Report Chides Bureau of Land Management's Rush to Drill

Congressional watchdog says a policy shortcut on oil and gas permits led to lawsuits, confusion and dirty air in Vernal.

by Patty Henetz

Sloppy wording in the Bush administration's 2005 Energy Policy Act's directives to streamline oil and gas development has led to lawsuits, end runs around environmental laws and dirty air in Vernal, a federal agency says.

In a report issued this week, the Government Accountability Office criticized the Bureau of Land Management's "inappropriate" use of so-called categorical exclusions -- exemptions from normal procedures -- in its drilling-permit operations.

The exemptions, pushed through to speed energy development in the West, let one broad environmental-impact statement on one drilling application serve for all subsequent requests.

The 2005 provision also allows BLM officials under certain conditions to sidestep provisions in the 1969 National Environmental Policy Act requiring analyses of threatened or endangered species, historical or cultural resources, human health and safety of potentially significant cumulative environmental effects of oil and gas drilling on public lands.

The Energy Policy Act contains serious gaps and inconsistencies that have led to violations of environmental laws, the GAO found. Cumulative impacts of additional oil or gas development, especially on air quality, have been the most widespread and potentially serious concerns.

The Environmental Protection Agency and other agencies have determined the Vernal BLM area is among those where allowable levels of ozone pollution have been reached or exceeded, in part because of the release of nitrogen oxides from additional wells approved under the exemptions, the report says.

About 25 percent of drilling permits issued from 2006 through 2008 allowed the exemptions. Nearly two-thirds of all the exemptions came from three BLM field offices: Vernal; Pinedale, Wyo.; and Farmington, N.M.

One premise for the categorical exclusions was that they would save time for oil and gas developers. The GAO couldn't find any hard evidence that happened.

The main problem, the report found, was BLM's inconsistency from state to state in how to grant categorical exclusions. The GAO also pointed out that BLM officials were at a disadvantage because the law itself was unclear on how to evaluate, grant, monitor or enforce the exemptions. The law wasn't even clear on whether the exemptions were mandatory or discretionary. This has prompted complaints from industry and environmentalists alike.

The Nine Mile Canyon Coalition, the Southern Utah Wilderness Alliance and The Wilderness Society in August 2008 sued the BLM for its use of the 2005 Energy Policy Act provision. The lawsuit said BLM's Price field office failed to analyze properly the cumulative effects of approving one drilling permit after another in Nine Mile Canyon.

At the time, Mike Stiewig, the Price field office associate director and a defendant in the suit, said the BLM "operates within its statutory obligations and authority."

The Interior Department says it will take immediate steps to fix the problems outlined in the GAO report. Congress is considering bills that would clarify how individuals, advocacy groups or drilling operators might counter BLM decisions on the exemptions.