Washington – Seven oil and gas drillers are choosing the company that will study how much drilling should be allowed on 1.5 million acres of public land in northwestern Colorado and will pay most of the study’s costs.
The arrangement has sparked protests from environmental groups that the U.S. Bureau of Land Management is giving too much power to industry.
“This gives the industry excessive influence over the BLM office,” said Nada Culver of the Wilderness Society. “It’s not even behind the scenes.”
But officials at the BLM’s White River Field Office in Meeker say there are safeguards in place to make sure the study doesn’t take an industry perspective.
“I know that is a perception. But it is not a reality,” BLM field-office manager Kent Walter said. “While industry is paying for it, they don’t get any special treatment.”
The arrangement comes as the Bush administration and Congress are pushing the BLM and other agencies that administer public land to increase domestic production of energy.
The two-year environmental-impact study, estimated to cost $4 million to $6 million, will be largely paid for by a consortium of seven oil and gas companies. The companies are:
EnCana Oil and Gas (USA)
Exxon Mobil Corp.
Williams Production RMT Co.
XTO Energy Inc.
Pioneer Natural Resources USA Inc.
Riata Energy Inc.
Chevron USA Inc.
The BLM and the industry group agreed on the names of four contractors to seek out for the study. The contractors send their proposals to the companies, which then choose the contractor. No firm has yet been chosen.
Once a contractor is picked, control returns to the BLM, said the agency’s project manager, Jane Peterson, and the contractor may communicate with the companies only through the BLM.
BLM spokeswoman Jaime Gardner said that if the companies were to choose an unacceptable contractor, “we’ll have to work together to find a contractor who works for both of us.”
Giving industry this sort of role in an environmental study – called “third-party contracting” – has been used before to harness the money of private companies to speed up studies of the Silverton Mountain ski area and the Pinedale Anticline oil and gas project in Wyoming, Peterson said.
But the process was not used for the ongoing study of Colorado’s energy-rich Roan Plateau. In that area, the BLM paid a contractor with taxpayer dollars to study the effects of drilling.
While environmentalists are criticizing the plan, it enjoys congressional support. Sen. Wayne Allard, R-Colo., praised what he called the “unique partnership” at an October hearing in Washington, calling it a “shining example of out-of-the-box thinking.”
The current plan for BLM- administered lands surrounding Meeker would allow for 1,100 wells. But oil and gas companies would like to drill as many as 15,000 wells over the 15- to 20-year life of the plan.
At that rate, they would hit the 1,100 mark in one to three years. If that happened, the BLM might have to reject companies’ permit applications because the impact had not been sufficiently studied.
Walter said that after discussions with industry, BLM officials realized something needed to be done to take the growth into account.
But environmentalists say the structure of the study is skewed to favor drilling over other considerations, like preventing air and water pollution or protecting wildlife and wilderness.
Exact numbers have not been worked out on exactly who pays for what, BLM’s Walter said, but industry will be paying the lion’s share of the study cost. Walter said he’s seeking approval for hundreds of thousands of dollars for each of the study’s two years to pay for staff time to monitor the contractor’s work.
Peter Loeffler, an EnCana geologist who represents the gas companies, stressed that the process will be guided by federal environmental law.
“Once the contract is let, industry really steps back then and does not have involvement in the process,” Loeffler said.
Staff writer Mike Soraghan can be reached at 202-662-8730 or msoraghan@denverpost.com.
