October 8, 2008

GAO Launches Probe into Oil, Gas Drilling

By Paul Foy Associated Press

Congressional investigators are looking at the government's quick -- and legal -- approvals for oil and gas drilling in an investigation called long overdue by environmental groups. Industry executives condemn it as political.

Two Government Accountability Office investigators are in Utah as part of a probe into the Bureau of Land Management's practice of approving some drilling projects without a full environmental study of the consequences.

The practice, authorized by the 2005 Energy Act, has been used thousands of times at field offices in Price and Vernal, Utah; Farmington, N.M.; and Pinedale, Wyo., said GAO officials, citing the bureau's own figures. Agency officials say they were just doing their job, and that they don't set policy.

On Tuesday, the investigators visited eastern Utah's Nine Mile Canyon, an area with thousands of ancient rock art panels that has turned into a battleground over energy development.

Three environmental groups are fighting plans by Denver-based Bill Barrett Corp. to drill more than 800 new gas wells in the area, adding to the truck traffic that can stir up dust and coat the art panels.

Critics contend a chemical used to keep dust down corrodes the art panels; the company denies it but says it's testing less abrasive chemicals.

In August, the Southern Utah Wilderness Alliance, the Nine Mile Canyon Coalition and The Wilderness Society sued to block BLM approval for the first 30 of Bill Barrett Corp.'s wells on a plateau above Nine Mile Canyon.

The wells on the West Tavaputs Plateau were approved by the BLM under a "categorical exclusion" provision, which allows certain projects to move ahead without an in-depth examination of potential environmental impacts.

"We just follow the policy that's been established. I don't feel we've inappropriately used any categorical exclusions," said Mike Stiewig, BLM's field manager in nearby Price.

"The larger question has to do with the policy issues, which are way above the chain from me," Stiewig said Tuesday. "I don't make the rules, I just live by them."

The GAO investigators were expected to visit a second Utah BLM office Wednesday in Vernal. That office waived environmental scrutiny 491 times in fiscal year 2007 for oil and gas projects, said GAO officials in Washington, D.C. Bill Stringer, the field manager in Vernal, didn't return a phone message left by The Associated Press. Nor did field managers for Pinedale, Wyo., and Farmington, N.M.

"When it comes to those exclusions, we're confident we applied them correctly," said Megan Crandall, a spokeswoman for BLM operations in Utah.

A staff lawyer for the Southern Utah Wilderness Alliance, however, said BLM was willing to waive environmental regulations even for sensitive and wilderness-quality areas around Nine Mile Canyon.

"Congress established categorical exclusions to streamline the process, not to eviscerate it, but that's how the Bush administration has interpreted it," Stephen Bloch said Tuesday.

"There's been concern since this was passed in 2005 that this was going to be a loophole exploited by the industry and the Bush administration. We certainly think there are some abuses happening, and we're pleased GAO is going to look into it," he said.

The director of GAO inquiry, Robin Anzzaro, said her team was starting in Utah to gather facts and statistics and wouldn't make a judgment about the BLM's "high number of categorical exclusion."

The request, she said, came from the House Natural Resources Committee and its Subcommittee on Energy and Mineral Resources. Both panels are chaired by Democrats.

An executive for Bill Barrett Corp. called the inquiry political.

"You have a couple of congressmen that know little to nothing about oil and gas and even less about public land management ordering an investigation into categorical exclusions by an agency that knows less than nothing about oil and gas and public lands management," said Duane Zavadil, vice president for government affairs for Bill Barrett Corp. "It's political grandstanding."

The publicly traded company expects to receive government approval by year's end for the 800-plus gas wells. Zavadil said his company was funding an environmental impact study; a draft version released earlier this year drew 58,000 objections, including one from the U.S. Environmental Protection Agency, which registered concerns about air emissions and protection for Nine Mile Canyon's rock art.

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