Land Use Planning and Oil and Gas Leasing on Onshore Federal Lands (1989) / Chapter Skim
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6 Oil and Gas Leasing and Management Procedures
6 Oil and Gas Leasing and Management Procedures
Pages 87-105
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From page 87... ...
While the process is predictable, the location and impacts of resource production are not, at lease at the early stages of exploration and development. OVERVIEW Onshore federal oil and gas leases are made available for exploration and development by means of a legal contract called a lease.)
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From page 88... ...
If it were subsequently determined that any surface activity on the lease would jeopardize an endangered species, then the lessee has no legal right to occupy the lease surface to drill that lease, nor presumably can the lessee: demand compensation for its investment in the lease. Probably the same result would be reached whether or not the lease contained -a specific term obligating the lessee to comply' with the Endangered Species Act, because the standard, lease 'form obligates the lessee to comply with all federal iaws,';of which the Endangered Species Act is one.
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From page 89... ...
If oil or gas production in paying quantities is discovered, then the well is completed in accordance with an approved procedure. In addition to federal review and approval, further plans for development of a well or field, including unitization and enhanced or secondary recovery, also require state as well as BLM approval OIL AND GAS LEASE ISSUANCE Current Oil and Gas Leasing Procedures for BLM and Forest Service Lands Under the Federal Onshore Oil and Gas Leasing Reform Act of 1987 (101 Stat.
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From page 90... ...
. The current oil and gas leasing system for BLM and Forest Service lands is derived from the Mineral Leasing Act of 1920 (30 USC 181-287)
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From page 91... ...
, in its recent review of the newly implemented leasing procedures, confirmed the increased percentage of competitive leases and the increased revenues from competitive leasing. While the Reform Act did not contain any statutory changes in land use planning procedures relative to oil and gas leasing, the Forest Service and the BLM recognized the need to revise their administrative procedures and regulations under existing law.
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From page 92... ...
| Filing Received 1 1 r 1 | Issue Noncompetitive | Lease (10 yr Primary Term) Expl ora t ion, development, production, abandonment, and reclomation No Production, :: Exploration, developm en t, production, abandonment, and reclamation FIGURE 6.2 Fedem1 oil and gas leasing process, post-Reform Act.
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From page 94... ...
The Forest Service has now proposed rules by which it will implement the statutory responsibilities of the Reform Act for management of oil and gas leasing and attendant surface-disturbing activities conducted on National Forest System oil and gas leases. A controversial feature of the Forest Service proposal requires the nclusion of the following standard stipulation in all oil and gas leases issued for National Forest System land: The lessee must comply with the applicable rules and regulations of the Secretary of Agriculture set forth in Title 36, Chapter II of the Code of Federal Regulations governing use and management of the National Forest System and must submit to the authorized forest officer a surface use plan of operations for approval or disapproval in accordance with OFF, Part 228(e)
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From page 95... ...
FIGURE 6.3 Administration of federal oil and gas leases on national forest system lands. SOURCE: Courted of Forest Service.
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From page 96... ...
The surface management agency should maintain the data base and ensure that the plan and the decisions to lease, with or without special stipulations, accurately reflect the current data. The committee heard considerable discussion concerning the impact of seismic exploration and drilling on threatened and endangered species, primarily grizzly bear, and big game, particularly elf.
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From page 97... ...
Stipulation One of the more common special stipulations limits the range or duration of time during which oil and gas exploration and development can be conducted on the lease. This stipulation is primarily designed to protect certain wildlife values, such as use of critical winter range, rutting and/or calving periods, eagle nesting, and similar activities that could be impaired by oil and gas operations, principally exploration.
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From page 98... ...
1988~. In the Deep Creek Plan on the Lewis and Clark National Forest, 75 percent of the 42,000 acres leased was covered by a no-surface-occupancy stipulation (Bob Marshall Alliance v.
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From page 99... ...
46 if.) Legislation dealing both with oil and gas on the Outer Continental Shelf and with geothermal resources onshore contains explicit provisions making lease rights leases contingent upon agency approval of development proposals.
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From page 100... ...
Because the Reform Act requires the federal agencies to approve surface operations on their leases, the Department of Agriculture apparently takes the position that the act requires, in effect, that all oil and gas leases on National Forest lands are contingent upon subsequent approval by the Forest Service of the environmental acceptability of plans of operations on the leases (see section 228.106 of the proposed regulations)
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From page 101... ...
Third, it would allow staged or segmented environmental analysis of oil and gas leasing activities by specifically reserving the right to say no to an activity. This would appear to satisfy court decisions like Conner v.
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From page 102... ...
The committee heard complaints that this process was often a very informal one, without public notice or much environmental assessment. The question is of considerable concern because of the agencies' apparent tendency to "load up" leases with stipulations rather than make what might be controversial or difficult decisions about oil and gas development at the planning or lease issuance stage.
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From page 103... ...
, storage and transportation systems, and location and density of service roads. The impacts of full field development can be controlled, again at potentially significant cost to the operator, through requirements for multiple wells or completions from a single surface location, pipeline versus truck transport, specific site and road construction, timing of development, contemporaneous reclamation, and establishment of alternate habitat for wildlife.
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From page 104... ...
This might include pump jacks, tanks, pipelines, compressors, heater treaters, storage sheds, offices, hydrogen sulfide abatement equipment, roads, drillingJproduction pads, equipment storage areas, and vehicles. However, full field development is not automatically initiated by the first successful well.
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From page 105... ...
1989. Mineral Revenues, Implementation of the Federal Onshore Oil and Gas Leasing Reform Act of 1987.
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