Roan gas lease settlement announced
Industry and environmental groups joined federal, state and local officials Friday in applauding a long-anticipated settlement regarding natural gas development on the Roan Plateau west of Rifle.
The landmark deal protects most of the public lands on top of Roan from drilling, at least for the foreseeable future, while allowing development to continue on other leases in the area, including those at the base of the Roan.
The settlement was announced Friday afternoon at a joint press conference at the state Capitol called by Gov. John Hickenlooper and U.S. Interior Secretary Sally Jewell.
“This is great news for the state of Colorado and for the local community, who have worked hard to strike a balance between protecting open space and energy development,” Jewell said in a formal news release.
“The Roan Plateau is an extraordinary place, and this settlement is a model for what can be accomplished when we all come to the table and work to find solutions,” she said.
Hickenlooper reacted to the formal release of the settlement by the Bureau of Land Management, Bill Barrett Corp. and a coalition of environmental groups, saying, “We are thrilled to see resolution for this decade-long controversy over one of Colorado’s most special places.
“This settlement will protect the valuable fish and wildlife resources atop the Roan Plateau, while clearing the way for orderly development to take place elsewhere in the planning area,” the governor said.
The agreement cancels 17 of the 19 leases issued on the plateau in 2008 and refunds approximately $47.6 million in bonus bids and annual rental payments to Barrett Corp.
Barrett’s remaining two leases on top of the plateau and 12 leases at the base of the Roan cliffs, which are held by WPX, Ursa and Oxy, will remain in place.
Pete Maysmith, executive director for Conservation Colorado, spoke on behalf of numerous environmental, conservation and recreation groups involved in the lawsuit challenging the BLM’s decision to issue the leases on approximately 55,000 acres of the Roan.
“Conservationists, hunters, anglers and wildlife advocates welcome this settlement and the opportunity it provides to conserve an area rich in wildlife and unparalleled scenic vistas,” Maysmith said. “This settlement helps us achieve the goal of preserving important natural areas like the Roan Plateau in Colorado while oil and gas development continues in Colorado and across the West.”
Other groups involved in the settlement included Earthjustice, the Wilderness Society, Rocky Mountain Wild, the Sierra Club, Rock the Earth and the Carbondale-based Wilderness Workshop.
“We thank Gov. Hickenlooper, Rep. (Scott) Tipton and our senators for their support of this balanced plan that offers strong protections for the Roan Plateau while still allowing reasonable access to energy leases,” said Peter Hart, staff attorney for the Wilderness Workshop.
David Ludlam, executive director for the West Slope Colorado Oil and Gas Association, said the compromise will provide many decades worth of jobs and needed tax dollars for local communities.
“Today we celebrate the local governments and tireless elected officials of northwest Colorado who secured responsible drilling on one of western Colorado’s most important energy reserves,” Ludlam said. “Tomorrow, we’ll get back to work supporting the BLM and helping them expedite their approval of this milestone.”
Also attending the Friday press conference were Colorado’s two U.S. senators, Michael Bennet and Mark Udall, state Rep. Bob Rankin of Carbondale and Garfield County Commissioner Tom Jankovsky.
“It is a compromise, but it is a positive for Garfield County in many ways,” Jankovsky said in a phone interview following the announcement. “It not just protects the more sensitive areas on the Roan, it allows some mineral production as well.”
That’s good economic news for Garfield County and western Colorado, he said.
“Every rig that goes up, that’s 55 jobs, so it does have an impact,” Jankovsky said. “It also helps in terms of property taxes, and everything that goes with that.”
County Commissioner Mike Samson, also reached by phone Friday following the announcement, said he remains hopeful that local communities will be held harmless for the reimbursed leases. Hickenlooper has promised to support a state budget resolution that would prevent future mineral lease and royalty payments to local governments from being withheld.
“I am hopeful that will be the case,” Samson said. “We must ensure that our local communities are held completely harmless, past, present and future.”
Samson was also clear in discussions with his fellow commissioners that he would not support the settlement if it prevented the canceled leases from being reissued at some point in the future.
“It’s important that these lands are not blocked from energy development in perpetuity,” he said.
Under the terms of the settlement, the BLM will cancel the stipulated leases and begin work to consider a management plan alternative to allow for limited development on remaining leases. While the deal precludes new leasing on top of the plateau under the anticipated 20-year life of that plan, new leasing could be considered once the plan expires.
Scot Woodall, CEO of Bill Barrett Corp., said the company is grateful to the BLM and elected officials for supporting an agreement that gets it out from under the disputed leases while allowing some new drilling to occur.
“The settlement ends a long period of uncertainty that has limited our ability to invest in development and to bring the Roan’s natural gas to market,” Woodall said. “We look forward to working with BLM as they complete the analysis necessary to start drilling.”
Last month, Bennet, Udall and Hickenlooper, all Democrats, joined Republican Tipton and Republican county commissioners from both Garfield and Mesa counties in urging Secretary Jewell to approve the settlement.
“Our local communities and the leaseholders have worked out this compromise,” Bennet said. “They’ve agreed to it because it balances a variety of needs and interests by allowing for some development while also establishing crucial environmental and wildlife safeguards.”
Tipton said the resulting compromise will allow “responsible energy production” to move forward.
“We worked to ensure that protections are in place to hold local communities harmless for any royalties that may need to be paid back,” Tipton said. “As a result, impacted communities including Garfield and Mesa counties voiced their support and helped push the agreement across the finish line.”
BLM Director Neil Kornze said it was that “broad coalition” of divergent interests that allowed the settlement to be reached.
“After many years of discord and disagreement, this settlement represents a path forward for the people of Colorado, for the oil and gas industry, and for those that seek to protect critical wildlife habitat,” Kornze said.
As part of the agreement, the BLM agreed to consider a “Settlement Alternative” to the court-ordered Supplemental Environmental Impact Statement that has been ongoing.
The settlement agreement was approved by the U.S. Department of Justice. It can be found on the BLM website at: http://www.blm.gov/co.
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