State offering energy leases

By Nick Gevock - 10/09/2008

State officials will offer more than 420 tracts of land for oil and gas leases in December, including 233 parcels in southwest Montana that conservationists say could be harmful to fish and wildlife.

The Montana Department of Natural Resources and Conservation will be putting 158 pieces of state land in Beaverhead County out for lease, 72 tracts in Madison County and three parcels in Gallatin County, said Monte Mason, chief of DNRC's minerals management bureau. The state received requests from petroleum companies and other private parties to lease out 427 tracts of state land.

"The interest that's shown by industry determines where we have applications," Mason said.

Leases will also be offered on state parcels in Big Horn, Blaine, Chouteau, Dawson, Fallon, Hill, McCone, Pondera, Richland, Roosevelt, Sheridan, Stillwater, Teton, Toole, Valley and Wibaux counties. State lands come up for leases four times a year.

But the leases in southwest Montana are drawing skepticism from conservationists worried about the effects of oil and gas drilling on fish and wildlife habitat.

Earlier this year a coalition of groups led by Montana Trout Unlimited protested a seismic exploration project on federal lands near Lima. They expressed concerns with how the testing and vehicle traffic associated with it would affect the abundant deer, elk and other wildlife in the area, as well as Big Sheep Creek and other streams.

That project is moving forward after the Bureau of Land Management, which oversees oil and gas leasing on all federal lands, imposed a series of restrictions. The rules included stream setbacks and a requirement that the seismic testing not take place in spring when wildlife is giving birth to its young.

But the state parcels up for lease also are important habitat that could be harmed by energy drilling, said Michael Gibson, a spokesman for Montana Trout Unlimited. He said the leases include parcels close to the upper Red Rock, Beaverhead and Ruby rivers.

"There's a pretty big group of them right at the confluence of the Beaverhead and Ruby rivers near Twin Bridges," he said. "It doesn't look good — having this much activity just upstream from the Jefferson is a little bit worrisome for us." That's because MTU has been working on a $2 million habitat improvement project on the Jefferson to improve irrigation, fix up headgates and make other enhancements to keep more water in the river, Gibson said. The overarching goal is to improve conditions for trout and help ranchers get more water during irrigation season.

But large-scale energy development upstream on the tributaries of the Jefferson could bring roads, well pads and other infrastructure near the streams, polluting them with sediment, Gibson said. Trout Unlimited plans to review the lease parcels to see which areas are appropriate for oil and gas drilling, or may ask for stipulations on drilling.

"Besides direct fisheries impacts of water quality and the like, you've got a world class fishery there," he said. "If they go into full scale production you're looking at a fairly industrial landscape." Mason, however, noted that the lease sale is only the beginning of the process. Companies buy up the leases and then have to go through a permit process with the state Board of Oil and Gas in order to conduct testing and production.

That's when the state can impose standards on any work to protect the environment. Those stipulations can range from controlling noxious weeds to requiring special parcels be drilled directionally from a neighboring property to protect the environment.

"We look at stream setbacks, whether there are sage grouse issues, sensitive areas, whether there are endangered or threatened species…" Mason said. "The standard is very high." A map and detailed list of tracts under consideration for leasing may be obtained by calling Mason at 444-3843. Information is also available on the DNRC website at http://dnrc.mt.gov/trust/mmb/og Comments on the leases should be submitted by Nov. 3 to Mason at DNRC, P.O. Box 201601, 1625 Eleventh Ave., Helena, MT 59620-1601.

Reporter Nick Gevock may be reached at nick.gevock@mtstandard.com.