My Side: The Lake Ridge Unit: putting process over politics
It’s often said laws and rules are only as good as institutions that enforce them. Allowing the BLM to follow process, born of law, is critical in managing the diverse activities occurring on public lands.The Lake Ridge Unit Application should be approved or denied based on its own technical merits, not by misappropriated political pressure or special treatment for an area of wealth and political influence.A recent opinion editorial by local consultant Trsi Houpt asked the BLM to deny the Lake Ridge Unit Application submitted to the BLM by SG Interests. Readers likely suspected the energy industry to quickly disagree and counter with a brittle, petulant position of our own.So readers might be surprised that I take no position, and neither support or oppose the Lake Ridge Unit application. After all, Ms. Houpt and I have something in common – our resumes disqualify us both from forming meaningful opinions about geophysical principles and subsurface geology – the elements used in determining whether or not to issue a federal unit.The West Slope Colorado Oil & Gas Association does, however, take a strong position that the BLM should be allowed to follow its own regulatory processes, formed over time, by legislation, case-law, rulemakings, and IBLA decisions.In order to further advance my case for following process and law over politics, some clarity on the whole Thompson Divide conflict is perhaps needed.So here it is.The strategy for blocking energy development in the Thompson Divide area is simple. The Thompson Divide Coalition seeks to delay SG Interests’ ability to manage their natural gas leases as a unit. This delay might contribute to the expiration of SG’s natural gas leases. If the leases were to expire, the coalition would then seek a leasing prohibition that would create permanent restrictions to benefit landowners and residents who don’t wish to see natural gas production in their area.If keeping oil and gas production out of the coalition’s backyard is the goal, then the strategy outlined above, while shrewd, makes sense. But there is a problem. This narrow goal and strategy to block local natural gas production is blind to the broader policy implications of how the coalition is choosing to get from here to there. Targeting of the unitization review process means uncertainty for companies around the nation who rely on the orderly management of leases by forming units. Worst of all, the strategy’s recent outcry for national intervention in the BLM’s decision making process also reinforces the perception that Aspen and Carbondale are somehow deserving of arbitrary, special treatment from the regulatory process. And such arbitrariness leaves other energy companies around the Rockies scratching their heads thinking, whose unit could be next?It’s a common theme from our industry that can’t be restated enough. American businesses large and small rely on regulations that are predictable and relatively constant. Otherwise, there is no way to measure the risk of investment. That’s true whether someone is building a house or permitting a refinery. Changing the rules during the game is a clich but for a reason. And attempting to change the rules during the game is exactly what is occurring surrounding the BLM’s Lake Ridge Unit determination process.So it comes down to this. Should the privileged demographics of the Thompson Divide area receive different treatment by U.S Senators, Federal Agencies and or the processes itself? Should the Lake Ridge unit application have a different burden of proof than hundreds of other unit applications that go through the same technical review process? It’s around these principle questions that we engage in the debate.Ranchers purchase grazing leases. Developers seek permits to improve ski resorts. And oil and gas companies navigate the political landscape to monetize their mineral property rights. All of these example activities on public lands require a rulebook for development that is clear so that investments can be measured, and risks properly calibrated.Moving forward, politicians can and should take positions on the Thompson Divide issue – that’s what they’re tasked to do. Ms. Houpt has every right to ask the BLM to deny the Lake Ridge Unit – that’s what she’s presumably contracted to do. But the BLM technical staff should follow their established processes – that’s what they must do if businesses and individuals are to have confidence in the frameworks that govern private business in America.- David Ludlam is executive director of the West Slope Colorado Oil & Gas Association.
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