EPA: ‘Significant environmental impact’ in BLM oilfield plan

Federal regulators say a U.S. Bureau of Land Management plan to expand the Moneta Divide oil and gas field and discharge millions of gallons of polluted water into drainages above Boysen Reservoir is incomplete and may lead to environmental damage.

The BLM should supplement its 2,048-page environmental impact statement before finalizing and approving the 4,250-well expansion across 512 square miles east of Shoshoni, EPA official Phil Strobel wrote on July 18. Lacking that, the BLM needs to write another EIS before allowing development, the letter to BLM state director Mary J. Rugwell states (see letter below).

Federal environmental regulators made their comments after analyzing the BLM’s draft EIS issued April 18 that proposes dumping pollutants above the Class I waters of the Wind River. “The EPA considers the water quality effects associated with disposal of produced water as a principal environmental concern for the project,” the EPA letter reads.

“There does not appear to be sufficient information available … to assess the potential environmental effects of the various water disposal options,” Strobel wrote of the BLM’s Moneta Divide Natural Gas and Oil Development Project draft EIS. That missing information is critical to ensuring environmental protection, according to regulators.

“The EPA expects that the water disposal components … would have significant environmental impacts based on project context and intensity,” Strobel wrote.

The EPA made similar comments to the to the Wyoming Department of Environmental Quality regarding its separate proposal to allow the discharge of 8.27 million gallons a day of produced water on the landscape. A byproduct generated during oil and gas extraction, produced water is salty and contains hydrocarbons and drilling chemicals, the EPA said.

The 8.27 million gallons a day that would be discharged on the surface is a fraction of what the oil and gas field would produce, the EPA said. Up to 58 million gallons a day would come out of the ground and much of that would be injected back underground, potentially contaminating drinking water there, the EPA said.

Development plans call for up to 160 injection wells and “many would likely inject into underground sources of drinking water as defined by the Safe Drinking Water Act,” regulators said.

A second EIS?

One way or another, BLM needs to address the potential significant environmental impacts, the EPA said. If that’s not done while finalizing the existing draft study that would greenlight development, the BLM should write another EIS as more detailed, site-specific expansion plans are fashioned, regulators wrote.

The BLM accepted comments on the draft environmental study through July 18 but has not made those comments available to the public. WyoFile obtained a copy of the EPA comment and several others that leveled criticism at proposed state and federal approvals. Critics worry about cancer-causing hazardous air pollutants and impacts to already-alkaline soils irrigated in Hot Springs County.

Hazardous air pollutants emitting from proposed evaporation ponds would put the risk of cancer due to long-term exposure at a 37-in-one-million chance, the EPA wrote. It recommended the BLM adopt methods to reduce emissions or establish buffers “to limit the risk of cancer to the public to below one-in-one million.”

BLM project manager Ben Kniola told WyoFile on Thursday that comments would be made public with the release of the final EIS. That’s expected after comments are analyzed and after the agency selects from among four development alternatives and proposes one for approval.

Meantime, the BLM has scheduled an Aug. 15 meeting of cooperating agencies in Casper at which participants will select the preferred alternative. The meeting is not open to the public and Kniola said he was uncertain how or whether the BLM will address calls for more information and study. At least one commenter has asked BLM to undertake a supplemental EIS before — not after — releasing its final decision.

“We’re still working through the comments,” Kniola said. Regarding a supplemental EIS, “that hasn’t been determined yet,” he said.

The proposed project on 327,645 acres of public, state and private lands near Lysite anticipates that the disposal of produced water from the drilling would meet all Wyoming permits, according to the BLM. 

Aethon Energy Operating, LLC and Burlington Resources Oil & Gas Company, LP are seeking approval to expand the existing field of some 800 wells. They seek permission to dump 2,161 tons a month of total dissolved solids in surface flows. That would include more than 1,000 tons each of sodium and sulfate. Aetheon would be the major operator in the field.

Hot Springs County lies downstream of Boysen Reservoir and the town of Thermopolis gets its drinking water from the dam’s outflow.

“They’re advancing an alternative that does the maximum environmental damage,” said Lee Campbell, a retired county planner who lives in Hot Springs County. Hot Springs was left out of initial discussions regarding what needed to be studied, “even though we’re the ones most affected by it,” he said.

Five major water worries

After writing that Wyoming DEQ’s draft discharge permit may result in “significant” degradation to the Wind River, the EPA turned its attention to the BLM analysis for development of the oil and gas field itself. EPA wrote of five major water worries for the BLM.

The volume of produced water is “exceptionally high” and the risks posed to health and the environment “are highly uncertain without site-specific analyses,” Strobel wrote.

“Produced water chemistry varies over time and space, and the water treatment process and permit requirements have not yet been specified, therefore the chemistry of water to be disposed/discharged is not yet known,” the EPA letter reads.

Although Wyoming DEQ said the draft discharge permit would meet state and federal anti-degradation rules and laws — an assertion widely challenged in comments to that state agency — EPA told the BLM that the chemistry of the proposed discharge hasn’t been pegged.

There’s worry about the recreation use of Boysen and that the Wind and Bighorn rivers downstream are the source of drinking water. Combined, they carry “high economic and recreational value.”

Then there are the worries about polluting underground drinking water. To inject produced water into those reservoirs “would require aquifer exemptions,” the EPA said.

“The ability of the injection zone to confine wastes over an area this large is uncertain without site specific assessment and there is an overlying aquifer that is currently used as a drinking water source,” the EPA wrote.

So regulators seek a groundwater monitoring program for the Wind River Aquifer in the Shotgun disposal area (named after the shotgun member of the Fort Union geologic formation) “to provide early detection should injected fluids migrate into the Wind River Aquifer.”

In addition to worries about the injection wells, the EPA wrote that existing production wells in the Shotgun disposal area — wells that extract oil and gas — should be reviewed for their potential to enable pollution of potable groundwater.

Fremont County already is the site of groundwater contamination believed to be caused by oil and gas activity. Today residents of 30 homes in the Pavillion area who are unable to use their own wells have water trucked in. They used to pump drinking water from the Wind River Formation before a boom in drilling activity.

One analyst who examined pollution in Pavillion told residents their groundwater would likely never be cleaned up. He advised them to look east to near the Moneta Divide, construct a new, clean water well and build a pipeline to their community. 

A profitable proposal

The Moneta Divide development, which would greatly expand long-standing oil and gas operations in the area between Shoshoni and Casper, is projected to produce about 18.16 trillion cubic feet of natural gas and 254 million barrels of oil over 65 years, the BLM has said. Development could bring $71 million a year in federal royalties, $57.6 million a year in Wyoming severance taxes, and $70 million a year in county ad valorem taxes, the statement read.

While EPA wrote that Wyoming DEQ’s draft surface discharge permit may result in “significant” degradation to the Wind River, Aethon disagrees.

The proposed Wyoming permit “adequately satisfies applicable regulations,” the company wrote in comments to the state. WyoFile did not receive a response to requests in the last week for comment from Aethon.

The Dallas-based private energy investment firm writes that it achieves its objectives by “opportunistically pursuing transactions where Aethon believes it can alter the risk/reward profile in its favor.” Founded in 1990 by Albert Huddleston, it has managed over $1.6 billion in oil and gas assets on behalf of family and institutional capital, according to its website.

In an interview with the Sioux City Journal editorial board in 2007, Huddleston shared his philosophy that holds that doing business and protecting the environment are not mutually exclusive. “My business will be directed by this mantra,” the newspaper quoted him saying of a three-legged philosophy that also looks for projects to be socially uplifting.

The society downstream of Boysen is questioning how uplifting the development might be. Hot Springs County officials welcome economic activity from the oil and gas field expansion, county planner Bo Bowman told WyoFile. “We are, however, concerned,” he said in a telephone interview. “We want to make sure potential impacts to waters below the dam are addressed.”

The Hot Springs County Natural Resource Planning Committee, an appointed advisory board to the county commissioners, reviewed the BLM and DEQ plans and submitted letters to the authorizing agencies, Bowman wrote in an email. County commissioners did not review the comments, he wrote.

Aethon’s plan to discharge produced water “is the least environmentally sound option available to the applicant, as well as the least expensive,” Natural Resource Committee Chairwoman Toddi Darlington wrote the BLM. Among other things, the BLM must evaluate an alternative that would treat all water to acceptable standards, or inject pollutants underground, the letter reads.

Without these additional alternatives, “the Draft EIS is insufficient,” the letter reads.

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The committee also is worried about increasing salt in waters used for irrigation. “Irrigators below the dam are already troubled by high salt content in irrigation water from the Big Horn River,” she wrote Wyoming’s DEQ earlier this summer. The development plan would raise chloride levels. “Elevated salinity would be detrimental to downstream agriculture,” her letter reads. 

The “serious concerns” raised by the EPA and others require the BLM to withdraw the draft EIS or write a supplemental draft EIS that corrects deficiencies in the environmental review, former Hot Springs County Planner Campbell wrote in a July 17 letter.