Forest lands in the East attract oil and gas bidders, but some question rush
By Juliet Eilperin,
Oil and gas companies looking to lease swaths of U.S. Forest Service land holding the promise of shale gas deposits and other fossil fuel resources have made the Bureau of Land Management’s Eastern States Office in Springfield ground zero for a new land rush.
For years Forest Service land in the East was considered irrelevant when it came to oil and gas leasing. But in the past year and a half, the federal government has leased or scheduled for auction more than 384,000 acres at the request of private bidders, more than 10 times as much land as it had leased in the previous two years.
The burst of activity has sparked a public debate over how to reconcile the different uses of national forests.
The office was scheduled to auction the rights to energy exploration on nearly 90,000 acres of Forest Service land in four states — Alabama, Arkansas, Louisiana and Mississippi — next week, but announced Friday it would delay the Alabama auction in the face of widespread protest there. Meanwhile, officials at Virginia’s George Washington Forest are embroiled in a controversy over whether to ban any future horizontal drilling in the forest, as they proposed last year, or leave open the possibility for companies in the future.
The intense competition in recent years to lease private land for a form of oil and gas drilling known as hydraulic fracturing, or fracking, has made federal lands overlying shale deposits more attractive even if they might not be developed for years, said Kevin Book, managing director for research at Clearview Energy Partners. With the exception of 38,174 acres in Alabama’s Conecuh National Forest, all of the Eastern U.S. forest acreage leased since 2011 lies over shale deposits.
“Every area overlying shale resources is being leased, whether it’s in the West or the East,” Book said. “When the race is on and in the heat of battle, the price of private land is very expensive. The federal government makes it slower and more difficult to do [drilling], but by comparison these are relatively cheap leases.”
Private land overlying shale deposits can sell for thousands of dollars an acre; land in the most recent BLM forest leases averaged $47 per acre.
Robert Bonnie, senior adviser to the secretary of agriculture for environment and climate, said Friday that the government decided to delay the auction of 42,965 acres in Alabama’s Talladega National Forest because “both the Forest Service and the BLM recognize the need to solicit public input on this.” But he said the government would press ahead with energy exploration elsewhere on national forests.
“What we balance is conservation and resource extraction,” Bonnie said.
“Forest Service areas are multiple-use lands,” said Dan Naatz, vice president for federal resources at the Independent Petroleum Association of America. “Our concern is Forest Service areas are being more and more managed like national parks, rather than for multiple use.”
But environmentalists, as well as some officials in regions that have experienced an uptick in lease applications, said the small BLM office in Springfield overseeing forests in 31 Eastern states is ill-equipped to evaluate the requests it is receiving from prospective land buyers.
Natural Resources Defense Council land program director Sharon Buccino, whose group joined with the Southern Environmental Law Center in lodging a formal protest against the Talladega National Forest lease sale, said BLM is not applying the same environmental review and public comment procedures that the Obama administration has instituted in the West.
Under those procedures, BLM analyzes the site-specific environmental consequences for lease parcels several months in advance of a sale and provides its findings to the public for comment; provides maps and global positioning data for each lease parcel; and provides links to the environmental analysis supporting a sale on its Web site.
By contrast, bidders on Forest Service lands in the East don’t even need to provide GPS coordinates for prospective parcels; they can describe areas by referring to local landmarks or other general terms. Forest management plans, which last for 10 to 15 years, lay out which areas are acceptable for drilling years in advance and how it can be conducted, and a site-specific environmental analysis takes place only after leases are sold.
“People are leasing national forest land left and right,” Buccino said. “There’s not the infrastructure in place to provide the environmental review and public participation that BLM now has in place in the West.”
The difference, according to BLM officials, lies in which federal agency is operating as the land’s surface manager. In the West, BLM, a division of the Interior Department, performs the analysis; in Eastern national forests, the Forest Service performs this task because it owns the land being leased, even though BLM officials conduct the auctions.
Dennis Lathem, executive director of the Coalbed Methane Association of Alabama, said he doesn’t know who asked BLM to put energy rights in parts of the Talladega National Forest up for sale next week. The now-delayed lease sale represents 10.9 percent of the forest’s total area, on top of the 19 percent the federal government leased for energy exploration five years ago.
“There’s not a whole lot, and never has been, much oil and gas activity on forest lands in Alabama,” Lathem said. “I don’t expect this lease sale to generate much interest.”
But Book noted that these leases last for 10 years, which “is enough for a market, especially natural gas, to go from trough to peak. . . . The greater value is for production in the future.”
In several communities, the prospect of possible water contamination is atop concern. Fracking involves injecting a mix of water and chemicals at high pressure to free oil and gas trapped beneath the surface, and the Environmental Protection Agency is studying whether there is a link between this activity and the contamination of nearby water supplies.
In the 3,500-person town of Heflin, Ala., more than 200 people showed up at a May 14 meeting to protest the upcoming lease sale; Rep. Mike D. Rogers (R-Ala.) sent a letter to BLM Director Bob Abbey on May 24 asking that he “immediately reopen the protest filing period” and schedule a public hearing on “the different types of energy extraction that could result” from a lease sale.
Anna Berry, Heflin’s mayor, said that although she would welcome a delay of the auction, “we want the Talladega National Forest taken off the table. We don’t think this will benefit us in any way.”
Many residents near Virginia’s George Washington Forest are similarly skeptical of the idea of allowing horizontal drilling there. Last spring the Forest Service issued a draft management plan that would ban such activity; it is now reconsidering that in the wake of protests from the oil and gas industry.
Sarah Francisco, a senior attorney for the Southern Environmental Law Center, recently visited one of the areas in the Talladega National Forest that was to have been auctioned next week. It includes a lakeside recreation areas with a jungle gym and picnic tables, where a father was having a picnic with his daughters.
“It was completely idyllic,” Francisco said. “People are using that forest.”
Shenandoah Valley Network Executive Director Kate Wofford said her group and others are worried about drilling’s effect on a forest at the headwaters of the Potomac and James rivers, which supply drinking water for Washington and Richmond, respectively, along with “the infrastructure” that accompanies hydraulic fracturing. “It’s the industrialization of the forest lands,” she said.
Naatz, whose group represents small and mid-size oil and gas companies, said these firms want to ensure they have the option of developing resources there in the future. “The real bottom line is we want to make sure these areas are available,” he said. “It may not be economical, it may not make sense now. But a number of years from now, it may.”