Wyoming has narrowed its definitions for who can bid on state oil and gas lease parcels, disqualifying parties that intend to conserve the land rather than produce the mineral resources.

The change, made under emergency rulemaking in June, was mandated by House Bill 141 – State land oil and gas leases-operator requirement, which the Legislature passed during the budget session. Rep. Cyrus Western (R-Big Horn) brought the bill on behalf of the Petroleum Association of Wyoming. The association raised concerns over the state’s vetting process after the Lander-based conservation group Wyoming Outdoor Council last July placed bids on a state oil and gas lease parcel in Sublette County intending to spare it from development.

If a small Wyoming conservation group can bid to block energy development, a conservation- or anti-oil-and-gas-minded billionaire could do the same, the trade association argued.

“So rather than wait for that to happen, we thought, ‘Well, let’s step in now and let’s put in place a bill that acts as a deterrent to doing that,” Petroleum Association of Wyoming President Pete Obermueller told WyoFile.

Ultimately, the winning bidder in last year’s controversial auction was Casper-based Kirkwood Oil and Gas — the same company that had nominated the parcel — at $19 per acre for the 640-acre tract. When the company later learned that it had been competing against a conservation group, the owners cried foul and claimed they were duped into paying an artificially inflated price.

The Wyoming Outdoor Council defends its actions. 

Yes, council leaders say, the organization did bid on the controversial “Parcel 194.” But it didn’t skirt the rules or misrepresent its identity. The group expected that, if it was the winning bidder, it would pay about $12,000 for the lease (based on its $18 per acre bid) out of its own budget, according to Wyoming Outdoor Council Executive Director Carl Fisher. No well-heeled individual was on standby to finance the purchase, he told WyoFile.

The bidding controversy, he said, misses the larger issue: a lack of commitment by the state to implement its own policies that were crafted years ago to avert such conflicts in wildlife migration corridors.

Path of the Pronghorn

Kirkwood Oil and Gas had nominated a state lease parcel, 194, smack in the middle of the Path of the Pronghorn — a popular name for the long-distance migration of the Sublette Pronghorn Herd. It’s part of one of the most studied ungulate migration routes in North America, and the Path of the Pronghorn portion of the route is so named because it represents a “bottleneck” — an area squeezed due to rural development and landscape features.

And, critically, according to the council, Parcel 194 bisects the New Fork River where pronghorn cross. 

Given the years of high-profile studies and discussions regarding the Path of the Pronghorn and many other well-documented ungulate migration routes in Wyoming, the group didn’t expect the state would OK oil and gas lease parcel nominations in the area for its competitive lease auction.

“To our surprise, they were going to offer an oil and gas lease directly in one of the most important spots where, like, thousands of these members of the Sublette pronghorn herd are crossing the New Fork River,” said Alec Underwood, the council’s program director.

In the weeks before the auction, the council and other conservation groups implored state officials and the Wyoming Game and Fish Department to intervene and convince the Office of State Lands and Investments to remove Parcel 194 and others inside the Path of the Pronghorn from the auction, according to Fisher. But the parcels were not removed.

At that point, Fisher said, the council felt it had no other choice. 

“We had a conversation just to say, ‘Well, if we can’t get the parcel removed, and if we do qualify as a bidder in the process, we should engage in the process and put our money where our mouth is and bid to protect the parcel and the corridor,’” Fisher said.

Delayed protections 

The state had already anticipated such conflicts.

Gov. Mark Gordon signed an executive order in 2020 outlining general protections for designated wildlife migration corridors and directed the Wyoming Game and Fish Department to develop a set of specific migration corridor policies to avoid activities that might disturb the critical pathways. But the state, under pressure from industry, still has not bestowed official designations to several migration corridors, which leaves the Path of the Pronghorn open to development without the state’s stipulations — although the years-long designation process is formally underway.

In the immediate wake of the July 2023 bidding controversy, Wyoming Game and Fish Department officials collaborated with the Office of State Lands and Investments to propose adding stipulations to Parcel 194 preventing industrial activity during spring and fall migrations.

But the State Board of Land Commissioners, made of the state’s top five elected officials, declined the proposal.

For its part, Kirkwood Oil and Gas discounts the need to significantly restrict industrial activities in migration corridors — the industry has a stellar track record of producing oil and gas without detrimental impacts to wildlife, the company’s Land Manager Steve Degenfelder said. The industry continually refines best practices for habitat mitigation, he added.

Kirkwood didn’t nominate Parcel 194 because it is in the Path of the Pronghorn, he told WyoFile. It nominated the parcel, and others in the area, because the company is trying to piece together a block of lease tracts on the western flank of the prolific Pinedale Anticline natural gas field.

“I hunt and fish,” Degenfelder said. “I value the attributes of Wyoming, both monetary and wildlife, and our standard of living with great respect. I think that we can accomplish both of them at the same time.”

Research, however, shows that pronghorn have avoided and abandoned the Anticline gas field. 

The state’s new definitions for qualified bidders went into effect just before an oil and gas lease auction that began July 8. The online auction, which is managed by Texas-based EnergyNet, was extended to Wednesday due to disruptions caused by Hurricane Beryl.

Wyoming bans conservation bidders from oil and gas lease sales is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

GILLETTE—The Biden administration’s proposal to end federal coal leasing in the Powder River Basin will have “grave” and “drastic” consequences for Campbell County, the nation’s largest coal supplier and a bulwark of Wyoming’s economy for the past 50 years, residents and local officials say.

If implemented, the proposal will destroy the livelihoods of thousands of miners and their families here and gut the community’s economy, Gillette resident George Dunlap said.

“We have to stop the Biden administration from destroying it because they will. We can’t sit back and say ‘What’s going on?’”

Dunlap, who owns and operates a photography business in Gillette, was among several speakers to address the Campbell County Commission on Tuesday. The commission solicited public testimony during its regular meeting to accompany a formal protest letter opposing the Bureau of Land Management’s proposal.

The five-member commission is hoping to rally a massive outpouring from the public and is encouraging the state to take immediate legal action to stop the BLM from banning federal coal leasing.

“The effects it’s going to have on this local community are going to be grave, and we need to fight,” Commission Chairman Del Shelstad said.

But the commissioners’ efforts to solicit testimonials garnered participation from only a handful of residents Tuesday — a disappointment for the body, even considering the shift-work nature of this blue-collar community and the 11 a.m. weekday timing of the hearing. Residents who spoke were outnumbered by other elected officials and reporters. 

The coal industry — which includes 10 active mines in the county and directly employs more than 3,000 workers here — was a no-show.

Shelstad asked whether there were any coal producers or representatives of coal mining companies in the room. There were none, which elicited a frustrated response from Shelstad.

“I think that’s a darn shame that the coal producers aren’t here fighting — if for nothing else, for their employees,” he said. “They’re probably going to have a strategy that takes a little different approach, and I’m OK with that. But it’s really shameful that we can’t get them here to make public comment and to enter this fight with us.”

Coal leasing fight

The public comment hearing was organized in response to what many regard as a historic move by the Biden administration to effectively set an expiration date for one of the nation’s largest sources of electrical power generation, as well as planet-warming greenhouse gas emissions: Powder River Basin coal. 

The BLM on May 16 announced its preferred “no future coal leasing alternative” in a federal court-mandated update of its land use plans for the Buffalo, Wyoming and Miles City, Montana field offices that oversee coal leasing in the Powder River Basin, which spans portions of both states. Conservation groups had successfully argued the federal agency must fully consider the environmental, climate and human health implications of leasing federal coal in the region.

In its proposal to ban further federal coal leasing, the BLM estimated that existing leases will support the current rate of Powder River Basin coal production to 2041, according to the agency.

Cooperating agencies — such as local and state governments in the region — have until June 17 to file letters of intent to protest the BLM’s preferred no future leasing alternative. That gives those entities legal footing to challenge the decision. In addition to filing a protest letter, Campbell County commissioners are circulating an online petition urging the BLM to reconsider its preferred alternative.

“The coal industry employs thousands of workers across the country, and this ban will put many of these jobs at risk,” the petition states. “Additionally, coal is a vital source of baseload electricity for millions of Americans. Without a reliable supply of coal, our nation’s energy grid could become unstable.”

As of Wednesday morning, the county had collected 455 petition signatures, according to officials. Shelstad said he hopes to eventually collect at least 20,000 signatures.

Has the market already spoken?

Coal proponents in Wyoming say the BLM’s coal leasing ban is the latest in a series of Biden administration actions designed to kill the industry in favor of renewable energy sources and an effort to appeal to voters concerned about the global climate crisis.

The U.S. Environmental Protection Agency in April issued four “final” rules aimed at drastically cutting coal pollution, including a mandate that operators of existing coal-fired power plants commit to cutting or capturing 90% of the planet-warming carbon dioxide emissions by 2032 or convert the facilities to natural gas or close altogether.

Those coal-fueled power plants represent nearly the entirety of the Powder River Basin coal market today.

Energy market analysts, along with conservation groups, have suggested that the administration appears to be issuing rules and compliance deadlines that follow market trends already in motion, noting that many utilities are moving up coal plant retirement dates and that mining companies have not nominated a major new federal coal lease in the Powder River Basin since 2012.

Market trends have already cut production in the region by half since 2008, and the decline in demand for Wyoming coal appears to be accelerating — down by 20% so far this year. In fact, one of the region’s biggest coal producers, Arch Resources, has said it plans to sell or close its two coal mines in Campbell County: Coal Creek and Black Thunder.

Rep. John Bear (R-Gillette) and other local elected officials assured commissioners that they’re hearing pleas from their constituents to use every resource to fight the federal rules. If there is a lack of presence among coal companies themselves, Bear told WyoFile, it might be attributed to years of bad news and mounting pressures on the industry.

“The local [mining companies], most of those boards are located in St. Louis [Missouri] and they’re not interested in fighting this fight the way we’re going to have to fight it as government entities,” Bear said.

Wyoming Mining Association Executive Director Travis Deti, who could not attend the meeting, has said the mining companies rely on the association to speak on their behalf in the state, as well as other advocacy groups at the national level. 

“As far as the Mining Association, which represents those companies, we’re fully engaged with our congressional delegation, with the governor’s office, with the Legislature, and we’re using every tool at our disposal to try to fight back on some of this stuff,” Deti told WyoFile by phone on Wednesday.

Some state and local officials are skeptical that the market has already spoken louder than the Biden administration. While some companies such as Arch Resources might not anticipate a future in Powder River Basin coal, others see an opportunity to apply carbon capture technologies and coal-to-products manufacturing — all of which is under threat by the BLM’s no future leasing proposal, according to Bear.

“Even if we’re forced to do it alone, other investors will see an opportunity,” Bear told WyoFile. “They have to see that somebody is fighting back right now.”

Bear said he worries that even some in Campbell County might not be aware of future opportunities for coal, or the dire consequences if the industry goes away completely.

“The rest of the country is going to be in trouble, too,” he said, adding that the rapid move to shut down coal plants presents an electric reliability issue. “Reliability is absolutely critical and that’s what this stuff provides.”

Past layoffs, bankruptcies linger

Though most coal miners and residents here squarely pin the blame for the coal industry’s decline on the Obama and Biden administrations, they’ve been burned by coal companies in the past.

Most infamously, Blackjewel in July 2019 abruptly closed its Eagle Butte and Belle Ayr coal mines — among the nation’s largest — leaving some 600 miners in limbo about whether they could return to work or collect paychecks. The company furloughed many workers and eventually brought others back as both mines resumed operations. But the company’s unannounced mine closures and subsequent bankruptcy left coal miners as well as local businesses and governments fighting to get paid for wages and taxes owed.

Arch Resources (then Arch Coal) and Peabody Energy separately announced massive layoffs on the same day in March 2016, cutting jobs for some 500 miners. Both companies subsequently shed billions of dollars in debt in Chapter 11 bankruptcy reorganizations.

Coal industry a no-show at Wyoming event to rally against federal leasing ban is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.