Backlash

by Ray Ring


Marty Lambert isn't the kind of politician you'd expect to take an environmental stand. A Republican elected as Gallatin County Attorney, after 19 years in law enforcement, he makes his career taking on murderers, robbers and other threats to his community.


But Lambert is now fighting a legal battle on the same side as local environmentalists, allied with local leaders of both political parties and most business and property owners here.


The unusual coalition fights for a principle: that local people should have power over oil and gas development. "I'm representing the people of Gallatin County," says Lambert tersely.


The other side is a multinational company that wants to drill for coalbed methane on some of the best private land in the county. Most people here worry the drilling would harm groundwater, wildlife habitat and the character of the landscape. They want their county government to oppose it. Lambert calls it "a chess game." When J.M. Huber Corp., based in New Jersey and Denver, makes a move, the county government makes a countermove, then the company tries to outflank it or files lawsuits. The company "had the opening move," Lambert says. "We're in a tense middle game now."


Oil and gas politics here don't follow party lines, even as the top of Lambert's party, the Bush administration, pushes for more drilling around the West. Here it's all about local versus outside interests.


The same political break shows up a thousand miles south, where dozens of county and municipal governments in Colorado have tried to assert local laws over oil and gas development under several presidents' terms.


As the nation increasingly looks to the West as a source of raw energy -- and the region undergoes a personality change, with more people moving in for the vistas and lifestyle -- the battle to decide who's in control is heating up.





It's up to the locals -- For people worried about oil and gas development on private lands, local governments seem to be the only line of defense. Higher levels of government have not been tough enough.


The federal government still owns oil and gas rights beneath some private land in the West, but it's a patchwork. In most places, industry owns the rights, and state governments take the lead on overseeing development through agencies such as the Montana Board of Oil and Gas Conservation. Most of the states' agencies have direct ties to the industry, granting permits for wells without much public input or attention to the environment.


Reformers have made many uphill runs at state legislatures, trying to pass laws to make the agencies more responsive, but the number of local governments complaining today indicates the reforms have fallen short.


As local governments try to take control, though, they get dragged into court. It's a lawsuit free-for-all, based on a conflicting jumble of laws and everyone's constitutional property rights. The essential conflict: Local governments have powers over land use, but state laws say oil and gas can't be "wasted," meaning oil and gas shouldn't be left in the ground when drilling is feasible.


Local governments first took a stand in Colorado as far back as the 1980s. They've been sued by numerous companies, industry groups and even the Colorado Oil and Gas Conservation Commission. In sometimes conflicting court decisions, some local governments have had their teeth kicked in, while others have held a bit of ground.


"We think local governments should have as much or more say as the state does" on oil and gas, says Rick Brady, city attorney in Greeley, Colo. That city banned oil and gas drilling inside city limits in 1985, got sued, and eventually suffered total defeat. The Colorado Supreme Court ruled in 1992 that the city can't ban all drilling. So today, with the state agency firmly in charge, there are about 80 active oil and gas wells inside Greeley.


Other local governments in Colorado have managed to defend their laws, short of an outright ban, on issues such aesthetics, noise and where oil and gas wells are placed. At least 11 counties and 15 municipalities in Colorado concerned about public health, safety, the environment and orderly land use have adopted laws regarding oil and gas.


Colorado's Oil and Gas Commission and the industry don't surrender authority easily. At least six county attorneys in Colorado are battling in court now, trying to prove their counties can assert some local control over the current push for coalbed methane.


The director of the Colorado Oil and Gas Commission, Rich Griebling, says local control isn't necessary because well technology has improved, reducing gas leaks and other problems, and because the agency is becoming more responsive to local concerns. "The Legislature has articulated, there is some value in having oil and gas regulated consistently statewide, and not to have 40-some counties with differing regulations."





Montana is next -- Wyoming and New Mexico, which also host major oil and gas development, have not seen local governments rebelling against it. Montana's first rebellion flared up this year, in Gallatin County.


Huber Corp. could not pick a better place to find opposition. Gallatin County borders Yellowstone National Park, has two ski resorts and three fishable rivers, and is home to Montana State University and thousands of entrepreneurs and retirees.


Huber, which reportedly operates in 11 states and 17 countries with $1.3 billion in annual sales, leased about 18,000 acres of gas rights and announced plans to drill for coalbed methane around Bozeman Pass, a loosely settled neighborhood in the mountains just outside the county seat, Bozeman.


The development could install more than a hundred methane wells and a network of pipelines and pumps, where forests and pastures are laced around homes worth anywhere from $300,000 up into the millions. The ranchettes and trophy homes are occupied by doctors, professors, retired CEOs, wildlife photographers, real-estate investors and other New West characters.


"A test well could be the start of a cancer that will affect all of us," a real-estate agent wrote to the county planners. "The stigma will cause a reduction in values and negatively affect our tax base," warned a nationally prominent broker who also lives in the Bozeman Pass area.


So the chess game in Gallatin County began.


The company plunged in, getting an okay to drill from the Montana Board of Oil and Gas Conservation, which has never turned down a well proposal for environmental reasons. But the company also had to deal with a county zoning district, formed by residents decades ago to deflect all kinds of development. The zoning commission -- composed of four Republicans and one Democrat -- said no.


Huber Corp. promptly slapped Gallatin County with two lawsuits, one in state court challenging the county's power, and another in federal court calling the county's denial unconstitutional and seeking monetary damages. The county's legal bills could run to hundreds of thousands of dollars.


"I consider it an all-out war," says John Vincent, a Gallatin County commissioner whose previous career was teaching high school students about government. "We've got to do everything we can to win, within the law. Full-scale mineral exploration and extraction is contrary to the long-term economy here."


What's next? Huber Corp. representatives declined to comment for this story. But it's a good bet the company will fire off more lawsuits, challenging every countermove by the locals.





Western push -- The opposition to coalbed methane development around the West doesn't surprise Ken Wonstolen of the Colorado Oil and Gas Association. "Rarely is there a local constituency for oil and gas drilling," admits the state's leading industry lawyer. "Generally, local folks don't want it in their backyard. [Local] elected officials hear from them. But ultimately, we need this activity somewhere. There is a disconnect between local desires and society's general needs."


And society needs drilling in the Rocky Mountains, Wonstolen says, since other reserves are being tapped out: In rough numbers, in the last 25 years, Gulf of Mexico production is down 24 percent, and mid-continent production (including Texas) is down 36 percent. Meanwhile, production in the Rockies has soared 518 percent.


"The Rockies have the remaining reserves," Wonstolen says. "This is where we're going to get our energy from."


If his prediction is correct, much of that energy will come in the form of methane, which is abundant in the region's widespread coal seams.


The market for natural gas got superhot in the late 1990s and 2000. It has cooled with the economy, but is sure to bounce back, and when it does, local governments will face more pressure. Yet in much of the region, the gas companies probably won't find the Old West champing at the bit for natural resource development.


More likely, they'll run into people like Jennifer Read. Read's 10-acre spread with a log home neighbors a parcel where Huber Corp. wants to drill in Gallatin County.


"I love it out here. Sometimes you really make a connection to a place," Read says. As she talks about how she's become "obsessed" with fighting Huber Corp., she pauses to point out a sandhill crane taking off from her pond. Her land is used by songbirds, hawks, elk, deer, bears, lions.


"It's unrealistic to say we don't want this here and then continue to use energy" without making adjustments, Read says, including more emphasis on conservation and renewable sources like wind power. "Maybe the fear of having this beautiful area industrialized will help us move forward with longer-term solutions."





Ray Ring is Northern Rockies editor for High Country News.