American Oil and Gas Reporter - January 2015 - 205

The Presidential Papers
to report their production to DEP on a
monthly basis rather than every six months,
and the other provides a formal method
for a landowner with an oil and gas lease
to obtain a release on lease termination or
cancellation. PIOGA highlighted inconsistencies and vague requirements in both
bills, but they were approved nonetheless.
In all, PIOGA tracked more than 200
pieces of legislation in the last session,
65 of which we considered high priority.
As our President and Executive Director
Lou D'Amico often notes, not long ago
it was common for PIOGA to monitor a
dozen or so bills during a two-year session,
and perhaps one or two of those would
be important.
Things certainly have changed in the
past several years since "Marcellus Shale"
became a household term. In 2014, PIOGA
created a Legislative Committee to help
review newly introduced bills, develop positions on pieces of legislation, and encourage
members to take a more active role in impacting the legislative process. We expect
this committee will keep busy in 2015.
In fact, I cannot say enough good
things about the work of PIOGA's committees in promoting our industry's interests. In addition to our Legislative Committee, our Environmental Committee is
busy with a host of state and federal regulatory matters; the Pipeline and Gas
Market Development Committee is focusing on new markets and hosts the Conventional Producers Round Table to help
that segment of our membership understand
how the markets are changing. Our Safety
Committee is sharing best practices and
other information about how we can work
safer, and our Tax Committee is sharing
details about how we can hang onto as
much of our money as possible. All these
efforts are worth far more than the cost of
membership-and that does not even account for the good work done by our staff
and board of directors!
As the saying goes, the only constant
is change. I am proud to be part of PIOGA
and its role in helping guide our industry
through these constantly changing times.
Ì

Coming In February
Special Report:
Unconventional Resources Science,
Part II

Petroleum Association
of Wyoming
RANDY HARRIS
Director of Corporate Development
Black Hills Corp.
Denver

FROM THE CHAIRMAN
It's no secret that the state of Wyoming
is experiencing a resurgence in oil production from formations that historically
have been produced through vertical
wells. Horizontal drilling in the DenverJulesburg and Powder River basins of
eastern Wyoming has produced some remarkable results.
As reported in the October 2014 American Oil & Gas Reporter, the state's 2013
oil production was 20 percent greater
than that of the prior year and 95 percent
of the drilling rigs in the state were
drilling for oil. This trend has been
building steadily since late 2009. Most
of these increases have been attributed to
horizontal drilling in the Niobrara, Codell
and other formations.
PAW believes this trend should continue
for the foreseeable future, assuming crude
oil prices remain strong. However, the
ongoing activity growth will come with
challenges.
These challenges include a pending
decision from the U.S. Fish & Wildlife
Service to determine whether the greater
sage grouse will receive protection under
the Endangered Species Act. By September
2015, USFWS will determine if the
species will be classified as endangered,
threatened or not warranted for listing.
The September deadline is a product of
litigation filed by groups seeking ESA
protection for the sage grouse.
Other potential drags on the pace of
drilling and development may originate
from increased difficulties with federal
land access, obtaining federal permits to
drill, or anticipated rule changes by the
Wyoming Oil & Gas Conservation Commission, the Wyoming Department of
Environmental Quality and the U.S. Environmental Protection Agency. Multiple
groups are pressuring state and federal
agencies to amend rules governing oil

and gas activities or to add new ones.
ESA Status
The status of the greater sage grouse
will dwarf all other issues, especially if
it receives a protective listing. Even
without a formal listing, the fact that the
federal government owns nearly 50 percent
of Wyoming lands and two-thirds of its
minerals means that restrictions from the
U.S. Bureau of Land Management already
limit the amount of surface disturbance
from oil and gas drilling in core sage
grouse areas, as well as the time frames
acceptable for surface activity.
A protective ESA listing will go far
beyond these measures and constitute a
major blow to the oil and gas industry, the
state, and all local stakeholders who have
taken numerous actions to protect the bird
while also seeking to safeguard Wyoming
jobs along with the state's royalty and tax
revenue. Aside from tightening restrictions,
a listing will exacerbate the heavy administrative workloads and time frames for
permitting extraction activities.
Those parties that have taken the initiative and undertaken significant efforts
to improve and maintain habitats should
be commended for helping show the federal government that a listing is not warranted. On behalf of its members, PAW
has been working diligently with the
Wyoming Game & Fish Department, oil
and gas trade organizations, other natural
resource user groups and others to review
data and studies associated with these
initiatives to ensure USFWS properly develops and appropriately considers such
information. PAW believes the data effectively demonstrate that local stakeholders and the state are more capable
than the federal government of managing
species protection effectively.
JANUARY 2015 205

American Oil and Gas Reporter - January 2015

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