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Oil and Gas

Salt Lake City, Utah – After many long conversations between representatives of the Public Lands Council (PLC), the National Cattlemen’s Beef Association (NCBA) and Ruby Pipeline, an agreement has been reached, in principle, which seeks to ensure the relationship between the livestock industry and El Paso Corp. continues far into the future.
While details of the agreement are being finalized, it establishes a significant endowment with the mission to “protect, enhance and preserve the public lands grazing industry.”
“The El Paso money will go into a permanent trust, and the earnings on that money will be administered by PLC nationally,” says Jim Magagna, past president of the PLC, who was involved in the negotiations. “The money doesn’t have to relate back to the pipeline – it can be used for any purpose, other than filing litigation, that furthers the well-being of the public land livestock industry, nationally and in any state.”
The concept was formally adopted Aug. 10 after a unanimous vote by the board of directors of PLC, whose board members represent 13 western states, NCBA, the American Sheep Industry Association and the Association of National Grasslands. Neils Hansen of Carbon County represents Wyoming on the Public Lands Council.
“When the final agreement is completed, there will be another vote of the PLC Directors to approve that agreement,” explains Magagna, noting he expects that to come soon. “That agreement will address establishing and managing the trust.”
“While we are concerned about the potential impacts of Ruby’s recent settlement agreement with the Western Watersheds Project and the Oregon Natural Desert Association (ONDA), we are satisfied that this endowment provides us a tool with which to mitigate many of our concerns,” says PLC President Skye Krebs in a joint press release from PLC and El Paso. “As the organization that has represented public lands ranchers in the West for over four decades, we are confident our industry will benefit from this endowment for many years to come.”
“When we first sat down with El Paso in negotiations, our only request was they cancel agreements with the environmental groups, or significantly modify them,” says Magagna. “El Paso felt, good or bad, that they were signed agreements, and they had an obligation to honor them, and that’s when we began to look at this approach, which gives us resources to help counter those groups.”
“Clearly, our preference would have been to have the agreements with Western Watersheds Project and the Oregon Natural Desert Association become null and void, but that wasn’t doable,” continues Magagna. “This provides some important resources, and is a good resolution of the problems that were caused, and it’s an important way to build a lasting relationship with El Paso in particular, and the mineral industry in general.”
In Wyoming, opinions on the agreement are mixed, at least until the deal’s details are released. Dick Loper of the Wyoming State Grazing Board says his group is “generally in support of the concept.”
“The livestock industry needs more funds available to fight the battles in the industry, but we need to wait until we see the level of detail in the agreement before we make a comment on whether we support it,” says Loper. “We’re in support of the principle, but we’re not yet in a position to comment as to whether this is the way to do it.”
According to information from PLC, the $15 million endowment, $7.5 million to be contributed later this year and $750,000 to be added into the endowment annually for the following 10 years, will be governed by one representative from the PLC and one representative from El Paso Corp. While the principal amount will not be used, the endowment’s earnings will go toward meeting PLC’s mission to serve the public lands livestock industry. Specific projects may include scientific research, education, range monitoring, fire restoration, media and community outreach for the benefit of the public lands grazing industry. It is important to note that funds from the endowment will not be used for litigation.
“We are grateful and proud of the lengthy relationship our company has had with the ranching and livestock industry and we believe that ranchers are important users of public lands,” says Jim Cleary, president of the El Paso Western Pipeline Group in the joint press release. “We are committed to working with all parties – ranchers, environmental groups, legislators, community leaders and other stakeholders – to ensure the Ruby Pipeline is a benchmark for the industry and future energy infrastructure development.”
Following a lengthy planning, outreach and permitting effort, El Paso Corporation recently started construction on the $3 billion Ruby Pipeline, a 680?mile natural gas pipeline that extends from Wyoming to Oregon and crosses through northern Utah and northern Nevada. In addition to providing important energy infrastructure in the West, the pipeline is expected to create nearly 5,000 jobs during construction and provide millions of dollars in property, sales and other tax revenues for counties along its route.
“This is an important project for the individual states, the region and the nation, helping to further establish long?term energy independence and providing a critically needed economic boost for all involved,” says Krebs. “We (the livestock industry) have long supported energy development on public lands, while at the same time balancing the concerns of other multiple use stakeholders and we look forward to working with El Paso to ensure proper stewardship of public lands far into the future.”
Christy Hemken 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..

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..

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..

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..

Cheyenne – On March 14, Gov. Matt Mead announced the 2016 energy strategy for the state of Wyoming, a new effort building on the strategy that was released in 2013.

“This strategy is again titled, Leading the Charge. In the process of putting this together, we had six public meetings across the state and one statewide conference broadcast live on YouTube, Facebook and Google. Over 3,500 individuals commented, and those comments were received in preparation for putting this together,” Mead said in a March 14 press conference.

The 2013 strategy contained 45 initiatives, 28 of which are now 100 percent complete or nearly complete, including a water strategy, pre-development oil and gas baseline water testing, integrating additional natural gas vehicles into the state fleet and more.

Wyoming’s energy strategy is a living document, according to Mead, who explained that some goals are attainable, others may need more effort and new initiatives will be added to the list as time goes on.

“We felt very good about the 2013 strategy in terms of the initiatives, that have been set out, the public process developing it, the progress we’ve made and what we’ve learned,” he stated.

New initiatives

Moving forward, the 2016 strategy contains 11 new initiatives including an infrastructure investment initiative, biomass utilization initiative and a wind energy manufacturing initiative.

“A primacy initiative will help find efficiencies in the Environmental Impact Statement (EIS) process. The goal is to help federal processes within the state,” Mead added. “Another initiative is a reclamation and regulatory review, and with that, looking at Wyoming bonding requirements and regulations.”

The new energy strategy will continue to work with the Endangered Species Act initiative and will also include an initiative for the collaborative state management of invasive species on federal land.

“The eighth initiative is public land access, where we will work with local governments to make recommendations on final designations of wilderness study areas and other management actions,” he continued.

Additional work

A career readiness initiative will work to expand and grow current success in matching Wyoming jobs with Wyoming workers, and the carbon innovative initiative will embrace the challenge of finding solutions for advanced technologies and opportunities related to carbon-based fuels.

“The 11th initiative is the energy information initiative, which will help to grow understanding of the energy industries so the public and decision makers know their importance and can see ways to balance energy industries and environmental stewardship,” Mead explained.

Mead also recognized a few key successes of the 2013 energy strategy, including the integrated test center in Campbell County.

“I view that as an opportunity for some great research into how to look at a coal-fired plant and take what comes off of a coal power plant to see if we can utilize it,” he commented. “We want to continue with that because we want to lead not only in energy production. I think we also have a corresponding responsibility to lead in energy innovation and research.”

NREX

Mead also mentioned he is proud of the Natural Resource and Energy Explorer (NREX) tool that was built in a collaborative effort with the University of Wyoming Geospatial Information Science Center.

“Here in Wyoming, we have pipelines, we have endangered species, we have roads and we have transmission lines,” said Mead.

When he entered office, there was no easy way to determine how all of these different elements were laid out across the state in relation to one another. The NREX tool allows access to publically available data on Wyoming’s natural, cultural, socioeconomic and infrastructure resources.

“It is built to accelerate planning and discovery. NREX is available to the public, and it’s a web-based, user-friendly geographic information system (GIS). It has analytic capability and real time data updates, yet it maintains the confidentiality of sensitive data sets and allows development of maps, reports and downloading of public data,” he described.

Continuing into the future, Mead hopes that the initiatives of the 2016 energy strategy will encompass critical segments of energy and environmental work taking place in Wyoming, representing consensus energy and environmental policy.

The 2016 energy strategy, including updates on initiatives from the 2013 strategy, can be found on the governor’s website at governor.wyo.edu.

Natasha Wheeler is editor of the Wyoming Livestock Roundup and can be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it..