Oil wells on Billings’ doorstep under consideration – Last Best News, May 21, 2014

May 21, 2014

Categories: Agriculture, Fossil Fuels, Landowner Rights, News, Oil and gas


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Kris Spanjian talks with Paul Van Tricht about the possibility of oil and gas development taking place on her property off Molt Road. In the background are the pens where her husband, a falconer, raises pheasants and other game birds.

By Ed Kemmick

In February, the Yellowstone Valley Citizens Council called a meeting in downtown Billings to support residents of Carbon and Stillwater counties as they braced for an onslaught of oil and gas drilling.

Mary Fitzpatrick, one of the organizers of the gathering, said the group’s focus soon changed.

“Shortly after we formed, the BLM announced these leases out here,” she said. “Suddenly it was a Yellowstone County issue.”

“Out here” referred to rolling prairie land to the north and northwest of Billings, where the Bureau of Land Management announced that 12 parcels of land — and one in Stillwater County — were being considered for possible oil and gas development.

Fitzpatrick and a few other members of the newly formed YVCC Oil and Gas Committee toured the area Saturday afternoon, heading up Highway 3 to Shepherd-Acton Road, then going in a big loop to a ranch couple’s house near the junction of Molt Road and Shorey Road. One parcel they did not visit was in the vicinity of 80th Street West and Grand Avenue.

Even as they were familiarizing themselves with what could be oil and gas exploration sites in Yellowstone County, a dispute was brewing at the site of an exploratory well near Belfry, in Carbon County.

There, according to nearby farmer Bonnie Martinell, the Energy Corporation of America is unlawfully drawing water from a gravel pit that is fed by waters from the local aquifer and the Clark Fork River. Though the pit is on private property, Martinell said, she and other farmers and ranchers in the area own rights to the water.

Deb Muth of Red Lodge, chairwoman of the Carbon County Resource Council — like the YVCC an affiliate of the Northern Plains Resource Council — said she went to Belfry on Sunday and filmed trucks filling up with pit water and taking it to the drilling site, about a mile away.

“They were just going back and forth all day,” she said.

Muth said the resource council was told by the state Department of Natural Resources and Conservation that ECA does not have a permit to remove water from the pit, which feeds irrigation ditches in the Clark Fork Valley.

“Come July, first of August, people around here start fighting over water,” Martinell said.

Martinell said she was in the process of filing a complaint over ECA’s use of the pit water with the DNRC, but had not formally submitted it as of Wednesday morning.

Also Wednesday morning, a spokeswoman for the ECA in Billings released this statement:

“Energy Corporation of America (ECA) is working with a local vendor to purchase water for our operations.  It is our understanding that this particular vendor has an agreement directly with a surface owner in the area who has a gravel pit on his property that has filled with water.  Under their agreement, the vendor draws water from this gravel pit, which he then transports and ultimately sells to ECA.

“It is important to note that the location in question is simply a gravel pit that has filled with water.  There are no surface streams or other water sources running into or out of the gravel pit.

“We have discussed this situation with our counsel and he has advised us that we have taken all necessary steps to appropriately and lawfully utilize the water being drawn from the gravel pit.  Therefore, we believe we are in full accordance with the law and, as we strive to with all of our operations, we are operating responsibly — utilizing local vendors and working hard to be a good neighbor.”

John Mork, the chief executive of ECA, based in Denver, caused an uproar last fall, when he announced in Billings that he “would love to bring something like the Bakken” to promising sites around Red Lodge and Roscoe, and to the Bighorn Basin of Montana and Wyoming.


Ed Kemmick/Last Best News

Left to right, Paul Van Tricht, Mary Fitzpatrick, Becky Mitchell and Alicia Pettys consult their maps Saturday during a tour of Yellowstone County parcels being considered for oil and gas development. At this point the group was on Shepherd-Acton Road north of Billings.


The BLM did not identify who sent in “expressions of interest” on 12 parcels in Yellowstone County and one in Stillwater County. The BLM announced its receipt of the letters on March 25.

The expressions of interest indicate that someone or some company is interested in buying federal oil and gas leases on the parcels in question. The BLM has scheduled a lease sale for Oct. 21.

On Monday, the BLM released an environmental assessment of the impacts of offering the parcels for oil and gas development. Comments on the assessment will be accepted for 30 days.

The BLM’s assessment recommends proceeding with the sale of leases on 10 of the parcels, all within Yellowstone County, but deferring sales on three of the parcels, including the one in Stillwater County, near Dean.

The two parcels in Yellowstone County for which deferral is recommended are close to greater sage-grouse leks. Preservation of sage-grouse habitat is a major consideration of a revised Resource Management Plan the BLM is working on. That means action on leases in those areas would be deferred at least until the revised plan is finished, perhaps by the end of 2015.

As for the Stillwater County site, deferral was recommended because the parcel takes in the unincorporated town of Dean as well as a stretch of stream designated as suitable for Yellowstone cutthroat trout recovery habitat. It also falls within a state-designated “source water protection area.”

The removal of the Dean-area parcel from the list, again until completion of the revised management plan, was hailed by David Katz, a blogger whose family owns property on the Stillwater River. His blog, Preserve the Beartooth Front, is updated almost daily with news, data and opinion.

Katz noted that the environmental assessment said 40 people wrote letters opposing development of the parcel near Dean.

“So for those of you who took time from your schedules to write letters, take five minutes to pat yourself on the back,” he said. “Citizens who take the time to speak to government can have an impact.”

Kris Spanjian is hoping citizens can do something about possible exploratory drilling on her property. She and her husband, Ray Gilbertson, raise bison on 1,226 acres near Molt and Shorey roads.

They own the surface rights to their property, but the BLM holds the mineral rights and can sell them to the highest bidder. The BLM says in the environmental assessment that of the 10 parcels still being considered for leasing, the BLM manages surface rights on two of them, totaling 240 acres.



Ray Gilbertson photo

These bison are part of the herd on Ray Gilbertson and Kris Spanjian’s ranch.


The other eight parcels, totaling, 1,282 acres, are split-estates, like Spanjian’s. She hosted the tour group Saturday, pointing out the location of the quarter-section parcel being considered for development — about a mile south of her house.

She said she and her husband put their land under a conservation easement through the Montana Land Reliance, to protect it from inappropriate development, but the easement has no bearing on the BLM-owned minerals.

Like residents of the McFarland Subdivision, just outside of which their property sits, Spanjian said they are most worried about groundwater pollution, particularly if hydraulic fracturing is used to get at the oil and gas. They have two water wells, one for their livestock and one for household needs.

In addition to groundwater pollution, Spanjian said, their concerns include “the dust, the noise, the disruption. And we have the wildlife issue and the livestock issue.”

“For somewhere this close to a metropolitan area,” Gilbertson said — their ranch is not quite 15 miles from downtown Billings — “there is an abundance of wildlife out here.”

Craig Drake, assistant field manager in the BLM’s Billings office, said the BLM has already met once with people in the McFarland Subdivision. Another meeting, which will include Yellowstone County Commissioner Bill Kennedy and a representative of the DNRC, is being planned for June 9.

Spanjian is hoping for the best and preparing for the worst.

“I’m afraid … it’s going to be the beginning of a big rush,” she said.


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