by David Nicholas

Drilling for oil & gas on the Baca National Wildlife Refuge took another step back this month. In a settlement reached between the plaintiffs: San Luis Valley Ecosystem Council (SLVEC) and the Citizens for SLV Water Protection Coalition and the defendants, the United States Fish and Wildlife Service (USFWS) and Lexam Explorations (USA) Inc., the parties agreed to begin the National Environmental Protection Act (NEPA) process all over again.

Under the agreement a new NEPA process is to be initiated as soon as possible and to be completed no later than April 1, 2011. Also the settlement does not prevent the plaintiffs from  bringing a suit if they are dissatisfied with the USFWS process and conclusions.

The agreement invalidates the previous environmental analyses and decisions which would have allowed Lexam to begin drilling in the Baca National Wildlife Refuge in late 2008. Under the Draft Settlement Agreement dated May 5, 2010, USFWS agrees to withdraw all approvals, authorizations, decisions on Lexam’s operation on the Baca National Wildlife Refuge.

“The public process has been effective, but much work remains,” said Christine Canaly, Director of the San Luis Valley Ecosystem Council, whose group filed the original challenge in 2007, claiming that the proposed oil and gas drilling of two 14,000 ft. wells beneath the newly designated Baca National Wildlife Refuge were required to go through a NEPA process to receive public input and provide alternatives.

In a statement released by the Ecosystem Council, a new NEPA process will be initiated to analyze the impacts of Lexam’s development proposal, which includes drilling wildcat wells into unproven oil and gas deposits which Lexam believes lie beneath the Baca National

Wildlife Refuge. Attempts to acquire Lexam’s (mineral) interests are ongoing and provide a favorable alternative to drilling into these ecologically important areas.

“The information gained during the lawsuit convinced us that purchase and retirement of the private mineral rights may be the most attractive option for all parties involved,” said Ms. Canaly.

“We intend to accomplish a purchase of the mineral rights without incurring the impacts and high risk threats which come with drilling a three-mile-deep wildcat well into the sensitive ecology and unique aquifers which define the San Luis Valley,” said Mathew Crowley, Chairman of the Water Protection Coalition.

However, acquisition of those mineral rights would involve a lengthy process over a number of years which would end up in the hands of the federal government. Money for the federal acquisition would have to be included in the budget of U.S. Department of Interior, which oversees the Fish and Wildlife Service.

For that process to begin it has to be shown that there is support for this purchase all the way up the federal chain, starting with local support from the region.  The Rio Grande Water Conservation Dist. and Saguache County Commissioners have already publicly come out in support for purchase and retirement of the mineral rights.  Then it is up to the Interior Secretary to ensure the money is included either in whole or in part, beginning in 2012, and to shepherd it through the budget process. If the money is allocated in part then it could take several years to acquire the rights. That would also mean that another entity would need to acquire the rights in whole to hold them while the Federal Government completes the funding.

When the Great Sand Dunes National Park and Preserve Act was passed in 2000 it was not until a final budget appropriation was passed in 2004 that the entire purchase price of $33 million was funded. It was fortuitous that during the interim period the Nature Conservancy held ownership of the land until the appropriation was completed.  Ownership then passed to the federal government.

Could something like that happen with the acquisition for the mineral rights? Possibly. But the question is: how much are the mineral rights worth? Determining that will involve delicate negotiations.

In the meantime the settlement completed on June 14 is a quiet victory.  It provides those opposed to drilling on the wildlife refuge time to work out alternative plans.