GAO rips BLM for sidestepping NEPA on oil and gas leases

September 16, 2009

The Energy Policy Act of 2005 rather famously – or infamously, depending on your point of view – allowed for a Safe Drinking Water Act exemption for the Haliburton-perfected process of hydraulic fracturing in of natural gas wells.

But, according to a Government Accountability Office (GAO) report issued today, the act also sought to pick up the pace of natural gas exploration and production by allowing the U.S. Bureau of Land Management (BLM) to use “categorical exclusions” when issuing oil and gas drilling permits.

The report found that from 2006 to 2008 the BLM signed off on more than 22,000 new oil and gas drilling permits in 20 states, mostly in the mountain west. Of those, Section 390 categorical exclusions granted as part of the Energy Policy Act of 2005 were used to approve more than 6,100 permit applications, or about 28 percent.

In 85 percent of the field offices sampled, the GAO found that BLM officials failed to follow guidance and provide adequate justification for using categorical exclusions, which allow for drilling permits outside of the National Environmental Policy Act (NEPA) process in order to speed up production.

“A lack of clear guidance and oversight contributed to the violations and noncompliance,” the GAO report summary reads. “While many of these are technical in nature, others are more significant and may have thwarted NEPA’s twin aims of ensuring that BLM and the public are fully informed of the environmental consequences of BLM’s actions.”

Locally, the GAO found that the Glenwood Springs office of the BLM used categorical exclusions to approve new wells on sites where no drilling had yet occurred, but Section 390 says exclusions can only to be used to facilitate faster drilling on existing sites.

The GAO report concludes Congress may want to address the issue of categorical exclusions, which is exactly what it’s doing with U.S. Rep. Nick Rahall’s energy bill (H.R. 3534) currently being debated in the House Energy and Natural Resources Committee, which the West Virginia Democrat chairs.

That bill would also create a new agency called the Office of Federal Energy and Minerals Leasing to oversee onshore and offshore lease sales and hopefully clean up the sex and drugs scandals that racked the Minerals Management Service last year.