Letters from the West

Otter, Speaker Bedke endorse oil and gas transparency bill

AM Idaho's Willow Creek storage and dehydration facility near New Plymouth. The company operates eight producing wells in the surrounding area that produce oil, gas and other liquid petroleum products.
AM Idaho's Willow Creek storage and dehydration facility near New Plymouth. The company operates eight producing wells in the surrounding area that produce oil, gas and other liquid petroleum products. doswald@idahostatesman.com

Idaho Gov. Butch Otter and House Speaker Scott Bedke joined three lawmakers Monday in endorsing a bill to increase transparency and competition in Idaho’s oil and gas industry.

Rep Judy Boyle, R Idaho, and her District 9 colleagues, Rep. Ryan Kerby, R-New Plymouth, and Sen. Abby Lee, R-Fruitland, pressed for the legislation after complaints from property owners and suspicions that the state and landowners weren’t getting their fair share. A hearing is scheduled Monday in the House Resources and Conservation Committee.

The District 9 lawmakers joined Otter and Bedke in writing the guest opinion submitted to Idaho newspapers.

“No piece of legislation is ever perfect. However, House Bill 301 is a step in the right direction for an industry that could provide big benefits for Idaho – if we do this right,” they wrote.

Here is the entire guest opinion:

Legislation working its way through the Capitol in the 2017 session’s waning days would provide Idaho, as a relatively new producer of oil and gas, with the protections and expertise it needs to safely and responsibly nurture and regulate this emerging industry.

House Bill 301, also called the Landowner Bill of Rights, brings Idaho’s oil and gas laws up to industry standards used in such petroleum-producing states as Louisiana, Oklahoma, Texas and Utah. Separately, Senate Bill 1099 addresses Idaho’s lack of technical and legal expertise in developing up-to-date regulations for the industry while protecting Idaho property owners. It creates the position of Oil and Gas Administrator within the Idaho Department of Lands and requires the new administrator to have at least ten years of industry experience.

Discovery of oil and gas deposits in southwestern Idaho brings the potential for renewed prosperity for local citizens and a shot in the arm for the area’s economy. It will come in the form of direct leasing and royalty payments to individuals and new business ventures providing good-paying jobs that will bring new revenue to support city and county services. That gives us plenty of reason to support oil and gas development in Idaho.

As with any new and unfamiliar industry, getting it right involves a sharp learning curve. It’s as if Idaho is trying to get its arms around simple arithmetic while the industry elsewhere is working on calculus.

The good news is that Idaho is finally catching up by seeking assistance from experts in other states and the State Oil and Gas Regulatory Exchange (SOGRE), a partnership of the Interstate Oil and Gas Commission and the Groundwater Protection Council. SOGRE’s recommendations are included in House Bill 301.

Work on this proposal started last summer when it became apparent that – left to our own devices – we were making little progress toward solving such serious issues as metering, reporting, spacing of drilling units, and public transparency. It became clear to us that legislation would be needed to move the issue forward.

That legislation started taking shape early in the session through our work with Idaho Department of Lands Director Tom Schultz, the chairmen of the House and Senate Resource committees, legislators from the area where oil and gas production already is taking place, and experts from other oil and gas producing states.

House Bill 301 creates a new commission to include three technical experts, the Idaho Department of Lands director, and a county commissioner from a producing county. The Department of Lands’ Oil and Gas administrator would serve as commission secretary. The measure also clarifies definitions and production and sales reporting requirements, and provides protections for surface landowners, penalties for producer noncompliance, and public internet access to related documents.

No piece of legislation is ever perfect. However, House Bill 301 is a step in the right direction for an industry that could provide big benefits for Idaho – if we do this right.

Rocky Barker: 208-377-6484, @RockyBarker

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