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Last Updated on Friday, 17 September 2010 15:08

Written by Heather Hamilton

Douglas – Past Public Lands Council president Jim Magagna spoke Aug. 18 at the annual Cattlemen’s Conference in Douglas about the El Paso/Ruby Pipeline public lands issue, and the resulting negotiations.
“About a month and a half ago a joint press release from El Paso and Western Watersheds Project (WWP) and the Oregon Natural Desert Association (ONDA) was released, stating that in return for a commitment from WWP to withdraw a threat to file a lawsuit delaying the construction of the Ruby Pipeline, El Paso would pay them $21 million into two funds set up and jointly administered – one by WWP and El Paso, and the other by ONDA and El Paso,” Magagna began.
“I assume, first and foremost, that everyone is somewhat aware of WWP. Their sole and stated purpose is to eliminate all public land grazing in the west on Forest Service, BLM and other lands,” he explained. “These funds would be used for a number of pro-conservation and litigation activities. Most notable to us was that they would also be used to buy up federal grazing permits from ‘willing’ sellers.”
He continued that a “willing” seller is almost always someone who has had enough litigation and permit pressure that they have no choice left beyond selling.
“There are confidentiality provisions on those agreements, so we haven’t seen them. But information was shared that El Paso would work with the environmental community in Congress to change the Taylor Grazing Act as it stands today. The change would allow monies from these funds to pay someone for their permit, and that permit would then be permanently retired, with no more grazing on that allotment or area. Today the BLM must re-admit a relinquished permit to a qualified applicant.
“We were able to arrange an initial meeting with El Paso leadership and placed in front of them our demand as the public livestock industry representative that those agreements be negated. Either break the agreements, find a way out of them or significantly amend them so they don’t include monies that could be used to acquire grazing permits,” said Magagna of the Public Lands Council’s demands.
“They said they would take our demands under advisement. They acknowledged they were embarrassed and walked blindfolded down this path. Their goal was to get this pipeline in the ground, and the threat of litigation was so potentially costly that $21 million over 10 years seemed like a pretty good bargain, even though it was a deal with the devil, as they’ve come to realize and believe,” noted Magagna.
A week later another meeting was held between public lands grazing representatives and El Paso.
“As I understand it, this went all the way up the corporate ladder to Houston, and the decision was made that they should not have done this and it was bad for El Paso and the industry. But, they also said that in their 100-year history they have honored all contracts, good, bad or otherwise, and they weren’t going to break this one,” explained Magagna.
He adds they did offer to go back to WWP with some changes, but that what they proposed was “significantly inadequate.”
“When it became apparent El Paso wasn’t going to beak their contracts with these organizations, we considered our options. While we could file a lawsuit as an industry, they had already been granted their permits and it was unlikely we would accomplish anything by appealing, beyond further delaying the pipeline.
“We finally told them, ‘You are empowering our enemies. If you’re not willing to undo that, or feel you can’t, then at a minimum you need to empower us so we are better able to deal with our enemies.’ There was no threat to sue, because then we would be no better than WWP. Rather, it was telling them that if they are sincere in what they’re telling us and value our relationship and want to continue working with us, they need to help us strengthen our industry,” said Magagna.
The result of the meeting was a $50 million endowment administered through a separate entity by a board consisting of an El Paso representative and a member of the public lands grazing industry.
“There will be no termination of the endowment, so long as the Public Lands Council remains in existence, so it’s basically a perpetual agreement,” explained Magagna. “If you use the typical five percent on endowments, that’s a minimum of $750,000 per year available to address public land livestock grazing issues and needs.
“The only formal limitation on the use of those funds, as agreed to with El Paso, is they won’t be used in a proactive way for litigation. The specifics of how the money will be handled and what the process will be for states or individuals to apply to use the proceeds will be worked out by the board of directors of the Public Lands Council, and does not involved El Paso,” noted Magagna.
He added that the agreement is, in principle, expected to finalized and signed by Oct. 1 of this year.
From what he’s heard, Magagna said Lincoln County is in the best position to lead a lawsuit, as they had cooperating status with the BLM. “There has been a meeting of county commissioners, and I have no idea how many counties will join in, but the lead county at this time, so to speak, would be Lincoln County.”
“No one would like to go back to the beginning more than El Paso,” said Magagna.
Heather Hamilton is editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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Last Updated on Friday, 15 April 2011 13:02

Written by Heather Hamilton

Torrington – Glendo area rancher Rocky Foy spoke on his experiences working with oil and gas companies during the Goshen County Oil and Gas Development Workshop in Torrington on March 11.
“My grandpa homesteaded our place in 1910, and a mere 13 years later, in 1923, the Sinclair Pipeline Company wanted to put a pipeline across us,” said Foy, who has 11 pipelines and two power lines running across his operation today.
“I’m going to share what’s happened to us. We’ve been dealing with pipelines a long time. I’m going to talk about more of the negative things, just so you’re aware of what can happen, and prepare yourselves to deal with these things,” explained Foy.
He said most rights-of-way for the pipelines are three-and-a-half miles long, and he figures he has between 275 and 300 acres of rights-of-way on his ranch, not including the phone and electric lines, or actual roads.
“There’s the trash. When they’re constructing a pipeline and have so many workers strung out for two or three miles, inevitably there will be trash – that’s just part of it. We’ve also had the gates left open and our cattle have been mixed. People come in when it’s muddy, without notice, then don’t want to fix roads and those types of things. We’ve even had a helicopter fly over when we were trying to trail a bunch of cows one day,” said Foy.
He added that one thing he’s done to mitigate some of those issues is to have companies give at least 24-hour notice prior to coming in. This allows him to schedule activities, like moving cattle, around incidents such as helicopters flying overhead.
“In the mid-1960s we had a couple welders welding and they caught the place on fire. It was in the fall, and it burned all our meadows, all the hay stacks and fences. It burned the back off the corral and almost burned the house down. It was over three days before they got it out. Those kinds of things are devastating,” commented Foy, adding another fire was set with a grinder in later years.
“They’ve also taken the first pipeline out, and at that time all the workers on the pipeline drove their own vehicles on the rights-of-way, and they all had a camper on the back. That fall we ended up short quite a few calves, and I imagine that’s about where they had to go.
“Since then we’ve put in new contracts that we have the right to search any vehicle, at any time, that’s on our place,” noted Foy.
“They’ve taken more work space than they said they would. We’ve been condemned, and they let weeds take over, despite it being in the contract that they would control them,” continued Foy. “By the time they decided to control the weeds, they were off the right-of-way and in the creek, and were so bad we ended up buying 150 head of goats. We ran those goats for four years trying to get the weeds out of our creek.”
However, he said the biggest problem, which is also an ongoing issue, is having 10 pipelines going across him in one corridor, which ranges from a half mile to 100 yards wide.
“We have a road down the middle of that, and we said they could use the road, but we want 24-hour notice, and don’t come out in the mud, shut the gates and help maintain it. ‘If you do that you can use it,’” said Foy of the road, adding he considers that a fair deal.
“If they all wanted to use their right-of-way, you can imagine what it would be like. With 10 pipelines running side by side, we would have 10 roads, 10 gates at every fence, side by side, and so on. It’s ridiculous, so we let them use that road, and I ask that when they get off in the grass I get compensated because I sell my grass through pounds of beef, and I want to be compensated when they ruin it.
“Every time a worker or sub-contractor causes damage, it’s up to us as the landowner to go out and see what kind of damage they’ve caused. Then we go call the landman, set up a meeting with him, go back out with him to assess damages, and they see what we think is fair. Then we start haggling, and we never agree,” explained Foy.
“It’s just a constant battle, because our contract isn’t good enough. We have good contracts, but not good enough,” he added.
“I want to tell you to protect yourself with the contract. That’s your only protection, and it’s really frustrating for us because we’re trying to ranch, and it seems like we’re on the phone and all we’re getting done is haggling with these guys. It doesn’t have to be that way – when you make your contract, do it right, don’t do what we’ve done. I shouldn’t have to give up how I make my living so they can make theirs,” said Foy.
“Each pipeline is different and each landman has his own policy and personality, and usually the less they pay for damages, the better they look and the faster they get promoted,” noted Foy. “If there’s one we get along with it seems he only lasts about a year, then there’s another one.”
He said the company a landowner signs with today might be different tomorrow or next year, too.
“I don’t know how many times lines have been bought and sold that are on our place. Sometimes it’s so rapid we can’t even keep track of company names. We’ve had companies come in and build a new pipeline, and trade that with another company, and it goes from having crude run through it to a gas line,” explained Foy.
“With the 11 pipelines and two power lines it seems like all we’re doing is dealing with someone on our place. They don’t want to compensate us for damages or our time. All we ever asked was for the negotiations and compensations for damages to be fair. Divide and conquer, condemnation and scare tactics have been the very norm. It’s my sincerest hope that by sticking together, and using the landowner guidelines, that you won’t have to endure these hardships,” explained Foy.
He suggested working with neighbors to develop a collective bargaining strategy, hiring an attorney and splitting the cost, and trying to get an annual or set payment for damages, so landowners aren’t constantly spending time checking for damages and haggling with companies, as a few ideas to seriously consider as a community.
“If you have a fair payment, and a solid contract that will hold up in court, and they reclaim your ranch back to what you deem satisfactory, that’s a good deal,” concluded Foy.
Heather Hamilton is editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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Last Updated on Tuesday, 06 December 2011 16:58

Written by Christy Hemken

Jackson – According to Oklahoma Water Resources Board Executive Director Duane Smith, both federal agencies and states have their hearts in the right place when it comes to water management across the West.
    “When are we going to do something about water supply that doesn’t utilize traditional methods? We have to sustain growth,” he told the Western Governors Association in Jackson in late June. “We believe technologies to reuse and recharge water can provide significant water increase, as well as weather modification - one inch of rain on an ag crop can mean millions of dollars to that economy. We need to have that discussion.”
    “Without water there’s no energy, and without energy there’s no water,” commented Idaho Governor “Butch” Otto. “We need a good partnership with the federal government. We need them to understand our water rights and uses and its importance to us. The management has to have an overload of state interest and state influence, and that’s not only in Idaho but in every Western state.”
    “Managing conflicts is very difficult when it comes to water, and Governor Freudenthal has agreed to give all of Wyoming’s water to the state of Nebraska,” joked Nebraska Governor Dave Heineman.
    Despite recommendations from panelist members, New Mexico Governor Bill Richardson only said, “We’re talking to each other on water and not being bold. I believe we need a national water policy and a national dialogue. We’re just talking to each other but we’re all doing the right things.”
    He said the national perspective, with droughts in Atlanta and floods in the Midwest and a declining Lake Mead, are a national problem. “What we need are national solutions. The dialogue being recommended is good but it’s among each other,” he said. “There is a recommendation to urge the federal government to develop a national water policy, but they’re not going to do that. They can barely walk and chew gum at the same time.”
    “We’ve got to get transmission infrastructure right,” said Utah Governor Jon Huntsman, turning the discussion to energy. “Many of our resources – wind, sun and geothermal - come from rural areas without infrastructure. If we’re going to take the energy seriously we’ve got to get the transmission and infrastructure piece right.”
    “I look forward to entering a world where we are relying more on sun, wind, geothermal and the atom,” said Huntsman. “The mix of energy opportunities will be significantly different in the years ahead. We all know it’s possible, but the infrastructure must be in place for us to succeed.”
    Wyoming Governor Dave Freudenthal defined Wyoming and other western states as the “Saudi Arabia” of solar power.
    “Generation and transmission are two components, but they must be integrated because you can’t do one well without the others. It’s a significant challenge that’s getting bigger,” said Jeff Sterba, chairman, president and CEO of PNM Resources.
    Sterba said over 35 percent of the resources the U.S. will need in 2030 don’t yet exist. He said he thinks that 40 to 50 percent of that needed increase may come through energy efficiency alone.
    MidAmerican Energy Holdings Company CEO David Sokol concluded the panel by introducing philosophy from Warren Buffet, “We should err on the side of the planet as we make decisions.”
    Christy Hemken is assistant editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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Last Updated on Saturday, 22 October 2011 01:00

Written by Christy Martinez

Although the eastern Wyoming landowner group Progressive Pathways, LLC spent much time and effort developing a detailed proposed easement for the company Oneok Partners Bakken Pipeline, they recently received the easement back, with substantial changes from the company.

The landowners devoted countless hours to producing a proposed easement to present to Oneok that included several major areas of concern: landowner liability, reclamation, abandonment of the pipeline, safety and compensation.

“They’ve not worked very hard at addressing our concerns at this point,” says Progressive Pathways member Pat Wade of Lusk, noting that liability is the number one concern of the members, of which there are about 125.

“We’re trying to limit the landowners’ liability, because we’re concerned that the pipeline company operates as an LLC, so the most any of its owners can lose is their investment in the company. If something really terrible happened, the landowner could become liable, which could possibly cost them their land, which is, for most of us, our biggest asset. We have to have our land to operate in agriculture, so liability is one thing on which we’re working really hard.”

Wade says abandonment is also a top priority.

“Right now they want to leave their options really open when it comes to abandonment, and our concern is that, as these projects age they generally sell, and to a company that’s probably less financially able to fulfill the requirements of the original agreement,” he comments. “If it’s a company that does not have the financial ability, they could walk away because they don’t have the money for proper abandonment.”

Wade says that, in doing so, the landowner could become liable at that point, so he and the others would like some assurances, ideally in a type of bonding.

“I don’t know if we’ll achieve that, but we’d like some assurance the pipeline will be decommissioned properly,” he notes.

The landowners are also working on reclamation language.

“We’re trying to minimize the scarring on our places, and return them back to their original productivity,” says Wade. “We have some concerns about how the pipeline is constructed and installed, and how it’s reclaimed, and also all erosion, noxious weeds and streams that may be polluted through erosion.”

Wade says the last thing the landowners are working on is compensation and negotiating an agreement.

“To some, that may seem the most important, but to many in our group it’s no more important than anything else,” he says, but adds, “The important thing to remember is that everyone else who is involved with the pipeline will do so with the hope of having some profit, and the landowner is the only one asked to give up anything, without having any way to participate in the profits. We’d like to negotiate an annual payment so a landowner can view the pipeline as an asset rather than a liability, and that will be a tough issue.”

“When this comes through, we as landowners have the liability, and everybody’s an LLC except for the ranchers along the route,” says landowner and Progressive Pathways board member Donley Darnell. “Everybody’s making money except for the landowners. When push comes to shove, the landowner supposedly gets the appraised value of their land, which isn’t making money. We get all the added risk and none of the benefits.”

Wade adds that compensation has not been discussed at all to this point, so people can’t assume the group presented an easement with a large price tag, which caused the company to reject it.

“We’re not willing to talk about compensation until we have the rest of the terms in place,” says Wade.

Another concern of the landowners is that Oneok could change the use of the pipeline after its construction.

“When we proposed our easement we wrote that the pipeline would be for one natural gas liquids pipeline. From the beginning Oneok has represented that’s what they wanted to build, but their changes to the easement are written so they could run anything that can be run through a pipeline, and they could switch the use. Once it’s in the ground, the landowners have no ability to weigh in on any of those things. It’s one of those red flag situations,” says Wade.

The original LLC board of Progressive Pathways has been narrowed to a negotiating committee of four members, which had a meeting with Oneok on Oct. 18 in Cheyenne. The Wyoming landowners were joined at the meeting by two representatives from a similar organization for the pipeline in Montana known as the Eastern Montana Landowners Group.

“When we sent our agreement they made the changes they’d like to see, and we’re a long way off from an agreement,” says Wade. “They took out all the language we wrote concerning construction and reclamation. They struck every bit of it, and that’s a huge concern.”

Wade says Progressive Pathways board member Steve Hayes of LaGrange made the point that Oneok has emphasized their consulting with different experts on the phases of the pipeline, and, when it comes to reclamation, the landowners are the experts who understand their places and the implications of the pipeline project, should the land not be properly reclaimed.

“We have several members who have won state and nationwide stewardship awards, and we’ve worked closely with Lisa Shaw and the Niobrara Conservation District for help with the reclamation language,” says Wade.

Darnell says the conservation, reclamation and mitigation portion of the easement includes not only how the company reseeds the land, but also how long the ditch is left open, fire suppression equipment during welding and how to honor and avoid paleontological sites.
Wade says the requests in the easement aren’t unprecedented.

“A whole lot of what we proposed is patterned off an agreement that’s already agreed to, signed and recorded in courthouses between a large landowner group and a large pipeline company,” says Wade. “What we’re doing is not setting a precedent. We’re trying to negotiate something similar, and we’re in hopes that Oneok could do at least as good, if not better.”

“We’ve put a lot of pressure on them, and when we’re not plowing new ground it’s difficult for them to say no, we can’t do that,” says Darnell.
Oneok has chosen a route for their project that avoids federal lands at all costs, because of the red tape and expense that is involved.

“In the end, Oneok appears to have the power to condemn their way through with this, and one of the requirements for condemnation is that the land is needed for the public good. If it’s for the public good, shouldn’t public land be used as much as possible?” asks Wade. “By avoiding federal land there are many permits they don’t have to get. As far as we can find out, the only permit they have to get is a stream-crossing permit through the Army Corps of Engineers, so the whole thing has no regulation or oversight. There’s no comment period, and there’s no opportunity for the landowners to weigh in.”

Wade says that recently Oneok stepped up its public relations campaign, meeting with county commissioners in the affected counties and interviewing with local newspapers.

“They’re representing the whole process considerably differently than the way we view it,” says Wade, noting that’s what prompted a letter to the editor for local papers from Wade and fellow landowner Danny Hanson.

The letter outlines the landowners’ opinions and goals, and also encourages new members to join with Progressive Pathways.

“Right now Oneok is stepping up their process, and they sent out a letter to every landowner that could be interpreted as somewhat threatening, so we’re hoping people will join with us as they receive that letter and see the limited success they’d have in negotiating on their own,” states Wade.

Christy Martinez is managing editor of the Wyoming Livestock Roundup and can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it. .