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  • Solenex LLC v. Jewell

Reagan-Era Energy Lease Idled by Enviro Opposition and Bureaucratic Delay

Sep 16, 2013 | by William Perry Pendley

In September of 1981, President Reagan became involved personally in whether to grant permission to drill on a federal oil and gas lease in north-western Wyoming.  In the summer of 1981, two federal agencies completed months of study on an application for permit to drill (APD) submitted by an oil company that owned a lease in the Bridger-Teton National Forest south-east of Jackson in Teton County.  They concluded the APD should be granted; after all, the lease is a property right and denial of the APD violates the U.S. Constitution.  When the recommendation reached Washington, Wyoming’s congressional delegation was briefed that Secretary Jim Watt intended to approve the APD.  Meanwhile, environmental groups had been gearing up for a major battle on the issue for more than a year.

Future Wyoming Governor Mike Sullivan, a Democrat, learned the opposition had gone far beyond angry words.  Death threats had been issued against Watt, threats that Sullivan thought serious enough to convey directly to his fraternity brother Watt.  (The U.S. Park Police knew of the threats already and had tightened security.)  About that time, Watt heard from a unanimous and Republican Wyoming delegation:  deny the APD!  In time, Watt had a meeting in the Oval Office; he feared he was about to let Reagan down.  Reagan stiffened Watt’s backbone.  “No,” Reagan declared and then uttered a paraphrase of remarks that would become famous in his Second Inaugural Address:  “If not us, who?  If not now, when?”

President Reagan consistently demonstrated rare courage in his efforts to discover and develop energy on the nation’s “federal lands,” as to which he said, “Isn’t it time we remembered that the very term means it belongs, to us—to the people of America?”  No doubt Reagan would be horrified to learn that a man issued a federal oil and gas lease less than a year after that White House meeting has been unable to drill for over 30 years.  That such a case exists demonstrates why America is in desperate economic shape today!

In June of 1982, the Bureau of Land Management (BLM) issued Sidney M. Longwell of Baton Rouge, Louisiana, a 6,247 acre oil and gas lease in the Badger-Two Medicine Area of the Lewis and Clark National Forest in Glacier County in northwestern Montana.  In 1983, Mr. Longwell assigned the lease to America Petrofina Company of Texas, which later became Fina Oil and Chemical Company.  In October of 1983, Fina submitted an APD in order to drill to evaluate the natural gas potential of that part of the Overthrust Belt. 

After extensive review pursuant to the National Environmental Policy Act (NEPA), seventy-six (76) separate appeals, and a ruling by the Interior Board of Land Appeals (IBLA), the BLM, in consultation with the U.S. Forest Service, the Montana Department of Fish, Wildlife, and Parks, and the U.S. Fish and Wildlife Service, approved the APD in 1985, in 1987, in 1991, and again finally in January of 1993.

In April of 1993, seven environmental groups filed a federal lawsuit challenging the approved APD.  Then Senator Max Baucus (D-MT) introduced legislation to bar surface disturbances on oil and gas leases in the area and to evaluate the area for wilderness designation; he also demanded that Secretary Bruce Babbitt impose a moratorium on oil and gas drilling there.  In 1997, the lawsuit was terminated administratively, without prejudice.

In June of 1993, Secretary Babbitt suspended activity on the lease purportedly to await congressional action.  In 1994 and 1995, he extended the suspension for the same reason.  In 1996, Secretary Babbitt continued the suspension but this time asserted that it was necessary to comply with the National Historic Preservation Act (NHPA).  In 1997, he extended the NHPA-related suspension and finally, in 1998, he continued it indefinitely!

In 1999, in the face of the interminable delay, FINA assigned its rights under the lease and the approved APD back to Mr. Longwell. 

In 2002, the Keeper of the National Register of Historic Places decided 90,000 acres of the Badger-Two Medicine Area were eligible to be named as a Traditional Cultural District.  Although the district did not include the drill site, in 2004, the Forest Service initiated another study, which is not finished, to determine if it should expand the district to include the proposed well site. 

In December of 2006, Congress withdrew the unleased portion of the Badger-Two Medicine Area, subject to valid existing rights, from further oil and gas leasing and gave tax incentives to existing oil and gas lessees if they sold their leases to environmental organizations.  Today, thirty-one years after he got the lease, Mr. Longwell is the last oilman standing there.

In July of 2004, Mr. Longwell assigned his lease and approved APD to his company Solenex, LLC.  Then, in May of 2013, Solenex demanded that the federal government lift its suspension.  The federal government denied that request.  In June of 2013, Mr. Longwell filed his federal lawsuit.

No wonder the miracle of hydraulic fracturing that has produced untold energy riches across the country has been only on State and private lands, not on the third of the nation that, in Reagan’s words, “belongs, to us—to the people of America.”  They must be part of America’s energy future.   

Thank you for supporting MSLF’s demand that the federal government adhere to the rule of law, especially in the nation’s vital search for energy.

For more information: Solenex v. Jewell

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