Several moves to change energy permitting and royalty policy on public lands could impact Montana, although probably not its national forests.
On Thursday, the U.S. Forest Service announced proposed new rules in the Federal Register simplifying the permitting process for oil and gas leasing on its lands. The same day, a Department of the Interior panel announced it wanted to speed up its permitting process on Bureau of Land Management acreage as well as develop new ways of charging royalties for natural gas pumped from those lands.
“It’s going to eliminate a bunch of redundancy to get the same permit,” said Montana Petroleum Association Director Alan Olson. “Under this, one agency permits, but that doesn’t take away from any of the National Environmental Policy Act provisions.”
Coincidentally, the House Natural Resources Committee on Thursday advanced a bill to fund deferred maintenance in national parks with federal energy revenue. The National Park Service estimates it has nearly $12 billion in backlogged repairs. The Restore Our Parks and Public Lands Act would spend up to $1.3 billion a year for five years from federal oil, gas, coal and other mineral royalties and lease sales.
The Interior panel postponed its permitting changes until January, but forwarded the new royalty policy to Interior Secretary Ryan Zinke to begin the formal rule-changing process.
The Forest Service proposal will go through a public comment process that ends Oct. 15. Its changes include speeding up identification of national forest lands that could be offered for energy leasing, updating the responsibilities of leaseholders to protect the environment, clarifying rules on inspections and compliance and making rules for seismic testing mirror those of the BLM.
"We’re particularly interested in finding ways to make our internal process for managing oil and gas leasing and permitting more efficient and to improve customer service," Forest Service Region 1 spokesman David Smith said on Friday. "Updates to current regulations are needed to provide better service to the public with clear expectations for both resource protection and the environmental review process for proposed activities.
The Forest Service manages 154 national forests, 20 grasslands and one prairie in 43 states and Puerto Rico. At least 44 of those forests and grasslands have ongoing energy exploration or activity.
Under current policy, the Interior Department handles oil and gas leases and drilling permits and the Department of Agriculture must analyze the surface land use and may veto leases.
“The intent of these potential changes would be to decrease permitting times by removing regulatory burdens that unnecessarily encumber energy production,” the notice states. “These potential changes would promote domestic oil and gas production by allowing industry to begin production more quickly.”
It cites a BLM 2017 review of lease proposals that found the average time for a Forest Service review was 3.6 years. It added that “five to 10 years was not an uncommon length of time” for leasing parties to wait.
The changes would align “Forest Service process with the BLM so that operators have one simplified permitting system,” the notice states.
Earlier this week, the Interior Department’s Royalty Policy Committee proposed new ways for energy companies to launch projects and calculate the fees they pay the federal government for natural gas taken from public lands. One proposal would automatically approve some drilling permits unless federal land managers raised objections within 45 days. The second would set up two formulas for calculating royalty rates that companies could choose between.
Critics said the changes would undermine environmental reviews and allow energy companies too much discretion to set their own costs of operation.
Olson said it wasn’t likely the changes would have much impact on Montana national forests. Oil and gas prospectors have probed parts of the Rocky Mountain Front between Great Falls and Glacier National Park several times, most recently in 2012 and 2013.
A protracted legal fight continues over energy leases in the Badger-Two Medicine area south of the Blackfeet Indian Reservation where one company maintains it still has the right to drill. Several other companies have either abandoned or been compensated for their claims to the same area.
This summer the BLM proposed opening thousands of acres in the Big Hole and Beaverhead valleys to oil and gas leasing.
The bulk of the land up for possible lease is considered by the BLM to have “low,” or even in some instances, “very low” potential. One of the potential leases is in an area considered to have a moderate level of potential for development.
Also, instead of a 30- or 60-day buffer for comment after the initial announcement, the BLM gave a 10-day notice to the public in July that the parcels would potentially go up for lease
“One place that might see interest is some of the national grasslands in North Dakota that are managed by the Forest Service,” Olson said. “There’s a tremendous amount of oil and gas activity that goes on there. That would be an economic thing.
"We’re starting to see some permitting in central Montana. We finally got a drilling rig there for first time in the last five years,'' he said. "Everything is price-dependent.”
Smith said the Dakota Prairie Grasslands had more than 700 operational wells.
The Alliance for the Wild Rockies formed in the 1980s in part to challenge oil and gas exploration in the Badger-Two Medicine and the Bob Marshall Wilderness vicinity. Its current director, Michael Garrity, said the combination of moves showed the Trump administration had no interest in protecting public lands.
“Theodore Roosevelt created the national forest system to protect them from corporate exploitation,” Garrity said. “Trump is putting corporate profits ahead of clean water, clean air and public wildlife. They’re going to be destroying what makes the public lands great.”