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Drilling Rig

The Nabors X21 rig operates at a Wold Energy Partners well site Friday north of Rolling Hills in Converse County. A proposed 5,000-well project in the county would bring as many as 8,000 jobs and $28 billion in revenue to the area over 10 years.

Jim Willox knows when industry is picking up in Douglas, a 6,000-head town in the heart of the southern Powder River Basin.

It’s the traffic.

The drive-thru may have seven cars instead of three. Winch trucks and flatbeds stack up at stoplights, and men eat alone in cafes — temporary fixtures in a town that may be far from home, wife or kids, the Converse County commissioner said.

People that live around Douglas are expecting to see those familiar signs of an increase in drilling if the price of oil remains steady, more so because a proposed 5,000-well project may be approved just north of town.

The project would be an economic boon, bringing an estimated 8,000 jobs and as much as $28 billion in revenue to the region over 10 years, but public comments on a draft assessment of the project by the Bureau of Land Management are divided.

The agency spent four years analyzing how the 1.5 million-acre project would impact everything from dirt roads to bald eagles, but its preferred direction is exactly what the five oil and gas firms have proposed — 5,000 wells over 10 years — with exemptions to allow for year-round development where possible. Industry groups and political leaders support that direction as one more manageable for local communities, but environmental advocates, and even other federal agencies, have criticized the proposed alternative for failing to address the magnitude of the project’s impact on wildlife, water and air quality.

Brady Owens, a spokesman for the Bureau of Land Management said the environmental analysis is still a draft and the ultimate decision, whether consistent with the oil and gas firms’ proposal or a mixture of other options, will be made after the public has weighed in on the proposals.

“The (Environmental Impact Statement) is not a decision document,” Owens said. “What we are doing now is going through the analysis.”

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The project lies north of Interstate 25, roughly from Glenrock in the west to Douglas in the east. It extends north to the Campbell County border. Within that enormous square are ranches and wind farms, oil wells and sage grouse habitat. Only about 10 percent of the surface is public land, but a majority of the minerals are managed by the federal government. It would be one of the largest single projects Wyoming has seen go through the federal permitting process.

Five major firms proposed the venture in 2014: EOG Resources, Anadarko Petroleum, Chesapeake Energy, SM Energy and Devon Energy.

The draft analyzes three alternatives for developing the project and chooses a preferred direction:

  • One alternative would essentially kill the project, a baseline that allows development to move forward in the area independent of a hawk-eye assessment.
  • The second alternative, and the one preferred by the Bureau of Land Management, mirrors the oil and gas operators’ suggested plan of 5,000 wells over 10 years with a number or exemptions from environmental restrictions.
  • The final alternative would include numerous limitations on drilling, but still allow the same number of wells over the same period of time.

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The Bureau of Land Management’s preferred alternative has a number of supporters in Wyoming, from local officials to the Washington delegation.

The Petroleum Association of Wyoming, which represents the majority of the state’s oil and gas producers, noted that the industry proposal had the highest economic benefit for the region. Given that executive orders from the president and the Interior Secretary Ryan Zinke mandate promotion of the nation’s energy resources, the Petroleum Association asked that the BLM proceed “with only those restrictions on development that are necessary.”

The Bureau’s other alternative carries too many restrictions to be carried out, and would only increase traffic and disturbances for wildlife by turning drilling on and off at certain times of the year, the group wrote.

Year-round drilling was also supported by Wyoming’s delegates. The state’s two senators and one representative echoed the Petroleum Association and advised the Bureau of Land Management to take into account the Trump administration’s guidance on regulations, limiting those that unduly burden or delay energy development.

“Given the overwhelming positive benefits of this project to our state, we urge you to complete the (environmental impact study) and issue a record of decision in as timely a manner as possible,” the three delegates wrote in a joint letter.

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The urging of politicians has been one of the main concerns of environmental groups that say the Bureau has an obligation to balance energy and the environment.

Supporting a plan that is exactly what energy companies asked for is unheard of for the agency, said Dustin Bleizeffer, communications director for the Wyoming Outdoor Council, and a former energy reporter for the Casper Star-Tribune and Wyofile.

“This is what energy dominance might look like under (the Trump) administration,” he said “It looks like the BLM is taking what it sees as its orders from D.C. on this, and it doesn’t have to be that way.”

The proposed action, supported in this draft stage by the Bureau of Land Management, eliminates best practices that would give industry some degree of certainty while protecting wildlife and environmental resources, he said.

“These are best practices for a reason,” he said.

From producing extreme volumes of waste water to drilling near protected bird species, the proposed alternative falls short on a number of basic concerns that benefit no one, he said.

Owens, of the BLM, said it is not that unusual that the preferred plan in the draft aligns with industry’s proposal.

“They aren’t going to propose something that isn’t compliant,” he said of the oil and gas firms. “Quite frankly, we’ve been working for four years to cover those bases, to make sure that they are compliant with all the laws.”

The agency will continue to follow its rules and regulations, while streamlining its processes to meet with the various executive orders, he said.

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The Environmental Protection Agency, now led by former Oklahoma attorney general Scott Pruitt, disagrees with the BLM. It suggested in a public comment that the bureau choose a more environmentally sound alternative for the project. The energy firms’ proposal adds significant impacts that could be avoided, while allowing the same number of wells over the same 10-year period, the agency wrote in its public comment.

The preferred alternative adds more than 700 miles of roads compared to the other plan analyzed by the Bureau of Land Management and uses 900 million more gallons of fresh water per year. It also doubles the amount of waste water and suggests 30 new disposal wells to inject produced water underground. Those additional wells “cover some, but not all, the potential disposal needs,” the agency wrote.

Water may be the Achilles heel of the environmental assessment, noted in numerous public comments as a weakness in the Bureau of Land Management’s work. Hydraulic fracturing methods use significantly more water now than when the bureau began its analysis of the project.

Owens, the Bureau of Land Management spokesman, said the agency was aware of the water challenge and officials were updating that aspect of the environmental analysis.

Willox, the Converse county commissioner said water was also a local concern.

But he believes the water issue can be solved.

Overall, the local leaders support the project and the agency’s work so far, Willox said, noting that the draft is an early step in the process.

Douglas has seen booms of development, and the busts that can follow, he said.

Like the delegates, and the Petroleum Association of Wyoming, Willox said year-round drilling would be the least disruptive for his county.

“It’s an exciting opportunity for Converse County and Wyoming,” he said. “But it comes with its own set of challenges.”

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Energy Reporter

Heather Richards writes about energy and the environment. A native of the Blue Ridge Mountains in Virginia, she moved to Wyoming in 2015 to cover natural resources and government in Buffalo. Heather joined the Star Tribune later that year.

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