Little victory in permitting lawsuit

The Department of Interior’s (DOI) effort to overhaul public land drilling was setback when the court sided with the Western Energy Alliance (WEA) in a suit against the limited use of categorical exclusions to expedite onshore drilling. According to The Hill, WEA “alleged the policy ran afoul of a 2005 energy law that required the exemptions.”

The limited use of categorical exclusions was meant to insure fewer permits came under litigation from environmental groups, thereby delaying the approval process for Big Oil. In fact, the reforms were protecting the permits from unnecessary protests. The Bureau of Land Management (BLM) reports there are fewer protests today compared to the past six years.

The court’s decision means Bureau of Land Management (BLM) cannot rely on its 2010 guidance, but it does not require BLM to return to a practice of endangering our natural and cultural resources to permit drilling without any common sense limitations.

While WEA may praise the court decision – they have set the industry up for more time spent in court rather than drilling. The categorical exclusion program continues to be misapplied and out of compliance with BLM policy.

In a 2009 report on the use of categorical exclusions, Government Accountability Office (GAO) “found numerous examples—in 85 percent of the field offices sampled—where officials did not correctly follow guidance, most often by failing to adequately justify the use of a categorical exclusion.”

Between 2006 and 2008, the BLM permitted more than 6,100 permits to drill – 28% of the total handled by BLM – were issued using categorical exclusions, according to a GAO analysis.

Even the Western Governor’s Association (WGA), which at the time included Wyoming Gov. Dave Freudenthal, was concerned about the use of exclusions in the permitting process.  In 2007, WGA passed a resolution calling for Congress to prohibit the use of categorical exclusions to permit oil and gas projects in wildlife migration corridors and crucial habitat. The resolution was meant to thwart the same energy laws WEA sited in its suit.

Unused land leases limit tourism and contribute to high gas prices

As we head into the Memorial Day weekend and the unofficial start of the summer travel season, families are feeling the pinch from high gas prices. Unfortunately, instead of pushing for real solutions to help Americans save money and drive our nation toward energy independence, the oil and gas industry lobby continues demanding more government handouts, including reckless development of our public lands and ending common sense protections for the land, water, and air on which American families and businesses depend. Responsible energy development means protecting the land, rivers, and lakes western states need for their outdoor recreation and tourism industries and that Americans enjoy on their Memorial Day weekend and summer vacations.

Outdoor recreation is a significant part of America’s economy, contributing over $730 billion nationally. In 2010, more than 137.9 million Americans, age 6 or older, participated in at least one outdoor activity.

Moreover, access to public lands for drilling is not an issue. The simple truth is that the oil and gas industry has failed to develop 57 percent of its current leases as well as 7,200 permits where they have a green light to drill.

Outdoor recreation business leaders and user groups support responsible energy development. That way we can ensure Americans can continue to visit their favorite vacation spots on future Memorial Days and provide jobs to the of thousands of men and women who work in the outdoor recreation industry.

Outdoor recreation & tourism in the Intermountain West

  Outdoor recreation industry annual state economic contribution[1] Outdoor recreation industry related jobs[2] All direct travel and tourism jobs[3]
Colorado $10 billion 107,000 357,721
Montana $2.5 billion 34,000 71,216
New Mexico $3.8 billion 47,000 119,974
Utah $5.8 billion 65,000 151,334
Wyoming $4.4 billion 52,000 42,429

Drilling by the numbers

Access to drilling is simply not an issue on our public lands:

  • Onshore drilling permits are expected to increase over 40% in 2011. (U.S. Dept. of Interior)
  • Oil and gas companies have yet to develop 57 percent of their existing onshore leases nationally. (U.S. Dept. of Interior)
  • Oil and gas companies yet to develop nearly 7,200 onshore oil and gas permits nationally where they have a green light to drill. (New York Times)

The United States is a world leader in oil and gas production

  • The U.S. is the world’s third largest producer of oil in the world, producing about 9.1 billion barrels of oil per day. (Energy Information Administration)
  • The U.S. is the world’s leading producer of natural gas, producing 26.2 billion cubic feet per year. (Energy Information Administration)
  • More drilling rigs are located within the United States than all other countries in the world combined – U.S.: 1,830; Canada 143; all other countries, 1129. (Baker Hughes)
  • Oil and gas companies receive over $15 billion in taxpayer subsidies each year. (Taxpayers for Common Sense)
  • President Obama targeted $43 billion in taxpayer subsidies over 10 years in his FY12 budget proposal. (White House)
  • While the U.S. does important significant levels of crude oil, the U.S. is now a net exporter of petroleum products and selling refined oil and diesel oil abroad. (Energy Information administration)

[1] “State by State Active Outdoor Recreation Economy Report,” Outdoor Industry Association, http://www.outdoorindustry.org/research.php?action=detail&research_id=52

[2] Ibid.

[3] :EPS-HDT: Socioeconomic Profiles,” Headwaters Economics, http://headwaterseconomics.org/tools/eps-hdt

THE BALANCE SHEET: APRIL 26, 2011

Our weekly update to unravel the industry and political spin around the energy debate


IN CASE YOU MISSED IT

WE’RE IN THE WRONG LINE OF WORK

While Americans are suffering from pain at the pump, Halliburton reported last week that its first quarter revenue set a company record at $5.3 billion, which is up from $3.8 billion in the first quarter of 2010. First quarter profits were up 148 percent from $206 million in 2010 to $511 million in 2011.

Halliburton cited increased U.S. onshore drilling activity as the reason for its success, with Chairman Dave Lesar stating, “North America delivered strong performance as margins progressed due to increased activity while Eastern Hemisphere operating income was significantly impacted by geopolitical events in North Africa, delays in Iraq, and typical seasonality.”

ANOTHER EARTH DAY, ANOTHER SPILL

A Chesapeake Energy Corp. well blowout occurred in Northern Pennsylvania Tuesday, spilling up to tens of thousands of gallons of toxic, chemical-laden fluid onto area residential land and contaminating a tributary of the Susquehanna River. The incident may be the most serious fracking accident in the history of the commonwealth’s Marcellus Shale development. DeSmogBlog has the story.

WORD GAMES

Last week, Colorado Oil and Gas Conservation Commission Director David Neslin testified before a Senate committee looking into hydraulic fracturing’s less than spotless track record on safety. Contrary to his testimony, where he asserted that groundwater contamination from fracking has never occurred, Neslin told The Checks and Balances Project immediately following the hearing that oil and gas production in Colorado had indeed led to contamination. Most drilling is fracking, so to say fracking does not cause groundwater contamination is disingenuous at best. Watch how Neslin and industry representatives use rhetorical tactics to excuse corporate responsibility for toxic fracking fluid casing leaks and pit overflows.

PRICE, NOT POLICY, DETERMINES HEALTH OF WESTERN ENERGY DEVELOPMENT

Headwater Economics on Tuesday released a report analyzing the relative success of states and communities to maximize energy development’s benefits and minimize its costs. The report concludes with a series of policy recommendations for communities trying to achieve that goal. In five Rocky Mountain, energy-producing states – Colorado, Montana, New Mexico, Utah, and Wyoming – Headwater Economics discovered that common sense standards and protections did not hamper energy production. Price was the ultimate factor in determining whether energy development occurs. Read the full report.

DID WE LEARN OUR LESSON FROM THE GULF OIL SPILL DISASTER?

Checks and Balances Deputy Director Matt Garrington asks that question in his guest-commentary piece for Sunday’s Denver Post. Give it a read and let us know what you think.


DID YOU KNOW?

OIL & GAS NY LOBBY FUNDS UP 400 PERCENT IN TWO YEARS
In New York State last year, the oil and gas industry spent $1.6 million on lobbying to fight common sense protections from oil & gas fracking impacts, up from $400,000 in 2008.


COMING UP THIS WEEK

BLM TO REVIEW COMMERCIAL OIL SHALE LEASING PROGRAM

The Department of the Interior Bureau of Land Management will host public hearings in three Western states – Colorado, Utah and Wyoming – beginning today to gather input from residents and experts as they review the federal oil shale leasing program. Find out more about the hearings.

Now that gas prices are hovering around $4 per gallon, risky schemes like oil shale are back in the national debate. Oil shale is pure science fiction, as companies have failed to produce commercial oil from oil shale despite a hundred years of experimentation.

Chairman Doc Hastings (R-WA), Subcommittee Chairman Lamborn (R-CO), Rep. Scott Tipton (R-CO) and Rep. Rob Bishop (R-UT) have all been throwing about this fantastic tale. Compare what politicians are saying to those in the oil and gas industry, who believe viable oil shale is a decade out or more.

Furthermore, oil shale today is being conflated with shale gas and shale oil, giving the false impression that oil shale is ready for prime time. This has led to inaccurate rhetoric, and it has the potential to mislead investors, policymakers and other Americans interested in real energy solutions.

Compare what politicians are saying to those in the oil and gas industry, who believe viable oil shale is a decade out or more: Oil Shale Quotes – Congress v Industry


CONTACT US

Twitter: @checksandbals | Email: tips@checksandbalances.org

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