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The Future of Natural Gas Development on the Western Slope

How Energy Production and Public Lands Intertwine

MESA COUNTY, Colo.- - Around 35% of Colorado is federally owned land, managed by agencies like the National Forest Service, National Park Service, and the Bureau of Land Management. According to the 2017 Conservation in the West poll, 60% of Coloradans oppose state takeover of these public lands, and Sarah Eller is one of them. 

Eller is one of the many residents that can be found hiking on public lands early in the morning. "I've hiked around 4,000 miles of long-distance backpacking and I get a variety of responses, and sometimes people just don't understand why I would choose to do that. But I enjoy it so much because it helps me get back to my roots," says Eller. 

The idea of keeping public lands in public hands has become an interesting issue during a time when the country is adapting to a new presidential administration. "Colorado is blessed with 24 million acres of public lands that belong to everybody, to you and to me. They're managed by the Bureau of Land Management, the Forest Service, and the National Park Service. What the balanced uses of those lands are is they key question," says Scott Braeden, a Wilderness Advocate for Conservation Colorado.

The Western Slope is a resource rich area, specifically in natural gas. A recent decision allowing natural gas exports to flow to China may create new opportunities in the energy sector. And out here in the Grand Valley, this means that natural gas organizations could soon be competing for some of the resource rich public lands in the area. "The Grand Valley is very unique in that we have world class recreation alongside world class natural gas resources. The Piceance Basin just north of us is possibly the largest, most abundant, natural gas plate in the world... And the thing to remember is, the BLM manages for multiple uses. That doesn't mean that all things are managed on all places, but it means where compatible, we might have multiple things that we're managing at the same location," says Chris Joyner, the Public Affairs Specialist for the Bureau of Land Management. 

The Mancos Shale Formation in the Piceance Basin is estimated to contain 66 trillion cubic feet of shale natural gas and 45 million barrels of natural gas liquids. Meaning the Western Slope could be the home to the second largest reserve of natural gas in the country. "Since the first well was drilled in 1892, there's been a level of activity ever since that day. So, it's deeply ingrained in the fiber of our culture, and the fiber of our local communities, and I think it will continue to do so in the coming decades," says David Ludlam, the Executive Director of the West Slope Colorado Oil and Gas Association. 

According to the BLM, the Oil and Gas industry supports 13,401 jobs on BLM managed lands in Colorado alone. They also generate around $3.5 billion dollars of economic contributions on these lands in Fiscal Year 2015. Oil and gas are dependent on prices, and natural gas is cheap right now, which is why natural gas producers say they may benefit from a change in regulations. "When you sit on top of the second largest natural gas reserve in the country, that tremendous resource will find a way to market no matter who's in control in Washington. However, the current administration has said some good things about making it easier to get permits, and that will help move forward our ability to recover in a timely manner. And bring rigs back to the area, if those policies manifest themselves in regulation," says Ludlam. 

A difference between the National Park System and the BLM is that the Park Service manages for preservation, while the BLM manages for conservation. This means the BLM conserves environmental resources, while also getting sustained yield from the public lands. The energy minerals under National Forests are managed by the BLM and an increase in drilling could be seen within National Forests. "There is some energy development going on under White River National Forest. That's an area that's always been a lot of interest for various energy companies... And the BLM manages the mineral energy state under that federal property," says Joyner. 

According to a report by White River National Forest, it is the most visited National Forest in the country. "A recent decision on the forest plan for the White River National Forest all but banned future leasing on the forest. Which we think is unfortunate, and it's something we hope to remedy under the current administration in Washington D.C.," says Ludlam. 

White River is not the only National Forest being considered. "On the flanks of the Grand Mesa, particularly in Delta County and in Gunnison County, as you get down into the lower elevations, there's tremendous Mancos Shale development opportunities which our companies have been pursuing and developing for 10 years. And I think that, as technology continues to advance, we'll see quite a bit of production come out of the flanks of the Grand Mesa," says Ludlam. 

The oil and gas industry fundamentally rejects the terms 'boom and bust' for their business. "Because we still have 15,000 wells that are producing in this area, and they will do so for the next 30 years. And so, we have dramatic business cycles, but nonetheless, it is a business cycle just like any other sector - and we fully expect a recovery in the coming years," says Ludlam. 

But after the record high prices of natural gas in 2008 plummeted, some say they would like more dependence on other industries. "I would like a more stable economy here. Tourism is a really stable economy, we have a lot of people come here to see the Monument... There's a lot of positive aspects that don't depend on natural gas or oil that we could maximize," says Michael Gibson of the 'Our Revolution' group.

According to the Annual Energy Outlook, natural gas production will continue to increase despite low prices due to more exports. And with the recent decision allowing natural gas exports to flow to China, and the approved Jordan Cove Liquified Natural Gas project in Oregon, there may be more incentive for natural gas production on public lands. 

Eller hopes these decisions of where to drill for natural gas are made with care. "I hope those people that are in a position of power, in a position of change, allow themselves to think about what does that mean? What does it mean, not just now, but the next day and the next day after that - and what we can do about that," says Eller. 

The Annual Energy Outlook projects that natural gas may account for nearly 40% of U.S. Energy Production by 2040.

The BLM is currently accepting public comments on parcels of land in both Mesa and Garfield Counties that could be available for the competitive oil and gas lease sale in December 2017. 

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