Show t rr 1 Land restriction proposal draws concern concern from oil companies By nelen C Vernal Express Washington Correspondent Westerners Washington have told In- In Interior tenor Department officials they are con con- concerned about restrictions that the Department Is considering putting on sales of surplus land and on new oil and gas leases on public lands The question about land sales came up at the seminar on the Administrations Administration's plan to sell off surplus public lands which the Public Lands Council PLC held in Reno on Sept 20 To avoid problems over conflicting land land uses uses- uses and Forest SerVIce of- of officials at the PLC seminar said that con con- continued continued use of habitat by wildlife and con con- continued continued right to graze livestock by grazing graz- graz grazing ing might be included in the sales of public lands 11 s Is they pointed out a good way to avoid law suits A nUmber number of the land experts at the seminar questioned such plans notably Judge Fite of Texas He is a real state marketing expert and he told the seminar if such restrictions were put on the fee simple title of land sold by the government it wont won't be worth much The advice of the experts to the govern govern- government government ment officials at the PLC meeting was dont don't do it according to PLC Washington staffers who attended the seminar The restrictions on leases have been suggested by officials of the public land management agencies as a means of clearing oil and gas lands for leasing and to whittle back on the backlog of applications applications in the pipeline One proposal put put lout for tor public comment on Aug 10 by Director Director tor Robert F Burford of the Bureau of Land Management put some fair fair- fairly fairly ly stiff restrictions on oil and gas leases which could have the effect of de- de denying denying nying development of the lease at a later date if problems could not be worked out The restriction on Is called a contingent right stipulation or The The second proposal put out for public comment by Burford on Aug 10 would require ap- ap applicants applicants who want a lease granted quick quick- quickly quickly ly where land use planning and en- en environmental environmental studies were not completed to pay for such studies which would however be directed by and under the control of at all times Representatives of the oil and gas In in- in industry became unglued over these pro pro- proposals proposals particularly as it appears that both will be approved for use by both the Forest Service and mainly as an optional use to clear up the backlog of oil and gas applications Environmental groups also aiso oppose having individual oil and gas companies paying for environmental studies noting this is a conflict of interest Both pro pro- proposals proposals if implemented are re almost certain certain tain to draw law suits to the by In- In Industry industry and the industry underwriting of environmental studies by the National Wildlife Federation Among the companies and organizations which have condemned both are Chevron Phillips Petroleum Texaco of Salt Lake City Amoco True Oil Co of Casper Wyo Texas Oil and Gas Corp ARCO Cities Service EXXON the American Petroleum Institute API the Rocky Mountain Oil all Gas Association and law firms representing oil and gas companies in Denver Dallas and Salt Lake City and research firms in California LC Soileau III of Chevron USA told In order for a company to under under- undertake undertake take the pre drilling pre work for an oil and gas lease It must have the assurance that it will be able to drill on the lease if the results of the earlier work are favorable Exploration for oil and gas is already a high risk business It should not be burdened with the additional risk that drilling may not be permitted the Chevron hevron lands expert told WW W W Dunn of Phillips Petroleum got right to the bottom line We reel feel that a aCRS aCRS inadvertently acts as a cloud on the title of the lease and that such use by the will create an to the future restrictions which might be placed on operation at a later date We feeL that use of a would deter pru- pru prudent prudent dent operators from accepting the lease perhaps resulting in fewer operations 00 be being Ing conducted the reverse of the op op- optimum goal Dunn said CT Sawyer r vic vice president of API said The lessee who has a on ids his lease would be bou bound d by U unknown known restrictions to be imposed at a future date E Fred Birdsall of noted that an applicant who accepted a lease with witha a on It would have to pay a rental on the lease from the date it was approved ed even though he would woold not be able to drill drillon on it it until and after U the If-the Jh- Jh ns we were lifted lifted If it was not lifted he he would would be paying rentals Without having g the right to drill Birdsall pointed out Because of the potential for abuse we cannot en en- endorse dorse dors it even as a prospective option by he said Roland J Gill Jr of of Salt Lake City expressed concern that a would be used by the US Forest Service to prohibit leasing In wilderness study areas It seems manifestly unfair to us for the government to hold out one hand to receive rentals and at the same time use the other hand to deny the rights to the lease Gill wrote J Donald Arnett of Texaco also a land expert expressed concern that speculators might traffic In leases en- en encumbered encumbered cumbered by CBS's as such leases would be less likely to be developed And Jack G Swenson of observed the land management agencies have no legal authority to separate the exploration and development phases of an n oil and gas lease |