PUBLIC LANDS:

Controversial 'wild lands' policy could face first legal test in Wyo.

The Obama administration's controversial new "wild lands" policy could face its first legal challenge in northwest Wyoming's McCullough Peaks, but not from pro-development interests and Republican lawmakers who have been most critical of the policy's implications.

Rather, environmental groups are prepared to challenge the Bureau of Land Management's recent approval of an oil and natural gas exploration project that will affect roughly 14,000 acres of wilderness-quality land in the northwest Wyoming desert badlands tucked between the Bighorn and Shoshone national forests.

The Rocktober Unit Project, to be undertaken by Denver-based Bill Barrett Corp., would allow for the drilling of three 15,000-foot-deep exploratory wells in the McCullough Peaks area, and as many as four additional wells if the initial three produce sufficient quantities of natural gas. The company has also proposed to expand its pipeline and compressor station network to move gas from the McCullough Peaks drill sites to market, according to BLM.

An amended environmental assessment and Feb. 11 record of decision authorizing the first three test wells states that "the entire development will disturb approximately 155 acres," and "if any of the wells will prove to be incapable of producing natural gas in commercial quantities, they will be plugged and abandoned and the location reclaimed according to BLM standards."

But critics argue that BLM's approval of the exploratory wells contradicts Interior Secretary Ken Salazar's Dec. 22, 2010, executive order instructing agency field offices to identify parcels with wilderness characteristics and to consider designating them as wild lands that are off-limits to development. BLM just last week issued final guidance documents on the wild lands order that, among other things, instruct field managers to place a high priority on the preservation of lands with wilderness characteristics.

Under that order, BLM has already identified more than 50,000 acres of unprotected land in the McCullough Peaks area that may have wilderness characteristics and should be studied for possible protection as wild lands under the agency's upcoming revision of its Bighorn Basin resource management plan, which will guide management policies on 3.2 million acres of federal lands and 4.2 million acres of federal minerals. The plan is expected to be released this spring (Land Letter, Jan. 20).

"It is a considerable concern to us that, in what could very well be the first on-the-ground implementation of the new wilderness policy, BLM's decision is to authorize the impairment of wilderness-quality landscapes," said Bruce Pendery, program director and staff attorney for the Wyoming Outdoor Council, one of the groups opposed to the project.

Environmentalists are also concerned that the Rocktober wells would cut through state-designated "core areas" for greater sage grouse, which last year became a candidate species for Endangered Species Act protection. Fish and Wildlife Service officials have said that if Wyoming's core habitat areas are left intact, the grouse would likely avoid a formal listing.

But Erik Molvar, a wildlife biologist with the Biodiversity Conservation Alliance in Laramie, said BLM's approval of the Rocktober project runs counter to the agency's responsibility to protect delicate or imperiled resources such as sage grouse. He pointed to BLM Director Bob Abbey's March 2010 memorandum to field agents in Wyoming and 10 other Western states calling on regulators to "withhold from sale or defer the sale" of leases for energy development on federal lands containing priority sage grouse habitat (Land Letter, June 24, 2010).

"There was a clear commitment in the instruction memorandum last year that is not being followed here," Molvar said.

Grandfathered lease

While acknowledging the wilderness characteristics of the McCullough Peaks area, BLM officials in Wyoming say they approved the Bill Barrett exploratory wells because the company has a valid federal lease that dates back to 2003 -- long before Salazar's wild lands order or Abbey's memorandum on sage grouse habitat.

"There's no way [the wells] are compatible" with the surrounding area, said Fred McDonald, assistant field manager for BLM's Cody Field Office. "We're very open and honest about saying that."

But, McDonald added, since the company filed applications to drill the first three wells before either policy was enacted, those wells are essentially grandfathered under the pre-existing policy. If Bill Barrett decides to drill the additional four test wells, those drill sites would be subject at least to the sage grouse restrictions outlined in the Abbey memo, he said.

McDonald added that BLM staff took great pains to offset development impacts in the area, such as limiting drilling activity between April and July during the sage grouse and mountain plover breeding seasons, and requiring that propane tanks and fence slats are painted to blend in with the natural background.

"Even though there's development, we worked really hard to mitigate the impacts to the land, whether to visual resource management by screening tanks with earth-tone colors or requiring low-profile tanks," he said.

Bill Barrett officials also stress the company's sensitivity to environmental impacts.

Company spokesman Jim Felton said officials might reach out to environmental groups to see if a compromise can be struck that would allow for drilling to proceed in a timely manner. "We would like to get to work out there," he said. "However, we are not adverse to working on issues with individual groups if the result is some regulatory clarity and certainty that allows us to move forward efficiently," he said.

Such deals have been struck before.

Felton pointed to an agreement reached last July between Bill Barrett and a coalition of environmental groups that allowed for the drilling of 626 new wells on 1,603 acres in the West Tavaputs Plateau area in northern Utah, including underneath the Jack and Desolation canyons that are being studied for possible wilderness designation (Land Letter, Aug. 5, 2010). As part of that deal, the company agreed to drill fewer wells than originally proposed and use directional drilling under the most sensitive areas.

Felton said the company hopes to avoid a protracted legal fight with environmental groups in Wyoming. "We'd rather be at the bargaining table than in the courtroom," he said.

Long path to leases

But the company may also face the reality of shifting public sentiment toward pristine public lands since 2003, when Bill Barrett purchased leasing rights to the 24,851-acre Rocktober Unit.

BLM's first environmental assessment (EA) for the project, issued in 2009, determined that the drilling project would have no significant impact on the surrounding McCullough Peaks environment.

That EA was challenged by environmental groups, including the Wyoming Outdoor Council and the Biodiversity Conservation Alliance, and BLM agreed to revise the original document, mostly to more fully account for impacts to the area's visual resources.

Visitors are known to frequent the area to try to catch glimpses of wild mustangs in the 17,000-acre McCullough Peaks Herd Management Area, a portion of which would be encroached upon by the Rocktober Unit wells.

The revised EA toughens conditions for drilling activities around the herd management area, including using fences rather than cattle guards to keep the horses away from drilling areas.

Pendery and Molvar said their organizations have not made a decision on how to proceed, but both agreed the revised EA does not go far enough to protect wilderness-quality parcels.

"Obviously, Bill Barrett has valid leases in the area," Pendery said. "However, just because they have valid lease rights doesn't mean BLM has its hands tied. But that's the position the BLM takes. I disagree with that view. They have a substantial amount of retained rights so as to protect a lot of values."

Among the solutions that might help resolve environmental concerns would be the use of directional drilling techniques, much as Bill Barrett agreed to do in Utah, to avoid surface disturbances on pristine lands.

"They have not used the full suite of options available to them," Pendery said.

Click here to read the amended environmental assessment for the Bill Barrett project.

Click here to read the Feb. 11 record of decision.

Click here to read BLM's guidance on implementing the new wild lands policy.

Click here to read BLM's first EA for the Bill Barrett project.

Streater writes from Colorado Springs, Colo.