Utahs BLM oil, gas leases spark discussion
United States Deputy Interior Secretary David Hayes stepped into the crosshairs Tuesday of the fight over his boss' decision to cancel 77 oil and gas leases in Utah.
He did it in the heart of the state's energy region.
"We know that the withdrawal of these leases has been an unsettling event," Hayes told an audience of nearly 800 people at the Western Park Convention Center in Vernal.
Hayes was in the Uintah Basin for a "listening session" with local leaders and the community.
The trip was part of an agreement between Interior Secretary Ken Salazar and Sen. Bob Bennett, R-Utah, to review the secretary's cancellation of 77 oil and gas leases auctioned off by the U.S. Bureau of Land Management in December.
The leases are the subject of several pending lawsuits in federal court.
"We don't really understand why these (leases) got pulled and we're asking you to take a critical review of a number of these leases," said Brad Boyce, executive vice president of Cirque Resources.
Boyce indicated the Denver-based energy firm successfully bid on three of the leases that were later canceled.
He said the parcels were adjacent to other properties Cirque holds the mineral rights to and are not located near any national parks, which was one of the reason cited for Salazar's decision.
"When one reviews the facts of these leases it becomes apparent that these properties have been scrubbed by the BLM and were not part of any last ditch leasing effort by the Bush administration," said Boyce.
Bill Ryan, a founding member of Uintah County's public lands committee and the owner of an energy consulting firm, said the primary concern for the industry extends beyond the 77 disputed leases.
He said energy companies who bid on leases are required to pay bonuses on the parcels they win, money which is returned to the state and county of origin.
"When you, through an administrative decision, go ahead and pull these, it makes operators less willing to pay high bonus fees because they don't know for sure that they're going to actually enjoy the right that they thought they had won in a legal sale," said Ryan.
"You're creating an environment that is not friendly to some of the operators," he said. "It's a very dangerous thing that you guys have done."
Other speakers focused on the personal impact that the slow economy and Salazar's decision has had on their lives.
Cheryl Hemphill said she is battling breast cancer and her husband has been laid off from his oil-field job. The couple is facing mounting medical bills and may soon be forced to move in with one of their adult children.
"Obama got his presidency by saying, 'Change,'?" Hemphill said, "but I'm lucky if I have any change left."
R.L. Tatman, a long-time oil-field worker, told Hayes the energy industry operates under mounting state and federal regulations, many of which he said are unnecessary.
"For the most part, wells aren't easy to drill," said Tatman. "There are no less than 80,000 regulations, from the leasing to the drilling of the well. ... Can you think of any one single thing that takes 80,000 regulations? Could we build houses if there were 80,000 regulations?"
Tatman said the basin is a tough area to drill in because the Vernal BLM office is "doing its job" and urged Hayes not to allow the federal government to implement additional regulations on oil and gas exploration and production.
"We don't need anymore regulations," he said.
A few supporters of Salazar's decision to rescind the leases stepped to the microphone only to be drowned out by boos and catcalls.
Hayes called for respect for all of the speakers, as did others in the audience who want the leases reinstated.
"I'm a little bit disturbed by the lack of respect that we've given some of the speakers because we're not rednecks," said Val Labrum of Roosevelt, who then said Salazar should return the leases to the winning bidders.
Hayes, who met behind closed doors with state and county leaders before the public hearing, said his team would make recommendations to Salazar by the end of next week and discuss them with Bennett shortly thereafter.
"We are hoping we can work through this," he said. "We know by your very presence here how important this is to all of you."