of trail that goes right along a fence next to a
well which bears a giant sign that says beware of poisonous gases. So
my guides tell my guests that if they get a flat tire in this area, or
have any other problems, do keep moving--and perhaps hold your breath
until you get safely away from the area.
On top of these challenges, the current federal energy policy has
resulted in a five-fold increase in applications to drill in the
region. And since none of the land management agencies have any
obligation to inform recreational permit holders about changes in
resource extraction, we could roll into camp next week with a group of
paying guests and find big trucks, big lights and a big hole in the
ground. It is beginning to look like North Dakota made a bad
investment. What steps need to be taken to insure that recreation and
resource extraction can coexist?
The Outdoor Industry and Resource Extraction
To answer this question, we must first ask ourselves as a society,
and you must ask yourselves as leaders of our society, is it absolutely
necessary to recover every last drop of oil in the US? We know that oil
is a finite resource. So since we must begin to transition to
alternative fuels, shouldn't you, the long term stewards of our nation
initiate that transition? One way to do that would be to require that
outdoor recreation be considered before oil leases are awarded.
Ultimately, this is a long term versus short term question. Our
public lands are the backbone of the $730 billion dollar outdoor
industry, which contributes 6.5 million jobs and more than $88 billion
in annual state and federal tax revenues. This includes bicycling,
camping, fishing, hunting, paddling, snowsports, wildlife viewing, and
trail running, hiking, and climbing. And there is nowhere to go but up,
the outdoor industry has seen consistent growth over the past 25 years.
There are two factors contributing to this growth: increased
population and increased awareness that outdoor exercise greatly
contributes to both health and happiness So, while demand is
increasing, supply is dwindling. A microcosm of what the future might
hold can be seen in the Grand Canyon. Demand for permits to float the
Colorado River through the Grand Canyon has skyrocketed. Land managers
rightly control access to the canyon to avoid damage to the fragile
environment. Commercial outfitters often book all their trips for the
year in a single day. Private parties have been known to wait over 10
years to receive a permit. Recently a lottery has been instituted to
provide better access, but the reality is that right now, only wealthy
people with flexible schedules get to float the Grand Canyon.
If we insist on extracting every drop of oil from our public lands
there will be fewer and fewer places that are truly in their natural
state. And the law of supply and demand will result in a situation
where only the wealthiest Americans will be able to visit those spots.
Opportunities for Outdoor Recreation for all Americans
Despite my plea here today, you may look at the maps and the
millions and millions of acres managed by our federal agencies and
think how can a oil well, which often occupies less than a quarter acre
be such a big problem. The consequences of digging the well spread well
beyond its mere footprint. There are the roads that must be put in to
reach it and there is the noise and there is its particular location.
It is getting harder and harder to find contiguous sections of the
backcountry to run an 18 day trip, or in some cases, even a 5 day trip.
When people are traveling under their own steam, you can't simply
change the route or just keep going to get away from the well. On an
introductory bike trip, we really don't want to ride much further than
20 to 30 miles in a day. So, if a well pops up in one of our camps, we
will have to change the entire route of the trip, which often is not
possible. And suddenly one of the trips in my product line is gone.
USDA Forest Service
While we have long standing relationships with many of the
rangers with whom we work, they have no official obligation to
contact us should a lease be sold on one of our trip routes.
Bureau of Land Management
The BLM is legally required to consider wildlife, paleontology,
and archaeology in both the planning and development stages of
oil and gas leasing, but there is no such requirement regarding
recreation.
National Park Service
While the Parks themselves are protected from actual drilling,
to provide a true backcountry experience we must protect the
viewshed from the park and avoid the noise.
While my testimony here has focused on permit holders on our public
lands, we probably represent less than 40% of the recreation that is
taking place. Americans of all types recreate on our public lands in
thousands of ways. While not every land manager has perfect data
regarding visitation, they are all aware of use and visitation patterns
that would be interrupted by drilling.
If we continue to pursue aggressive resource extraction on the
public lands without regard to increased recreational demands we will
sacrifice the long term for the short term. By definition an oil well
is a short term economic engine, whereas land in its pristine form can
provide a living for guides and outfitters and those that make tents,
and raincoats and bicycles and boats forever. So I urge you to add
language to your bill requiring all land management agencies to
consider long term recreational patterns, visitation, economic
benefits, and social impacts before leases are awarded.
______
Response to questions submitted for the record by Ashley Korenblat
1. Our federal lands are precious resources to be utilized to the
benefit of all Americans. At the same time, these resources are
needed to provide fuel for the American public. Do you believe
there is a balance in which we can maintain the federal lands,
but also provide fuel for the economy and sustainability of the
American public?
Yes, and one step towards maintaining that balance would be to add
language to the Energy Bill which would require land managers to
consider the recreation economy before lands are leased for oil and gas
activities. Since oil and gas are non-renewable resources, an oil or
gas well is a short term economic engine, whereas land in its pristine
form can fuel the outdoor industry indefinitely. In most cases,
recreation considerations would result in reducing leased acreage by
less than 3%.
Some members of the committee may feel that sacrificing even as
little as 3% is not possible given the intense and growing demand for
energy worldwide. Yet we all agree that oil and gas are finite
resources. Prices will go up as supply dwindles. As a business person,
I ask you to have more faith in the scientists and entrepreneurs of our
country. Necessity will lead to invention and the necessity is upon us.
We will find a cheaper cleaner source of energy and clinging hopelessly
to the oil and gas establishment is only delaying that transition.
The small percentage which the Outdoor Industry requires will not
solve the energy crisis or delay the need to begin the transition. I
have been warned that you may see the consideration of recreational
needs as micromanagement within the Energy Bill, but if those lands are
all leased, you will do permanent damage to the $730 billion outdoor
industry.
You speak of sustaining the American public, how can we sustain
them if we do not sustain the earth? In my business, I have already
noticed distinct changes in weather patterns all over the US. Global
warming and its dramatic effect on weather patterns will ultimately do
more damage to the U.S. economy than the very predictable rise in fuel
prices. Businesses can plan for increased fuel prices, they cannot plan
for unpredictable natural disasters.
As leaders of our nation, you have the opportunity to make one of
the most important decisions in the history of mankind. Initiate the
transition away from oil and gas dependency before we have done
irreversible damage to the earth and its ability to sustain the
American public. Including language to protect the recreation economy
in the Energy Bill is a step you can take in the right direction.
______
Mr. Grijalva. Thank you very much.
Ms. Moseley.
STATEMENT OF CLAIRE M. MOSELEY,
EXECUTIVE DIRECTOR, PUBLIC LANDS ADVOCACY
Ms. Moseley. Thank you, Mr. Chairman and Mr. Pearce for
inviting me to testify here today.
I am Claire Moseley. I am Executive Director of Public
Lands Advocacy in Denver, Colorado. At the risk of divulging my
age, I have been working on public lands issues for 29 years,
since 1978. Since that time I have seen oil and gas come under
increasing criticism for turning to the last frontier left in
the United States, public lands for domestic energy supplies,
and it has become a partisan issue, which is unfortunate.
Yes, energy is a large, even huge, industry, but it
wouldn't exist if there weren't a huge demand for the goods and
services it provides. We currently import 60 percent of our
oil. We import 15 percent of our natural gas, but we shouldn't
have to import gas. We have adequate natural gas resources in
the U.S. to avoid the same problem we have with oil.
A fact that appears to be consistently ignored is that
consumer demands are not diminishing. They are increasing at a
rate where demand is projected to outstrip supply by 2025
unless something is done to avoid it.
According to the USGS, an estimated 69 percent of oil and
51 percent of natural gas lie beneath public lands. However, we
are locked out of most of these areas since 51 percent of the
oil and 27 percent of the gas is entirely withdrawn from
leasing. The lands not withdrawn are subjected to high-level
lease stipulations, restrictions, and conditions of approval to
the point where in many areas we are subject to no surface
occupancy.
This could hardly be construed as leasing being the
dominant use of the public lands. In fact, as you hear earlier
this morning, the operations on public lands, my figure is less
than 1 percent, BLM said less than 2 percent. Regardless of
what it is, it is still very minimal. There is grumbling that
industry doesn't deal fairly with surface landowners who bought
land underlain by Federal minerals. Yet industry follows the
law and the regulations, and makes a good faith effort to reach
agreements with the landowners for surface damages. BLM found
in recent studies that were discussed this morning under EPCA
that of the thousands of wells drilled on split estate lands
fewer than 20 cases exist where they have had to bond off, so
to speak, onto those properties.
It must also be noted that BLM determines the amount of the
bonds. It is not a function of the industry. Nevertheless,
industry has taken many steps, as you all know in my written
testimony, to try to improve the relationships with the
landowners. States have also passed legislation that have
addressed at a local level issues that address their specific
needs. There is no need for a one-size-fits-all approach to
this issue.
Recently, the statutory categorical exclusions for oil and
gas activities have come under fire. There are concerns that
the CXes will bypass the NEPA process, but that is not the
case. Categorical exclusions are actually part of the NEPA
process. They are only available for use in cases where
adequate NEPA analysis has already been done and no good reason
exists to go through a new costly analysis.
I would also like to point out that just because an action
is excluded from additional review that the lease stipulations,
the permit conditions of approval and site-specific inspections
to determine resource conflicts are still required, including
evaluation of wildlife concerns. Elimination of these
categorical exclusions will slow down critically needed
development of new resources for no good reason.
Produced water from the Powder River Basin has also come
under fire. Companies who produce coalbed natural gas are
allowed by state and Federal law to discharge excess water into
the Tongue River and its tributaries because it meets the water
quality standards that have been set by the Federal government
and by the state departments of environmental quality. No
impairment has been found as a result of the several studies.
Nevertheless, it has been found that certain vegetation,
irrigation and farming practices may need to be changed because
of the naturally occurring sodium content of the river water.
In conclusion, PLA urges the members of these Subcommittees
to recognize that the issues I have discussed this morning do
not require Federal action, except for one. We need to allow
the processes established in the Energy Policy Act to remain in
force. It took many years to determine what would work best to
ensure the U.S. can meet its energy needs in the future by
improving its domestic supplies and while protecting the
environment. We need to make sure we avoid an embargo-like
situation such as we had in the seventies.
I appreciate this opportunity, and welcome any questions.
[The prepared statement of Ms. Moseley follows:]
Statement of Claire Moseley, Executive Director,
Public Lands Advocacy
Mr. Chairman Grijalva and Mr. Chairman Costa and members of the
Subcommittees, my name is Claire Moseley, Executive Director of Public
Lands Advocacy (PLA) based in Denver, Colorado. PLA is a nonprofit
trade association whose members include independent and major oil and
gas producers as well as nonprofit trade and professional organizations
that have joined together to foster environmentally sound exploration
and production on public lands. I would like to thank the Subcommittee
on Parks, Forests and Public Lands and the Subcommittee on Energy and
Mineral Resources for the opportunity to testify at this Oversight
Hearing on ``Land-Use Issues Associated with Onshore Oil and Gas
Leasing and Development.''
Natural gas is extremely important to the nation, not just to the
petroleum industry or the states where the resources are produced.
According to Energy Information Administration (EIA), the highest
demand states for natural gas are: Texas, California, Louisiana, New
York, Illinois, Michigan, Ohio, Florida, Pennsylvania, and New Jersey.
Conversely, the Rocky Mountain States (or Public Land States) produce
much of the natural gas required to keep the standard of living and
economies of the rest of the nation at the levels they expect. Meeting
American consumer demands for energy, which is expected to increase 23
percent by 2025, requires a tremendous investment by both industry and
the Federal government to find and produce oil and gas, refine and
distribute them and market the wide variety of products derived from
them.
It should be noted that the energy we consume today is possible
only through investments made years ago, which includes energy research
and development, acquisition of 3D geophysical surveys, and development
of new drilling, completion and production technologies; all of which
have has resulted in a smaller, less obtrusive footprint and improved
environmental and reclamation practices. Our industry continues to
pioneer the development of alternative energy and to expand the use of
existing sources of energy. According to the American Petroleum
Institute, from 2000 to 2005, the U.S. oil and natural gas industry
invested an estimated $98 billion in emerging energy technologies,
including renewables, frontier hydrocarbons such as oil shale, tar
sands, and gas-to-liquids. This represents almost 75 percent of the
total $135 billion spent on emerging technologies by all U.S. companies
and the federal government. Industry is also actively investing in
second generation biofuels research and research to find better ways to
reduce greenhouse gases.
According to the United States Geological Survey (USGS) an
estimated 69 percent of the nation's undiscovered oil and 51 percent of
its natural gas resources lie beneath Federal public lands. However,
for much of the last century, most of the oil and gas was produced from
state and private lands. As these resources have become depleted,
industry has been forced to seek out new sources on public lands to
meet growing demand for energy supplies. It is important to our
discussion today to put industry's activities on the public lands into
proper context. Industry does not seek out new resources from withdrawn
lands such as Wilderness Areas, National Parks, National Monuments,
Wilderness Study Areas, Wild and Scenic Rivers or National Wildlife
Refuges, which comprise nearly 50 percent of Federal land, but rather
on those lands found compatible with oil and gas leasing and
development through the federal land use planning process.
BLM is responsible for carrying out a variety of programs for the
management and conservation of resources on 261.8 million surface
acres, as well as 700 million acres of subsurface mineral estate, These
public lands make up about 13 percent of the total land surface of the
United States and more than 40 percent of all land managed by the
Federal government. In FY 2005, the Federal Treasury collected over
$2.3 billion from mineral royalties, rents and bonuses, half of which
went back to the States.
Onshore public lands, particularly those in the Rocky Mountain
West, are vitally important to the energy future of the United States.
According to the EIA, the Rocky Mountain region is on the verge of
surpassing the Gulf Coast as the largest supplier of natural gas to the
nation. The National Petroleum Council in its 2003 study, Balancing
Natural Gas Policy--Fueling the Demands of a Growing Economy, found
that ``abundant natural gas resources exist in North America'' and
identified the Rockies region as the most prospective area for
development of new natural gas supplies. The study cautions, however,
that ``the recent tightening of the natural gas supply/demand balance
places greater urgency on addressing the future of this important
energy source and resolving conflicting policies that favor natural gas
usage, but hinder its supply'' and points out that new and continued
development of this vital resource can occur only if the importance of
allowing reasonable access to natural gas reserves is recognized.
The Nation is in desperate need of reasonable energy policies that
provide access to conventional energy supplies, encourage energy
efficiency, and promote continued development of new energy
technologies and to expand the use of existing sources of energy.
Clearly, there is a great need for reasonable access to public lands
and minerals.
OIL AND GAS LEASING
The Mineral Leasing Act of 1920, as amended, and the Mineral
Leasing Act for Acquired Lands of 1947, as amended, give the Bureau of
Land Management (BLM) responsibility for oil and gas leasing on public
lands administered by BLM, National Forest, and other Federal lands, as
well as private lands where mineral rights are retained by the Federal
Government. Public lands are available for oil and gas leasing only
after they have been evaluated through the BLM's multiple-use planning
process. That is not, however, the only analysis that is conducted
before a lease is issued and drilling activities are permitted.
Before a lease can actually be issued, BLM conducts a
Determination of NEPA Adequacy (DNA) to ensure resource conditions have
not changed since the Resource Management Plan (RMP) was completed and
that leasing is still an appropriate use of the area.
After a lease has been issued and a company seeks to
access its lease for exploration or development, a project level
Environmental Assessment (EA) or Environmental Impact Statement (EIS)
is prepared which analyzes and discloses the impacts of the proposed
undertaking.
When a specific well location is identified by an oil and
gas operator, a subsequent site-specific NEPA analysis and onsite
inspection is conducted before the drilling permit is approved.
As can be seen, before surface disturbance activities for oil and
gas related activities can occur several levels of NEPA analysis have
taken place, all of which are subject to public involvement. It must
also be noted that during each level of analysis, new mitigation
requirements to protect sensitive resource values are often identified
and imposed by the land management agency.
Recently, disingenuous claims have been raised that BLM's
predominant focus is on leasing for oil and gas. The oil and gas
program is one of many priorities for BLM, ranging from cultural
resources to water and wildlife, so it is simply untrue that oil and
gas dominates over other programs despite the revenue it generates for
the Federal Treasury. Moreover the BLM works with states with respect
to air and water quality issues. According to BLM figures, of the $3.2
billion collected in revenue from BLM programs in FY 04, $2.4 billion
were received in mineral royalties, lease rentals and bonus bids. The
remaining revenue of $778,411,189 was received from grazing,
recreation, timber, rights-of-way and other BLM programs.
Despite the huge revenue generated from oil and gas activities,
producing oil and gas leases cover less than 1/2 of 1 percent of the
261.8 million acres of public lands and the additional 700 million
acres of federal mineral estate. Oil and gas operations on these leases
are subject to varying levels of restrictions imposed through the land
use planning process to protect other resources associated with these
leased lands. In addition, proposed activities are required to conform
to with BLM supervised environmental analyses, either through an EA or
an EIS, both of which are driven by public involvement.
In late 2006, the Departments of Interior, Agriculture and Energy,
through their respective agencies, completed a study required by
Congress through the Energy Policy Act of 2005, which expanded upon on
an earlier report published in 2003 pursuant to the Energy Policy and
Conservation Act of 2000, or EPCA. In the 2003 report, the agencies
were only required to analyze actual stipulations placed on leases.
However, the agencies were directed by the Energy Policy Act of 2005 to
also consider conditions of approval on specific projects or permits
that are not included as lease stipulations. The eleven areas
inventoried in the 2006 study included six new oil and gas basins in
Alaska, the Rocky Mountain West and the East, in addition to the five
basins studied in 2003. The newly inventoried area is estimated to
contain 187 trillion cubic feet of natural gas and 21 billion barrels
of oil, which represents 76 percent of onshore Federal oil and gas
resources.
Within the 99 million acres inventoried, the 2006 study found that
just 3 percent of onshore Federal oil and 13 percent of onshore Federal
gas are accessible under standard lease terms, while 46 percent of
onshore Federal oil and 60 percent of onshore Federal gas are subject
to additional restrictions, including timing limitations for wildlife
concerns, controlled surface use for cultural or other sensitive
resources, as well as no surface occupancy which often renders the
lease essentially useless. The study found that in the inventory areas,
51 percent of the oil and 27 percent of the natural gas reserves on
federal lands are presently closed to leasing. These figures clearly
demonstrate that while the oil and gas program is, indeed, a priority
program for the agencies, the program is administered with overriding
protection of other values.
Conclusion: PLA urges that a balance between oil and gas
exploration and development and the protection of the environment and
other uses be maintained. Despite certain claims, in reality this has
not yet occurred because only 3 percent of onshore Federal oil and 13
percent of onshore Federal gas are accessible under standard lease
terms, while 46 percent of onshore Federal oil and 60 percent of
onshore Federal gas are subject to additional restrictions, including
timing limitations for wildlife concerns, controlled surface use for
cultural or other sensitive resources, as well as no surface occupancy.
Of greatest concern and according to BLM's own figures, 51 percent of
the estimated oil and 27 percent of the gas on Federal lands are
presently closed to leasing.
We acknowledge that the Federal government is following its
multiple-use mandate from the Federal Land Policy and Management Act
(FLPMA) by allowing oil and gas activities to occur. We strongly urge,
however, that production of new oil and gas supplies, along with
protection of the environment and the interests of private landowners
be better balanced for the sake of the country's future.
SPLIT ESTATE
Surface owners and mineral owners are neighbors. Like many
neighbors, they don't always agree. However, it must be recognized that
multiple state and federal agencies regulate the oil and gas industry.
As such, laws and rules are in place to protect land, water, air,
humans and wildlife. Suggestions that federal minerals are developed
without this oversight are patently false. Implications that problems
exist between all surface and mineral owners are equally false. Where
conflicts do exist, they constitute a very small percentage of the
overall activity. Legislators and regulators should analyze the true
magnitude of a perceived problem before reacting.
Existing federal mineral / private surface reclamation bonding
requirements:
43 CFR 3104--``Prior to commencement of surface
disturbing activities...an operator shall submit a surety or personal
bond...to ensure compliance with the act, including complete and timely
plugging of the well(s), and the restoration of any lands or surface
waters adversely affected by lease operations after the abandonment or
cessation of oil and gas operations on the lease(s)...''
43 CFR 3104.2--``A lease bond may be posted...in the
amount of not less than $10,000 for each lease conditioned with all of
the terms of the lease...''
43 CFR 3104.3(a)--``In lieu of lease bonds...operators
may furnish a bond in an amount of not less than $25,000 covering all
leases and operations in any one State.''
43 CFR 3104.3(b)--``In lieu of lease bonds or statewide
bonds...operators may furnish a bond in an amount of not less than
$150,000 covering all leases and operations nationwide...''
In addition to posting a reclamation bond, the oil and gas industry
is also required by regulation to make good faith efforts to gain
consent from all surface owners who obtained their property in
accordance with the Stock Raising Homestead Act before BLM will approve
an APD. If permission cannot be obtained, operators must comply with
certain bonding requirements before it can proceed with development, as
required by 43 CFR 3814.
The Department of Interior recently revised its Onshore Order No. 1
(OO#1) which clarifies the policy, procedures, and conditions for
approving oil and gas operations on split estate lands.
OO#1 directs that BLM will not consider an APD (Application for
Permit to Drill) or SN (Sundry Notice) administratively or technically
complete until the federal lessee or its operator certifies that an
agreement with the surface owner exists, or until the lessee or its
operator complies with bonding requirements under the Order. Compliance
with the Order requires the Federal mineral lessee or its operator to
enter into good-faith negotiations with the private surface owner to
reach an agreement for the protection of surface resources and
reclamation of the disturbed areas, or payment in lieu thereof, to
compensate the surface owner for loss of crops and damages to tangible
improvements, if any.
Under the Stock Raising Homestead Act, there is a bonding
requirement that has a $1,000 minimum at the discretion of the BLM
officer to cover surface damages to tangible improvements or crops
above and beyond the reclamation bond that is already in place. [43 CFR
3814] With this bonding mechanism and policy guidance in place, the
process encourages landowners to negotiate with operators for
acceptable surface damage payments verses the minimum bond.
Oil and gas operators are required to work through an exhaustive
process that includes surface owners and multi-agency consultations or
approvals before development may occur. Additionally, the federal
permitting process provides the private landowner with the opportunity
to participate in an on site inspection of the well location in order
to accommodate the landowner's needs in conjunction with the federal
decision to approve the well permit.
BLM has a statutory obligation to maximize the recovery of federal
minerals, avoid waste and prevent drainage from occurring while
providing protection for other resources.
Wyoming Split Estate Initiative
The Wyoming Split Estate Initiative was established in the summer
of 2002 with the purpose of developing protocols that both oil and gas
operators and surface owners could use to minimize or alleviate
conflicts, while fostering cooperation between the parties. The
Initiative recognizes that Surface Use Agreements are a private
contract between the landowner and the operator.
The partners involved in the initial organization of the Wyoming
Split Estate Initiative include: Petroleum Association of Wyoming,
Wyoming Wool Growers Association, Wyoming Stock Growers Association,
and the Wyoming Farm Bureau Federation. The United States Department of
Agriculture Natural Resources Conservation Service (NRCS), Wyoming
Association of Conservation Districts (WACD), and the Wyoming Oil and
Gas Conservation Commission (WOGCC) instrumental in developing this
Protocol. The Wyoming Department of Agriculture Natural Resource and
Mediation Board also participated. The overriding goals of this effort
include:
Minimizing or preventing conflict between landowners and
operators while maximizing cooperation where oil and gas development
occurs in areas of split ownership;
Enhancing and encouraging responsible development of
minerals and continued agricultural productivity while maintaining and
promoting land, water, air, and wildlife resources;
Providing a forum for conflict resolution.
The Wyoming Split Estate Initiative is quite comprehensive and
provides for public education and information regarding split estates
where oil and gas development occurs; an advisory (technical review),
mediation (if necessary), and binding/non-binding arbitration process
(if necessary); suggestions for improved communication between the
landowner and operator; and options/alternatives to be considered by
both parties during the Surface Use Agreement negotiations.
The final Wyoming Split Estate Initiative and implementation of
educational programs and presentations were set in place July 7, 2003.
The Initiative has been very successful in assisting parties to reach a
successful negotiation. The Wyoming Department of Agriculture and
Natural Resources Mediation Program, which was the basis of the Wyoming
Split Estate Initiative, was also included in the Wyoming Surface
Owners Accommodation law that was recently passed. The legislature saw
that program as being very beneficial to the parties to resolve
conflict and has had an 80 percent success ratio.
New Mexico ``Good Neighbor'' Initiatives
The New Mexico Oil and Gas Association and its members, working
with the Petroleum Recovery Research Center at New Mexico Tech,
established the Good Neighbor Initiatives which demonstrates their
dedication to responsible development of New Mexico's oil and gas
resources. The Initiative acknowledges that responsible development
includes good relationships with their neighbors and a commitment to
environmental and human protection. NMOGA and member companies have
pledged to be a ``Good Neighbor'' in the areas where they operate.
This policy describes specific areas where industry actions as
``good neighbors'' are especially important, i.e., companies will
listen to the landowner, lessee permittee, and/or resident concerns and
respond appropriately; personnel (company employees and contractors)
must respect rights-of-way; protect livestock/wildlife; drive safely;
report damages to public/private property to the appropriate parties;
assure mechanical integrity of production systems; and ensure that
personnel know and understand the rules and regulations applicable to
our operations.
In order to achieve industry's goals, a host of measures have been
adopted:
Companies will strive to increase communication with the
landowner, lessee, permittee and/or residents
Companies and company contractors will respect the
property and the rights of others
Companies will promote public safety
Companies will promote the responsible maintenance and
use of roads
Companies will protect the environment
Companies will emphasize education by educating our
personnel about being a good neighbor
Companies will communicate with appropriate government
officials, including city and county officials
The oil and gas industry will be proactive in building
relationships with city, county, state and federal officials
Adoption of these principles has significantly improved the working
relationship between New Mexico oil and gas operators, land owners, and
State and Federal government officials.
It is important to note that other industry trade groups are
working to adopt similar initiatives in their states as well as at the
national level. Clearly, industry has taken the issue of working
closely with its neighbors, landowners, and government officials very
seriously, thereby advancing good relationships. To that end, industry
is committed to ensuring private landowners are treated with respect
and given opportunities to work with oil and gas operators in a
meaningful way in order to eliminate possible conflicts.
Conclusion: BLM has done a good job of soliciting feedback from
landowners and industry alike in order to determine how best to address
the split estate issue. Split-Estate Open Houses were held throughout
the country in order to comply with directives contained in the Energy
Policy Act of 2005 that required studies to be conducted on Split
Estate Rights and Responsibilities under Existing Mineral and Land Laws
and Surface Owner Consent Provisions under SMCRA. Through the open
houses and comments received BLM found that very few actual conflicts
existed and that the current process has proven to work reasonably
well. This is supported by the fact that out of the thousands of wells
drilled on split-estate lands, there are fewer than 25 cases, according
to BLM, where surface use agreements could not be reached and operators
were required to post a bond in accordance with the provisions of the
Stock Raising Homestead Act.
As you can see, the energy industry has implemented several new
programs whereby codes of conduct have been established to ensure
improved relationships with private landowners. To date, these have
proven successful. Moreover, some western states have passed (Wyoming
and New Mexico) or are considering legislation to address perceived
problems between surface owners and mineral operators. Therefore, PLA
recommends that Congress let this issue be handled at the state level
in accordance with the specific needs identified locally.
CATEGORICAL EXCLUSIONS
Categorical Exclusions represent one of three possible avenues for
fulfilling the requirements of the National Environmental Policy Act,
the other two being Environmental Assessments (EAs) and Environmental
Impact Statements (EISs). Categorical Exclusions (CX) have been in use
for many years and are defined at 40 CFR Sec. 1508.4:
``'Categorical exclusion' means a category of actions which do
not individually or cumulatively have a significant effect on
the human environment and which have been found to have no such
effect in procedures adopted by a Federal agency in
implementation of these regulations (Sec. 1507.3) and for
which, therefore, neither an environmental assessment nor an
environmental impact statement is required....Any procedures
under this section shall provide for extraordinary
circumstances in which a normally excluded action may have a
significant environmental effect.'' [Emphasis Added]
Congress decided in the Energy Policy Act of 2005 to establish
three statutory CXs associated with drilling of wells. Following is a
discussion of these CXs and why they are appropriate.
1. Individual surface disturbances of less than 5 acres so long as
the total surface disturbance on the lease is not greater than 150
acres and site-specific analysis in a document prepared pursuant to
NEPA has been previously completed.
Before a lease can be issued, a land use plan specifying what
stipulations are required to protect sensitive resource values will
have been completed. The drilling permit would have to conform to these
requirements and abide by any other conditions imposed by the agency to
protect additional resource values. This provision would expedite minor
drilling and permitting in areas outside an existing field. If a well
is within an existing field, it would have to conform to the field
development analysis.
2. Drilling an oil or gas well at a location or well pad site at
which drilling has occurred previously within 5 years prior to the date
of spudding the well.
A site-specific analysis of a well location/site will have already
been completed and approved and conditions already implemented.
Therefore, it is wasteful and duplicative to conduct another analysis
simply because the operator wants to drill another well from same pad,
reenter the well bore or move the bore a few feet on the same pad. Even
if additional wells would require a minor expansion (less than an acre)
of the original pad, it will still result in much less disturbance than
a brand new well pad.
3. Drilling an oil or gas well within a developed field for which
an approved land use plan or any environmental document prepared
pursuant to NEPA analyzed such drilling as a reasonably foreseeable
activity, so long as such plan or document was approved within 5 years
prior to the date of spudding the well.
A cumulative impacts analysis in association with a field
development NEPA document would have already been completed and as long
as the well(s) is in conformance with the development analysis and the
operating requirements prescribed therein there is no need for further
analysis.
The Western Governors' Association (WGA) passed a resolution urging
Congress to amend Section 390 of the Act to ``remove [the 3rd]
categorical exclusion for NEPA reviews for exploration or development
of oil and gas in wildlife corridors and crucial wildlife habitat on
federal lands. By removing the categorical exclusion, appropriate
environmental site analysis will be completed as necessary to protect
crucial wildlife habitat and significant migration corridors in the
field of development.''
In addition, the WGA has asked the ``Secretaries of Interior and
Agriculture to consider placing a moratorium on such categorical
exclusions in crucial habitat or migration corridors and to work
collaboratively with the states to ensure that states' concerns in
preserving wildlife migration corridors and crucial wildlife habitats
are met.''
The criticism that this statutory CX bypasses adequate NEPA
analyses in favor of oil and gas exploration and development at the
expense of other resources is unfounded. Depending upon the CX that is
applicable for a specific action, there must have been a NEPA analysis
that addressed such an action as part of its reasonably foreseeable
development scenario or full field development analysis. Moreover,
multiple wells could be developed from a location that had already been
approved through a NEPA review.
Conclusion: PLA believes the concern of the WGA may be eased by an
understanding of the process used by BLM to grant CXs. It is not, by
any stretch, a tool that can be used to elevate oil and gas uses over
and above other uses or a policy that well permits will be approved
without proper consideration of surface resource values. No CX can be
approved unless the action meets the test of NEPA adequacy. It must
also be recognized that all lease stipulations, conditions of approval,
and operating standards are still in force. Furthermore, most of the
CXs that have been approved were based upon project level environmental
documentation rather than resource management plans. Nevertheless, even
in situations where the RMPs are the basis for granting an exclusion,
careful, site-specific consideration of all resources, including
wildlife, is given before the exclusion is granted.
MONTANA/WYOMING WATER ISSUES
My testimony this morning will focus on CBNG produced water in the
Powder River Basin of Wyoming and Montana. Please do not infer my
comments as being applicable to all oil and gas, especially CBNG
produced water. CBNG produced water quality varies greatly throughout
the producing basins in the United States.
The quality of groundwater produced by coalbed natural gas
operations has become a hotly debated issue among the public, State and
Federal agencies, special interest groups and industry. As background,
methane natural gas can be recovered from wells when groundwater
contained in coal seams is pumped to the surface to reduce pressure
allowing the gas to be recovered. Coalbed natural gas (CBNG) water is
naturally-occurring groundwater; no chemicals or sodium are added to
the water by drilling or production activities.
According to studies conducted by independent researcher Schafer
Limited LLC, using data supplied by the United States Geological Survey
(USGS) and other agencies, the quality of Powder River Basin CBNG water
is suitable for drinking, livestock, wildlife and crop irrigation uses.
For example, water from coal seams is often used as drinking water
because it is often of higher quality than other available water
sources and meets primary Federal Safe Drinking Water Act and Montana
Water Quality Act standards. Primary standards have been established
for chemicals that may be harmful to public health. These standards
consider the health effects of the chemicals as well as the feasibility
of removing the harmful chemicals through treatment. There are other
standards that apply to the esthetic value of water, i.e., taste, which
does not mean the water isn't suitable for domestic uses; one just may
not enjoy drinking it.
CBNG water, because of its low to moderate level of salinity, is
either the same or better than many local water sources used for
livestock operations. According to studies conducted by the National
Academy of Sciences (NAS), CBNG water is appropriate for livestock use.
In fact, in parts of southeast Montana, many surface waters contain
such high concentrations of salt, that CBNG water is placed in storage
ponds to provide a source of stock water for use by livestock
operations.
The quality of irrigation water presents a more complex situation
because water suitability rests with the types of crops being grown,
the soil type and irrigation methods. Crops differ in their ability to
tolerate salinity levels and soils differ in their ability to tolerate
sodicity levels. Most of the forage crops (alfalfa) grown in the Powder
River Basin are tolerant to the salinity (1500ppm TDS) of
CBNG produced water The main factor when using CBNG produced water for
irrigation is the permeability of the soil to be irrigated.
Permeability must be high enough so the soil can be revitalized by
using flood or sprinkler irrigation methods. Due to the sodicity of
CBNG water, there is a high permeability hazard which limits its use on
many soils. However, several managed irrigation sites using soils
amendments such as gypsum (a form of calcium) are demonstrating that
CBNG-produced water can be used for irrigation while protecting soil
quality.
With respect to protection of aquatic life, management
opportunities exist where CBNG water is discharged into surface water.
It must be noted that any such discharge must meet the requirements of
the Federal Clean Water Act and the standards implemented by the
Wyoming and Montana Departments of Environmental Quality, which require
non-degradation of water in order to preserve it at its current levels.
As such, concentrations of metals in produced water discharged into
other waters are typically kept at levels that are lower than for
personal drinking water. It is acknowledged that concern was raised by
some researchers regarding the potential toxicity of bicarbonate ions
in CBNG water that may be discharged into rivers. However, toxicity
testing over time using CBNG water showed a much lower toxicity than
was predicted by research models, indicating that discharge of CBNG
water into Montana and Wyoming Rivers appears not to be harmful aquatic
organisms.
Tongue River
There have been recent claims that CBNG discharge into the Tongue
River has had a detrimental impact on the river's water quality. This
charge is unfounded. The USGS has been collecting daily streamflow data
and periodic water quality samples at 12 monitoring sites, ranging from
Monarch, WY (just north of Sheridan, WY) all the way up to Miles City,
MT along the Tongue River since the early 1970s. These monitoring
stations cover 7 mainstem sampling sites and 5 tributary sampling
sites. The State of Montana and EPA have also conducted a major
investigation of the Tongue, Powder and Rosebud Creek watershed as part
of their Total Maximum Daily Load (TMDL) assessment program. As part of
the assessment, a basin-wide predictive water quality model was
developed for the Tongue River. The model uses climate data, land use
and the quality and quantity of discharged water, including CBNG water.
Results of these studies have found that the Tongue River above the
T&Y Irrigation Diversion Dam where the CBNG development takes place is
currently meeting water quality standards. In fact, it was found that
even if all permitted discharges operated at their maximum allowable
level (which rarely occurs) the River would continue to meet water
quality standards established by both Federal and State laws.
However, it has also been revealed that below the T&Y Irrigation
Diversion Dam water quality standards are often exceeded during the
irrigation season when nearly all the water in the Tongue River is
diverted into the T&Y Canal. During this time, the water in the lower
Tongue River is limited that that which is accumulated from localized
groundwater inflows and irrigation return flow, which does not derive
from CBNG water that was discharged above the T&Y Diversion Dam.
Clearly this information demonstrates that the water quality of the
Tongue River above the T&Y Diversion Dam was found unimpaired by CBNG
development or any other use, while below the T&Y Diversion Dam
impairment due to salinity and/or sodium exists and is caused by
irrigation water uses.
Additional data generated by the USGS Montana Water Science Center
along the Tongue River Surface-Water-Quality Monitoring Network has
also been collected through the Tongue River Agronomic Monitoring and
Protection Program (AMPP) The AMPP study involved the identification of
soil characteristics and the monitoring of soil quality and crop
yields. The Study's finding indicated that soils physical and chemical
characteristics did not change as a result of CBNG development but
rather, differences in crop yields were the result of farming
practices.
Conclusion: All water produced from CBNG must meet specific
narrative and numeric standards. According to data and studies
conducted by independent researchers as well as USGS Montana Water
Science Center and EPA it has been shown unequivocally that CBNG water
discharged into the Tongue River and its tributaries has had no impact
on the water quality of the River. Rather, it appears water quality
problems associated with the Tongue River are caused by farming and
irrigation practices. In addition, many landowners in the Powder River
Basin have found that CBNG water provides many beneficial uses,
including drinking water, livestock water and irrigation when it is
coupled with various treatments. Consequently, there is no need for
Congress to consider legislative measures to fix a problem that does
not exist.
Thank you for this opportunity to provide you with testimony this
morning. I will be happy to answer any questions.
______
PUBLIC LANDS ADVOCACY
10200 East Girard Avenue, Suite C-141, Denver CO 80231
Phone (303) 303-750-3333 * Cell 303-506-1153 * Fax (866) 718-2692
Email [email protected]
May 24, 2007
The Honorable Jim Costa
Chairman, Energy and Mineral Resources Subcommittee
The Honorable Raul M. Grijalva
Chairman, National Parks, Forests and Public Lands Subcommittee
Committee on Natural Resources
The Honorable Stevan Pearce
Ranking Member of the Energy and Minerals Subcommittee
US House of Representatives
Washington, DC 20515
Re: Response to Questions from April 26 Hearing, House Resources Joint
Subcommittee on Parks, Forests and Public Lands and the Subcommittee on
Energy and Mineral Resources Oversight Hearing on ``Land-Use Issues
Associated with Onshore Oil and Gas Leasing and Development''
Dear Sirs:
Public Lands Advocacy (PLA) appreciated the opportunity to provide
testimony before the Joint Subcommittee oversight hearing on ``Land-Use
Issues Associated with Onshore Oil and Gas Leasing and Development.''
Following are answers to your post-hearing questions.
1. What, in your opinion and previous experience, would be the effect
of repealing Sec. 366 of EPAct 05 that require BLM be
accountable to a timeframe for the processing of Applications
of Permit to Drill?
The 30-day approval time frame for Applications for Permit to Drill
(APD) was part of a strategy by Congress to establish BLM
accountability in the Federal oil and gas permitting process. Over the
past decade, permit processing time frames slipped to a point where it
would sometimes take the agency as long as 2 years to process a single
APD, which led to a backlog of thousands of applications. Of note, many
of these APDs were for in-fill development, i.e., new wells in existing
fields for which the requirements of NEPA had already been met. As a
result of the new time frame established in EPAct 2005, BLM has taken
steps to monitor permit approvals to ensure they are acted upon in a
timely manner.
If Section 366 were repealed, it would mean domestic production of
natural gas is not important to the Nation. Severe gas supply shortages
would result, creating an even greater rift between supply and demand
of the resource and higher prices for consumers.
Production from traditional U.S. and Canadian basins is declining
because these supplies are produced from mature fields. Therefore, it
is crucial that new conventional and non-conventional sources of
natural gas be developed, such as coalbed natural gas, tar sands and
oil shale, on public lands. There are abundant North American natural
gas resources in the Rocky Mountain region outside designated
wilderness and national park-type lands that are presently closed to
leasing which could play a key role in providing future natural gas
supplies if Federal leasing and permitting processes are responsive to
the need. Outside of leasing and development of new conventional and
non-conventional resources, a key factor in meeting demand is to ensure
permits are approved within a 30-day time frame, provided they meet the
criteria of a complete APD and meet the environmental protection
requirements established through land use and project level planning.
2. As you know, oil and gas are a much sought after global commodity.
With state-owned companies and the OPEC in control of a
majority of the global market, do you feel the success of the
federal leasing program at the BLM has national security
implications?
Yes. Although some new oil and gas fields have been discovered here
in the US, energy demand has grown at a much higher rate than supply,
which has caused us to become even more dependent on foreign imports of
oil and natural gas. Also, there has been a shift from oil to gas
because as a clean burning fuel, gas can replace oil in many of its
traditional uses, such as home heating fuel, power generation,
industrial use and, to limited extent, as a transportation fuel.
However, the importance of bringing more natural gas to the North
American market is crucial because in so doing future market volatility
and fuel shortages can be diminished.
Although the Rocky Mountain region is projected to contain nearly
double the reserves of natural gas than both coasts and the Gulf of
Mexico combined, many of these areas are off-limits to leasing. Since
most sources of energy on private lands have already been discovered,
it is crucial that we expand the search for new energy to Federal land.
That is why the success of the BLM leasing program is of vital
importance to the nation as a whole. For the U.S. to secure energy for
our economy, government policies must create a level playing field for
U.S. companies to ensure international competitiveness. The net effect
of current U.S. policy serving to inhibit U.S. oil and gas production
and to increase our reliance on imports is, in fact, a matter of
national security.
Questions from Minority Members
1. Why do we have federal split estates? In a split estate situation,
what is the dominant estate? Why? When one buys federal split
estate lands, is that land conditioned?
The United States government encouraged settlement and economic
development of the West by reserving the mineral estate in land patents
granted to homesteaders and others. This approach opened western lands
for immediate agricultural and ranching development and reserved the
mineral rights for later development. Split estate occurs when there
are different owners of the mineral rights and surface rights. There
may be federal mineral ownership with private surface or private
mineral ownership with federal surface.
The split-estate lands in question are those where the surface
rights and mineral rights were severed under the terms of the Nation's
homesteading laws. These and other Federal laws give BLM explicit
authority and direction for administering the development of Federal
oil and natural gas resources beneath privately owned surface:
Coal Lands Acts of 1909 and 1910
Agricultural Entry Act of 1914
Stock Raising Homestead Act of 1916
Mineral Leasing Act of 1920 and amendments
Federal Land Policy and Management Act of 1976
It is important to remember that split estate owners obtained their
surface lands subject to development of the mineral estate. Established
legal doctrine preserves the ``dominance'' of the mineral estate
reflecting the fact that the mineral estate would have no value if the
mineral owner did not enjoy access to the minerals through reasonable
terms. This dominance extends to federal minerals where the revenue
generated to the Federal Treasury exceeds billions of dollars annually.
In fact, it is the policy of the Federal government to retain mineral
rights only when it is determined that mineral potential exists. When
private landowners purchase their land, they are notified of the split
estate situation as required by law.
While in some states disclosure to buyers of severed surface rights
is required, disclosure of the severed mineral estate may not have been
common practice by realtors or sellers in areas where such requirements
do not exist. Therefore, situations have arisen where surface owners
are unaware that the Federal government has retained the mineral rights
and that reasonable access to explore for and develop those minerals is
required by Federal law.
Thousands of leases have been issued on America's public lands for
the purpose of providing clean burning natural gas supplies for the
nation. Any efforts by the federal government to change existing split
estate practices will impact the nation's domestic natural gas supply
by imposing unreasonable burdens on lessees of the mineral estate.
2. Other witnesses in their testimony advocate for Mr. Udall's H.R.
1180 because it would ``require reclamation of the site to
support the same uses it was capable of supporting prior to
development.'' Isn't is true that under BLM law, BLM requires
``returning disturbed land as near to its pre-disturbed
condition as is reasonable practical or as specified in the
APD? Are these really different standards?
According to Chapter 6 of the BLM's Gold Book, Surface Operating
Standards and Guidelines for Oil and Gas Exploration and Development,
Fourth Edition, 2006, it is required that ``at final abandonment, well
locations, production facilities, and access roads must undergo
``final'' reclamation so that the character and productivity of the
land and water are restored. Planning for reclamation prior to
construction is critical to achieving successful reclamation in the
future--The long-term objective of final reclamation is to set the
course for eventual ecosystem restoration, including the restoration of
the natural vegetation community, hydrology, and wildlife habitats. In
most cases, this means returning the land to a condition approximating
or equal to that which existed prior to the disturbance.'' In order to
ensure satisfactory reclamation, the Gold Book provides direction on
the specific requirements that must be met, including a detailed
Reclamation Plan that must accompany an APD that addresses:
,-- ,
Plugging the Well Road Reclamation
Pit Reclamation Reclamation of Associated
Site Preparation and Re- Facilities
vegetation Water well conversion
Pipeline and Flowline Final Reclamation
Reclamation
Well Site Reclamation
BLM ensures these requirements are met by conducting a thorough
inspection before granting final abandonment approval. In the event
agency requirements are not met, BLM will not release the liability
bond for the project until established standards are met.
Clearly, BLM's enforcement authority to ensure reclamation is
accomplished efficiently and appropriately is effective. No new
legislative requirements are needed because extensive reclamation
procedures and conditions are already in place.
Thank you for affording PLA this opportunity to provide Congress
with additional information and answers to your important questions.
Please do not hesitate to contact me should you have additional
questions or require further clarification.
Sincerely,
Claire Moseley
______
Mr. Grijalva. Thank you for your testimony.
Mr. Muggli.
STATEMENT OF ROGER MUGGLI,
NORTHERN PLAINS RESOURCE COUNCIL
Mr. Muggli. Mr. Chairman, Members of the Subcommittee,
thank you for the opportunity to testify here today.
My name is Roger Muggli, and I am here to represent the
Tongue and Yellowstone Irrigation District and it is located in
Mile City, and in our district there is 9,400 acres of
irrigated land and its water supply is from the Tongue River 12
miles south of Mile City, and it has been in existence since
1886.
I am also representing my family farm, Muggli Brothers,
Incorporated. I have been the chairman of this operation for
the last 12 years, and we have 1,700 acres of irrigated land in
this district.
We have also built a feed processing plant to process the
hay produced on our farm, and mixed with grain we make a
pelletized livestock feed, and we sell 14,000 tons of this feed
in the local area in any given winter.
I am also here representing Northern Plains Resource
Council, a family agricultural group that organizes Montana
citizens to protect water quality, family farms, and ranches,
and the unique quality of life we love here in Montana.
My grandfather came here to this valley in 1925 and bought
his first farm, and he was also manager and secretary of the
Tongue and Yellowstone Irrigation District, and sometime later
bought a few more farms, and so did my father when he came on
line, and he became manager and secretary of the Tongue and
Yellowstone Irrigation District as well in about 1957, and I
was elected to the position in 1987, and the family has been
actively involved in it for all of these years.
I also recognized another problem we had was fish going
into the canal, and I worked hard to come up with a plan to
divert the fish from our irrigation canal back into the river.
The 1987 date is when I started, and it came on line in 1999.
I guess I am here today to talk about coalbed methane gas
and its production, and how it is done. The first process is
there is a main. The main thing about that is the pressure has
to be released, and to release that pressure you have to pump
the water out of the ground in great volumes. In the Powder
River Basin, there is basically--the water is very good for
people and animals to drink, but it is fatal for plants and
aquatic life, and there are three major problems associated
with the loss of groundwater.
The first one is the loss of groundwater, and the
groundwater, first of all, when you take that much out it
amounts to about--in the Tongue River drainage, it is about
38,000 acre feet, which is enough for a population of 345,000
people, or 2.2 million head of cattle, and there is about 2.6
million head of cattle in the entire State of Montana. Also by
pumping this water out, we don't know how much water is in the
aquifer, how it got there, and how long it has been there, and
the draw down can go anywhere from 200 to 600 feet, and it may
take as long as 100 to 1,000 years for this water to recharge.
The second major problem that is associated with this is
for the ecosystem. The main constituents of this water are
harmful to aquatic life, and sodium, magnesium, and calcium is
the problem, and the fish population can--the reproductive part
of it--the fish population is--will reduce it by 94 to 96
percent in some cases, and there are some endangered species in
the river.
One of them is the famed pallid sturgeon that is barely
hanging on, and it is not even sure where they spawn in the
Yellowstone River, but it is likely they do move up the Tongue
River, and hopefully they will be able to use the bypass I am
currently working on and hope in the next year will come on
line that will allow the fish to move around the end of the 12-
mile dam, and it is sort of unprecedented. You don't see
irrigators involved in fish-saving processes, but I have worked
with this for 20 years, to try to make this a reality, and
within the next year it will be, and I hope it isn't for want
because of quality of water.
The third problem relative to water is soil and crops. The
USDA, associated with the salinity lab in California, came and
got a quarter ton sample of our dirt, and took it to
California, and raised alfalfa in it, and the conclusion was
after a two-year study that it was an SAR of two to four would
significantly reduce the ability of the water to travel into
the soil because of the clay content of the soil and the
dispersion of the surface soil affected by sodium bicarbonate.
And as the pictures show what has happened on my farm in
the last few years since this process has come into practice,
we are now this last winter, I am just finishing up with a
year-end of our pelleting season as winter is over and there
isn't the demand for our feed, so it tapers off and we are just
finished, about a third of my hay production is now gone, and
CBM is the only factor that I can attribute it to. The
fertilizer program is still the same, the rotation is still the
same. We are still managing to do everything that we have the
same except we have this clay soil and you can see from the
pictures that the big spot in the foreground of that picture is
mountain clay, and usually before this kind of a thing has
happened was that we can raise 100-bushel barley on there, and
we are about a 7 ton average on our alfalfa, so it is declining
at a very rapid rate, and there is no other explanation, and
scientific world views that at the rates that we are exposed to
CBM water in the Tongue River, that we are going to take
damages and I hope that something can be done to at least re-
inject this water and put it back into the system so we are not
affected by it, and just stop, simply stop wasting the water,
and put the water back into the river.
And Representatives Udall's H.R. 1180 will require that oil
and gas operators to replace damaged wells and require them to
submit plans stating how they will protect the water quality
and the quantity, and other resources. The Northern Plains----
Mr. Grijalva. Mr. Muggli, your whole statement will be part
of the record, and so can we get onto the questions I am going
to ask you to wrap it up as quickly as you can, and then I can
move on to the last witness.
Mr. Muggli. The Northern Plains Resource Council has been
in existence and helped us with this situation, and they have
been here for 30 years, and they intend to be here longer than
CBM is going to be here, and I hope my family farm and
irrigation can exist and still survive, but it is getting very
doubtful.
Thank you very much.
[The prepared statement of Mr. Muggli follows:]
Statement of Roger Muggli, Manager, Tongue and
Yellowstone River Irrigation District, Miles City, Montana
Mr. Chairmen and Members of the Subcommittees, thank you for the
opportunity to testify today. My name is Roger Muggli. I am here today
representing the Tongue and Yellowstone River Irrigation District,
located in and around Miles City, Montana. This district consists of
9,400 acres of land that is irrigated with water diverted from the
Tongue River, twelve miles south of Miles City.
I am also representing my family farm, Muggli Brothers Inc. I have
been chairman of this operation for the past 12 years. The farm has
1,700 acres irrigated from the T&Y canal. We have also built a
livestock feed plant that processes 14,000 tons of pellet type feed
from alfalfa, barley, wheat, field peas, and corn for horse and cattle
winter feed.
I am also representing Northern Plains Resource Council, a
conservation and family agriculture group that organizes Montana
citizens to protect water quality, family farms and ranches, and the
unique quality of life we love in Montana.
I have lived in the Yellowstone River Valley near Miles City all my
life. My grandfather, Joseph Muggli, came here in 1925 and bought a
120-acre farm. In 1930, he bought another farm that consists of 400
acres. In 1932, he became active in the T&Y Irrigation District and was
elected to the secretary/manager position. He was also one of the
authors of the 1950 Yellowstone River Compact, which defines the
percentage of water from the Yellowstone's tributaries that will go to
North Dakota, Wyoming, and Montana. This document was hard fought. In
15 years, two commissions failed to reach the goal that was finally
achieved when the compact was signed in 1950.
My father, Don Muggli, was elected secretary/manager in 1957 and
served for many years as in this position. My father and grandfather
had great engineering minds and built and rebuilt many structures on
the canal system, such as flumes, siphons, and canal checks (water
stops).
Many discussions I listened to as a kid between my father and
grandfather centered around water quality and the effects of salts on
crops and soil. They worried me so much that I wondered if the farm
could survive until I was old enough to have a shot at managing it and
the Irrigation District. I am much older now and have a better
understanding of soils and water related salts and some of the
terminology that goes with all of this. I have come to realize that my
father and grandfather were right about the threat of salts and the
impacts they have on the soils. Everyone who's lived in the Powder
River Basin for long knows not to water their lawn with groundwater,
much less use it on their crops.
At the age of five I was lucky enough to go with my grandfather
some eighteen miles south of our farm to the diversion dam up on the
Tongue River and check on all the related structures along the way.
From then on, whether I was with my dad or grandpa, it was a learning
experience. I had the privilege of going to the many fields on our farm
that were flood irrigated from the big canal. I could run around and
gather up the fish that entered the canal at the diversion dam and make
a dash on my bicycle for the Yellowstone River to release them, sparing
them from death in the field. As I got older, I tried to come up with
several plans to somehow save the fish. The only plan I came with was
to screen them from the canal in the first place.
As time passed, I came to have a burning need to do something
positive for the fish that ended up in our fields. Actually doing
something was difficult, as my father did not think saving the fish was
worth the cost. In fact, nobody in the irrigation district really
supported this idea. Everyone was afraid of the additional expense.
In 1987, I was elected manager of the T&Y. By then I had concept
plans in hand and talked to every agency and organization I could find.
From time to time, I would take a bucket with a few catfish or
smallmouth bass, sauger or whatever the catch of the day was to the
Fish and Game office and show them. Finally, they agreed there was a
problem.
More time went by, months turned into years, and in 1999 we had
completed a new inlet structure complete with a 90-foot fish louver, a
fish bypass flume that will let the fish back into the river below the
dam. The final stage of the project will be completed this year.
After all of this blood, sweat, and tears, after all the efforts we
have made to make irrigation and the fish conservation compatible, we
could lose both to decreased water quality from the discharge of
wastewater from coal bed methane development in the Powder River Basin.
All for a short-term industry that is projected to be around for
20-30 years.
Coal bed methane is a gas trapped under water in coal seams. In
order to extract this resource, developers must release the pressure
from the coal seam by pumping massive quantities of water to the
surface. In the Powder River Basin, the water from this process is safe
for consumption by livestock and as drinking water, but creates a
disaster for plants and aquatic life. The three problems associated
with pumping this volume of water are the loss of the groundwater, the
damage to the aquatic life and the damage to irrigated soils and crops.
Mr. Chairmen, in each of these areas, scientists independent of the
CBM industry and the BLM have predicted that damages from produced
water will be more widespread and more extreme than either the industry
or the BLM will acknowledge. And, in each of these areas, the
predictions of these independent scientists are being borne out.
First, groundwater. To put the quantity of water that we are
addressing in perspective, the amount of groundwater currently
discharged in the Powder River Basin from coal bed methane extraction
is 38,339 acre-feet of water/year. This is enough water to sustain
345,000 people or more than 2.2 million head of cattle. This is well
over a third of the population in Montana or 60% of the population of
Washington, DC. And there are 2.6 million head of cattle in the entire
state of Montana.
Pumping this quantity of water will drain aquifers used for
drinking and stock water by 240 to 600 feet, with recharge taking over
100 years and possibly as long as1000 years. We really don't know how
long it will take, but we do know that it will dry up valuable springs
and wells. This water could be reinjected, but instead most of it is
being dumped on the land or sent down the river never to be used again.
The second major problem with CBM produced water is the impact it
can have on aquatic ecosystems. The main constituents of the wastewater
that are harmful to aquatic life are sodium, magnesium and calcium.
Studies have shown that an increase of these constituents our rivers
will reduce reproductive rates of fish by as much as 94 to 96%. A
recently released U.S. Fish and Wildlife Service study found that
excessive levels of these contaminants in water and tissue samples
taken from fish and birds in the Powder River--levels associated with
increases in deformities and reproductive damage. The fish cannot
sustain this level of contamination. Entire species could be wiped out
by this change in water chemistry.
The third major problem associated with CBM produced water is its
impacts on soil and crops. The majority of the soils on my farm and in
the T & Y Irrigation District are largely made up of clay. Last June, a
study sponsored by the EPA and conducted by the USDA's Salinity Lab of
soil samples from our farm concluded that increased sodium, magnesium,
and calcium imbalance would drastically lower the infiltration rate of
water and air to the soil, limiting soil productivity and plant growth.
In other words, discharges of CBM water into the Tongue River will ruin
much of the soil located in my irrigation district, making our farms
less productive.
Once again, we are seeing on the ground what independent scientists
have predicted would occur. Last August, I irrigated 320 acres of my
farm with water from the Tongue River. In September, there were several
rain events which created an imbalance of sodium, calcium and magnesium
in the soil and caused a dispersion of the clay particles. The rain was
the trigger for a chemical reaction that caused the alfalfa on my field
to turn yellow in some areas and killed the crop in others--the exact
situation predicted in the Salinity Lab Report. In last year's growing
season, production from our farm was off by one-third. Increased
discharges of CBM water is the only factor that could have caused this
loss. You can see why farmers in our region feel that agriculture is
threatened by this industry.
There is hope, however, especially in Montana, where development is
still just beginning. How big these problems become will depend on how
rapidly coal bed methane production occurs and how the produced water
is managed. There's hope if they will slow down and do it right.
What we're asking for is relatively straightforward--stop wasting
water and every single one of the problems I've talked about will be
minimized.
Treat it and reinject it. If that truly cannot be done, put it to a
true beneficial use. The industry is doing this in New Mexico and we've
shown that this approach is technically and financially feasible in the
Powder River Basin.
Mr. Chairmen, your subcommittees can help protect the livelihoods
of those who farm, ranch, and irrigate in Southeastern Montana by
ensuring that necessary safeguards are put into place before more
development occurs. You can help by passing Representative Udall's H.R.
1180. Require oil and gas operators to replace damaged wells. Require
them to submit plans stating how they will protect water quality and
quantity, and other resources.
I urge you to go further. Require the industry to treat and
reinject produced water and, if they can't, require them to put the
water to a true beneficial use--not try to irrigate with it and not
discharge it onto our land or into our rivers.
Finally, it's time to replace the self-recording and self-reporting
with more government monitoring and enforcement. Last summer, samples
from the Tongue River concluded that the discharges from coal bed
methane increased the salinity of the river and exceeded Montana's new
water quality standards for three months. This was brought to the
attention of the Montana Department of Environmental Quality, but
little was done to enforce the violation that had taken place. As a
taxpayer and Montanan, I demand more from my government agencies to
protect my interests. This industry self monitoring and reporting is
blatantly irresponsible and is an indication of a broken system.
Mr. Chairmen, the Northern Plains Resource Council has been in
existence for over 30 years, and has every intention of being here long
after the CBM industry is gone. I'd like my family to be here too,
farming and managing the T&Y Irrigation District. And, I'd like the
fish I've spent all of my life trying to restore to the Tongue River to
be here too. We have never been opposed to coal bed methane
development, but they must do it right.
Thank you again for the opportunity to testify.
______
Mr. Grijalva. Thank you. Thank you for traveling this far.
Appreciate your testimony very much.
Ms. Utesch. Did I get that right?
Ms. Utesch. Yes, you did.
Mr. Grijalva. Oh, good.
STATEMENT OF PEGGY UTESCH, WESTERN ORGANIZATION OF RESOURCE
COUNCILS & WESTERN COLORADO CONGRESS
Ms. Utesch. Thank you for the opportunity to testify today.
My name is Peggy Utesch, and I have lived with natural gas
drilling at my front door for four years, during which time I
have worked hard on a number of projects aimed at systems
improvements. I am here today representing the Western
Organization of Resource Councils and Western Colorado
Congress.
Before I begin my remarks, I would like to make a couple of
unplanned comments. So many times and a lot of the testimony
that we have heard here today tries to paint people like myself
and the other panelists that we have heard testify today are
having problems with the gas industry as obstructionists. They
try to make this issue black and white, and it is not black and
white.
I am a landowner who lost my livelihood and my home to gas
drilling. Am I against energy development? No. I am for energy
development. I understand that it is an important thing for
this country. I understand that it is an important concept that
we are embracing in terms of national security. I am not
against energy development.
The statement was made early on today that the natural
resources of the West belong to the nation. I would agree with
that statement. What does not belong to the Nation is the
ability of ranchers and farmers to make a living on their land
from people who own the surface to co-exist, and that is what I
am here talking about today.
The Rocky Mountain West is experiencing an unprecedented
scale of natural gas development, facilitated by Federal tax
breaks, reduced regulation, and BLM directives to issue more
permits faster. Mr. Chairman, I am here today to tell you that
that production has come at a great cost. Two specific issues
come to mind that I would like to discuss--reclamation bonding
and inspection oversight.
The state and Federal bonding and reclamation system has
not changed since 1960, yet the industry has changed
dramatically. During the last 10 years, well pad spacing in
Colorado where I live has gone from one pad per square mile,
one pad per 640 acres, down to one pad per 10 acres. That is a
huge change.
The current bonding system allows operators to post state
and national blanket bonds, whether they drill three wells or
3,000 wells. Unlike bonds for coal and hard rock mining
industry, the BLM does not require oil and gas operators to
cover the true cost of reclamation.
In 2005, a professional engineering firm, Kuipers and
Associates, which does reclamation work with the hard rock
mining industry, invented the bonding system that is in place
for natural gas. In Colorado, in 2005, EnCana Oil and Gas had
3,652 wells under a blanket bond of $235,000. That works out to
$64 per well. In Montana, Fidelity Exploration and Production
had a bond that totaled $473 per well, and in Wyoming seven
operators had bonds that provided only $75 per well. How can we
believe that reclamation can be accomplished with these
insignificant amounts?
In 2004, the BLM and the State of Wyoming estimated that it
will cost $4 million to reclaim 120 abandoned well sites, and I
want to point out to you those are sites that were drilled
within the last four years. We are not talking about historic
wells that were drilled in the twenties and thirties.
The state's blanket bond of $125,000 was insufficient, so
the Wyoming Conservation Fund had to contribute $2.6 million.
That leaves $1.4 million in clean up costs with only a $25,000
Federal blanket bond to cover the work.
We are looking at the tip of an iceberg called taxpayer
liability if this problem is not addressed. Here is what the
Western Organization of Resource Councils recommends:
Require site-specific reclamation plans; improve the
performance standards for oil and gas operators to be
consistent with the coal and hard rock mining industries; and
base bond amounts on professional engineering estimates;
abolish or update the blanket bond system; require that
reclamation plans and bond amounts be reviewed and updated
annually; and I would urge this Subcommittee and the committee
as a whole to work hard to pass Representative Udall's bill,
H.R. 1180.
Also in need of updating is the inspection and enforcement
system. The Western Organization of Resource Councils did a
2005 report that looked into this particular system titled
``Law and Order in the Gas Fields.'' These were the findings:
The Bureau of Land Management inspection system
improvements targeted production, not environmental compliance.
The number of inspectors has not increased to reflect almost a
yearly doubling of drilling activities in many states. In 2003,
environmental compliance inspectors only spent 15 percent of
their time doing environmental inspections. Of the six BLM
offices that were studied, they oversaw 79 percent of the
active gas wells but they only employed 26 percent of the
inspection staff. And based on 2003 staffing levels,
environmental compliance inspections were only completed every
four to 49 years.
The pictures that you see scrolling are pictures that were
taken within a five-mile radius of my home, and I can tell you
that there are incidents and violations on every well pad that
you see in those pictures. We need environmental inspections on
a more regular basis, at least once a year, not once every 50
years.
While the number of inspectors and inspection activities
has increased significantly since 2003, the BLM has not
provided the hard data that the Western Organization of
Resource Councils has requested under FOIA. We do not yet know,
for example, how many environmental inspections are being
conducted. We have been given a number of inspections as a
whole, but we don't know the percentage of environmental versus
production.
What can we do to make the system better? Increase
environmental inspection staff, fill all newly created
positions, develop standardized compliance check lists, repeal
the 30-day permitting time frame that was set in Section 366 of
the Energy Policy Act, and don't rely on industry self-
reporting as an enforcement strategy.
Consumers are being hit hard by rising energy prices.
Please don't make us pay a second time with a broken regulatory
system.
Thank you for your time, and I appreciate the opportunity
to testify.
[The prepared statement of Ms. Utesch follows:]
Statement of Peggy Utesch, Western Organization of
Resource Councils and Western Colorado Congress
My name is Peggy Utesch. I am a Colorado landowner who lived for
four years in and around natural gas drilling in the Piceance Basin.
During that time, I worked hard to expose illegal and unethical
industry practices, with the intention of improving the system. In
2005, I spearheaded a collaborative project that brought a drilling
company together with a rural community. The resulting agreement--
called the Rifle, Silt, New Castle Community Development Plan--has been
endorsed by Senator Ken Salazar as a new model for how industry and
communities can work together.
I am here today representing the Western Organization of Resource
Councils (WORC) and the Western Colorado Congress, two non-profit
organizations that have worked proactively for responsible energy
development in the West for nearly 30 years. WORC is a network of
grassroots organizations from seven western states that include 9,700
members and 44 local community groups. About a third of WORC's members
are family farmers and ranchers, many of whom are directly impacted by
oil and gas development. Western Colorado Congress is an alliance for
community action made up of eight chapters and over 3,200 members on
the Western Slope of Colorado.
The Rocky Mountain West has become the nation's new center for
natural gas production. The scale of development is unprecedented, with
the number of wells being drilled doubling annually in some areas. This
energy boom affects public and private lands; water, soil and air
quality; agriculture, quality of life; property values; wildlife
habitat; local economies and health.
Congress and the Bush Administration have facilitated this boom by
offering energy companies tax breaks, easing regulations and directing
the Bureau of Land Management (BLM) to issue more permits at a faster
pace. Although industry complained a few years ago that the permitting
process was too slow, they now sit on more leases than they can drill
with a year's time.
Mr. Chairmen, I'm here to tell you that this emphasis on production
has come at a great cost. It undermines the BLM's inspection and
enforcement responsibilities and sends the message that drilling should
not be slowed for any reason and human beings are simply collateral
damage. Taking the time to listen to substantive public concerns,
mitigate drilling impacts and ensure that we have enough inspectors and
an adequate bonding system are viewed by the current system as
unacceptable delays.
In this climate, the industry has no incentive to operate
responsibly and, to no one's surprise, it is not doing so. I know. In
Garfield County, where I life, there are over 50 drilling rigs
operating full-time. Over 18,000 wells were permitted in 2006 alone.
Within three years, more than 30 natural gas wells were drilled within
a mile of my home, and I lived with the consequences of an oversight
system that is inadequate. The single largest accident in Colorado
history, happened three miles from my home. Due to faulty well-bore
cementing, 115 million cubic feet of gas were released underground. The
gas leaked to the surface and sickened ranch families and livestock, as
well as contaminating water wells and West Divide Creek. The accident
could have been prevented.
Today I'm here to outline specific problems and propose solutions
in two areas:
1) reclamation bonding; and
2) oversight inspections.
The state and federal bonding and reclamation systems have not
changed since 1960, even though gas production has changed
significantly. During the last 45 years, well pad spacing has been
reduced from one well pad per 640 acres to one per ten acres in some
areas, and the rise of coal bed methane development has brought impacts
on a scale that was previously unimaginable. Twelve to fifteen years
ago, some of the technologies that are making this boom possible didn't
even exist.
The current bonding system allows operators to post state or
national blanket bonds that cover their operations whether they drill
30 wells or 3,000. The minimum federal bond amounts are $10,000 per
lease, $25,000 covering all of a company's leases statewide, or
$150,000 covering all of a company's leases nationwide. Although the
BLM has the authority to require higher bonds, they rarely do, and
still in those cases, the amounts fall far short of the what is
necessary to repair the unprecedented level of disturbance we are
seeing on the ground today. Unlike coal and hard rock mining industry
bonds, the BLM does not require bonding at the true cost of reclamation
for oil and gas operators.
In 2005 WORC asked the professional engineering firm of Kuipers and
Associates to investigate the adequacy of the bonding and reclamation
system. The findings are contained in a report called ``Filling the
Gaps.'' In general, it was found that land management agencies are not
balancing booming energy development with protecting taxpayers,
landowners, local economies and natural resources:
1. In Colorado in 2005, EnCana Oil and Gas had 3,652 wells covered
by federal bonds of $300,000 and a state bond of $235,000, or $146 per
well.
2. In Montana, Fidelity Exploration and Production Company
operated 571 wells under a federal blanket bond of $220,000 or $736 per
well.
How can we believe that removal of equipment, re-vegetation of
drilling sites and reclamation of roads and pipeline corridors can be
accomplished for these insignificant amounts? Environmental engineers
have estimated the bond shortfalls for these projects and others amount
to hundreds of thousands at each site, and in some cases several
million.
The BLM and the State of Wyoming estimated in 2004 that it will
cost $4 million dollars to reclaim 120 well sites that were abandoned
by Emerald Restoration and Production in 2001. The state's blanket bond
of $125,000 didn't begin to touch the actual cost. The Wyoming
Conservation Fund contributed $2.6 million dollars to fund the state of
Wyoming's share of this reclamation effort. For the 64 wells on federal
land that will cost an estimated $1.4 million to clean up, the only
funding available is the $25,000 federal bond. The rest will be paid by
taxpayers or the cleanup will not happen.
We are looking at the tip of an iceberg called taxpayer liability
if this problem is not addressed. Under the current administration, the
Department of Interior has refused to finalize a rulemaking effort
begun during the Clinton Administration that would have raised the
minimum bond amounts and have also rejected a rulemaking initiative
proposed by WORC.
If the federal oil and gas bonding program is going to be fixed in
the next few years, Congress will have to do it. Here is what WORC
recommends:
Require site-specific reclamation plans;
Improve the reclamation performance standards for the oil
and gas industry to be consistent with other extractive industries,
such as coal;
Abolish or substantively update the blanket bond system;
Base financial assurance on estimates from professional
engineers and cover the full cost of reclamation; and
Require that reclamation plans and bond amounts be
reviewed and updated annually.
Passing Representative Udall's bill, H.R. 1180, would be a great first
step toward meeting these goals.
Also in need of updating is the inspection and enforcement system,
which is under-staffed and outdated, as documented by WORC's 2005
report called ``Law and Order in the Oil and Gas Fields.'' The report
finds that:
1. The BLM has made improvements to its Inspection and Enforcement
program since 1998, but those improvements have targeted production
rather than environmental compliance inspections;
2. The number of BLM inspections had not significantly increased
while drilling activities have exploded--more than doubling in some
states each year from FY2000 to FY2003;
3. In 2003, environmental compliance inspectors spend an average
of only 15% of their time completing inspection and enforcement
activities, in large part because they were being diverted to
permitting activities;
4. The 6 BLM Offices studied were responsible for 79% of active
oil and gas wells on BLM lands nationwide in 2003, yet they only
employed 26% of all inspection staff; and
5. Based on 2003 staffing and inspection levels, BLM inspectors
inspect active wells only once every 2-10 years on average.
Environmental compliance inspections are only completed every 4-49
years on average.
While the number of inspectors and inspection activities has
increased significantly since 2003, the BLM has not provided the hard
data requested by WORC under the Freedom of Information Act on this
issue. We do not yet know, for example, whether the inspections being
conducted are environmental compliance inspections or production
inspections, and we have not verified whether they are keeping up with
the continuing explosive increases in the number of wells. In Colorado
where I live, several of the BLM's newly created environmental
inspection positions remain unfilled, while additional staff positions
to facilitate permitting were hired immediately.
What can we do to make it better? For starters, I urge members of
these Subcommittees, in particular, to closely watch what BLM is doing
on inspections and enforcement and ensure that environmental compliance
is getting the long-overdue resources and attention that are so greatly
needed. We also recommend:
1. Increasing inspection staff to keep pace with the rapid growth
of the industry;
2. Filling newly created positions;
3. Don't rely on industry self-reporting as a compliance strategy;
4. Requiring regular reviews of environmental inspection programs
for accuracy and adequacy;
5. Developing standardized compliance checklists; and
6. Repealing the 30-day permitting timeframe in Section 366 of the
Energy Policy Act.
In closing, consumers are getting hit hard by rising energy prices.
Don't make them pay again as taxpayers for the failures of an outdated
regulatory system.
Throughout its history, Colorado has been through resource booms
that have left us with a legacy of scarred landscapes, polluted streams
and a tax burden for future generations to clean up the mess. If we are
to avoid repeating this history, the federal government must play an
active role in protecting our environment while permitting the
extraction of resources that are so vital to our nation. The choice you
are making is not for a safe and clean environment or energy
extraction. We can and should have both.
Thank you for your time and the opportunity to testify.
______
Mr. Grijalva. Thank you very much. Let me at the outset
thank all the panelists. Your comments and testimony are very
much appreciated.
Let me begin my round of questioning with Ms. Moseley.
There is a reference to the 1977 Surface Mining Control and
Reclamation Act. Under that Act, surface owners over Federal
coal deposits must give written consent to surface mining
operations before that Federal coal can be leased, and no harm
has been done.
On the contrary, I think that the coal industry in the West
has thrived and there has been no harm as a consequence of this
provision, in my estimation, despite the predictions to the
contrary at the time from representatives of the western coal
industry.
Having said that, do you think surface owners over Federal
oil and gas deposits deserve that same consent right that
surface owners over coal deposits now have under the 1977 law?
Ms. Moseley. Thanks for that question.
No, I do not believe that they deserve the same rights. The
difference between a coal mine and an oil or gas well are so
magnificently different. The impacts are completely different.
They are shorter in term. I don't think that it is necessary
for surface owner consent to be applied to oil and gas.
Mr. Grijalva. As we go through this process in the full
committee, that is a contradiction in process that is going to
have to be looked at. In one hand there is a consent required;
on the other hand there isn't. I think at the very minimum that
needs to be well debated.
Ms. Moseley. Mr. Chairman, I know that BLM has taken a look
at that, and they provided a report to Congress on that
specific issue.
Mr. Grijalva. OK.
Ms. Moseley. It was one of the split estate reports that
they did.
Mr. Grijalva. Let me follow up with one more, then I have a
couple for some of the other witnesses.
Ms. Utesch, in her testimony, talked about the cost to
reclaim a gas well, and then the example I am going to use is
Delta County, Colorado, where that energy corporation has
posted a $25,000 bond to cover all the wells in the state, and
I think it is between 400 and 500 wells on Federal land.
Do you think a bond of at the most $63 per well is
adequate?
Ms. Moseley. I don't think that is the purpose of the bond,
Mr. Chairman. The purpose of a bond is to make a company aware
that it has legal responsibilities to reclaim its property. It
is sort of an insurance policy. It is not intended to cover the
actual amount of the reclamation procedure. Just like with car
insurance, you don't pay to have your car fixed, you know,
every month that you pay.
Mr. Grijalva. I know that----
Ms. Moseley. Go ahead.
Mr. Grijalva. I know, but using the analogy of an insurance
company, it is a heck of a deductible for the taxpayer, isn't
it?
Ms. Moseley. I don't believe so, Mr. Chairman. I think that
the companies are held to those bonds. They cannot have their
bond released until they have met the criteria established by
BLM for reclamation procedures.
Mr. Grijalva. Thank you.
Mr. Muggli, thank you again for your testimony. We have
heard from several Montana ranchers who are using produced
water for their livestock, and want to continue to do so. Can
you talk a little bit about that?
Mr. Muggli. Mr. Chairman, Members of the Committee, yes, I
can address that.
We have never felt that they should not be able to use the
water for reasonable watering of livestock and human
consumption, and that is what the water is there for, and that
is why I want the water to remain there, not pumping out
thousands of times more water than what ranch communities or
ranch households and their livestock can use, and that it is
the real problem to pump out that much extra water, and it
would not be a problem for us if that is what they were using.
That is what that water is there intended for is stock water.
We have never limited that because that is the type of water,
the same water that I have in my well at my house is that same
type of water. It has got sodium bicarbonate in it, but you
just flat can't irrigate with it.
Mr. Grijalva. Thank you.
Mr. Pearce.
Mr. Pearce. Thank you, Mr. Chairman.
Ms. Moseley, if we were going to consider--we heard from
Mr. Muggli that there were three conditions that really were
problematic and those made sense to me, but where he was making
the observation that the only thing he could attribute the loss
of crop to was coalbed methane water.
You seem to be familiar. Are you familiar with any of the
USGS studies, or who else might be doing studies?
In other words, I know in New Mexico they measure the water
at different increments, and we have measuring points to see
where problems occur. Tell me a little bit about that, if you
would.
Ms. Moseley. It is my understanding that the USGS has been
monitoring the water quality in the Tongue River since the
early 1970s. They have several points in which they monitor,
and as a result of the coalbed natural gas development, they
have found no change in the water composition. That is what I
found on their website.
Mr. Pearce. So they have points at which they measure. Is
there a point at which they do begin to find problems?
Ms. Moseley. Well, it is my understanding that once the
water has been drained out of the river through the T&Y
Diversion Dam, that the water that comes back out into the
river has problems with water quality. But the water that goes
into the diversion dam does not have the problem. When the
water comes out, it does.
Mr. Pearce. And that is what I understand also. That both
EPA, which I have not found to be a pushover in water quality
issues, we deal with them a lot in New Mexico, and in fact we
have a couple of cities that re-inject their sewage back in,
and the EPA is checking them, and they have to be at zero parts
per million TDS.
So I tend to believe that if they say they have checked the
water along a run and it is clear until it gets to the
diversion for irrigation, then it might be that this water is
picking up things in the irrigation process, because I know in
New Mexico we have a lot of water that is just pulled off of
the Rio Grande, and then it is pushed back into the Rio Grande,
and it simply percolates down through the soil, so I see that
as being a possibility.
Now, you are somewhat familiar with the split estate
question. The idea that we would--I think you heard from Mr.
Adami that we would want to let split estate lapse, maybe after
15 years, that the mineral estate would go back to the
landowner. How much would that cost the Federal government? A
lot or a little?
Ms. Moseley. Well, let us put it this way. When the lands
were homesteaded back in the 1800s, the Federal government
reserved the mineral rights for those lands because it was a
significant source of revenue for the Federal government, and
as it states today mineral development is second only to the
IRS in revenue generation.
So from their standpoint, they did the right thing by
withholding the minerals from the surface owner. They were able
to get the lands homesteaded and had crops put on them at the
expense of--not at the expense, but in a hurry, and then they
reserved the mineral rights for later use.
Mr. Pearce. So it was economic to the IRS, so we wouldn't
need to pay go for this provision, we would need a pay went.
Ms. Moseley. I think it would be a problem, sir.
Mr. Pearce. OK. On the whole idea of the split estate, what
production do people like Mr. Adami have? In other words, he is
going to buy a ranch, and is it just kind of slid under the
table that it is a split estate? What notification, what right
does he have to understand that there minerals aren't attached
to that land?
Ms. Moseley. You know, it is interesting that you ask that
because I have bought three houses and every time I have bought
a house I have looked to see who owns the minerals. Now, maybe
it is because I work for the mineral industry, but even before
I did I always looked, and I think that it is part of the
record that is involved, and I would recommend that people take
a look at that to see if----
Mr. Pearce. So you are saying it is on the deed or whatever
piece of legal----
Ms. Moseley. Yes. Yes.
Mr. Pearce. So it is not like people wake up one day and
there is a knock at the door, hey, we own your mineral rights.
It is in fact right there on a piece of paper.
Ms. Moseley. Well, it is made public.
Mr. Pearce. But it is on the deed also.
Ms. Moseley. Whether people look at it or not is another
story.
Mr. Pearce. I have a couple more rounds of questions, but I
will yield back.
Mr. Grijalva. Thank you, and let me wrap up my turn. To
begin with let me ask you, Mr. Muggli, how do you respond to
the comments that Ms. Moseley just made about water quality
data that she says was posted on the USGS website?
Mr. Muggli. Water quality data posted on that website is
rounded numbers, and if you go to the true side, it is a very
long process to do so, it is rounded off to the nearest one
percentage point. And if you go to some different location on
there and get the numbers, we have taken a 44 percent increase
in sodium adsorption ratio numbers on the lower Tongue, and
that is what the salinity lab claims that we are over that
limit of two, between two and four, that we are going to start
seeing collapses that you were seeing on the pictures.
Insofar as the river return, between the 12 Mile Dam, if
you can feature the Tongue River runs north, dumps into the
Yellowstone. Our diversion dam, and we have five flumes that
cross five major creeks that drain 850 square miles of land
that dump into the Tongue River below the 12 Mile Diversion,
and this water mostly comes out of badlands country that is
influenced by coal seams and heavy clay soils, and that is
where the increase is coming.
The land that T&Y irrigates is less than half of one
percent in that reach. Seventy-six percent of our land drains
back is below Mile City on the banks of the Yellowstone.
Mr. Grijalva. Thank you, and let me wrap up my turn of
questioning, for that matter the questions in general from my
perspective.
I am going to ask Ms. Utesch, in your testimony I know you
have experience the impacts of oil and gas drilling in a very
personal level, and if you could elaborate on that for the
committee.
Ms. Utesch. In 2001, my husband and I purchased four acres
of land fives miles south of the Town of Silt. At that time in
Colorado--I am sorry, we purchased the land in 2000. At that
time in Colorado mandatory disclosure of mineral or split
estate was not required in Colorado, so we did not know that we
didn't own our minerals.
We also never had mineral development on our small four
acres because there was a wetlands that ran through it, and
when you have an average well pad that is four acres, there was
nowhere on our property they could put a well pad.
However, within four years I had more than 30 gas wells
drilled within a mile of my home. The mile long road that I
used to live on that was a dead end, and some, maybe 15 to 17
cars a day became a thoroughfare that saw over 100 semi-trucks
every day. I ate the dust of those trucks. I watched the
magnesium chloride that was used to try to mitigate the dust
drain into my wetlands, and kill grass and kill the plant life
that was in the wetlands.
Also, because our area was low lying area, many of the
fumes that came off of the wells settled down. They are heavier
than air, and the ozone and all the production chemicals
settled down over the area where we lived.
In 2005, I sold my home. I had lung problems. I had an all-
over-body rash. I had extreme fatigue and I had headaches. My
doctor said that the most likely cause of all of those,
particularly the unusual skin rash that I suffered, was
exposure to industry chemicals.
I lost my home, I lost my way of life to the gas industry,
and during that time I was working hard to try to get the
industry to understand I didn't want them to go away. I just
wanted them to consider that I had a right to be there too.
Mr. Grijalva. Thank you.
Mr. Adami, if you could share your personal perspective and
your experience.
Mr. Adami. With the split estate, Mr. Chairman?
When we bought our ranch, I was aware that we didn't have
the mineral rights, and there had been no mineral development,
and as the coalbed methane moved from the eastern part of the
Powder River Basin to the western edge where we were located, I
visited with a number of clients and friends that had
negotiated with the mineral companies, and asked them what
problems did you have, what areas did you wish you had done
different in your agreements, and so I had a fairly long list
of things that I wanted to address when the mineral company
arrived.
What they offered was a one-size-fits-all, take-it-or-
leave-it surface agreement. And in the case where I was bonded
on, they offered that agreement, withdrew it. It was never
offered again, and they just simply proceeded to bond on.
The local BLM office made no effort beyond a token effort
to require them to negotiate. They were a relatively
accommodating partner in that process.
Mr. Grijalva. Thank you very much. I have no further
questions.
Mr. Pearce.
Mr. Pearce. Thank you, Mr. Chairman.
I would request unanimous consent, one of our witnesses
stated that North Dakota made a serious mistake in accepting
oil and gas exploration, and I just would like to ask unanimous
consent to submit for the record from the Governor of North
Dakota saying that actually it has been very positive for North
Dakota.
Mr. Grijalva. Without objection.
[The letter from the Governor of North Dakota follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Pearce. Ms. Moseley, would you want to--again you
kind of got into this already. We are talking about the
abysmally low bonds that are required now. That bond
requirement is not a total economic requirement for that
company. That is not all the companies do. Again, it is not $63
per well that they are going to pay to keep them up. It is that
they are taking out this bond that says I am responsible for
every single well that I drill, and this $25,000 is the
beginning point.
Have you ever found a company that would only pay $63 to
clean up a site?
Ms. Moseley. No, absolutely not. In fact, in some cases,
depending on where the well location is, it can cost hundreds
of thousands of dollars.
Mr. Pearce. And because they only had the $25,000 bond,
because they only had the $63 per well, did they walk away from
their investment? Did they walk away from their responsibility?
Ms. Moseley. No.
Mr. Pearce. So they paid the 100,000?
Ms. Moseley. They are required to follow the law. They are
required to follow the guidelines----
Mr. Pearce. OK.
Ms. Moseley.--that have been established by the government.
Mr. Pearce. Ms. Korenblat, you look like you have a comment
to make here.
Ms. Korenblat. I am sorry. You should finish that line.
Mr. Pearce. I mean it is fine, yes.
Ms. Korenblat. I think that was misinterpreted. I think you
are referring to my comment about North Dakota.
Mr. Pearce. Oh, yes. Excuse me.
Ms. Korenblat. Sorry. And my point was that the mistake was
made in building the trail and spending lots of money to market
it after the oil wells had been put in, after the oil fields
have been established.
Mr. Pearce. Fair enough. Yes, fair enough.
Ms. Korenblat. Thank you.
Mr. Pearce. I appreciate that clarification.
Ms. Adami, when did you buy your ranch?
Mr. Adami. In 1993.
Mr. Pearce. 1993?
Mr. Adami. Yes, sir.
Mr. Pearce. And you were aware of the split estate
question?
Mr. Adami. Actually, I was not.
Mr. Pearce. But it was on the deed.
Mr. Adami. No, it was not. It is not disclosed in any
fashion. Your warranty deed makes no reference whatsoever to
the minerals in Wyoming.
Mr. Pearce. So would you recommend that we pass a law that
would say stamp on the face of a piece of property ``This
property is split estate''?
Mr. Adami. That to me----
Mr. Pearce. That would seem reasonable.
Mr. Adami. I think that would be reasonable, and maybe a
small disclosure about----
Mr. Pearce. What do you think that would do to property
values of those pieces of property?
Mr. Adami. I am not sure that it would have much of an
effect. Colorado could probably answer that where they have
done that, but I am not sure.
Mr. Pearce. I think that is probably the push-back that we
would get, that people don't want their property value
diminished by full disclosure.
Ms. Utesch. Colorado does have mandatory disclosure and
that disclosure has not affected property values. That was
established in a study that was done in 2004.
Mr. Pearce. OK. Now, you sold your ranch?
Mr. Adami. Yes, sir.
Mr. Pearce. Who did you sell that to?
Mr. Adami. To Yates Petroleum for New Mexico.
Mr. Pearce. Were they the ones who were drilling close by
on the land?
Mr. Adami. No. Yates was the third developer to come, and
it was in the negotiation process that they made the offer to
purchase, but at that point they had not developed any of their
minerals.
Mr. Pearce. Are they in the process now?
Mr. Adami. You know, I haven't been back in the last three-
four months.
Mr. Pearce. What did you get per acre for the land?
Mr. Adami. The terms of the agreement were confidential,
Congressman. I guess I would have to refrain from answering
that.
Mr. Pearce. Above market or below market?
Mr. Adami. I am afraid I shouldn't answer that, sir.
Mr. Pearce. OK. I suspect, I suspect I could guess.
Mr. Muggli, you had some contentious response, you didn't
think that I was accurate in what I was saying about the EPA.
Do you think the EPA is allowing the oil and gas to put that
coalbed methane water into the river and contaminate it?
Mr. Muggli. Yes.
Mr. Pearce. Mr. Chairman, I would at this point ask that we
have a hearing, because I think Mr. Muggli is really sincere,
and I believe he is here with the best of intentions, and if
the EPA is not doing its job, I think that we should hold them
to task and we should take a look at that because I have found
them to be pretty strict in New Mexico. In fact, we are always
having to work to clear up problems, and this is a pretty
serious allegation because that is--EPA is one of the key
guardians of our fresh water, so I would take that as a pretty
serious problem, and would request--would you join me in the
request that we would have an open hearing about the
standards----
Mr. Muggli. Yes.
Mr. Pearce.--that EPA is enforcing on that particular
coalbed methane project?
Mr. Muggli. Yes.
Mr. Pearce. OK, appreciate that.
Ms. Moseley, let us say that we take the recommendations
that you have heard here to drive the price up per well, put a
well bond on, who will be impacted by that kind of a--Mr.
Chairman, I would yield back if you want me to. I have another
round of questions----
Mr. Grijalva. Yes, please continue.
Mr. Pearce. You bet. I saw that red light. You know, it
scares me.
Let us say that we do put that bond in. Who is going to be
affected among the producers?
Ms. Moseley. If it increases the amount that a company has
to spend.
Mr. Pearce. Yes.
Ms. Moseley. Is that your question?
Mr. Pearce. Yes.
Ms. Moseley. I would guess that it would make energy prices
more expensive.
Mr. Pearce. It would make energy prices more expenses. What
about the size of companies? In other words, in New Mexico, we
are almost down to just the mom and pops. We are down to the
independents. Exxon has moved out a long time ago. Those fields
are wearing out, people are not much interested. There is a
little excitement right now with $70 oil, but when it drops
back down to 50, they are all going to disappear again.
So what is going to be the effect on the small operator?
Ms. Moseley. Well, the small operators, the one who is most
affected by these kind of increases in costs of drilling a
well. As you heard earlier this morning, 90 percent of the
discovery wells are drilled by independents. If they can't
afford to go out and drill, then they probably will never be
drilled, and maybe some people feel that that is a good thing.
I don't believe that. I think that our country is based upon
energy for its economy and for its standard of living, and I
would recommend that we have a chance to work together to come
up with the best solutions instead of being attacked for
providing the service that we absolutely have to have.
Mr. Pearce. You heard the testimony by Ms. Korenblat about
the problems with the oil and gas industry. Tell me a little
bit about the positive relationship between say the biking
industry and oil and gas. Where do they intersect?
Ms. Moseley. Well, I would guess that without the oil and
gas industry and the mining industry you wouldn't have your
bikes.
Mr. Pearce. Yes, I was hoping we would get a little
response here. Ms. Korenblat, obviously, we are into the
engaging piece of this, but really you get carbon fibers, you
get your tires, you get the people traveling in, not in a black
reference I made in my opening statement, and you can take this
opportunity to dig into that if you would like with full vigor
too, if you would like.
Ms. Korenblat. If I am going to go out of business, does it
really matter whether I lose my customers first or the supply
first?
As you said in your opening statement, my customers fly in
airplanes to get to the trips, and if the prices of their
airplane tickets go up, I am going to have less customers. But
if we continue to drill without regard to recreation planning
and without any effort to co-exist, then I am losing supply
because I am going to be losing trips. So it is sort of a
chicken and egg problem really.
Mr. Pearce. Yes, and that really is a problem that we all
have here is that with every single problem that we have, we do
need to reach a balance point because, to be honest with you,
as a backpacker I have probably been as many miles as anybody
in Congress just with a pack, a really heavy pack too. I don't
much anymore, but I have been. So as a backpacker, I will tell
you that the bikes and the motorcycles and those things I
consider to be--I mean, you made the statement that we should
be naturalists, we should have natural space or something. I am
not trying to put words----
Ms. Korenblat. Operate under our own power.
Mr. Pearce. No. But you were saying that we should have
nature, that that should be it, and to be honest, there are
people who would say that really your bikes are invasive, that
they are not natural, and I am not that sort of purist. I was
the one who said, you know, we ought to have a place in our
parks that we can use motorized stuff, not every place in the
parks. That was Mr. Watkins' language, and I felt like always
that was the balance. Not every place for everything, but some
way we have to get the balance here.
We have to get the protection for these landowners, and I
am sympathetic to Mr. Adami that has got 12 of the 20. This is
like a golf game. High score is not very good in those
problems. Still, we can overreact, overrespond, and suddenly we
begin to squeeze off this little golden goose that really
provides a lot of jobs, and I am talking about the oil and gas
industry, provides accessible, affordable energy.
Ms. Korenblat. But----
Mr. Pearce. Go ahead.
Ms. Korenblat. Well, my question though is aren't we on the
downhill side? In 300 years, are we going to be burning oil? I
don't think so. Right? We know it is going to last 20, but is
it going to last 300? It is somewhere between 20 and 300,
right?
Mr. Pearce. So how would you feel about wind and solar on
Federal lands?
Ms. Korenblat. It totally depends on how it is put in, and
you talk about balance, and I agree with that, but I think one
of the points needs to be looking at the longer term. So many
people are so focused on the current situation that we are so
dependent on oil, but don't we have the opportunity--we are
going to make a transition. I don't think my grandchildren are
going to be using oil. They are going to have to use
alternative fuels.
So my question is do we really want to damage--I mean, land
in its pristine form is shrinking from the earth. They are not
making any more of it. You can't re-create it. Sure, you can
mitigate, and you can try to clean up the mess, but land that
hasn't ever been touched is very--it is in very short supply.
So when we look, we talked about 39 years worth of natural
gas. I mean, that is--in the big picture that is a very short
time frame. So what I am adding to the equation is not just
looking at balance, but looking at balance over the really long
term because my son can make a living the same way I am, and my
grandchildren can make a living the same way I am, but an oil
well has a life span, but the damage is relatively permanent.
Ms. Moseley. I don't agree with that, and I don't know
whether I am allowed to speak or not.
Mr. Pearce. OK, OK, the Chairman is about to--let me make a
couple more comments, Mr. Chairman, and we will be wrapped up,
but these are the kind of conversations that we need to be in.
I think everyone of us realizes that--I mean, my great fear is
that we are going to run out of oil quicker than what we think,
but the truth is we don't have anything that even comes close
to replacing it--maybe nuclear, but wind is 1 percent, solar is
1 percent, hydro-thermal, maybe 10.
Ms. Korenblat. Necessity is the mother of invention.
Mr. Pearce. Yes, well, the mothers of invention are a
little asleep at the wheel because we haven't got any way to
get those inventions to the market. I mean, we really have
slept through the last 30 years when we should be converting
and we have not converted and tremendous dislocation awaits us
if we just move wholeheartedly.
Mr. Chairman, with your indulgence Ms. Utesch tried to log
in a couple of times, and we just haven't gotten to her. She
wants to make closing comments. I don't have any. You have had
comments to things that I have said so I am going to turn the
floor over to her, and when she wraps it up, my time is way
past gone, and you have been more than congenial, Mr. Chairman.
Mr. Grijalva. No, just 29 minutes. No problem.
Mr. Pearce. No sweat. No problem.
[Laugher.]
Mr. Pearce. Thanks.
Ms. Utesch. Thank you for the opportunity to speak again. I
just wanted to offer a couple of clarifications.
When it comes to the issue of bonding or any regulation of
the industry, when consumers are--if the government puts
additional regulation on industry often the argument is made
that if the gas industry has to pay more, if their cost of
business goes up, that that will get passed directly to the
consumer, and I want to clarify for the record that that is not
true.
The natural gas in this country is traded just like corn
and soybeans, and any rancher can tell you that it doesn't
matter how much it costs him, it is the market value at which
that commodity is traded that sets the price, and natural gas
is the same way.
I also wanted the opportunity to also one more time look at
the issue of small operators. Ms. Moseley had testified that if
small companies that come in and want to do drilling have to
post high bonds, they won't be able to do the work, and so that
it would create a hardship on them in not being able to drill.
That may be true, but let us look at the other side of what
happens, and this does happen and we have seen cases of it in
New Mexico where small operators can't afford to post--they
post a small bond, and they go into an area, and when they are
done operating their choice is to pay the $100,000 in
reclamation costs that Ms. Moseley cited, or to forfeit their
$25,000 bond. It is a hell of a lot cheaper for them to walk
that bond and it has happened.
So you know, there are two sides to that question. There
are two ways to look at it. It is not black and white, and I
would just welcome the opportunity for both sides to sit down
at the table and proactively look at the needs on both sides,
and address a system that is outdated to come up with something
that works better for everyone.
Mr. Pearce. Thank you very much.
Ms. Utesch. Thank you.
Mr. Grijalva. Thank you, Mr. Pearce.
Now let me thank all of our witnesses today, and
particularly this last panel.
In closing, I think I can comfortably say that I am not
aware of a single member of this committee and the full
committee who does not support responsible oil and gas
development in the appropriate public places, and public lands,
and as we go through this process the search for a balance, the
search for responsibility and accountability on the part of
agencies and businesses doing gas and oil on public lands, that
process sometimes is going to be viewed as an attack, and I
would venture to say that it will be described as an attack.
On the contrary. The search for balance many times is a
difficult process. I wish we would have had this healthy debate
as we were going through the Energy Act of 2005, and we will
have this debate as we go through what we need to put together
in May in terms of an energy policy.
Today's hearing and other hearings this month before this
committee and all the various subcommittees have been held to
find out what is not working with that energy policy, and what
we need to do to fix it. I don't believe that any of the energy
laws that have been enacted in the last five years are sacred
or sacrosanct. We need to look at them. We need to dig for that
balance, that accountability, that transparency, and the
appropriate responsibility.
I want to thank all of you for coming today, and with that
this meeting is adjourned. Thank you.
[Whereupon, at 2:05 p.m., the Subcommittees were
adjourned.]