Industry slams BLM for barriers to oil drilling
E&E News
By Sam Pearson
February 6, 2014
Local officials and industry groups told a House subcommittee yesterday that the Bureau of Land Management was stifling oil and gas production on millions of acres in Western states -- echoing a long-standing conservative critique that the nation's current energy boom is taking place despite an overbearing federal government.
Other states could see economic statistics akin to North Dakota's oil- and natural-gas-based boom if land use restrictions were eased, said Kathleen Sgamma, the vice president of government and public affairs for the Western Energy Alliance, an industry group. About 2,000 oil wells per year were held up by BLM permitting delays, and letting oil companies access more public lands could create up to $23.4 billion in economic activity annually and more than 100,000 jobs from projects already proposed, Sgamma said.
Rep. Doug Lamborn (R-Colo.), chairman of the Natural Resources Subcommittee on Energy and Mineral Resources, and a panel of mostly industry witnesses used the hearing to lambast what he called the "burdensome and uncertain" permitting process even as Democrats said the hearing was unnecessary.
While Lamborn has held several similar hearings before, yesterday's panel came as some energy-friendly lawmakers have cautiously called for lifting the nation's longtime oil export ban to allow energy companies to sell excess oil overseas, which Democrats took as proof new drilling on BLM lands was unnecessary.
An increase in drilling on BLM lands would not serve the public, said Rep. Rush Holt (D-N.J.), the subcommittee's ranking member. Holt noted oil production had increased on BLM lands under the Obama administration, even though delays remained in the regulatory process. Many oil producers were not using about 7,000 drilling permits already approved, Holt said.
"The basis for this hearing is fundamentally flawed," he said.
Lamborn said the problems showed that BLM was ill-equipped to take on new regulatory efforts, like increasingly assertive air quality restrictions on projects and a review of whether it should regulate hydraulic fracturing or let other federal agencies like U.S. EPA and state agencies perform those tasks. BLM could then focus its resources on approving oil drilling permits and leases as quickly as possible, Lamborn said.
"It's not very rational to add on new responsibilities that take BLM agents out of the field and back to their desk pushing paper," Sgamma said.
The existing system "ensures energy development on the Federal lands proceeds in a safe and responsible manner," BLM said in a statement submitted to the subcommittee.
The Western Energy Alliance is appealing a controversial BLM decision to remove nearly 100,000 acres of public lands from its oil and gas lease sale last year after it received comments from an archaeological organization even though a public comment deadline had elapsed. The industry group and its member company Castle Valley Holdings LLC are challenging the decision before the Interior Board of Land Appeals, an administrative court that reviews BLM leasing decisions (Greenwire, Jan. 13). The archaeological group, the Utah Rock Art Research Association, warned that construction associated with the project could imperil important sites in the area, but the Western Energy Alliance contends BLM's action was an example of political favoritism.
Holt said BLM's decision was prudent and likely avoided lengthy, costly litigation for the company. He said the subcommittee should talk about how to manage the increase in oil production rather than assigning blame.
"Geology and economics, not red tape, traditionally are what drives drilling trends," said Dennis Willis, who worked in BLM's field office in Price, Utah, for 35 years and is now retired. He said oil drillers would likely return to their vacated wells if gas prices rose.
Next Article