Pros and Cons of Oil

MONTANA, Nov 19 (Neo Natura) - The following is an excerpt from an November 18th article written by John Cramer of the Missoulian discussing the pros and cons of future petroleum drilling in Montana.

Much of Montana's Rocky Mountain Front, a wilderness largely unchanged since Lewis and Clark's expedition, was protected from energy development last year after a high-profile push by citizens and legislators.

Many of Montana's other prairies, peaks and watersheds, though, have proved to be gushers for the oil and natural gas industry as it expands its search for more domestic energy sources.

Their next shot at reserving some of the state's fossil fuels comes Nov. 27, when the federal Bureau of Land Management hosts another round of bidding in a drilling expansion that's producing record amounts of revenue in the Big Sky state.

But those profits may be coming at a cost.

Early studies show that petroleum development is threatening habitat for many native species, including antelope, sage grouse, mule deer, elk, burrowing owls, pallid sturgeon and westslope cutthroat, rainbow and brown trout.

Some of those species have healthy populations statewide, but their numbers are declining in areas close to oil and gas wellheads, roads, pipelines, power lines and other energy infrastructure, said T.O. Smith, energy coordinator for Montana Fish, Wildlife and Parks.

“It's an urban development built in a short period in rural areas,” Smith said. “There's no way you can have that kind of intense development and not damage the fish and wildlife habitat nearby. But there are ways to mitigate the damage. That's why we try to look at the landscape comprehensively.”

David Dobkin, executive director of the High Desert Ecological Research Institute in Bend, Ore., said the drilling boom has overwhelmed the BLM, leaving it incapable of monitoring drilling sites and their impact on wildlife.

“It's clearly a formula for implosion,” Dobkin said. If oversight isn't dramatically increased, Montana “could easily become another Wyoming,” where gas development is wiping out vast stretches of sage grouse habitat.

In western Montana, many areas are protected from drilling by national park and wilderness designations, but energy companies have proposed adding thousands of new wells covering hundreds of square miles on federal, state and privately owned land in central and eastern Montana. And on the west side of the Continental Divide, drilling has been approved from near Glacier National Park to Beaverhead County in the state's northwestern and southwestern corners, respectively.

Across the West, the oil and gas boom continues to worry conservation groups and others who say it's harming wildlife habitat, fishing streams, hunting grounds, Native American tribal sites and public health in exchange for only enough petroleum to meet national consumption for a few months.

They maintain that the Bush administration should focus on energy efficiency, conservation and renewable power rather than drilling without adequate environmental review and public input.

“It's a broken system and we don't want Montana to make the mistakes Wyoming did,” said Bruce Farling, executive director of Montana Trout Unlimited.

Industry officials and the BLM, which oversees most drilling in the West, say underground exploration can occur with little impact to the environment, creating jobs, revenue for the state and energy independence.

Greg Albright, a BLM spokesman in Montana, said the agency is obligated to manage public lands for multiple uses, which means balancing energy needs and ecological concerns.

“Granted, oil wells aren't the prettiest thing on the face of the planet, but we also have a responsibility to develop natural resources in an environmentally sound way for the benefit of everybody,” he said. “There are a lot of fears, a lot of emotion, but we don't have a division called ‘How Can We Circumvent The Law?' ”

Energy companies often request that much more land be offered than they intend to lease in an effort to conceal their real interest from their competitors, so the true measure of energy development is how many drilling applications are filed and how much oil and gas is actually being produced.

Over the past decade in Montana, the leases and acreage offered and the number that sold decreased until this year, when there was a big jump, according to BLM records.

During the same 10-year period, though, drilling permit applications increased, the annual production of natural gas nearly tripled and the amount of oil increased more than 50 percent in Montana.

That's because energy companies have become more efficient at the risky and costly business of locating, tapping and transporting underground fuels.

Since 1997 in Montana, that efficiency translated into $264 million in royalties, rents and bonuses, some of which were shared with the state.

During that period, the BLM has offered lease sales on 4,570 parcels covering

4.4 million acres in Montana. Of those, 3,122 parcels were sold covering 3.3 million acres. Of those, 2,226 parcels produced applications for drilling permits.

Since 1999, Montana has increased its total oil production from both public and private lands, making it one of only two states in the nation to boost oil production in the last year, according to the Energy Information Administration and the governor's office.

On Nov. 27, the BLM will offer 215 leases for sale covering 227,654 acres in Montana. Most are in traditional oil- and gas-producing areas in the central and eastern parts of the state, but some are in western Montana.

The BLM has responsibility for oil and gas leases on its lands, national forest lands and private lands where the federal government has mineral rights.

The agency can refuse leasing requests if they threaten wildlife habitat, but some environmental protections can be waived at the request of companies. The companies post bonds and other fees, but those fees often fall far short of costs incurred closing wells and cleaning up drill sites.

Drilling on federal lands in five Western states - Montana, Wyoming, Utah, Colorado and New Mexico - has doubled over the past decade to more than 2,000 wells per year, and another 118,000 wells are planned, according to the Environmental Working Group and the National Wildlife Federation.

According to the Government Accountability Office, the BLM doesn't have enough time for oil and gas field inspections or to care for wildlife, cultural resources and the environment because it's so busy processing drilling permit applications.

Federal lease sales in Montana used to be handled quarterly, but now occur every other month. Conservationists say that's because of pressure from the Bush administration to open more public land to energy development, but the BLM says it's because of greater market demand.

The average number of federal oil and gas leases sold each year in Montana has fluctuated under the last three presidents: 199 in the first Bush administration, 301 in the Clinton administration and 260 under the current Bush administration.

Petroleum companies bid to buy the leases, which typically last 10 years but can be extended if the wells are in production. Of the 35 million acres under lease nationwide, about 12 million are in production.

As of September 2006, 3,714 leases covering 4,012,246 acres were in effect in Montana. So far this year, 469,137 acres have been offered for sale in Montana, a big jump after a decade of decline in the amount of land on the auction block.

That increased offering hasn't translated into more actual sales, but it has prompted protests from hunting and fishing groups.

They objected to more than 285,000 acres offered for sale in July alone, prompting the BLM to withdraw 73,000 acres that are to undergo further environmental reviews.

The protests also resulted in several restrictions being added to lease parcels, including protections of streamside areas, although the BLM refused to withdraw leases near the Beaverhead River.

In addition to environmental and sportsmen's groups, concern also is being expressed by outdoor-dependent businesses, the 19-state Western Governors Association and some pro-industry politicians, such as former Sen. Conrad Burns, R-Mont., who want tighter environmental restrictions on oil and gas projects.

The BLM's Albright said the leasing system works well. He cited the agency's decision to remove some tracts from its July lease sale in McCone and Garfield counties because of concerns about sage grouse habitat.

“Everything people do has an impact,” he said. “Just hiking and taking pictures and driving our car to the trailhead have an impact. But we try to minimize our impacts and not allow anything that's irreversible.”

Farling, of Montana Trout Unlimited, said Montanans must act now.

“You're not going to see another Jonah Field in Montana yet, but that's what people are afraid of,” he said, referring to a vast natural gas field in Wyoming that has become ground zero in the controversy over energy development in the West. “We want to get ahead of the curve, so that won't happen.”