The “relentless, aggressive and malicious” environmental public relations machine is succeeding in delaying and restricting natural gas development in the Rocky Mountains “with no regard for the impact on the national gas supply” — and the situation is getting worse, not better.

Producers need to get the message out to the American people that they will pay the price for excessive efforts to protect wildlife habitats in the cost and security of their energy supply, Duane Zavadil, environmental manager for Bill Barrett Corp., told attendees at the Colorado Oil and Gas Association’s Natural Gas Strategy Conference. The all-out anti-oil and gas campaign of environmentalists is at the very least “irresponsible.”

“The American people need to answer the question: are we going to halt our natural gas production for two-thirds of the year in order not to disturb the muledeer or elk — particularly in view of the fact that we have the ability to mitigate the impact?” Producers should convey the message and the basic math that a 10% reduction in wells drilled means a 10% reduction in energy supply.

Zavadil said that because of muledeer and elk protections, producers currently are allowed to drill on federal lands — where 70% of the West’s reserves are located — at most four months of the year. In the past producers moved their rigs onto state lands during the restricted periods, “but we’re running out of state lands,” and it is cost prohibitive to maintain rigs that only operate one/third of the year.

And seasonal restrictions are only part of the problem. Producers who are being prodded to support new pipeline projects, can’t commit to future pipeline capacity if they don’t know when or if they will get permits to drill. The time required to get a permit to drill on federal lands has escalated from 77 days in 1998 to 175 days today. At the same time it takes only two to three weeks to get a permit to drill on state-controlled land.

Currently, there are 1,700 federal drilling applications on file and awaiting action. “That’s about 300 MMcf of gas right there,” Zavadil said. “We’re two years behind in pipeline capacity” because of the regulatory uncertainty.

In addition, environmental groups have succeeded in forcing ever greater environmental study requirements and costs onto prospective drilling efforts. Small one-to-two well projects that used to require only environmental assessments, now are required to underwrite the costs of full environmental impact statements (EIS). “The costs of these gold-plated studies are prohibitive,” Zavadil said. “Small producers can’t afford a million dollars up front” for an EIS. “Producers are calling the National Environmental Policy Act (NEPA), the National Energy Prevention Act.”

For a large field it takes between two and two and a half years to complete environmental work.

Environmental groups are spending millions of dollars in anti-oil and gas campaigns, protesting individual drilling permits and pressuring Bureau of Land Management personnel. “We’re an easy target for the environmental spin doctors,” Zavadil said. “We’re not public relations people in this part of the country. We’re just rational scientists.”

He doesn’t fault the BLM employees, or even national politicians, noting that they are under constant pressure from well-funded environmental groups. In addition, the focus of BLM has changed to reflect more emphasis on conservation, recreation and tourism. There aren’t enough BLM personnel who understand oil and gas in the agency anymore. Zavadil urged producers to stay in touch with the government processors. “They need our expertise.”

Producers should mount their own promotional campaign. “We haven’t made our case. We need to gain public support.” And, it’s not impossible. Zavadil said his research shows that almost all the funding for environmental groups comes from foundation grants, and only a very small percentage is from ordinary people. This means the environmental cause does not have the broad public support it claims, and it could be vulnerable.

©Copyright 2003 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.