Ranchers worry about rights in methane development
SPOTTED HORSE, Wyo. (AP) – A few weeks back, an unfamiliar pickup truck pulled up at Mike Foate’s ranch and two men stepped out as if they owned the place. In a way, he soon found out, they did.
The men were from a company that holds the rights to mineral reserves beneath Foate’s Rocking Horse Ranch, where city slickers pay for the peace and quiet. The men were there to survey places to drill. The company, Foate learned, is gearing up for what many expect to be full-throttle drilling for coal-bed methane in the Powder River Basin of Wyoming and Montana.
Foate felt sick as the words from the two men sank in. He ordered them off his land until he could talk to a lawyer.
“We just never realized that could happen,” said Foate, who said he was unaware when he bought the ranch 10 years ago that the minerals underneath belonged to someone else. “How do you see that train wreck coming?”
Sometime early this year, the U.S. government is expected to lift a moratorium that has halted new drilling for coal-bed methane in much of the region for the past two years.
Landowners like Foate who have “split estates” are getting worried they will be overwhelmed with demands from developers for access to their land.
Split estate are common in the West; the rancher owns the land, or “surface rights,” but someone else owns the minerals, oil or gas beneath it.
Many ranchers fear that giving developers access to drill will mean new roads on their ranches, mazes of power lines and large holding ponds for the wastewater extracted during the drilling. They wonder if their land will ever look the same once the companies leave.
Foate knows he cannot legally stop the company from drilling. But he warned that he is not above a little civil disobedience to protect his land and livelihood.
“With me, what you see is what you get,” he said. “Predicting my nature or anybody’s when their back’s against the wall is hard to tell when it’s something you care about. I could end up in jail.”
Foate and his wife, Vivian, said they have considered outfitting their gates – now loosely chained to keep the horses they train from straying – with bicycle locks.
The Powder River Basin covers an estimated 13 million acres in northern Wyoming and southeastern Montana. It is a landscape of craggy buttes and rolling prairie. Underneath lie rich deposits of methane gas in the coal seams.
How that gas is tapped has been the focus of a long feud pitting some landowners and environmentalists against gas developers and the federal government, which controls mineral rights in a large portion of the basin and leases those rights to companies that do the drilling.
Farmers and ranchers say the water released during the drilling can be high in salt or metals that can damage crops and kill trees. The U.S. Bureau of Land Management in Wyoming stopped issuing new drilling permits in much of the state in August 2000 because of those concerns, and Montana ended all new drilling a few months earlier because of a conservation group’s lawsuit.
In early January, though, the government released an environmental review of coal-bed methane drilling, recommending stronger protections for rivers and streams but essentially clearing the way for tens of thousands of new wells.
Industry and government officials say there is no reason for ranchers to worry.
Among other things, companies must try to work with landowners first to devise plans for development, and negotiate rental payments or compensation for maintenance and potential damage to the property.
“We listen to landowners. And if what they want is within reason, we typically go with them,” said Richard Zander, a BLM assistant field manager.
Bruce Williams, vice president of operations for Fidelity Exploration & Production Co., said there are tight regulations to ensure that gas is developed in an environmentally friendly manner.
Near Gillette, rancher Eric Barlow’s property already has about a half-dozen wells. He negotiated an agreement with the drilling company and is compensated for use of his property. Still, he said, the cash is not worth the headache of watching constantly to make sure the drillers are carrying out their jobs responsibly.
“The bottom line for companies is, use what you need to use to get what you need to get,” he said.
For some landowners, especially those lucky enough to own the mineral rights on their property, coal-bed methane drilling has been a godsend.
Joel Ohman was skeptical of development as first but said the experience has been a positive one – and a profitable one – even as he deals with nine companies on his ranch near Gillette.
“It’s a matter of realizing they’re going to be there and trying to make the best of it,” he said.
As for Foate, he has not made up his mind about what he is going to do.
“We talk about the what-ifs. But it’s hard, because you’ve got so much of yourselves invested in the place,” he said. “We don’t want to move, but there’s always the chance, God forbid, that we say three or four years down the road, “We were so dumb. We should have moved.”‘