Proposed Federal EIS Plan

MONTANA, Jan 31 (Neo Natura) - A public discussion on the proposed federal EIS project, a plan to designate energy corridors on federal land in 11 Western states, drew few comments at a public meeting in Helena, but for the most part was supported from representatives of organizations who attended.

Use this form to submit comments on the Energy Corridor Draft Programmatic EIS. All comments received or postmarked by Thursday, February 14, 2008 will be considered. You can also view the proposed corridor area.

Most favored a route for oil and natural gas pipelines, power lines and distribution facilities that follows U.S. 287 from Townsend to Three Forks, then westward toward Butte and Anaconda and splitting to run north and south along the inter-states.

Another favored route could run from Townsend across Interstate 15 and the Beaverhead-Deerlodge National Forest, then north to Garrison and continue into Idaho.

“I’m bringing 200 petition letters asking for either the Garrison/Milltown or Townsend/Three Forks/Milk Creek routes,” Linda Sather, Anaconda-Deer Lodge County commissioner said at Tuesday’s meeting. “We want this in our county. We welcome it and support it wholeheartedly.”

But others are wary of the corridors, saying they could run through roadless areas. In New Mexico, critics said the map of the proposed corridors show only disconnected lines and that connecting the corridors would involve pipelines and power lines crossing state, tribal or private land. They said the connecting routes should be determined before the true impacts of the corridors can be measured.

Throughout the West, the proposed corridors cross through 12 national parks, monuments or recreation areas and three wildlife refuges. That’s down from the initial plan that involved 29 national parks, monuments or recreation areas; 15 wild-life refuges; and 58 wilderness areas.

“Although the Energy Department has made significant improvements in their proposed corridor designations, the proposed corridors still lack thorough consideration of the likely damage to federal lands and other places,” said Nada Culver, who has tracked the process for the Wilderness Society since it began. “In Montana and elsewhere, the Energy Department needs to come up with alternatives to minimize the number of corridors and maximize use of renewable energy, and it should include firm requirements to limit all projects to designated corridors.”

The energy corridors are part of an energy bill passed in 2005 to provide more energy to Western states and shorten the length of time it takes the energy industry to gain approval to run pipelines and power lines.

Once projects are proposed for the corridors, they would undergo additional environmental review before permits were issued and rights-of-way granted.

Jeff Barber with the Montana Environmental Information Center said the center supports the idea of energy corridors, but would like them placed within existing transmission routes and, if possible, to limit the export of Montana power.

“If it’s a coal plant exporting power, that’s not a direction we want to go,” Barber said. “But if it’s wind generation we want to export, that’s a different situation.”

Overall, the corridors include 6,055 miles over almost 3 million acres in Montana, California, Nevada, Colorado, Utah, Washington, Oregon, Wyoming, Idaho, New Mexico and Arizona.

Brian Mills, Department of Energy environmental protection specialist, said the corridors would be about 3,500 feet wide — although that could vary — with 3,700 miles in existing corridors’ right of way.
In Montana, the proposed corridors cover 102 miles over 42,000 acres of federal land.

NWE Plans Anaconda NG Plant

MONTANA, Jan 24 (Neo Natura) - NorthWestern Energy is considering a site east of Anaconda, Montana for a proposed natural gas fired electric generation facility. The facility under consideration would provide regulating reserves within the company's transmission control area and must be approved by the MT Public Service Commission prior to the company committing to construction.

The site selection is the first of many remaining steps necessary to determine the viability of the project. The company must still obtain competitive bids for generation equipment and submit all of the necessary environmental permitting applications before determining the actual size of the project and whether it is economically viable. If, after further analysis, the project is deemed appropriate, it will be submitted to the Montana Public Service Commission in the spring or early summer for review and approval.

"There's still much work to be done; however, the site selection is necessary before proceeding with technology and environmental evaluations. Our independent engineering firm evaluated several possible sites in Montana and we chose the Mill Creek site due to the proximity and availability of electric and gas transmission facilities, access to rail and water supply," said Bill Rhoads, Director -- Montana Production.

Dave Gates, Vice President -- Wholesale Operations added that the proposed plant, adjacent to the company's Mill Creek Substation, would be built and operated in full compliance with Montana environmental statues and meet or exceed all air and water quality standards. The power from the plant would be used to balance the company's transmission system and to provide the ancillary services needed to integrate the company's existing and any additional wind energy that may be added to NorthWestern's portfolio of electric supply resources. The exact size of the proposed plant has yet to be determined pending technology and environmental evaluations, but the range under consideration is 120-220 MW with an estimated cost in excess of $100 million.

NorthWestern Energy operates a 7,000-mile high voltage transmission system that requires adequate reserve capacity to maintain federal reliability standards. Currently, the company must purchase and import these services from utilities in the northwestern US and Canada. Until recently the company was not allowed to own rate-based generation resources. The market availability of regulating reserve capacity is shrinking throughout the region because utilities are now using more of their own regulating reserve capacity for projects on their own systems.

Farmer's Camelina Seed Reimbursed

MONTANA, Jan 16 (Neo Natura) - Montana farmers in 32 northern and eastern counties can now get reimbursed for their camelina seed costs as part of the new Montana's "Agro Energy Plan".

The program covers Camelina costs of up to a $1.30 per pound and up to 80 acres, at seeding rates of three to five pounds per acre.

Montana Department of Agriculture Director Ron De Yong says they're looking to help the growing agricultural sector and that he hopes the project will encourage farmers to gain experience planting the oilseed crop.

"We'd like to get enough Camelina grown to actually get this industry started. So, if you've never raised Camelina before it's pretty hard to think about raising it when you have all these good options right now which is unusual for farmers to have."

The camelina crop is planned to be used for the production of bio-diesel through the process of transesterification.

Corp vs. Corp - Update 1

MONTANA, Jan 09 (Neo Natura) - The Mars candy empire's billions of dollars couldn't stop a state judge from ruling Tuesday that a Wyoming company can drill for natural gas beneath Forrest Mars' southeastern Montana ranch.

Drilling was expected to begin within days.

Mars had sought to block Pinnacle Gas Resources Inc. from drilling on a 10,300-acre mineral lease it holds beneath his sprawling Diamond Cross cattle ranch. But Montana law gives oil and gas companies the right to drill on private land as long as they hold valid mineral leases and meet basic notification requirements.

Forrest Mars, who is worth an estimated $14 billion, owns more than 82,000 acres along the Tongue River in Rosebud and Big Horn counties. That "surface ownership" does not include rights to much of the underground minerals, including a type of natural gas known as coal-bed methane.

"Who the surface owner is should not make any difference, and it didn't today," Pinnacle attorney Bryan Wilson said after Tuesday's ruling.

Pinnacle's lease is set to expire if the company does not begin drilling by Friday. State District Judge Blair Jones said blocking Pinnacle because it notified Mars' son-in-law of its drilling plans -- rather than Mars himself -- would have amounted to a "death sentence" for the company.

Corp vs. Corp

MONTANA, Jan 07 (Neo Natura) - A reclusive billionaire whose family owns the Mars candy empire is emerging as a formidable opponent to the energy industry's development plans in southeastern Montana.

Through his previously undisclosed ownership of the 82,000-acre Diamond Cross ranch, Mars is bringing his fortune to bear on the side of ranchers and conservationists trying to curb the companies' ambitions. Mars is worth an estimated $14 billion.

“The perception that it's the big guy (energy companies) versus the little guy (ranchers) – in this instance, that's not the case,” said Bruce Williams, vice president of Fidelity Exploration and Production, a defendant in one of several lawsuits brought by Diamond Cross over natural gas drilling.

The Mars family has a long-standing reputation for secrecy, and Forrest Mars' name is not listed as a party in any of the lawsuits pitting Diamond Cross against coal and natural gas developers. His ownership in the ranch was revealed in a Dec. 28 court affidavit reviewed by The Associated Press.

Mars did not respond to requests for interviews made through his son-in-law, Lonnie Wright, and through Diamond Cross attorney Loren O'Toole.

O'Toole said Mars' opposition to energy development stemmed from the vast amounts of water such projects can consume. In the arid West, water is essential to keeping working cattle ranches such as Diamond Cross alive.

The ranch sits on the northern end of the Powder River Basin, an area with some of the most productive coal and natural gas fields in the nation. Development of those resources was concentrated over the last decade in the southern portion of the basin, in Wyoming.

However, in recent years, exploration began pushing north into Montana. And Mars' ranch soon began to push back, with lawsuits against the companies involved.

Yet despite his hefty legal and financial resources, Mars' influence on the rolling plains of southeastern Montana could be put to the test by state and federal laws favoring oil and gas development.

Under a property regime known as split estates, landowners in many Western states do not necessarily control the minerals beneath their property. In the Diamond Cross case, Fidelity and another company, Pinnacle Gas Resources, have oil and gas leases on the ranch that predate Mars' ownership, according to public records and company officials.

State law gives the companies the right to enter Mars' land to drill on those leases. So far, however, he's held them at bay.

“Forrest has a lot of money, but he's in the same boat as anybody else,” said Beth Kaeding, chairwoman of the Northern Plains Resource Council, a conservation group of which Mars is a member.

“If you don't own the mineral rights, it doesn't matter how huge your ranch is, how politically powerful you are, how much money you have,” Kaeding said. “Mineral rights trump surface rights.”

Mars Inc. – maker of Snickers, the Mars bar, M&Ms and a variety of other food products – is one of the country's largest family-held companies, with an estimated 40,000 employees and $21 billion in annual revenues. Forrest Mars and two siblings, John and Jacqueline, each ranked among the top-20 richest Americans in 2007, according to Forbes Magazine's annual list of the wealthy.

Forrest Mars, who is in his 70s, is no longer chief executive but still contributes to the company, company spokeswoman Bertille Glass said.

Public records show the billionaire, who reportedly also has a residence in McLean, Va., began to amass property in southeastern Montana as early as 2003 – just as natural gas production in the area was booming.

Since then, Mars has launched or joined multiple court fights through Diamond Cross. The suits have challenged the industry's depletion of water reserves, a proposal to build a new coal railroad through the ranch and, most recently, efforts to drill on Diamond Cross itself.

Diamond Cross controls more than 82,000 acres in Rosebud and Bighorn counties – equivalent to roughly 130 square miles, public records show. The court affidavit lists Mars, his wife Deborah, daughter Pamela and son-in-law Wright as the co-owners of Diamond Cross Properties. Its headquarters are across the border in Wyoming, where Mars keeps a permanent residence, according to the affidavit.

Ranch manager Denise Wood said Mars had kept the Montana property as a working cattle ranch and that all its employees were “native Montanans.” She said his concerns about energy development mirrored those of many longtime residents, particularly the practice of pumping out underground water reserves to access trapped pockets of natural gas.

Those reserves are depended on by farmers and ranchers to water their fields and livestock. Energy companies sometimes capture the water and hold it in stock ponds that ranchers can use, but often it is lost as runoff. Mars attorney O'Toole said the lawsuits were not meant to “at any cost block development.” “That's not the point,” he said. “The point is, we can't lose all that water and at the same time have no provision to put it back.”

In the most recent legal case involving Diamond Cross, Wyoming-based Pinnacle Gas Resources is attempting to begin drilling on a lease it holds to more than 10,000 acres of Mars property.

When the company notified Diamond Cross last month that it planned to begin drilling on the ranch by early January, O'Toole responded with a letter barring Pinnacle employees from the ranch. If they came on the property, O'Toole wrote, Pinnacle would be “nothing more than a trespasser” attempting to “breach the peace.” Pinnacle sued, demanding access. The first hearing in the case is scheduled Tuesday, in state district court. Attorneys and a state official in charge of oil and gas development said they could not recall a similar situation over the last two decades where a landowner had to be sued for access to valid leases.

“As a lawyer it should come down to the facts and the law, but there's no denying that money talks,” said Pinnacle attorney Chris Mangen.

A Mars victory would mark “a significant change in the interpretation of state law that says you do have access,” said Tom Richmond, administrator for the Montana Board of Oil and Gas Conservation. That agency is a defendant in a separate Diamond Cross lawsuit, over its approval of some of Pinnacle's drilling plans.

Richmond offered another solution to the dispute: Pointing to the gas company's size – its stock is worth about 1 percent of Mars' estimated personal fortune – he suggested the billionaire could simply buy the publicly traded company if he was determined to keep it off his land.

Is Coal To Gas Viable?

MONTANA, Jan 02 (Neo Natura) - According to the DOE's website on Montana we are actively pursuing alternative methods of energy production. This includes building new hydro-electric sources of power and Bozeman's regional coal sequestration research project. Apparently no one has told them that the last hydro-electric dam built in Montana, completed in 1975, was Libby Dam.

While commercial research into Coal-To-Gas technology continues in surrounding states there are some real environmental and economic questions surrounding the technology.

An essay written in 2006 by Joseph Romm and Ron Erickson address some of the underlying issues related to this not-so-new technology.

First, the process is incredibly expensive. You need to spend over $6 billion just to build one plant, which would produce 80,000 barrels a day - hardly a cost-effective solution when the U.S. consumes more than 21 million barrels a day.

Second, coal-to-diesel requires lots of water, about five gallons of water for every gallon of diesel fuel - not a particularly good long-term strategy in an area that is dealing with drought and water shortages, which will only increase with global warming.

Third, the total carbon dioxide emissions from coal-to-diesel are about double that of conventional diesel. Half the emissions are from the plant, and while you can in theory capture and store that carbon underground, it is expensive. Also, permanent leak-free solutions are not yet proven. And even if the carbon is captured at the plant, you are still left with diesel fuel that is burned in a vehicle and emitted out the tailpipe. We need to reduce our carbon emissions, and coal-to-diesel will increase them. It is not a good use for billions and billions of dollars.

Another argument is that Montana is spending ample time on research, but lacks any new useful legislation to expand energy development.

The sad part is that their tactics are working. None of the bills that would truly improve Montana’s ability to develop energy resources have passed the Legislature. A handful of environmental groups have prevailed over the well-being and livelihood of tens of thousands. I watched our governor’s “energy man” walk in and oppose the first major pro-energy bill of the session, and all it was supposed to do was speed up the permitting process.

NorthWestern Gains Stake In Coal Plant

MONTANA, Jan 02 (Neo Natura) - US-based NorthWestern Energy has paid approximately $133 million to acquire a larger share of the Unit 4 coal-fired generation plant in Colstrip from SGE, a subsidiary of GE Capital.

NorthWestern will gain a further 143MW in the Montana plant having acquired a smaller stake in the coal plant earlier this year.

NorthWestern funded the transaction with available liquidity and a newly formed subsidiary, Colstrip Lease Holdings, which is to finalize a $100 million non-recourse loan to support the purchase.

Accretion to earnings is expected to be approximately $0.6 million in 2007, $1.8 million in 2009, $3.6 million in 2010 and $4.8 million thereafter.

Rock Creek Project Progresses

MONTANA, Jan 02 (Neo Natura) - From the Missoulian: "A controversial mining plan to tunnel beneath the Cabinet Mountains Wilderness north of Noxon has passed a 'significant milestone'."

The Kootenai National Forest issued a letter of determination notifying Revett Minerals, Inc. "that they may conduct surface disturbing activities as authorized by their Plan of Operations after all the applicable conditions have been met as outlined in the Kootenai's Record of Decision (ROD) with respect to the Evaluation Audit."

Additional information on the Rock Creek Project, including supplemental information reports on fisheries and wildlife, the record of decision, and final biological opinions, are available on the Kootenai National Forest website.

Revett Minerals has a website devoted to the Rock Creek Project which includes permitting documents and technical reports.