If the Wyoming Department of Environmental Quality slows downthe permit approval process for companies eager to begin coal bedmethane projects in the state, the largest producers already thereare expected to have no trouble meeting their drilling schedulesthrough at least the first quarter of 2001. Anticipating thehearings, many had already moved proposed drilling projects for2001 through the regulatory process.

On Jan. 3, 2001, the Wyoming DEQ’s Environmental Council willhold a water discharge hearing that could have an effect on thefuture permitting process for coal bed methane projects in theprolific Powder River Basin. The discharge permits cover the amountof chemicals allowed into the nearest water source, and are arequirement for coal bed methane production because water is pumpedout of the drilling area to allow methane to escape from the coalin the production process.

Expected to voice their opinions at next month’s hearing areproducers, landowners and environmental groups, according to DEQ’sGary Beach, the administrator of the Water Quality Division.Following the hearings, DEQ will make a decision by February 2001on whether to change discharge limits, keep them the same, or in aworst case scenario, shut down future drilling for the long- orshort-term beyond those permits already approved.

Don’t expect the ruling to be written in stone. Following DEQ’sdecision, there could be an appeal by an opposing group, and theappeals process could take up to a year, possibly delaying pendingpermits.

However, producers already operating in the basin had beenprepared for the coming hearings. Barrett Resources, one of thelargest producers in the Powder River Basin, had announced it woulddrill 1,000 wells in 2001. But when Barrett discussed its thirdquarter results earlier this year, it warned of possible slowdownsin the Powder River Basin if its water permits were delayed.Western Gas also had warned of possible production delays.

However, of the 1,000 wells Barrett plans to drill next year, italready has obtained discharge permits for nearly 800 of them.Based on the approved permits, a Barrett spokeswoman said that thecompany would not be changing its 2001 drilling schedule “one bit.”She added that Barrett did not anticipate delays in the firstquarter.

What effect permit delays will have on other producers is opento question — most permit requests cover more than one well. DEQalready had approved 80% of more than 50 water discharge permitsplaced for public notice in September and October, according toBeach. All of the approved permits covered discharges into theCheyenne River and the Belle Fourche River, which are both in thePowder River Basin flowing into South Dakota.

The 11 delayed permits all were tied to water discharges intothe Powder River, but the flows would be north into Montana, wherepublic opposition to the water discharges has discouraged Wyomingofficials from approving permits for those discharges. There alsoare seven permits requested in November that now are held up.Before September, DEQ had cleared the books of all pending permits.

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