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New Oil/Gas Rules Advance in Idaho Legislature

Idaho lawmakers last Tuesday advanced four bills to alter rules covering oil and natural gas development in anticipation of upcoming growth in what is now an industry in its infancy in the state.

The Idaho legislature's lower House Resources and Conservation Committee sent bills for full House consideration that would expand and clarify the role of the state's Oil and Gas Conservation Commission (OGCC).

One bill (HB 50) gives OGCC clearer authority over common pools of oil and gas that extend through areas of multiple mineral rights owners. The various bill proposals deal with pre-oil and natural gas drilling rules, and they are being pushed by the state’s Department of Lands (DOL) (see Shale Daily, Jan. 28).

The other measures address oil/gas production under state-owned riverbeds (HB 47), making production records (per well) public after a six-month period (HB 48) as a means of fostering competition, and maintaining oil/gas drilling permit fees and eliminating a clause that would have reduced those fees in 2017 (HB 49).

The legislative moves come at a time when Idaho is still in the backwater for oil and gas development, having little production, proved reserves and few active oil/gas exploration and production (E&P) companies.

State officials told NGI that production information is still kept confidential, although they said that HB 48, if it becomes law, it would change that situation. So far, the state DOL has records of 15 wells being drilled with two additional ones permitted but not yet drilled, all in southwest Idaho.

Idaho has only one producing well, but its output remained confidential, a DOL official said. "More will come online once a pipeline [proposed by an E&P company] is completed." The state's two current producers are Alta Mesa Service LP and Snake River Oil & Gas Co.

The DOL official said several other companies are leasing in Idaho, including Red River Oil and Gas, Northwest Operating Corp., Trendwell West Inc., Lone Tree Petroleum, and Jetex.

Late last month an executive in Houston with Alta Mesa confirmed for NGI  that it holds stakes in Payette, Washington and Gem counties, and that it supports the proposed new rules as an offshoot of a negotiated settlement already approved by the OGCC.

This spring Alta Mesa expects to finish an 11-mile natural gas pipeline in southwestern Idaho to transport production from more than a dozen wells.

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