[Senate Hearing 107-729]
[From the U.S. Government Publishing Office]
S. Hrg. 107-729
OIL AND GAS WELLS AND MMS PAYMENTS
=======================================================================
HEARINGS
before the
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED SEVENTH CONGRESS
SECOND SESSION
TO IDENTIFY ISSUES RELATED TO THE INSPECTION AND ENFORCEMENT OF BUREAU
OF LAND MANAGEMENT OIL AND GAS WELLS IN THE FARMINGTON AREA AND
ATTEMPTS TO REMEDY COMPUTER PROBLEMS AFFECTING MINERALS MANAGEMENT
SERVICE PAYMENTS IN NEW MEXICO
__________
MAY 31, 2002
BLOOMFIELD, NM
Printed for the use of the
Committee on Energy and Natural Resources
U. S. GOVERNMENT PRINTING OFFICE
82-361 WASHINGTON : 2002
___________________________________________________________________________
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COMMITTEE ON ENERGY AND NATURAL RESOURCES
JEFF BINGAMAN, New Mexico, Chairman
DANIEL K. AKAKA, Hawaii FRANK H. MURKOWSKI, Alaska
BYRON L. DORGAN, North Dakota PETE V. DOMENICI, New Mexico
BOB GRAHAM, Florida DON NICKLES, Oklahoma
RON WYDEN, Oregon LARRY E. CRAIG, Idaho
TIM JOHNSON, South Dakota BEN NIGHTHORSE CAMPBELL, Colorado
MARY L. LANDRIEU, Louisiana CRAIG THOMAS, Wyoming
EVAN BAYH, Indiana RICHARD C. SHELBY, Alabama
DIANNE FEINSTEIN, California CONRAD BURNS, Montana
CHARLES E. SCHUMER, New York JON KYL, Arizona
MARIA CANTWELL, Washington CHUCK HAGEL, Nebraska
THOMAS R. CARPER, Delaware GORDON SMITH, Oregon
Robert M. Simon, Staff Director
Sam E. Fowler, Chief Counsel
Brian P. Malnak, Republican Staff Director
James P. Beirne, Republican Chief Counsel
John Watts, Counsel
Frank Gladics, Professional Staff Member
C O N T E N T S
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Page
Hearings:
May 31, 2002................................................. 1
May 31, 2002................................................. 23
STATEMENTS
May 31, 2002
Bingaman, Hon. Jeff, U.S. Senator from New Mexico................ 1
Blancett, Linn, San Juan Basin, NM............................... 19
Blancett, Treciafaye W., Blancett Trust, Blancett Ranches, San
Juan Basin, NM................................................. 7
Gallagher, Bob, President, New Mexico Oil & Gas Association,
Santa Fe, NM................................................... 8
Hottell, Jacob, Chairman, Clean Water Coalition.................. 19
Rolston, Alan, San Juan Systems.................................. 16
Taylor, B. Brooks, M.D., MPH, La Plata County, CO................ 17
Ulibarri, Lucille, Blanco, NM.................................... 18
Whitley, Richard, Acting State Director, New Mexico Office,
Bureau of Land Management, Department of the Interior.......... 3
May 31, 2002
Begay, Edward T., Speaker, Navajo Nation Council................. 25
Benally, Chester................................................. 49
Bingaman, Hon. Jeff, U.S. Senator from New Mexico................ 23
Blackie, Louise.................................................. 48
Chavez, Ervin, President, Shii Shi Keyah Association, Bloomfield,
NM............................................................. 42
Garcia, Calvert, President, Nageezi Chapter, District 19, Number
92, Nageezi, NM................................................ 29
Humphrey, Mary................................................... 51
Lizer, Matilda, Window Rock, AZ.................................. 50
Lords, Douglas, Director of Office of Trust Funds Management,
Department of the Interior, Office of the Special Trustee for
American Indians............................................... 24
McCauley, Pauline................................................ 46
Ray, Wilson...................................................... 45
Trujillo, Arvin, Chief of Staff for the Navajo Nation Office of
the President and Vice President............................... 27
Werito, Eileen................................................... 44
APPENDIX
Additional material submitted for the record..................... 57
OIL AND GAS WELLS IN THE
FARMINGTON AREA
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FRIDAY, MAY 31, 2002
U.S. Senate,
Committee on Energy and Natural Resources,
Bloomfield, NM
The committee met, pursuant to notice, at 8:30 a.m. in The
Bloomfield Cultural Complex, 333 South First Street,
Bloomfield, New Mexico, Hon. Jeff Bingaman, chairman,
presiding.
OPENING STATEMENT OF HON. JEFF BINGAMAN,
U.S. SENATOR FROM NEW MEXICO
The Chairman. Let me welcome everybody this morning. This
is a field hearing of the Senate Energy and Natural Resources
Committee.
We are going to have two topics we are going to try to
address. I know we don't have adequate time to fully address
probably either one, but we want to do our best in the limited
time we have.
First, from 8:30 to 9:30 we are going to discuss the issue
of inspection of Bureau of Land Management oil and gas wells
here in the Farmington area, your testimony on that.
Second--after that, we will have a short break and then
maybe about a quarter to ten we will start up on some testimony
and discussion about the Department of the Interior's computer
shutdown and its effect on royalty payments that are owed to
individual Navajo allottees.
For each part of the hearing, we want to have an
opportunity for public comment after we hear the testimony. So
if you would like to speak, we would ask that you sign up in
the back of the room, and we will hear public comments in the
order of those who have signed their names on the list.
Let me be sure I have the right instructions to people
here.
Let me say a few things about the first hearing, the one we
are starting here at 8:30. We heard several reports, sort of
repeated reports, in recent months about the problems here with
the Farmington Field Office of the BLM lacking staff for
inspection and enforcement.
The national average for the BLM is about 300 wells per
inspector, that's what I'm informed. There are at least 1,500
wells per inspector here in Farmington, this area, according to
the BLM's 2000 Technical and Procedural Review for the
Farmington Field Office.
I understand the BLM has set a goal of reducing the
caseload of each Farmington inspector to no more than 500
wells. That's still more than the national average, but it is
the minimum that the BLM finds to be acceptable.
I had a recent meeting in my office with Kathleen Clarke,
head of the BLM, and she informed me that they have determined
or made a decision to hire five new inspectors in Farmington.
These new hires are commendable; however, that still leaves
them with less than half the personnel needed to achieve this
500 wells per inspector, so I hope we can urge the BLM to add
additional staff and achieve this goal as soon as possible.
We've received a lot of information about reporting and
production--reported production sales and royalty amounts were
not adequately verified during some of the inspections that
were taking place, that the inspection personnel were not
provided with adequate support; and the Farmington Field Office
needs to hire an inspection and enforcement coordinator, a
position that the Office is now making an effort to fill.
I'm also concerned that there are large numbers of old and
poorly maintained sites in this area that are in need of
restoration. In many of these places, there is insufficient
protection against sediment runoff from the site and associated
roads. In other cases, sites and roads have not been cleaned or
and fully vegetated.
I understand that last year the Farmington Field Office
instituted a facilitated collaborative process between ranchers
who have grazing rights and the oil and gas lessees to help
restore many of the old sites and resolve these problems. I
look forward to hearing about that collaborative process. It's
a good first step. I want to know how that's working and what
more needs to be done. This field hearing, I think, will be a
good start in addressing these problems.
I understand that at the national level, Kathleen Clarke
told me during our meeting in my office that Assistant
Secretary Watson will be announcing some new policies related
to surface owner rights. I'm anxious to learn anything we can
about those new policies, and we look forward to hearing that.
Today, we are going to hear from the BLM about the agency's
efforts to remedy these problems. I know they have been working
on them. And we will also hear from Tweeti Blancett, who is a
land owner and a grazing permit holder in the area; and from
Bob Gallagher, who is the head of the New Mexico Oil and Gas
Association.
Before we start the testimony with our first witness, let
me just indicate that we would like each witness, if they
could, we will include any written testimony that has been
prepared in the record as if given. We would like each witness
to take 5 minutes or so to summarize the main points and tell
us what they think the Committee should be aware of.
Then following that, we will have this opportunity for
members of the public to give input as well, and I'll be able
to ask some questions.
Our witnesses on this first part will be Mr. Richard
Whitley, who is the Acting Director of the New Mexico State
Office for the Bureau of Land Management of the Department of
the Interior; as I indicated, Robert Gallagher, with New Mexico
Oil and Gas Association; and Tweeti Blancett, a long-time local
land owner and rancher from Aztec.
So Mr. Whitley, why don't you go ahead and give us your
views. And this is going to be a little awkward, I'll just
advise everyone, because we have the one microphone, and we
want everyone to hear all the witnesses. So we are going to run
the microphone back and forth. So there may be a little bit of
a delayed reaction here. So why don't we go ahead.
Thank you.
STATEMENT OF RICHARD WHITLEY, ACTING STATE DIRECTOR, NEW MEXICO
OFFICE, BUREAU OF LAND MANAGEMENT, DEPARTMENT OF THE INTERIOR
Mr. Whitley. Mr. Chairman, thank you for the opportunity to
appear here today. I am Richard Whitley, Acting State Director
for BLM New Mexico State Office. I have a couple of staff here
that will be available to answer some questions a little later
as well.
In the interest of time, I will begin my oral statement
with BLM's inspection and enforcement program, the I&E program,
and its responsibilities. The BLM is responsible for the
oversight of oil and gas operations on Federal and Indian lands
with the exception of Osage Tribal lands. The objectives of the
Oil and Gas I&E program are to protect the environment, public
health, and public safety; to ensure the public's oil and gas
resources are properly developed in a manner that maximizes
recovery while minimizing waste; and to ensure the proper
verification of production reported from Federal and Indian
lands.
This responsibility includes inspection of oil and gas
operations to determine compliance with applicable statutes,
regulations, onshore operating orders, notices to lessees,
lease terms and permit conditions of approval. These terms and
conditions include those related to drilling, production, well
plugging and abandonment, and other requirements related to
lease administration.
Under current law, the Secretary of the Interior is
required to inspect leases annually, based on production or
operator noncompliance. Leases are also inspected at least
annually if there is a potential for environmental degradation
or hazard to public health and safety. When inspectors identify
noncompliance, they initiate enforcement action. The BLM is
authorized to use a number of enforcement tools to ensure
compliance, such as issuing notices of violations, imposing
assessments or civil penalties, ordering a shutdown of
operations, and possible lease cancellation.
In July 2000, a Farmington Field Office I&E review was
conducted to address concerns in the Farmington Field Office.
The main finding identified an inadequate number of personnel
available to monitor oil and gas activities in the Farmington
area. The New Mexico State Office has worked to fill critical
I&E positions as a result of the fiscal year 2000 review.
A total of $840,000 base funding was provided in fiscal
year 2002 for BLM New Mexico petroleum engineering technicians,
PETs, in the I&E program. The Farmington Field Office has
filled five of those PET positions, the Carlsbad Field Office
has filled three PET positions, and the Oklahoma Field Office
will be filling four more PET positions in 2003.
The New Mexico State Office has advertised for two regional
I&E Coordinator positions, and a State I&E Coordinator, who
will provide for a more consistent I&E program statewide.
There will be a total of 14 new I&E positions in BLM New
Mexico before the end of fiscal year 2002. For fiscal year
2003, the BLM is proposing to further increase funding for New
Mexico's I&E program, and to add an additional 13 I&E positions
for the State.
The 2002 review also found that Surface Protection
Specialists were focusing their efforts on processing
Applications for Permits to Drill, APDs. A recommendation of
the review was to increase the number of Surface Protection
Specialists to ensure high-priority environmental inspections
were performed.
To address this recommendation for fiscal year 2003, the
BLM is proposing to add five new Environmental Specialist/
Surface Protection Specialist positions to conduct
environmental inspections and facilitate the APD approval
process. Currently, an individual from the I&E staff is
focusing on high-priority environmental inspections.
Of course, providing and maintaining a strong oil and gas
I&E program does not resolve all the potential conflicts
related to oil and gas development. The BLM is also attempting
to initiate and implement other means to address the inevitable
conflicts inherent with our multiple use mission.
An example of this in the Farmington area involves the
conflicts arising from the fact that the BLM issues livestock
grazing permits and oil and gas drilling leases for the same
BLM lands.
BLM grazing permit holders have claimed that oil and gas
production and pipeline companies negatively impact the
ranching operations of BLM grazing permit holders. Their
complaints primarily center on accelerated erosion from oil and
gas access roads and reclamation efforts on pipelines and well
pads.
In addition, ranchers believe they should have the
opportunity to have more input into siting and accessing oil
and gas wells within their grazing permit areas so that wells
cause the least disruption to grazing operations and minimize
surface disturbance.
In order to address these concerns, the Farmington Field
Office continues to stress collaboration and communication in
working toward resolving these conflicts. In July 2001, the
Farmington Field Office formed the BLM Grazing/Oil and Gas
Committee, consisting of BLM grazing permit holders and
representatives of the oil and gas industry, the New Mexico Oil
and Gas Conservation Division, the U.S. Forest Service, and the
New Mexico Land Office.
Some accomplishments of the committee's collaboration and
cooperation include agreeing on standards for fencing of waste
pits and tanks on oil and gas well sites; initiating a
voluntary $1,000-per-acre offsite mitigation fee to restore
vegetation; establishing better seed mix for rehabilitation of
disturbed areas; increasing communications between BLM,
industry, and grazing communities so that ranchers are aware of
pending surface disturbance in grazing areas; and initiating a
program of rancher and land owner involvement in predevelopment
field consultation and participation in working groups.
Last week, BLM officials also met with the New Mexico
Cattle Growers Association in the Farmington area to further
discuss these issues and to develop collaborative methods of
mitigating the impacts of oil and gas development activities.
Mr. Chairman, the BLM plays an important role in
implementing the President's National Energy Policy and in
providing for environmentally sound energy development. As you
know, it is imperative that a strong oil and gas I&E program
follow any increases in energy development and production. The
BLM is committed to addressing the issues raised in the 2000
review of the Farmington I&E program and looks forward to
working with you and your committee further on this issue.
Thank you again for the opportunity to testify. I would be
pleased to answer any questions that you have.
[The prepared statement of Mr. Whitley follows:]
Prepared Statement of Richard Whitley, Acting State Director, New
Mexico State Office, Bureau of Land Management, Department of the
Interior
Mr. Chairman and members of the Committee, thank you for the
opportunity to appear here today to discuss the Bureau of Land
Management's (BLM's) oil and gas inspection and enforcement (I&E)
activities in the Farmington area. I am accompanied by Steve Henke, our
Farmington Field Office Manager, who is responsible for the inspection
and enforcement program in the Farmington area.
background
In New Mexico, the BLM manages 13.4 million acres of surface land
(an area larger than Vermont and New Hampshire combined); 36 million
acres of subsurface mineral estate underlying Federal surface land; 8.4
million acres of Tribal and allotted lands where the BLM manages
mineral operations as part of its trust responsibility; and 9.5 million
acres of subsurface mineral estate underlying privately owned land.
Federal lands in New Mexico are some of the highest in oil and gas
production in the Nation. The Farmington Field Office administers 1.5
million acres of surface land in northwest New Mexico and 3 million
acres of subsurface mineral estate.
In following the Federal Land Policy and Management Act, the BLM
manages the public lands based on the principles of multiple use and
sustained yield, and balances recreation, commercial, scientific, and
cultural interests as it strives for long-term protection of renewable
and nonrenewable resources. These include range, timber, minerals, oil
and gas, recreation, watershed, fish and wildlife, wilderness, and
natural, scenic, scientific, and cultural values.
blm oil & gas inspection & enforcement responsibility
The BLM is responsible for the oversight of oil and gas operations
on Federal and Indian lands with the exception of Osage Tribal lands.
This I&E authority derives from the Mineral Leasing Act of 1920, the
Federal Oil and Gas Royalty Management Act of 1982, and the Indian
Mineral Leasing Act of 1938.
The objectives of the oil and gas I&E program are to protect the
environment, public health, and public safety; to ensure that the
public's oil and gas resources are properly developed in a manner that
maximizes recovery while minimizing waste; and to ensure the proper
verification of production reported from Federal and Indian lands. This
responsibility includes inspection of oil and gas operations to
determine compliance with applicable statutes, regulations, onshore
operating orders, notices to lessees, and lease terms and permit
conditions of approval. These terms and conditions include those
related to drilling, production, well plugging and abandonment, and
other requirements related to lease administration.
Under current law, the Secretary of the Interior is required to
inspect leases annually, based on production or operator noncompliance.
Leases are also inspected at least annually if there is a potential for
environmental degradation, or hazards to public health and safety. When
inspectors identify noncompliance they initiate enforcement actions.
The BLM is authorized to use a number of enforcement tools to ensure
compliance, such as issuing notices of violations, imposing assessments
or civil penalties, ordering a shutdown of operations, and possible
lease cancellation.
farmington field office oil & gas inspection & enforcement review
findings, recommendations & resolutions
In July 2000, a Farmington Field Office I&E review was conducted to
address concerns regarding I&E issues in the Farmington Field Office.
The main finding identified an inadequate number of personnel available
to monitor oil and gas activities in the Farmington area. The New
Mexico State Office has worked to fill critical I&E positions as a
result of the Fiscal Year 2000 review. A total of $840,000 in base
funding was provided in Fiscal Year 2002 for BLM New Mexico petroleum
engineering technicians (PET) in the I&E program. The Farmington Field
Office has filled five PET positions; the Carlsbad Field Office has
filled three PETs; and the Oklahoma Field Office will be filling four
more PET positions in July 2002. The New Mexico State Office also has
advertised for two regional I&E Coordinator positions, and the State
I&E Coordinator, who will provide for a more consistent I&E program
statewide. There will be a total of fourteen new I&E positions in BLM
New Mexico before the end of Fiscal Year 2002. For Fiscal Year 2003,
the BLM is proposing to further increase funding for New Mexico's I&E
program, and to add thirteen I&E positions for the State.
The 2000 review also found that Surface Protection Specialists were
focusing their efforts on processing Applications for Permit to Drill
(APD). A recommendation of the review was to increase the number of
Surface Protection Specialists to ensure that high-priority
environmental inspections are performed. To address this
recommendation, for Fiscal Year 2003, the BLM is proposing to add five
new Environmental Specialist/Surface Protection Specialist positions to
conduct environmental inspections and facilitate the APD approval
process. Currently, an individual from the I&E staff is now focusing on
high-priority environmental inspections.
other efforts to resolve oil & gas conflicts in the farmington area
Of course, providing and maintaining a strong oil and gas
inspection and enforcement program does not resolve all of the
potential conflicts related to oil and gas development. The BLM also is
attempting to initiate and implement other means to address the
inevitable conflicts inherent with our multiple use mission. An example
of this in the Farmington area involves the conflicts arising from the
fact that the BLM issues livestock grazing permits and oil and gas
drilling leases for the same BLM lands. BLM grazing permit holders have
claimed that oil and gas production and pipeline companies negatively
impact the ranching operations of BLM grazing permit holders. Their
complaints primarily center on accelerated erosion from oil and gas
access roads and reclamation efforts on pipelines and well pads. In
addition, ranchers believe they should have the opportunity to have
more input into siting and accessing oil and gas wells within their
grazing permit areas so that wells cause the least disruption to
grazing operations and minimizing surface disturbance.
In order to address these concerns, the Farmington Field Office
continues to stress collaboration and communication in working towards
resolving these conflicts. In July 2001, the Farmington Field Office
formed the BLM Grazing/Oil and Gas Committee, consisting of BLM grazing
permit holders and representatives of the oil and gas industry, the New
Mexico Oil Conservation Division, the U.S. Forest Service, and the New
Mexico Land Office. Some accomplishments of the Committee's
collaboration and cooperation include agreeing on standards for fencing
of waste pits and tanks on oil and gas well sites; initiating a
voluntary $1,000-per-acre off-site mitigation fee to restore
vegetation; establishing better seed mix for rehabilitation of
disturbed areas; increasing communication between BLM, industry and
grazing communities so that ranchers are aware of pending surface
disturbance in grazing areas; and initiating a program of rancher and
landowner involvement in pre-development field consultation and
participation in working groups. Last week, BLM officials also met with
the New Mexico Cattle Growers Association in the Farmington area to
further discuss these issues and to develop collaborative methods of
mitigating the impacts of oil and gas development activities.
conclusion
Mr. Chairman, the BLM plays an important role in implementing the
President's National Energy Policy and in providing for
environmentally-sound energy development to respond to our Nation's
growing energy needs. As you know, it is imperative that a strong oil
and gas inspection and enforcement program follow any increases in
energy development and production. This applies to the Farmington area,
as well as all other energy development areas. The BLM is committed to
addressing the issues raised in the 2000 review of the Farmington
inspection and enforcement program, and looks forward to working with
you and your Committee further on this issue.
Again, thank you again for the opportunity to testify. I would be
pleased to answer any questions that you may have.
The Chairman. Well, thank you. Before we go to any
questions, why don't we hear from Tweeti Blancett and then from
Bob Gallagher, and then I'll have some questions for each of
the panel members, and then we will have some public
discussion. Why don't we let them testify.
Ms. Blancett. Good morning, Senator Bingaman.
The Chairman. Good morning.
STATEMENT OF TRECIAFAYE W. BLANCETT, BLANCETT TRUST, BLANCETT
RANCHES, SAN JUAN BASIN, NM
Ms. Blancett. Welcome to northwestern New Mexico. I'm a
member of an eighth-generation ranching family. We've lived on
and farmed a ranch along the Animas River for parts of three
centuries. We were here in the 1800's, all through the 1900's,
and hopefully we'll last throughout the 2000's.
I don't really have to tell you the problems, because our
Senator has already told you. He outlined what our problems
are, and they're no different than they were a year ago when I
went into his office and told him what our concerns are.
I don't have to tell you the problems, because they're
documented in the evaluation summary that the Farmington Field
Office did. These problems were identified in July 2000, but
they were also identified in 1994 and 1998. So these are not
new problems that we're talking about, these are old problems.
And the problems that we have as grazing permittees, the people
that are sitting out in the audience, I see a lot of faces that
have exactly the same problems. They don't have a grazing
permit, but they have a small land holding. And they have the
noise, they have the air, they have the water pollution, they
have the erosion. They have the contaminant spills. And we have
serious contaminant spills throughout San Juan County.
And a year ago when I went into your office, Senator, I
wasn't aware of all the contamination that San Juan County has.
But in that year's time, with the media making known our
position, there's people that have come to me time and time
again and said there's some real serious problems in this area.
We have serious contamination problems that are not being
addressed and have not been addressed that we need to look at
as a community, as an industry, and as a BLM enforcement
agency. The mood of the stakeholder, whether you're from the
environmental community, whether you're from the grazing
community, or whether you're from the oil and gas community, is
becoming more confrontational. It is not as convenient to work
with inner friction in the situation as it was a year ago.
People are wanting more results, and they're wanting to see
something done besides lip service.
I would end my short statements and allow my time to be
used for people out in the audience to identify specific
problems. But I want to leave you with this thought: Last year
alone, San Juan County spent $2.49 billion--$2.49 billion from
our county from the extracting industry. Now, that's very
conservative, because I don't have Tribal figures, I don't have
private royalty owners, and I don't have the State of New
Mexico in that. Those are very conservative.
And my question to you as the public and to you, Senator,
from Congress, and to the industry and BLM is if we spent that
in one year, why are we having the discussion on where the
funds are? We have sent the money in to take care of the
problems, the surface problems that we have in San Juan County,
and we think that money needs to be reallocated back to San
Juan County to fix--and Rio Arriba County, northwestern New
Mexico--to fix--and parts of McKinley, too, I understand--to
fix the surface damage issues.
Now, I think when you start reallocating the money, you
need to lay the blame in the proportion of the people who
received it--the Tribes, the private royalty owners, the State
receive an eighth. Industry receives seven-eighths. So when we
start our reclamation project, maybe we need to allocate the
resources in that manner.
Senator, thank you again for coming. Thank you for the
audience that's here that's willing to share their concerns
with you, and thank you for hearing us and coming and having
the opportunity for us to speak. We appreciate that.
The Chairman. Thank you very much. Mr. Gallagher, we are
glad to have you representing the Oil and Gas Association.
STATEMENT OF BOB GALLAGHER, PRESIDENT, NEW MEXICO OIL & GAS
ASSOCIATION, SANTA FE, NM
Mr. Gallagher. Thank you, Mr. Chairman, it's always a
pleasure to be here with you. I don't know if I made you mad,
but now you've made me speak after Tweeti, and in all the times
that Tweeti and I appear together, I always sound less than
stellar when you follow Tweeti. It's a little hard to sound
good when you have to follow her. But I appreciate the
opportunity, Mr. Chairman.
I am the president of the New Mexico Oil and Gas
Association, which is comprised of 275 companies who conduct
business in New Mexico. Mr. Chairman, the New Mexico Oil and
Gas Association represents the producers that produce 99
percent of all the oil and gas that's produced in New Mexico.
We were founded in 1929, and not surprisingly at that time the
Association was called the New Mexico Oilman's Protective
Association.
Although the name has changed, the challenges facing our
industry concerning land access have not. Since our inception a
few weeks after the infamous stock market crash in 1929, our
industry in New Mexico has pumped more than 4.5 billion barrels
of crude oil and 45 trillion cubic feet of natural gas to help
America meet its growing needs while New Mexico has become a
national leader in the production of oil and gas.
In the San Juan Basin, the oil and gas industry takes
concerns, complaints, and conflicts over surface effects of
their operations very seriously. The oil and gas industry has
had an ongoing program to address the concerns, the complaints,
and the conflicts of surface owners, including those holding
grazing permits, since the first well was drilled in this basin
80 years ago.
The ongoing and very active program includes road
maintenance, reclamation, well and facility site security to
protect people and livestock, remediation of surface effects,
studies of areas of special environmental concern, noise
abatement, and general operating practices.
There have been more than 32,000 wells drilled in the basin
that now provides on a daily basis approximately 7 percent of
the Nation's consumption of natural gas. These wells have all
been drilled, completed, and are being operated under the
applicable BLM Resource Management Plan and the rules and
regulations of the New Mexico Oil Conservation Division.
In addition, producers and operators comply with the rules
of numerous other agencies, including the U.S. Forest Service,
the Bureau of Reclamation, Tribal governments, the Bureau of
Indian Affairs, the State Game and Fish Department, and the
State Environment Department. In each and every instance, these
32,000 wells must comply with all environmental rules,
regulations, and policies of these agencies. If operators fail
to meet their obligations under these requirements, they are
subject--and should be--to fines, and they must correct their
failures.
The oil and gas industry goal is zero incidents of surface
impact. We have made, and continue to make, great progress,
such as smaller well sites and improved drilling and production
technology. This also includes a commitment to working with the
citizens of the areas in which we operate to do the right
things. We are committed to our environmental obligations and
take surface owner and user complaints and conflicts very
seriously.
This is evidenced by our work every day, as well as by our
commitment to and our efforts in the groups that you mentioned
in your opening statements, Mr. Chairman, and that is the BLM
industry working group as well as the rancher and industry
working group.
We are very proud that together these two groups meet in
excess of twelve times a year, with the common purpose of
identifying and solving impediments to the multi-use principles
that must guide the BLM in their regulatory role.
These groups are very active in access issues, road
maintenance, reclamation, reseeding, noise abatement, as well
as other areas of mutual concern.
These committees do not rely on op-ed pieces in the
newspaper, selected tours of sites, or sound bites, but rather
on sound science and common sense to ensure that we can
continue to provide the energy needs of our State and our
country in an environmental responsible way.
In addition, we are proud that State lawmakers and
regulatory agencies in the State have passed industry
initiative and supported legislation and regulations that have
minimized surface damage and have been specific to the San Juan
Basin.
As the old saying goes, ``This is not your father's
Oldsmobile,'' nor is this your father's oil and gas industry.
Much has changed over the past 80 years, including technology
as well as regulatory requirements. Holding the industry
hostage to today's standards for deeds that were done years ago
in compliance with the laws at that time is not acceptable, nor
is it based on sound science or common sense.
Our industry is burdened with complicated regulatory
requirements which we are meeting on a daily basis while
providing the needed energy for our country, as well as a
return on the investments of our owners and stockholders.
Expecting to right the wrongs of the past 50 years in a 12-
month period is impossible at best and ludicrous at worst.
Working with the above-mentioned committees, the industry
believes that the establishment of 5-year plans by individual
companies for remediation and reclamation of old sites is a
practical and measured response to the problem.
Let me quickly move to the Bureau of Land Management and
their inspection and enforcement activities in the San Juan
Basin. We have a very good professional working relationship
with the Farmington Field Office of the BLM, and it generally
has increased tenfold under the leadership of Steve Henke, who
is the Field Office Manager in Farmington. But the entire State
of New Mexico's BLM efforts are hampered by a lack of financial
commitment on the part of the national BLM Office. Let me give
you some figures to illustrate that.
During the time period from fiscal year 1996 to fiscal year
2001, the Bureau--countrywide, there was a 25 percent increase
in funding, while New Mexico's increase during that same time
period for oil and gas activities was limited to 11 percent.
That's a little over 2 percent a year, not even keeping pace
with inflation. At the same time, the budget of the Washington,
D.C. National Office of the BLM has increased 175 percent.
Mr. Chairman, I stop at this point to point out my
testimony, my written testimony, shows the National Office
increased 45 percent. Knowing your demand for accuracy, we
double-checked again yesterday to make sure, because that
figure sounded high. And, in fact, that figure was low. In that
time period, the national office has increased 175 percent.
Those figures: in 1997, the Washington Office of the BLM
had a budget of $43.8 million. A short 5 years later, the
budget of the Washington Office is $120.4 million. This
represents an increase of 175 percent from fiscal year 1997 to
fiscal year 2002. Employees have grown from 300 to 500 in the
national headquarters of the BLM.
And while Tweeti and the ranchers and the grazing permit
holders can't get enough I&E inspectors, the oil and gas
industry can't get enough people processing applications and
permits to drill and right-of-way permits in order to
effectively work.
I have to question how the money can be spent in
Washington, D.C., rather than in the field offices throughout
New Mexico and the United States. It's hard for me to
understand this disparity in funding and its logic.
The industry, Mr. Chairman, does not oppose an increase on
I&E as long as it's accompanied by equal increases in the Field
Office's ability to process applications to drill and permits.
In New Mexico today, there's an average of 90 days wait for the
processing of APDs, and our industry cannot maximize the
production of natural resources, which is essential to our
industry's health, meeting the growing demand for energy, as
well as the financial health of cities, counties, and the State
of New Mexico.
I would point out, Mr. Chairman, that in On-surface Rule 1
of the BLM, they say that 85 percent of all applications and
permits to drill should be processed in 30 days. Our average in
New Mexico is 90. I will tell you in the Farmington Field
Office it's a little bit lower than 90. Since Mr. Henke
arrived, it's been reduced from over 100 to approximately 60.
Down in the Carlsbad area, it is still exceeding 100 days.
Moving forward, we will, as an industry, continue to work
in coordination with the BLM and the Federal and State
government, surface owners, and users to ensure all concerns,
complaints, and conflicts are addressed in a timely and
responsible manner.
The time has come to put to bed the myth that resource
development and the environment are not compatible or
diametrically opposed. Our industry has shown that we can and
in practice do develop valuable natural resources while
protecting the important wildlife and environmental values that
exist today. And we're committed to continuing that effort. The
taxpayers of our State deserve that commitment as much as they
deserve the $1.3 billion the oil and gas industry directly
provided to the State of New Mexico this past year.
Mr. Chairman, thank you for the opportunity to provide
testimony to you and your committee this morning. I also want
to thank you on behalf of our 275 member companies for your
leadership and dedication to the passage of a comprehensive
national energy policy. Our country now, more than ever, is in
dire need of a strategy that will provide the energy our
citizens need and will reduce our reliance for that energy from
hostile parts of the world.
Thank you very much, Mr. Chairman.
The Chairman. Thank you very much. Thank you all very much.
Before I start asking a few questions here, let me just say
what I should have said right at the beginning of this hearing,
and that is to thank the city of Bloomfield, Keith Johnson, who
is the mayor--I believe Keith is here, is that right? Thank you
very much for letting us use your facilities today. I
appreciate the hospitality and all the good work.
And let me also thank Terri Lee, who is the director of the
Community Services. Terri is in the back of the room. And Mary
Tso, who is the special projects coordinator, who is helping
us; is this right?
Ms. Tso. Yes.
The Chairman.T1 Okay. Thank you all very much for your
help.
Mr. Whitley, let me ask you a few questions about the BLM
effort here. The figures that I cited in my first comments
about the number of inspectors per well here in this Farmington
area, are those accurate as you understand it? I mean, do we
have that few number of inspectors per well in this area?
Mr. Whitley. Yes, Mr. Chairman. It's, 350 is the average
nationwide, and it's 1,500 here in the San Juan Basin.
The Chairman.T1 Does the plan--if it's 350 nationwide, 350
wells per inspector, and it's 1,500 wells per inspector here,
how quickly can the BLM under your present budgeting plans
remedy that and get our situation here in line with the rest of
the country?
Mr. Whitley. The numbers we brought on this year will be a
huge help. In addition, with the surface protection specialists
we'll bring on next year, that will be additional resources for
the field office here.
And there are some other issues related to some technology
that we're trying to bring on board in the way of pilot
technology to do remote sensing at the well sites that will
also help. And that pilot should start here in Farmington in
the next couple months, if we get the funding for it.
The Chairman. Well, I guess my concern, though, is if we
add the five people you're talking about adding this year here
in this office--and how many would you anticipate adding next
year in this office for inspection enforcement?
Mr. Whitley. Five.
The Chairman. Five additional. So that will be ten more
people. Does that correct the imbalance? Does that get us up to
one inspector per 350 wells in this area?
Mr. Whitley. No. I believe it gets us to 500.
The Chairman. But that does get us to 500, one inspector
for 500?
Mr. Whitley. For 500 wells, that's correct.
The Chairman. So by the end of next fiscal year--so that
would be a year from this--from the first of October,
essentially----
Mr. Whitley. Right.
The Chairman [continuing]. You're saying that we would be
to where we'd have one inspector for 500 wells.
You say in your testimony here that the inspectors identify
noncompliance--when they identify noncompliance, they initiate
enforcement actions. Can you tell me how many enforcement
actions have been initiated by inspectors here in the San Juan
County and this area in the last year, for example?
Mr. Whitley. Mr. Chairman, I'd like Steve Henke, the field
office manager from Farmington, to answer that question for
you. He'd have that.
The Chairman. That would be fine. Steve, come right ahead.
Come on and join us.
Mr. Henke. Thank you. I believe we issued close to 700
incidents of noncompliance last year, and that does not include
situations where we found areas of concern where we handled it
with a telephone call or a verbal warning. But those were the
actual written notices of noncompliance that were issued.
The Chairman. And going on with Mr. Whitley's testimony, it
says the BLM has authorized a number of enforcement tools to
ensure compliance. You can issue a notice of violation, you can
impose assessments or civil penalties, you can order a shutdown
of operations, and possible lease cancellation. Could you give
me some indication of what--which of those various tools
actually are being used, or have been used in the last year? Is
it just the issuance of something, or do you actually impose
penalties, fines, civil penalties?
Mr. Henke. It follows the whole range that you identified,
Mr. Chairman. We start with the lowest level, and that would be
a verbal contact and request for action. And that would
escalate to written notification, fining, and ultimately if
there's noncompliance, to cancellation of the lease or
suspension of operations. I believe last year we only went to
the highest level of suspension on one lease.
The Chairman. I indicated earlier when I made my comments
that I had this meeting with Kathleen Clarke, the head of the
BLM. I guess she is your boss, is she not, Mr. Whitley?
Mr. Whitley. Yes.
The Chairman. She indicated that Assistant Secretary Watson
intends to announce some additional policies with regard to
surface owner rights. Can you give us any information as to
what is contemplated there or what we could expect there, the
timing or any of it?
Mr. Whitley. No, Mr. Chairman, other than knowing that
they're working on some new guidelines in that regard, I don't
have any detailed information.
The Chairman. Have you had a chance to provide input to the
national office as to the development of these?
Mr. Whitley. No.
The Chairman. And Mr. Henke, have you?
Mr. Henke. I have not. The national office is aware of what
we're doing in Farmington and in our working groups in our
committee. We have agreed to move towards consultation on on-
site development, where we bring in not only the surface owner,
where we have private surface and Federal mineral estate, but
also the grazing permittees on the BLM land to assist us in
siting of wells and roads in a manner that's least impacting to
the grazing operation. And that's something we have implemented
in the last 3 or 4 months.
The Chairman. So you have a committee that assists with
this, is that right? Does this relate to the individual land
owner, surface owner that is involved here, the lessee? I'm not
clear if you have a general committee that is setting up these
procedures or if the person who owns the surface is called in
to participate. How is that done?
Mr. Henke. Mr. Chairman, we had a recommendation from the
rancher/oil and gas/BLM working group to improve the
communication on the ground for the siting of well locations
and access roads. And we've begun implementation of that, when
we have an application for a permit to drill, whether it's on
private surface or BLM surface to invite that grazing
permittee, that land owner, to that site visit to have input
into the siting of that well. And I hope that answers your
question.
The Chairman. Yes, I think that does help. You also have a
Roads Management Committee, which I understand consists of a
committee of agency staff and oil and gas lessees. That
committee raises funds from certain lessees and certain areas
to maintain collector roads. Can you tell us how that
functions? There is an area, Hart Canyon Unit, that we have
heard particular complaints on. What are the percentage of
roads needing restoration that the committee is working on? Any
information you can give us on that I would appreciate.
Mr. Henke. The Roads Management Committee has taken a look
basin-wide at the roads issue. We've developed a cooperative
agreement among all the oil and gas operators in the basin and
the Bureau of Land Management. We've divided the basin up into
13 road management units, of which the Hart Canyon is one of
the 13. Assessments for road maintenance are based upon a
percentage of ownership of wells in those 13 units, and the BLM
contributes to that road maintenance agreement.
We anticipate spending approximately--collectively
approximately $600,000 annually to bring our roads up to
standards. We've invited representatives from the land owner/
ranching community to work with those individual 13 road
superintendents to provide input into the priorities for the
road maintenance in those 13 units.
Obviously, we've got to have the buses running, people have
to access their private lands. There may be issues beyond oil
and gas access that we need to consider as we maintain roads.
So again, we've tried to make that connection with the folks
living and working and owning property out on the ground with
the oil and gas operations in the BLM, to agree upon priorities
for road maintenance.
The Chairman. Let me ask you to return just a minute to
this issue of the number of staff we are going to have per
well. Mr. Henke, do you agree that we are expected to have
enough people in play here on inspection and enforcement by the
end of next fiscal year to get to this 500 wells per inspector?
Mr. Henke. Mr. Chairman, I went into natural resources
because I couldn't do the math to go into engineering. I think
the ratio is pretty close. Certainly the trend is up. I don't
have the exact figures, but, you know, our intent is to meet
the national strategy on our oil and gas inspection program.
The Chairman. So we are going to get to a point here fairly
soon where we are not that greatly disadvantaged relative to
the rest of the country as far as the staffing that we have?
Mr. Henke. The trend is absolutely in a positive direction
with regard to that ratio.
The Chairman. Okay. And Mr. Gallagher was also concerned
about the need for people to assist with the issuance of
permits. Is that part of what the increased staffing is going
to address or not?
Mr. Henke. That's part of our package for additional
funding as we go into fiscal year 2003, that part of that
additional capability would go towards the permitting and
surface compliance part of actual APD processing and
completion.
The Chairman. Let me ask about another part of this report,
this technical performance review that the BLM did itself. It
indicated that there was--I think the word they used was
``huge,'' a huge problem with no user validation of data
entries into the inspection recordkeeping system known as
AFMSS. This technical performance review found, and I quote,
``The AFMSS data is so corrupted and inadequate that it is
recommended that all inspections except those critical be
suspended to allow for I&E personnel to perform data cleanup,
file verification, and data entry.'' Is this something that has
been done and been corrected?
I guess this report was done in the year 2000, we are now
half-way through 2002. Has this problem been fixed? Mr.
Whitley, do you have a view on that?
Mr. Whitley. Yes. We've hired two additional positions that
are working on the data entry and data cleanup and the movement
of the data from the old system to this new Atlas system.
The Chairman. Okay. Let me ask a couple of the other
witnesses here a few of these questions.
Tweeti, thank you for being here. There's a lot obviously
that you believe needs to be addressed in order to get this
problem under control. If you had to identify a couple of first
steps that you think need to be taken that haven't yet been
taken--you've heard some of the things that are ongoing that
Mr. Henke has tried to implement since he has arrived here, but
if there were a couple of things that you think are first steps
that need to be given highest priority by the BLM, what would
those be?
Ms. Blancett. Mr. Chairman, I along with the other panel
members want to congratulate Steve Henke on the job that he's
attempting to do. It's very difficult to walk into a situation
that, as Bob Gallagher said, is 50 years in the making, and
correct it overnight.
But the industry that we have in San Juan County has not
had to comply for a long time. And as a result, there's many
issues that we're at odds on. And I think probably the one
that's the most evident is the reseeding and the lack of
reseeding and establishment of forage. If we do not have forage
for livestock grazing, we do not have it for wildlife, we don't
have it for our environment. It contributes--the lack of forage
also contributes to our watershed problems, to our
contamination migration from well sites and roads and pipelines
to other parts of the environment. The reseeding has been not
ignored, but it has certainly taken second place to anything
else.
The second thing is--you asked me for two. The second thing
that I would suggest is to bring the roads into compliance.
Because the network of roads throughout the entire Farmington
District--and I need to tell you that our ranch is 75 sections,
which is larger than all of D.C. But San Juan County is about
the same size as Connecticut. So you're talking about a pretty
large land mass that has been pretty badly abused.
So the roads and the reseeding are the two things that
would work towards restoring the overall environment, and these
are the two things that I think have been neglected the worst.
The Chairman. Okay. Thank you very much. Let me ask Bob
Gallagher: I understand there are some 5-year plans that some
of the larger oil and gas companies are developing to try to
restore some of the oil sites that exist here in the San Juan
Basin. Could you give us any information about those 5-year
plans?
Mr. Gallagher. Mr. Chairman, we've had several of our
companies, not only large but small independent companies as
well, begin to want to aggressively address the concerns that
Tweeti and some of the ranching and user groups have raised.
And knowing that we can't do it overnight, knowing that it's
not possible to do, some of our companies have produced 5-year
plans.
And the 5-year plans are very specific to the problems of
the past. And not 5-year plans for how they're going to
continue to develop the basin, because they are at work on
those. But this 5-year plan is how would we address the
problems that have been raised by the citizens that have
occurred maybe when you built a road to a location 30 years
ago. Obviously over the last 20 years there probably has been
erosion, there's no doubt about that. And that road would not
be up to today's standards, even though 30 years ago when they
built it, it was up to those standards.
So our companies are beginning to say listen, we need to
address this, we need to address it in a very structured and
timely way. But in order to ensure that they're able to do
their job in the next several years developing natural
resources and at the same time go back and address these
problems, that's what we're beginning to see.
And Mr. Chairman, I can assure you we are encouraging
companies to continue to do that. Because I think--Tweeti and I
disagree on a lot of things, but we also agree on a lot of
things. And I think one of those is it can't be done in 12
months. But it can't be ignored tomorrow. And I think that
that's the common ground that we have found and that we're
pursuing, the industry, is to continue to address on a day-to-
day basis and hopefully in that 5-year plan to have gone back
and address that.
The two biggest issues on those plans are exactly what
Tweeti mentioned, is the reseeding and on the roads. And I
think they're being worked on as we speak today, Mr. Chairman.
I'm not going to tell you that the Hart Canyon area, for
instance, we're going to wait for 4 years. As they come up, we
continue to work on them.
The Chairman. Let me ask, is there an effort in any of this
planned development to get some of the grazing lessees, some of
the ranchers involved in that so they have some say as to where
you set the priorities and how you proceed?
Mr. Gallagher. Mr. Chairman, the answer is yes. The
rancher/industry/BLM group that meets several times a quarter,
we have gotten that input from that group. In addition, the BLM
and industry group has met. At the last meeting the president
of the Ranchers Association group was there and said that he
believes that progress is being made in those areas. But we
very definitely are developing the 5-year plans because of
input by the grazing permittees and those users. We are not
developing those sitting in an office and not listening to
those concerns.
The Chairman. Well, thank you very much. Why don't we go
ahead and allow some public input here. We have got another 10
minutes to go on this. I think we have a place we can have the
public use this microphone. Can we move this out there where
people could get it?
Let me just ask folks to come up here and take about 2
minutes each. As I understand it, Terri has a sign-up sheet
that she is bringing up to the podium to sort of try to
indicate the order in which people will speak. Oh, here it is,
I see. Okay. Alan Rolston, is that right?
Mr. Rolston. Yes.
The Chairman. Alan, why don't you come ahead and why don't
you take this mike.
STATEMENT OF ALAN ROLSTON, SAN JUAN SYSTEMS
Mr. Rolston. Thank you, Mr. Chairman, for the opportunity
to speak and thank you for the personal attention you devoted
to this area. I appreciate that. My name is Alan Rolston, I
work for San Juan Systems Lands out of Durango, and I work in
the whole basin on oil and gas issues. And I just want to
address one particular issue I think we've already touched.
The Chairman. If you might just hold that microphone so
that everybody in the back can hear you? I think that they are
having trouble hearing you.
Mr. Rolston. I'm very happy to see that you're familiar
with the inspection report about the lack of compliance
personnel in the Farmington Field Office. I think that's a
major problem. And I think that Steve is working towards that,
and also Rich. And I appreciate that. When I first came down
here a year ago, I looked at many well sites, and I strongly
disagree with Mr. Gallagher about the environmental stewardship
of the companies. We have different--an opposing viewpoint on
that.
I've seen at least two wells that there's been discharges
of flourishing wells that are violations of the Clean Water
Act, I've seen----
Reporter. Wait, wait. I'm sorry, could you please slow down
and speak clearly?
Mr. Rolston. Okay.
The Chairman. She's trying to take all this down, it's part
of our----
Reporter. I'm sorry.
Mr. Rolston. I'm trying to get all this in in 2 minutes. So
anyway, I've seen all these violations, and I--you know, I
think Mr. Gallagher has gone through a few, and he can show us
some of these places. But I do appreciate that we're trying to
move forward.
I urge you to make sure that the Senate and the House
properly fund the BLM for this. I talked to Kathleen Clarke.
The BLM gets about $3 per acre of land that they manage,
compared to the Forest Service around $7.50 an acre. And so I
think to do this job right and to get enough compliance people
out in the field to make sure the companies are going to
practice environmental stewardship and follow the rules and
regulations that are in place, we have to have the budget and
the amount of money to do that. Thank you.
The Chairman. Thank you very much. Next would be Brooks
Taylor.
STATEMENT OF B. BROOKS TAYLOR, M.D., MPH,
LA PLATA COUNTY, CO
Dr. Taylor. Senator, panelists and guests: My name is
Brooks Taylor, I'm a resident of La Plata County, Colorado. I'm
a surface owner, but more importantly I'm a surface dweller,
and it's on behalf of the surface dwellers that I'm going to
speak. That would include not only most of the people in this
room, but the guys drinking coffee over on the highway and the
kids who just got out of school yesterday over at the
elementary.
There's a persistent notion that methane gas is a source of
clean energy. And this may be true relative to other energy
sources at the point of use, at the time of use. However, if we
look at methane exploitation, exploration, transportation and
use, in its totality it's not clean, it is not environmentally
neutral. This is certainly the case with its effects on air
quality, and subsequently on the personal health of the
residents and the surface dwellers in this part of the country.
Recently publicized data on air quality and the
deterioration of air quality in the Four Corners highlights
several very disturbing trends. Among these are increasing
levels of ambient ozone in San Juan County--ozone is a
pulmonary toxin; the so-called hot spots of oxides of nitrogen
in La Plata County, Colorado; diminished visibility at Mesa
Verde National Park; and the ranking of Rio Arriba County to
our east as among the Nation's worst in air quality. These
indicators, which are occurring in what is customarily
considered to be a rural part of the Nation, run counter to
national trends of improving air quality.
Over the past few months, a subcommittee of the San Juan
Citizens Alliance has tried to look carefully at these issues
and their relationship to the expanding oil and gas
industrialization. We have found that perhaps as much as a
third of the air pollutant burden is contributed by this so-
called clean industry.
We have found that regulation of the industry's pollution,
because it targets only sources of certain sizes and as single
entities in the permitting systems, artificially minimizes the
apparent contribution to air pollution. We have found that
regulation is moreover rudimentary, haphazard, and
uncoordinated, and there's no single entity where all aspects
of regional air quality are systematically reviewed.
I have three recommendations. We strongly recommend that
all relevant air monitoring data be analyzed at a central
point, and Federal, State, and Tribal agencies be charged to
coordinate their efforts and to mutually share their findings
regarding air quality.
Secondly, it's urged that any expansion of oil and gas
exploration be preceded by systematic study and forecasting of
impact on regional air quality.
And thirdly, it's recommended that the USEPA be charged to
establish at least two comprehensive air monitoring stations
integrated into their national network to further follow--to
follow the further degradation, or hopefully improvement, of
regional air quality.
We appreciate your attention and interest.
The Chairman. Thank you very much. We are just going to
have time for a couple more statements here, and then after
that we will have people just go ahead and provide their
statements for the record.
But let me ask the next person to come forward. Lucille
Ulibarri? Is Lucille here?
Ms. Ulibarri. Yes, I am.
The Chairman. Please come up.
STATEMENT OF LUCILLE ULIBARRI, BLANCO, NM
Ms. Ulibarri. I'm old, Senator Bingaman. I am Lucille
Ulibarri. I live in the Blanco area. My complaint is my--I'll
start from the beginning. My dad 80 years ago homesteaded in
the Pump Canyon area. I own two sections of land. It's between
two hills and is in a valley. The roads--my biggest issue is
the roads that go through this--through my land is--I mean,
it's a freeway. I mean 30--20, 30 vehicles a day. That includes
rigs or service trucks or whatever. I have tried to get
together with Burlington, and they tell me there is nothing
they can do to help me out. I have suggested that I work with
them, and they have ignored me. And I am very much upset about
this. I'm 80 years old and I'd like to see something done for
inspection. Thank you.
The Chairman. Thank you very much. We have--Linn Blancett
is here? Please come right ahead.
STATEMENT OF LINN BLANCETT, SAN JUAN BASIN, NM
Mr. Blancett. Senator, thank you for your time. I am
pleased with your grasp of the problem that we have here.
Again, I appreciate what Steve Henke's trying to do. I'm a
member of the working committee. I would remind everyone that
the surface is not a rancher permittee problem only, although
many ranchers have had serious AUM unit cuts, and you can
directly relate it back to the loss of forage.
Now, our committee is working, and we are striving to
change things. But a problem that we have is industry's
attitude towards the grazing permittee and the process that
we're going through. At the present time, I know of one animal
for certain that was hit by a water truck, possibly another one
of mine, but I'm here today, I haven't been able to go look and
see. It's an attitude that we are causing enforcement of the
rules and regulations that are existing and have not been met.
With that, I would remind you, as it was mentioned earlier,
of the amount of money that is generated here in this county.
And it needs to come back in some form from the BLM to help
protect the surface where the money was generated. Thank you.
The Chairman. Thank you very much. Let's try to get two
additional folks given a chance here. Jacob Hartlell?
Mr. Hottell. Hottell.
The Chairman. Excuse me?
Mr. Hottell. Hottell.
The Chairman. Hottell, excuse me. Please go right ahead.
STATEMENT OF JACOB HOTTELL, CHAIRMAN,
CLEAN WATER COALITION
Mr. Hottell. Thank you, Senator. Good morning, Senator
Bingaman, panels and guests. My name is Jacob Hottell, chairman
of the Clean Water Coalition.
I appreciate Mr. Henke, Frank Chavez, Laurie Rodenbury,
OCD. I appreciate the people that are trying to keep this thing
under control. I think we're starting to get a little grasp of
what the magnitude of this is.
The numbers and figures and dialogue here this morning are
pretty overwhelming. It is absolutely overwhelming. Can we
comprehend the magnitude of the wealth that this industry is
taking in? The question to be addressed is how much of our
quality of life are we willing to sacrifice for your children,
my children, our grandchildren, and the future of our society?
Mr. Bingaman, we appreciate what you're doing to help
America and the people salvage some sanity in these times of
confusion. I love America, I'm fortunate to be born into
America, America the Beautiful. I've been blessed from the time
of the beginning of my life. I was born and raised on the
Animas River, and I don't know how a person could be more
blessed. And I realize there are those who are much less
fortunate than I.
Senator Bingaman, I see us as a society of junkies. We're
so addicted to hydrocarbon energy, we'll do just about
anything. We'll sacrifice our rivers, our lakes, our springs.
And worst of all, we're reinjecting the waste right into our
aquifers and our water tables.
In 1988, we found there was a shallow injection well at
Bondad, Colorado. They were injecting at 800 feet. Sir, that is
unbelievable. We questioned the ability of Colorado OTC and the
New Mexico OCD to actually regulate and control all this
madness that's going on around us. If Colorado OTC would permit
an injection well at 800 feet, I just can't comprehend this
type of engineering.
I don't know if you recall, but we had some correspondence
a few weeks ago pertaining to the Florida River, the direct
discharge into the Florida River. Well, if it hadn't been for
concerned citizens and organizations like San Juan Citizens
Alliance and Alan and us and the Southern Ute Tribe, I suppose
it would have been permitted.
But with the threat of lawsuits and so forth, Colorado OTC,
they rescinded this permit into the Florida River. I'm very
thankful for that.
I'll cut this short because of lack of time. We need
emergency action by Congress and the Senate for alternative
energy resource and development. There is no doubt about it. If
you look at our world's condition, the magnitude of wealth
that's going into oil and gas, there should be no problem with
that, they shouldn't object whatsoever.
We have fuel cell energy, solar cell, and all these
energies that absolutely have got to have some attention, and
the State of New Mexico should be the leader in this
development.
Coal bed methane development has been an absolute travesty.
I have personally witnessed in my farm the migration of methane
gas around the Cedar Hill area and all the Animas River Valley,
we've seen methane gas migrate into water wells. Methane gas
carries other dangerous pollutants.
I think that coal bed methane development has been a real
serious impact on the future of this community. It's wrecking
the water tables. The disposal to produce water is a nightmare.
By some observations here in the county, you can see that we
have to inject it, they have to evaporate in evaporative ponds.
And the cleaning up of dirty methane gas is costly. We don't
think that coal bed methane development would be practical
without government subsidies.
Thank you, sir, for coming down here.
The Chairman. Thank you. I think in light of the time, we
are going to have to cut it off at this point. We have got
several others who have signed our sheet indicating a desire to
give us input on this issue, and I would just urge each of
these, and anyone else in the audience that wants to have a
statement included for us to consider in the record, to contact
John, my staff, during this break we are going to have here for
the next 10 or 15 minutes, or mail it to us at the Senate
Energy and Natural Resources Committee.
But any of you who have a desire to have your statement, if
you want the equivalent of a couple of minutes of testimony
included, we are glad to include that.
Again, let me thank the witnesses that we have had this
morning. I think this has been useful in getting some of the
issued out on the table for folks to think about. Obviously,
there is some progress being made. It does not sound to me as
though it's adequate progress to satisfy all the concerns that
have been raised, and there is undoubtedly more we can try to
do in Washington to get the resources to the local office here
so that they can do all that is required under law to implement
these inspections and enforcement actions as necessary.
We also--frankly, I am also very hopeful that this
initiative that is apparently going on in the Washington
headquarters for the BLM will prove beneficial and will give us
some new direction and some new priority on solving some of
these conflicts between the subsurface and surface owners.
Thank you all very much. Let's conclude this hearing right
now. And then we will start up with the hearing that we are
going to do on the royalty owners in about 15 minutes. Thank
you.
[Whereupon, at 10:30 a.m. the hearing was adjourned.]
COMPUTER PROBLEMS AFFECTING MMS PAYMENTS IN NEW MEXICO
----------
FRIDAY, MAY 31, 2002
U.S. Senate,
Committee on Energy and Natural Resources,
Bloomfield, NM.
The committee met, pursuant to notice, at 10:45 a.m. in The
Bloomfield Cultural Complex, 333 South First Street,
Bloomfield, New Mexico, Hon. Jeff Bingaman, chairman,
presiding.
OPENING STATEMENT OF HON. JEFF BINGAMAN,
U.S. SENATOR FROM NEW MEXICO
The Chairman. Okay. Why don't we start up again. This
hearing is another hearing of the Energy and Natural Resources
Committee. And here we are examining the attempts to remedy the
computer problems caused by the Department of the Interior's
computer system shutdown on December 6, 2001.
This is affecting the Mineral Management Services payments
to individual Indian allottees in New Mexico. This disorder
caused by the shutdown and the lack of information about what's
happening here has become a major problem for a lot of the
allottees in this part of our State, especially.
I invited the Department of the Interior to testify at the
hearing today to explain what's happening with the royalty
payments that are owed to thousands of Navajos for oil and gas
leases on their allotments.
There are many rumors and there is a lot of confusion out
there about the shutdown, about estimated payments, about how
these accounts are being reconciled now that the Mineral
Management Service computer system is functional again.
In addition, I am sure that many people here would like to
know exactly what the royalty payments--when these royalty
payments will be issued in accordance with the normal payment
schedule that people have expected.
I would like to hear from the Departments first and have
them give their views, and then hear from Navajo Nation
officials and individual allottees about their view of the
situation, and then I will have some questions.
And then what we will do is to once again have an
opportunity for members of the public who are not on the
witness panel to make their statements. And we would ask that
they do that in a couple of minutes each.
Let me acknowledge Pete Valencia, who is here representing
Congressman Tom Udall. Pete, where are you? There he is.
Mr. Valencia. Thanks, Senator.
The Chairman. Give Pete a hand. We appreciate him attending
today and the interest he is showing in this issue. Let me go
ahead with our witnesses here. Let me get the--be sure I have
the full list here. First is Mr. Douglas Lords, who is the
Director of the Office of Trust Funds Management with the
Department of the Interior, Office of Special Trustee.
Following him is Mr. Edward Begay, who is speaker of the
Navajo Nation Council. Next is Mr. Arvin Trujillo, chief of
staff for the Navajo Nation, and then Mr. Calvert Garcia, who
is the president of the Nageezi Chapter of the Navajo Nation of
Nageezi. We very much appreciate all of them being here.
Mr. Lords, why don't you start. Let's give them a hand
here. They deserve a hand. Okay, let us start with Mr. Lords,
and we will just try to get this microphone over to you and
have you each testify. And then after all of you have completed
your testimony, I will ask some questions.
STATEMENT OF DOUGLAS LORDS, DIRECTOR OF OFFICE OF TRUST FUNDS
MANAGEMENT, DEPARTMENT OF THE INTERIOR, OFFICE OF THE SPECIAL
TRUSTEE FOR AMERICAN
INDIANS
Mr. Lords. Good morning, Mr. Chairman, and thank you. Prior
to giving my oral testimony, I'd like to introduce two
representatives, one from the Bureau of Indian Affairs, and one
with Minerals Management Service. They will be here to also
help and assist in addressing questions. From Minerals
Management Service we have Katherine Martinez, and from the
Bureau of Indian Affairs, we have Steve Graham.
Mr. Chairman, thank you for inviting the Department to
testify today. My name is Doug Lords, I'm the Director of the
Office of Trust Funds Management, OTFM, and the Office of
Special Trustee for American Indians. I've held the position of
Director since October 2001.
As Director of the Office of Trust Funds Management, I
report to the Principal Deputy Special Trustee, Office of
Special Trustee for American Indians.
The divisions of Trust Fund Services, Trust Fund
Accounting, Quality Assurance, Trust Fund Systems, Reports and
Reconciliation, and Field Operations assist me in the execution
of OTFM programs. The Office of Trust Funds Management is head-
quartered in Albuquerque, New Mexico.
As director, I'm responsible for supervising and managing
the day-to-day trust operations of approximately $3.2 billion
held in trust for approximately 250,000 individuals and over
300 Tribes.
An example of one of the trust resources is oil and gas
royalty collection on Indian land. Based on my experience as
Director, it's my understanding that the processing of oil and
gas royalties generally involves five governmental entities
that transmit information to and from one another. The five
governmental entities are Treasury, Minerals Management
Service, Bureau of Indian Affairs, National Business Center in
Denver, and the Office of Trust Funds Management.
It also primarily involves three nongovernmental entities:
The oil and gas producers, system contractors, and the account
holders. There are variances in the processes.
The processing of oil and gas royalties for Indian tribes
and individuals is initiated when the Minerals Management
Service deposits producers' funds with Treasury. The following
day, Minerals Management Service notifies the Office of Trust
Funds Management of the deposit. The Office of Trust Funds
Management then records the Minerals Management Service deposit
in a holding account and invests the funds.
The Minerals Management Service sends a distribution file
through the National Business Center mainframe to the Bureau of
Indian Affairs. The Bureau of Indian Affairs processes the
files and sends the output to the Office of Trust Funds
Management.
In the normal course of business, this results in an oil
and gas credit being recorded in the beneficiary's account. A
check or direct deposit payment may be generated, depending on
the account restrictions and/or disbursement instructions for
the accounts.
The office of Trust Funds Management relies on Minerals
Management Service to verify that the correct amount was sent
and collected and on the Bureau of Indian Affairs to verify
that the distribution file generated by the Bureau of Indian
Affairs accurately reflects the correct beneficiary credit.
Some Tribes receive payments from producers directly via lock
box arrangements with banks. In these cases, Minerals
Management Service collects and processes the royalty reports.
This concludes my prepared statement. I'm happy to answer
any questions the committee may have.
Mr. Bingaman. Why don't you go right ahead, Ed, with your
testimony.
STATEMENT OF EDWARD T. BEGAY, SPEAKER,
NAVAJO NATION COUNCIL
Mr. Begay. Thank you, Senator and Chairman, and also the
staff that is accompanying you to get information from the
field, and especially the State of New Mexico.
I'd like to thank you for allowing the Navajo Nation this
time to provide comments regarding the ongoing effort to resume
payments of Individual Indian Monies to account holders.
The Department of the Interior relies on the Internet to
exchange information to create payments and has caused
considerable hardship for many. Late last year, the Navajo
Nation was informed that IIM payments could not be processed
because U.S. District Judge Royce Lamberth ordered the trust
system taken off the Internet until DOI installed the necessary
safeguards. We were told that Interior Secretary Gale Norton
took the entire DOI off line, effectively freezing payments to
individual Indian trust beneficiaries.
On January 20, I attended a day-long meeting in Nageezi,
New Mexico, with allottees whose IIM payments were affected by
the DOI's Internet shutdown. I heard from elders who had not
received any income for 3 months. Many of them relied solely
upon IIM payments to pay for their homes and automobiles and
were being threatened with evictions and repossessions.
While these hardships were imposed by DOI's stoppage of IIM
account checks, the Navajo Nation could not, as a sovereign
Indian Nation, simply ignore the suffering of the Navajo
allottees.
I assured the allottees that I would make every effort to
use my authority and responsibilities vested in me by the
Council to move forward legislation that would provide some
financial assistance to Navajo elders affected by the freeze.
Subsequently, on January 28, during the Navajo Nation
Council's Winter Session, I sponsored a resolution that
appropriated $534,276 from the Navajo Nation's undesignated
unreserved funds to provide financial assistance to IIM account
holders. The Council acted compassionately and passed the
Resolution, which is attached to my written statement,* to help
those account holders who were in dire straits.
---------------------------------------------------------------------------
* Retained in committee files.
---------------------------------------------------------------------------
It is not a common practice for the Navajo Nation to assume
the Federal Government's fiduciary responsibilities. The Navajo
Nation must not be placed in a similar situation by its
trustee, the Department of the Interior, in the future. The
Council's action was intended to be a one-time emergency
appropriation for those that were suffering financially as a
result of the payment stoppage.
As many of you on the Senate Committee on Energy and
Natural Resources already know, the Navajo Nation has limited
resources. There are many needs, such as scholarships and
veterans' services, that go unmet every year. I believe the
Federal Government has a responsibility to reimburse the Navajo
Nation Government for the emergency allocation it made to IIM
account holders.
The Navajo Nation does support trust fund management
reform, as well as the larger issue of trust asset management
reform. The experience of Navajo allottees and the interruption
of their IIM payments highlights the need for such a reform.
The Navajo Nation supports the continued and improved provision
of trust fund management to IIM account holders. The narrow
reliance by the Department of the Interior on the Internet as
the sole mechanism for the transmission of information
necessary to the calculation and processing of the income of
IIM account holders without back-up contingency is but another
example of the gross failure of the DOI to meet its trust fund
management responsibilities.
It is my hope that by bringing these issues forward to this
committee that the DOI will be moved to respond quickly and
resolve the problems surrounding the provision of IIM payments
to account holders. Because a lot of account holders are--have
been informed, and they are here in the audience. If they
have--if they only had the time, I'm sure they'd have a story
to tell you. But due to the limited time, this is what I'd like
to pass on on their behalf, as I understood from them, from the
previous meeting.
Thank you.
The Chairman. Thank you very much. Go ahead, Mr. Trujillo.
STATEMENT OF ARVIN TRUJILLO, CHIEF OF STAFF FOR THE NAVAJO
NATION OFFICE OF THE PRESIDENT AND VICE PRESIDENT
Mr. Trujillo. Thank you, Senator, again, the public, your
staff. Real quickly let me introduce myself to the folks out
there.
[Mr. Trujillo speaks in Navajo.]
Again, this morning, Senator, the Navajo Nation thanks the
Senate Energy Committee for holding this hearing near the
Navajo Nation concerning the suspension of royalty payments to
Navajo allottees. And also we thank the committee for allowing
the Navajo Nation to present its concerns this morning.
My name is Arvin Trujillo, and I serve as chief of staff
for the Navajo Nation Office of the President and Vice
President. I extend to you greetings on behalf of President
Kelsey Begay and the great Navajo Nation. President Begay had
some other engagements to attend to with the Hopi Tribe this
morning. Therefore, he asked me to come and represent him this
morning.
Again, we thank you for bringing this issue to the
forefront, but most importantly, to bring it to the attention
of the Federal officials, as well as your colleagues on the
Hill. And again, the President wanted me to express his thanks
to you.
Over the past few months, the Navajo Nation has been
working with the BIA, the Minerals Management Service, the
Office of Trust Funds Management, and other responsible
agencies to try to find a workable solution to the present
suspension of royalty payment checks to the Navajo allottees.
The Navajo Nation knows that these Navajo allottees are the
most affected due to the stipulations placed on the Federal
Government by Judge Lamberth in the Cobell versus Norton court
case.
The Nation understands the reasoning behind this suspension
but finds that the allottees are bearing the burden for the
Department of the Interior's failure to live up to its trust
responsibility. Moreover, these Navajo families are being
punished for the Federal Government's inability to govern
Indian statutory mandates and manage fundamental government
functions. To have our Navajo people undergo such hardships is
not acceptable.
As time continues to move forward, many allottees are
caught in circumstances where they do not have the income to
address their basic financial needs. These individuals are
being threatened with foreclosures and liens and basic
household needs not being met, because the royalty funds are
part of their families' basic income stream.
The agencies' responsibilities must be to resolve the
payment suspension in order to resume the rightful gas and oil
trust payments to these allottees. Part of the trust
responsibility is to create a more convenient process to
improve the payment delivery, but these improvements must not
jeopardize the timely delivery of these royalty payments. The
impact of these delays could ruin credit ratings and future
financial opportunities for these individuals.
The Navajo Nation itself took some drastic steps to make up
for the financial irresponsibility of the Federal Government by
providing small discrepancy grants to the most economically
affected allottees. This was done to help ease the immediate
financial concerns.
In January, as the Speaker noted, the Navajo Nation
appropriated from its general funds account $534,000 to provide
one-time grants to eligible allottees.
Unfortunately, the families--unfortunately, the families
haven't really taken advantage of these grants. They falsely
believe if they accept this grant--if they accept this grant,
this income would affect their eligibility status, which would
result in their not qualifying for other social services
programs.
This has resulted in confusion and resulted in unnecessary
hardships by a direct result of the suspension of the payments
to the allottees. Until the issue is resolved, the Government
has noted that this grant will remain in place. An audit will
be conducted once the payments are resumed, and the Navajo
Nation will be requesting a fund of the expended amount. And in
the interim, your support in this effort will be most
appreciated.
As the Speaker knows, in January there was a meeting. The
Division of Social Services, under the direction of Miss
Belone, put forth a tremendous effort to identify assistance
for these allottees. And again, that process continues.
In summary, the Navajo Nation has availed itself to provide
assistance. But, unfortunately, the Navajo allottees haven't
taken advantage of the grants and services provided at this
point in time because the royalty checks were believed to be in
process and would be delivered. But we are finding that that is
not the case right now.
From our point of view, these families find themselves back
at square one with the suspension of their payments and the
inability to gain access to these funds.
The Navajo Nation recommends the following to answer the
needs of these allottees.
One, provide average annual royalty payments to be used for
estimated payments until such time a fully functional computer
system is operational. This would resolve the immediate
problem.
Two, provide for effective and efficient communication and
cooperation between Minerals Revenue Management, the BIA, and
the Office of Trust Funds Management to solve the accounting
and deposit information problems.
Three, resolve the royalty distribution and identification
problems under the Mescal Settlement for individual owners.
Four, resolve the computer system ``rejections'' apparently
caused by errors on the forms submitted for processing. These
systematic technical errors have slowed the oil and gas royalty
payment processing with the Minerals Revenue Management System.
Five, place the rejections issue at a high priority.
Six, review the time it takes to process the royalty check
payments and reduce the time between actual payments and
distribution of checks.
Most importantly, number seven, provide for a more
effective--a more effective method of communication between the
agencies and those individuals affected. Allow for assistance
and timely answers to urgent questions. We have also found that
several allottees have noted that the explanation of payments,
determining what is being paid out and how, is either very
confusing or not even given at this point. And also the
uncertainty of these payments must be resolved so that reliable
timetables can be communicated to these individuals. The idea
that the check is in the mail is just not sufficient any more.
The Navajo Nation continues to assist affected Navajo
allottees as best we can. The most persistent call for service
at this point in time is to devise a process to pay the
allottees their royalty payments as soon as possible. Once this
is achieved, then a more efficient, dependable, and reliable
system of royalty check payment processing should be put in
place, a system that will provide timely payments but would
also anticipate circumstances that are happening now, so
similar type payment suspensions do not happen again.
Once again, thank you for your attention in this matter.
The Chairman. Thank you very much. Mr. Garcia, please go
ahead.
STATEMENT OF CALVERT GARCIA, PRESIDENT, NAGEEZI CHAPTER,
DISTRICT 19, NUMBER 92, NAGEEZI, NM
Mr. Garcia. Thank you, Senator. On behalf of Navajo
allottees and as a chapter president of the Nageezi, I would
also like to thank Mr. Wilson Ray, our chapter president, who
has been very instrumental in getting these concerns and issues
addressed to you, Senator. And on behalf of your staff and the
people out here and the Navajo Nation, I'd like to thank you. I
will just go ahead and read a statement that we have prepared.
The Navajo allottees and the Nageezi Committee are deeply
concerned and disappointed that individual Indian monies have
not been adjudicated since the computer shutdown on December 6,
2001. The Department of the Interior, through the Bureau of
Indian Affairs, has mismanaged billions of dollars through
royalty payments of the Navajos, also known as Individual
Indian Monies.
What will make the Bureau of Indian Affairs to account for
all missing funds and return it to the rightful owners?
It was over a century ago that the United States obligated
to have the trust responsibility to ensure the Native Americans
protection and management of their affairs.
Most of our elderly rely on this income to meet their basic
living needs and to care for their livestock. This income is
deeply needed by our community to supplement what income they
have, if any, in that the majority of our people are way below
poverty income guidelines.
A great percentage of our Indian allottees have not
received or resumed any royalty payment proceeds since the
shutdown, which created critical financial hardship. Some
resorted to selling their personal possessions, livestock, or
other items of value.
On May 3, 2002, the Navajo allottees conducted a meeting
with Minerals Management Service from Denver, Colorado, Office
of Trust Indian Fund Management in Albuquerque, Bureau of
Indian Affairs of Gallup, and Farmington at Indian Minerals
Office of--Indian Minerals Office of Farmington. It was evident
at that time that some oil companies were not making payments
to MMS on Indian land for production and leases. Minerals
Management Service personnel confirmed the discrepancies, which
resulted in nonpayment to Navajo allottees. And this is still
current, ongoing, has not resumed any of their production and
lease payments.
Speaking on behalf of Navajo allottees, there are numerous
problems with the current program operation on Indian Trust
Management operations. Secretary Norton's plan to reorganize
and consolidate Indian Trust Asset Management functions into a
separate new organization unit will not work unless Tribes
develop a realistic and workable plan with individual input.
Creating another department with current Department of the
Interior personnel will only create further bureaucracy,
thereby hindering improvement and customer service.
Our recommendation to you, Senator, is to support the
following:
One, allow our Navajo allottees to utilize the Indian Self-
Determination Act by creating a local Individual Indian Monies
payment distribution, preferably in Farmington, New Mexico.
Current process for payment are distributed as follows: Oil
companies pay directly to Minerals Management Service in
Denver. Then it goes to the Bureau of Indian Affairs in Gallup,
New Mexico, and then to the Office of Trust Funds Management in
Albuquerque. Then, finally, to the Indian allottees. There are
ways to cut down the process that currently is not working, and
our people are at most times disadvantaged.
Two, coordinate proposed plan and set up with Farmington
Indian Minerals Office. Plans are as follows: Oil companies
make direct payment to Navajo allottees. The Farmington Indian
Minerals Office will monitor and ensure that oil companies make
proper and timely payments.
Three, the other recommendation that we make to you is to
develop a Feasibility Economic Plan, which will enable the
Navajo citizens to have a direct impact utilizing mineral
extraction for employment and other positive means. Suggestion:
Since our community averages a payout over almost a million
dollars a month, would it be feasible to have our own Navajo
refinery?
We urge you to support and seek ways to improve the system
that has failed our people for many years. There are ways to
prevent wasteful and unnecessary government bureaucracy in
hindering direct service to our community members. Please give
this matter your highest priority. May we hear from you very
soon?
Thank you. Calvert Garcia, chapter president.
The Chairman. Thank you all very much for the testimony.
Let me start with some questions here, Mr. Lords, about the
status of things.
Can you give us--the way I think about this issue, there
are, and I think everyone acknowledges this, a series of
problems in the Department of the Interior administration of
these payments to allottees. And that's one set of issues.
But a second sort of more immediate set of issues is the
set of issues that have arisen out of the decision, or the
order, really, which was directed to the Department of the
Interior to shut down their computer system this last December.
As regards that second series of problems, have we gotten
the computer system back up and running so that we are now back
to where we were before the judge stepped in and ordered a
shutdown, or is that still in the works?
Mr. Lords. Let me respond for OTFM, and I'll have Kathy
respond for MMS and Steve respond for BIA.
In the court order, Senator, it's stated that any
individual Indian systems that were connected to the Internet
were to be shut down. The Office of Trust Funds Management
converted all tribal and individual Indian money accounts to a
commercial Trust Funds Accounting System (TFAS). Conversion was
completed in March 2000. TFAS was not connected to the
Internet. The Office of Trust Funds Management System was not
shut down, due to the court order. If we had money in an IIM
account and we had distribution information, we were cutting
checks. But if I don't have the ownership information, I
couldn't cut checks.
The Chairman. And who has the ownership information?
Mr. Lords. BIA maintains the ownership information for oil
and gas royalties.
The Chairman. And that information was--the availability of
that information to you was interrupted by the court order; is
that right?
Mr. Lords. That's my understanding, yes.
The Chairman. So I guess the next question is is whether
BIA has now gotten in a position where they're making that
ownership information available so checks can be cut?
Mr. Lords. We've been issuing checks on oil and gas
royalties since the end of March 2002 on a weekly basis.
The Chairman. This seems to be in dispute. Let me ask the
audience to please let us try to conduct this is an orderly
way. Mr. Garcia, the president for the Nageezi Chapter, says in
his statement, ``A great percentage of our Indian allottees
have not received or resumed any royalty proceeds since the
shutdown.'' Is that consistent with what you understand, or do
you disagree with it?
Mr. Lords. Let me clarify, Senator. We estimated payments,
two estimated payments on February 21 and March 21.
Once systems started back up in March with MMS sending BIA
information, BIA sending OTFM information, then the estimated
payments were offset against the actual payments that came
forth on a weekly basis. Once we've recouped the estimated
payments, then the individuals started receiving checks. If we
haven't recouped the estimated payments, allottees are right,
they have not received checks.
The Chairman. So they did receive a check that was issued
February 21 and again a check that was issued March 21, but
those were estimated payments?
Mr. Lords. Yes, Senator.
The Chairman. And you're saying that if no checks have been
received since those two checks, it is because the estimated
payments were too large, were larger than they were really--
than they otherwise would have received. You estimated they
would be receiving more than they, in fact, had received up
until that time?
Mr. Lords. That is one scenario, Senator. I think the other
scenario may be that maybe there was a change in ownership or
the well production has changed.
The Chairman. If I were an owner--I am not an owner, but if
I were, if I were an allottee entitled to receive a check, how
would I know whether or not I'm getting my fair share of the
payments from production on one of these wells? Is there any
kind of an accounting that you provide to owners saying this is
what the total production was from the well, this is the amount
of your payment?
Mr. Lords. The BIA generates for OTFM an EOP, Explanation
of Payment, and that was enclosed with oil and gas royalty
payments prior to the shutdown. And that explained the
production, the amount of money, what oil well the money was
generated from. But since the recouping of the estimated
payments, the explanations of payments have not been enclosed
with the checks for the individuals that do receive checks.
The Chairman. And why have they not been enclosed?
Mr. Lords. Because with the recoupment process, the check
may not equate to EOP because we may have offset the actual
payment against the estimated payments. For example, let's say
that their total estimated payments were a hundred dollars. And
they get an EOP that the actual production was $150. Well, the
check is going to be for $50, the residual, and the EOP will
reflect that there was $150 generated off that well.
The Chairman. What I guess I'm wondering is, is this--are
you providing information to allottees that will let them
understand what you just said, so that they would know that in
January the well produced so much and I was entitled to so much
royalty payment from the well; in February it produced so much?
And then indicate what the checks were and how much is left
over to be paid? I mean, is this all--do people have to come to
a meeting like this in order to understand this information, or
are you providing it to them?
Mr. Lords. The EOP will show what the actual production
was.
The Chairman. Tell me, the EOP--what does that stand for?
Mr. Lords. Explanation of Payment, Senator.
The Chairman. Explanation of Payment. And that's a document
that is sent to them along with the payment?
Mr. Lords. In normal processing, yes.
The Chairman. But we are not in normal processing.
Mr. Lords. No, we're still offsetting the estimated
payments, Senator.
The Chairman. And you don't give them any explanation in a
period when you are offsetting their payments? They get no
explanation?
Mr. Lords. Within the quarterly statements that OTFM is
mandated to send out per the Reform Act, it shows their
estimated payments and what we've offset against them.
And today I have staff here for any of the allottees who
want to know the status of their estimated payments. I've got a
listing in alphabetical order by allottees of what their
estimated payments were, what we've recouped, and what they may
owe, if any. And once they show identification, we'd be happy
to tell them where they stand.
The Chairman. Well, in order that we be sure that people
can take advantage of that, who are your staff? Are they here?
Mr. Lords. Yes, right here.
The Chairman. Okay. And you have that information now?
Ms. Wabnum. Yes.
The Chairman. Should we have them either go to a separate
room and provide that to people----
Mr. Lords. I think that would be most effective, yes.
The Chairman. Is that possible? Do we have a place where
they could sit at a table and go through this?
Ms. Lee. We'll put you around the corner in the lobby, away
from this room.
The Chairman. Okay. Well, why don't we do this: Have them
go ahead and proceed there and be available to answer questions
of individual allottees as we are having this hearing. We will
continue to have the hearing and give people a chance to speak,
but if there are individual allottees who are here and want
this information now, they could get it right now from these
people.
Mr. Lords. Yes, Senator.
The Chairman. Okay. And let me ask also, though, if we
conclude the hearing about noon, which we are expecting to do,
or by noon, no later than noon, will they be able to stay
beyond that and provide the information?
Mr. Lords. We will definitely have someone stay until we
answer the questions, yes.
The Chairman. Okay. So they will be here until everyone's
questions are answered about their individual payments.
So any of you that want to talk to those representatives
now, you can, or you can wait until after the hearing. That's
your choice. Yes, Mr. Begay, please.
Mr. Begay. Senator, could I assist here by translating into
Navajo?
The Chairman. Please. Please do.
Mr. Begay.
[Navajo spoken.]
The Chairman. Very good. Why don't you hand the microphone
back to Mr. Lords, and let me ask a few additional questions of
him.
For allottees--Navajo allottees who are entitled to receive
royalties who are not able to be here today, who should they
contact in case we want to put a notice out? Who could they
contact to get the information that is on that sheet that your
assistants have in the next room if they're not able to be here
today?
Mr. Lords. They can contact the Office of Trust Funds
Management at (505) 816-1001.
They can dial 1-800-OST OTFM, and when it asks for the
three digits of their account number, that will take them right
to the agency where their account is managed. Agency staff can
get the information off the system, also.
The Chairman. So they dial 1-800-OST OTFM?
Mr. Lords. Yes.
The Chairman. And then they insert three digits of their
account number. So that each allottee knows what their account
number is?
Mr. Lords. They may or may not. And Kevin Gambrell at the
Farmington Indian Mineral Office can also help them, also.
The Chairman. Okay. Now, we are putting that information up
here so that anybody who is not able to be here today to ask
the questions about their individual payments, we want to be
sure you can get access to it.
Let me ask about the quarterly payments you referred to.
The quarters that you talked about, is the first quarter being
January, February, March?
Mr. Lords. They're not quarterly payments, Senator. They're
quarterly statements.
The Chairman. Quarterly statements?
Mr. Lords. Yes. And no, they do not coincide with the
calendar quarter. They're staggered, because we've got 250,000
individual IIM accounts that we're required to issue these on.
So we stagger them, but they're staggered on a 3-month basis.
The Chairman. So we cannot say to all allottees that as of
the end of June, they will be receiving a statement. Some will,
some won't?
Mr. Lords. For the Navajo allottees, I can get with my
staff. I don't know off the top of my head, but I can say for
them yes, they should have received a quarterly statement at
these dates for all of them.
We issue by regions and made sure they were consistent. We
didn't separate a region and say some of the individuals got it
these 3 months, and another of the individuals in another 3
months staggered.
The Chairman. Okay. Why don't--we need someone to translate
this also, and Mr. Garcia, are you able to do that? Or who can
translate what we just discussed and indicate what these
numbers are? Do we have somebody here who is a translator? I
hate to just keep relying on Ed Begay to do this, but
whatever----
Mr. Garcia. Thank you, Senator. I believe what some of our
people are experiencing getting--having direct contact with
them every day and conversing with them. I believe most of the
allottees who receive individual Indian monies were accustomed
to receiving an average amount prior to shutdown.
I believe--now, Kevin is here. Some oil company, maybe two,
has taken advantage of this computer shutdown. And I believe
there's two or maybe even possibly three that have not made any
payment, or very small payment, to Mineral Management Service
of Denver. That might have resulted in nonpayment to some of
the Indian allottees. I believe maybe Kevin can maybe attest to
that.
The Chairman. Why don't we hand that back to Mr. Lords, and
let me ask him. Do you have any information, or do you have
anybody who can tell us whether there's been any problem with
the companies making the payments into the government accounts?
Please go ahead, identify who you are, and tell us----
Ms. Martinez. Good morning, Senator Bingaman. My name is
Kathy Martinez, I work with Minerals Management Service. I'm
the Chief of the Accounting Services Branch there. As you know,
this issue started with the system shutdown. And in today's
world, we use computers for almost everything we do. So when
the Department was ordered by the Court to shut down and
disconnect from the Internet, that basically affected them.
There is a situation where a couple of companies also were
having computer issues. One of the companies happened to be a
company that does business in Indian country. And they, for
whatever reason, I don't know, because I'm not a computer
techno-person and I don't talk technobabble, because I don't
understand it, basically, but one of the companies was having
severe difficulties in bringing their computer system on line
and giving us a file. Basically, they were having difficulty
getting their computer to report correctly.
And this issue was resolved about a couple of weeks ago and
they were current as of a couple weeks ago. But that means that
they, too, had a number of months of data to give us.
Now, during the shutdown, all of the companies still had to
pay. Just because they couldn't report on the Internet was not
a reason that they could not pay. They were still required to
pay.
We collected all of the money that was reported to us,
either by wire transfer to a bank or by check, and we continued
to make deposits to the treasury account for OTFM to invest.
As I said earlier, to my knowledge, all of the companies
that did have computer reporting issues that did business in
Indian countries, those were resolved as of a couple weeks ago.
Now, that still means that the computer has to process the
data and that the accountant and the computer have to match the
report and the payment. And the data must be reported correctly
so that we can transmit that data to BIA so they can identify
the owners so that we can get checks out the door to the Indian
owners.
The Chairman. Well, if I am an Indian owner, are you
telling me that you are not able to send me my check because of
your internal computer problems and it's my problem and not
yours?
Ms. Martinez. No, sir, that is not at all what I intended
to imply.
The Chairman. What are you saying?
Ms. Martinez. Lets work with a particular example. If I
have a lease that is being operated, let's say right here in
New Mexico, and it's being operated by--it's Lease 1 being
operated by Company X, that company reports to Mineral
Management Service either electronically or by paper or
whatever method they so choose. They also have to send in a
payment for that royalty.
The computer adds up that data that's entered onto the
report to ensure basic math, basic dates, and to ensure that
the right lease number is on there. Then we do basic edits, we
do some basic verification.
We take that royalty report for that lease, say it's $100
and the company must also pay $100. Our computer and our
accountant basically work to match that payment--to identify
that payment to that report, and then it's processed through
the computer, sent in a file to BIA, just data at this point.
The money has already been deposited, so at this point it's
just data.
The file is sent to BIA, BIA looks at their computer
system, and it allocates that $100 to whoever the appropriate
owners are on that lease. And then OTFM distributes checks.
The Chairman. Well, I guess what I'm wondering is how
quickly are we going to see these computer problems resolved so
that people--Mr. Garcia here says that people were accustomed
to receiving a monthly check or a check every two weeks. Is it
a monthly check if I'm a royalty owner, or is it every two
weeks?
Ms. Martinez. Prior to the shutdown, BIA, MMS, and OTFM
used to go to the oil and gas revenue distribution twice a
month.
The Chairman. Okay.
Ms. Martinez. Since the shutdown, we have been doing the
oil and gas distribution on a weekly basis.
The Chairman. So that means you send a check out to one
owner every week? If I'm an owner, I should expect to get a
check every week?
Mr. Lords. Senator, based on the information that I receive
from BIA, if you were an owner and I did receive distribution
information, you would receive a credit to your account. Then,
depending on if you had estimated payments to offset, you may
or may not get a check. And then depending on the type of
account--there's certain restrictions, obviously, minors, non-
comps don't get checks distributed to them.
The Chairman. Well, I'm just trying to figure out--there
was a certain set of procedures being followed before the
Federal judge ordered the shutdown because of security reasons
or concern about people's privacy, I think was what prompted
that. How quickly are we going to be back to that same
procedure so that anybody who was getting checks before, under
normal circumstances could expect to start receiving their
checks again on a regular basis? How quickly?
Mr. Lords. I don't have a good answer for you, Senator.
That's dependent upon the information that I receive from BIA.
BIA is dependent upon the information they get from MMS. MMS is
dependent upon the producer information they get.
As Kathy stated, we're processing on a weekly basis now.
BIA has sent me weekly distribution files since the end of
March. We are going to continue to do that until we get caught
up.
Ms. Martinez. From when the system shutdown to about the
end of last week, Minerals Management Service has collected
roughly $9 million of Indian revenue. And since we brought the
system back the last week in March to the end of the last week
in May, we have also distributed to BIA $9 million.
Yes, there were some exceptions to that. There was the
company that wasn't reporting for 4 months. We're working with
that company, we work with them every day. We work on their
report, so we expect to get back to regular business very soon,
very quickly.
Again, if I can repeat myself, during the system shutdown
to about last week, we received $9 million of Indian revenue
and we have distributed $9 million to BIA for their action with
OTFM. So we have our resources working on Indian issues.
As I said earlier, I'm the Chief of the Accounting Services
Branch, and I make sure that they understand that our Indian
workload is our priority.
The Chairman. Let me try to understand this issue, though,
with the company that was not able to give you the right
information, computer information. They have been making their
payments, but you are not able to tell Mr. Lords's agency to go
ahead and send a check out because the information that they
have given you has been inadequate for you to verify as to how
much goes to which allottee; is that right?
Ms. Martinez. The particulars? Yes, sir, you are correct.
The particular company that I'm aware of that had the reporting
problem, they could not give me the data to identify what lease
they were paying on.
The Chairman. Which company is this?
Ms. Martinez. It's Burlington.
The Chairman. Burlington, okay. Have they corrected this?
Ms. Martinez. They have corrected their system issues, and
they are current in reporting to us. Now, it's our job to
review their reports, make sure they're adequate, that they
pass the basic edits that I described earlier. The math has to
be correct, it's got to be a valid lease number.
The Chairman. So the bottleneck in getting those payments
distributed by Mr. Lords is you have to check the information.
Now, Burlington has provided it, you are now in the process of
trying to audit it or confirm----
Ms. Martinez. Do some basic verification.
The Chairman. Right. And then Mr. Lords can send those
checks out?
Ms. Martinez. I have to make sure I process that data,
identify for OTFM the payment of that data, and then send the
data--the lease data with the payment data to BIA so they can
identify the right owner. And then when BIA sends the ownership
information with my lease and payment data, then OTFM can send
that out with interest.
The Chairman. But, now, you're the bottleneck right now?
Ms. Martinez. It sits in my court, I've got to work with
Burlington.
The Chairman. So how much longer are you going to be the
bottleneck?
Ms. Martinez. A lot of it depends on how good Burlington's
computer system is now. And off the top of my head, even though
we got the report, I don't know how accurate they are. A lot of
it depends on their accuracy, their response to our request for
information. But we are working on it and our staff does know
that our Indian workload is our priority.
The Chairman. And once you conclude your workload, how long
does it take for the BIA to get the information to Mr. Lords so
he can cut the check?
Ms. Martinez. I'll turn the mike over to BIA.
Mr. Graham. My name is Steve Graham, and I'm the regional
royalty officer for the Navajo Region.
Currently, one of the problems that we're having with it is
that we don't have all of our staff able to have access to our
system because of the security problems. Getting our current
office staff that were available to utilize the system prior to
the shutdown aren't able to utilize that.
The Chairman. So you say the Judge's order is still in
place and you can't access your computer?
Mr. Graham. Once the Judge's order is in place, the BIA
goes through the security process of all the staff that had
access to the system. They're reverifying everyone's access to
the system to make sure they have proper clearance.
The Chairman. So this is another bottleneck within your
agency?
Mr. Graham. Within BIA, yes.
The Chairman. Within BIA. BIA cannot figure out who--which
of their own employees should have access to the system?
Mr. Graham. They've been given--the information is there,
but the security office who--I don't know what their staffing
level is to verify every person that was knocked off the
system, to get everybody back on to utilize it, to work with
the different system that we have out there.
The Chairman. So how long is it going to take your security
office to figure out who's going to get access to the system so
that you can function?
Mr. Graham. I can't speak for the security office. I just
know that we sent our--the people that need to deal with
generating payments from the FIMO Office and also the Navajo
Regional Office and agencies to the people in Washington and
identify the people that need access to the system.
When the system went down and started to come up, there was
a very limited amount of people that were given access to the
system. And since that time in--prior to March, when we started
making payments, there has not been any other additional
individuals that have been given access to the system.
So that hindered the people out there in the field to
update their records in order to post new probates, if there's
a problem with the lease or whatever is identified in the
payment issue, for us to clarify and rectify that issue.
The Chairman. So we've identified two bottlenecks: One is
with the Mineral Management trying to verify the information
from Burlington in this case. That's the only area that's
related to the Navajo allottees that is currently not
functioning in a normal way. Is that fair?
Ms. Martinez. That is correct. We have today's business to
deal with as well as the accumulated inventory during the
shutdown. So we not only have to get current with this month's
activity, but reduce the backlog. And we've made great strides
toward that. But right now, given that Burlington was finally
able to report, now the ball is in our court, yes.
The Chairman. Okay. So that's one bottleneck. And then
there's a bottleneck within BIA getting these security
clearances accomplished?
Mr. Graham. That's one issue. And also the office there in
Farmington, because of their location, doesn't have access to
the system like they did prior to the shutdown. So they're
having to go offsite to process payments, which is also slowing
down the process.
The Chairman. Now, tell me a little more about that. Why
doesn't the Farmington office have access? I thought the
Judge's order had been lifted?
Mr. Graham. Maybe Kevin can speak to that, because I don't
know all the firewall and that kind of computer stuff. Because
they're in a different location with the three different
agencies working together at the Farmington Minerals Office--
BLM, MMS, and BIA. And I don't know what system they're running
off of to get back in to work with our system. Kevin may be
able to answer that question.
The Chairman. Kevin, are you able to give us more
information?
Mr. Gambrell. Kevin Gambrell with the Farmington Indian
Minerals Office. We shared the offices since the December
shutdown, and we will be able to serve. BLM has recently got
their trust data back on line 2 weeks ago. And I've been back
in D.C. working with the special master to get the Farmington
Indian Minerals Office back on line.
The Chairman. The special master has not permitted that as
yet?
Mr. Gambrell. Not the FIMO office. Because we're a multi-
bureau office at present. There's other things that have to go
on, to tell you the truth. Everyone's in my office--there's a--
it's kind of complicated in terms of security and how we go
through the security changes.
The Chairman. All right. Let me just make a statement, and
then we will go ahead to hear from some of the other people who
have signed the list wanting to testify here.
Obviously, this is an amazingly confused and multi-agency
process that needs to be sorted out and streamlined so that
once a payment is made by an oil company that's producing from
a lease, fairly quickly after that, the check will go to the
royalty owner, I would think.
Now, Mr. Lords, you indicated in your testimony that there
are some Tribes that have received payments from producers
directly by a lockbox arrangement with banks. Is there a reason
why we couldn't institute that for the Navajo Nation?
Mr. Lords. Senator, I don't have anything to do with direct
pay, so that's why I'm not going to try and answer that.
The Chairman. Okay. Is there any of the people here who
could tell me whether this is a possibility for us to try to
institute this for the Navajo Tribe so that they do not have to
go through the three or four agencies?
Mr. Graham. The Navajo Tribe--the Tribe on tribal leases is
currently on a lockbox arrangement. Individual allottees for
individual allotments aren't on direct payment. They have no
boxes that are available, even in the lease, to opt for direct
pay. But that has to be between the individual owner making
application, and then they will work directly with the oil
company on receiving payments.
The Chairman. So each allottee has that option?
Mr. Graham. There is an option for direct pay in our
current oil and gas leases.
The Chairman. But now, is that an option for the allottee,
or an option for the oil company?
Mr. Graham. It's the individual owner's option to request
for direct pay. Then it would not run through our system.
The Chairman. Is that information that is made available to
all the allottees, that they can start getting their payments
directly from the oil companies and not have to go through this
whole mess?
Mr. Graham. I don't know if that was offered to them. The
leases that are negotiated for allotted leases are handled from
the Farmington Indian Minerals Office.
The Chairman. But if I am an allottee at the Nageezi
Chapter and I want to start getting my payments directly from
the oil company, who do I talk to in order to get that
accomplished?
Mr. Graham. I'll have to let Kevin answer to that, because
his office is the one that administers allotted leases, so they
would be dealing with his office in requesting direct pay, if
that's something that an owner wished.
The Chairman. Kevin, do you have any information about
that? Is that a real option that people have?
Mr. Gambrell. There is an option with oil leases that pay
direct pay. There are some trust responsibility issues that are
problematic in trying to reconcile the payment that went to the
individual's account on an off-line system versus a royalty
report. That's some of the problems they've experienced in
Oklahoma. But direct pay is an option. It hasn't been exercised
in this area, and not anywhere else but Oklahoma, I believe.
That is our indication. Is that correct?
Ms. Martinez. My understanding is that the direct pay
option was being exercised in Oklahoma up until recently, and
I'm not sure why or what the rationale was, but my
understanding is that Oklahoma is now reversing all of their
direct pay leases back to agency pay. Again, I don't know
enough about the Bureau of Indian Affairs policies or
processing procedures, but that is my understanding as I've
spoken to them in doing research on other leases.
The Chairman. Okay. Well, why don't you give me back the
microphone and I'll quit asking so many questions.
Let me thank all of the witnesses. I'm not trying to point
the finger here except to point out the various problems that
we clearly have in this system. As I understand it, we have
payments being made by an oil and gas company that is producing
from a well. The payment to the royalty owner is being made,
and it goes first to the information goes first to the BIA, is
that right? To the MMS, the Minerals Management Service.
They get the payment and they then look to the BIA to
verify how much payment has been made and who it goes to or----
Ms. Martinez. No. Just----
The Chairman. Please tell me the three- or four-step
procedure that is followed.
Ms. Martinez. I'm going to stand up, and hopefully my voice
will project. Can you hear me in the back?
The Chairman. Here. Hand her this microphone again. Give us
the very short version of how a payment gets made from the oil
company to finally being a check that someone can take to the
bank and cash.
Ms. Martinez. Okay. In most situations for allotted leases,
Minerals Management Service, MMS, receives a check and a
report. The day that I get a check, it gets deposited into the
Treasury, and the next day I tell OTFM about all of the
deposits that I made for all of the allotted agencies. And so
immediately that day they have information so they can start
investing that revenue.
I start working in that royalty report and check and make
sure--if they come in together, I start working with the
computer to make sure that the computer understands here's the
check, here's the lease number it meant to pay.
And once I confirm that it's the right lease number--
accuracy is very important to us--once I confirm it's the right
lease number, then that data is sent to BIA. BIA checks their
records to make sure that they understand who the owners are.
That data is married with the MMS file on lease payment,
Navajo ownership data. Now, that file goes back to OTFM so that
they can process.
Mr. Lords. What she's outlining, Senator, is correct. Once
BIA sends me a lease file, like for example they send me a
lease file today, we interface it tonight, and if there are
checks that were to be generated, they will go out tomorrow.
The other thing I need to point out is that our 1-800
number is 1-888.
The Chairman. Okay. I'm sure there are a lot of unanswered
questions that people have after hearing these various
explanations. I have quite a few still myself. But I think
probably the best course--we have about 55 minutes now before
we have to conclude the hearing, and let me go ahead to the
various people who have signed up to give some short testimony
about the royalty payments and the issues that they want to see
addressed or the points they want to make.
We will take as many of these as we can before noon, but we
are going to have to quit by noon. So let me call on people in
the order in which people have signed up and ask them to come
up. And we will have the microphone for them, and I ask you to
keep your comments to 2 or 3 minutes, if you can, so we don't--
excuse me? I'm told 2 minutes each.
If we try to keep the comments very short, that way
everybody on our list will be able to make comments. If people
drag on too long with their comments, that's going to keep
someone else from testifying.
Let me first call Chris Martinez. Is Chris Martinez still
here? He is gone.
Kevin Gambrell? Is Kevin here? You do not have anything
more to say, okay, thank you very much.
Chris Velasquez? Is Chris Velasquez here? Well, we are
getting through this list in a hurry.
Lela Haseesa? Is that the correct? Is Lela--she left? Okay,
she's next door, that's fine.
What is this? Is this Orlen Blaki? Blakey?
Audience member. Arlene Blackie.
The Chairman. Arlene Blackie? She did not want to speak?
Rose Pettigrew? Dorothy Bitsue or Bitsie?
Mr. Garcia. Bitsue.
The Chairman. Bitsue. Is Dorothy here? Would you like to
speak?
Ms. Bitsue. Yes.
The Chairman. Would you like the microphone? Please come
up.
Ms. Bitsue. My name is Dorothy Bitsue. We're having
problems with our payment. We haven't gotten paid for 6 months
now, ever since November, last November. So we haven't gotten
anything yet.
The Chairman. You haven't received any payments since last
November?
Ms. Bitsue. That's correct.
The Chairman. Okay.
Ms. Bitsue. And I got a check for one penny. That doesn't
mean--that's a check?
The Chairman. Have you had a chance to look at the sheet
that Mr. Lords brought to see what they indicate you are owed?
Ms. Bitsue. No.
The Chairman. Okay. I think that would be a good thing to
do while you're here today.
Ms. Bitsue. Okay.
The Chairman. But thank you very much. I know Ervin Chavez
is here to speak, and we are glad to have him. Please come
forward, Ervin.
Mr. Chavez. Good morning Senator. By the way, Miss Arlene
Blackie gave me her 2 minutes.
The Chairman. Very good.
Mr. Chavez. I'm just kidding. There was a confusion,
Senator. Apparently they thought that you had a bag of checks
that you brought today for them to distribute.
The Chairman. I thought you had the checks, Ervin.
STATEMENT OF ERVIN CHAVEZ, PRESIDENT, SHII SHI KEYAH
ASSOCIATION, BLOOMFIELD, NM
Mr. Chavez. But it's good to see you again. And I do want
to make a statement regarding--and I would like for you to bear
with me, because I'm going to put a little different twist on
this, because I've been dealing with allottee issues for about
almost more than 20, 25 years. And I dealt with your office on
various issues like health issues, and I'm very familiar with
your staff.
Let me start off by saying my name is Ervin Chavez. I'm
here today representing an allottee association called Shii Shi
Keyah Association. This organization was first organized in
1982. The association is not a stranger to the Department of
the Interior. In fact, this association filed a similar class
action lawsuit as a Cobell lawsuit in 1984.
In 1997, Shii Shi Keyah Association agreed to a consent
decree whereby the U.S. Government agreed to make, among other
things, timely payments, development of an explanation of
payments, and to respond to complaints on environmental issues
on well sites, especially dealing with livestock.
Also coming from this action is the development of the
Farmington Indian Minerals Office, whereby three agencies were
supposed to come together to resolve issues for Indian oil and
gas problems. Today, the Bureau of Land Management and the
Mineral Management Service is the only ones to respond. The
Bureau of Indian Affairs continues to hold out.
So the problems with royalty payments is not new. When I
say this, this is an understatement. Historically, the Bureau
of Indian Affairs has never lived up to its trust
responsibility, never kept adequate records for Indian people,
especially dealing with royalty payments for oil and gas taken
from their land.
I might be oversimplifying, but I ask you these simple
questions. How much longer do we as Indian people, Navajo
people, have to put up with this?
How many more lawsuits, oversight hearings will it take for
the Federal agencies, Mineral Management Service, Bureau of
Land Management, Bureau of Indian Affairs to do their jobs,
live up to their trust responsibilities to Indian people?
When will Congress step forth and say enough is enough,
take the responsibility, take major action in revamping the
section of the Department of the Interior who is responsible
for individual Indian monies by appropriating money to repay
the Indian people the money which was taken from them by this
faceless governmental system?
This appropriation is not to be confused with the annual
Congressional Interior Appropriation, because every time Indian
people ask for more funding, it is subject to the Balanced
Budget Act, where money is just shifted. This money--this needs
to be real money.
In 1988-89, it was my understanding that the Senate Select
Committee on Indian Affairs was established in response to an
article which appeared in the Arizona Republic newspaper on
mismanagement of IIM. This committee was to address the very
issue that we're talking about today. On behalf of Shii Shi
Keyah Association, our attorney and I were involved in those
hearings on the Hill. Sad to say, that never was completed nor
did anything materialize, because their attention was focused
to investigate one Indian leader in Window Rock.
Meanwhile, millions of Indian money continued to walk out
the back door of the BIA for another 12 to 13 years since 1988.
We have gone through a Reagan administration, a Bush
administration, a Clinton administration, and now another Bush
administration. Everybody is stalling and passing the buck. BIA
and MMS, or the system, is continuing losing millions on
millions of dollars. The only difference is that it is only 12
to 13 times today. We are still holding hearings on the same
issue--we are still at the same place.
As long as the system is not addressed, corrected, lawsuits
will continue to be filed. Internets, computers will still be
unplugged and blamed for the inaction of those responsible.
Many of the problems for nonpayment that were addressed
today were even in place when the computers were up and
running. Navajo families will continue to get caught in the
middle of this system and politics. That's what I meant when I
said the system is not a new problem. Navajo families are not
being paid, are not being able to pay for food, clothing, and
make house payments, car payments. They are faced with
repossession of these items they bought. Meanwhile, they look
out their window and still see oil and gas wells producing, but
no money in return.
It will probably continue until someone deals with it and
solves this problem.
It is time Congress appropriates the money, reassigns the
responsibility of IIM accounting to another responsible entity
and repays the Indian people, Navajo people, their money. Stop
passing the buck.
Thank you.
The Chairman. Thank you very much. Is George Werito here?
Yes? Does he wish to speak?
Audience member. Mrs. Werito.
The Chairman. Yes, ma'am.
STATEMENT OF EILEEN WERITO
Mrs. Werito. Senator Bingaman, my name is Eileen Werito,
and I just had a concern, and I direct my question to the BIA.
We've been receiving the same information over and over as to
the process that it goes through. But the question we have, or
I have, is, you know, we've stopped getting payments as of
November, and we have the estimated payments, which some of us
had been paid and have a zero balance.
And right now, what I want to know is--and I'm pretty sure
some of the allottees would like to know also when do we get
our payments?
Do we get a lump sum for the 6 months that we haven't been
paid? And if there's any reports to that effect as to how
much--what money has been paid and which months, I still don't
have anything in writing to that.
I received a payment this month, but I'm just questioning
whether that's my regular payment or whether it's one of the
other months' payment. So I still question that, and just
wondering whether I should be getting another lump sum from
previous months.
Just like I said, we've just been getting the same
information over and over. Seems like it's not moving forward.
And I'm pretty sure some of the allottees still have a question
about that.
The Chairman. Let me ask if you have had a chance to look
at the sheet that Mr. Lords brought that sets out each payee
and how much has been paid and how much is expected to be paid
to them?
Mrs. Werito. Yes, I did. And it's the same information that
we've looked into when we had our meeting with the different
departments at Nageezi.
The Chairman. So it did not tell you what you want to know?
Mrs. Werito. No.
The Chairman. What more do you want to know beyond that?
Mrs. Werito. What I wanted to know is, when will the
payments stop. And I'd like to know for each month, you know, a
report as to say, how much money is in my account and how much
money was paid out. Of course, you said that my estimated
amount that I've repaid, and I have a zero balance. And what I
wanted to know is, how much money is in the account and how
much money I've been paid out, which I don't think maybe just
one payment out of that.
The Chairman. Okay.
Mrs. Werito. And I still want to know how much in my
account I still have.
The Chairman. Mr. Lords, are you able to respond to this,
or you just--maybe once we conclude the hearing, maybe we could
be sure to just verify any additional information that we could
provide on your payments.
Mrs. Werito. Yes, that's what we're looking for more
information as to, you know, regarding our payments.
The Chairman. Okay.
Mrs. Werito. Thank you.
The Chairman. Yes, thank you very much. Next is Wilson Ray,
I believe? Please. How are you?
STATEMENT OF WILSON RAY
Mr. Ray. Good morning, Senator.
The Chairman. Good morning.
Mr. Ray. You chair the Energy and Natural Resource?
The Chairman. That's right.
Mr. Ray. And I'm very thankful that you're here this
morning and to hear our problems and to give our input what
needs to be done. We started to--well, the people, the
allottees themselves, have been coming to our chapters. And the
problem that they're having, that they're not receiving their
payments. And it seems like we're the ones that they chew on,
me and Calvert.
But somebody's got to start the fire somewhere. And this
problem has to be resolved in some way. And as we listen, as we
have these meetings, it seems like from the very start, that I
was confused, just like you, when you were listening. And all
these--how the money flows into different departments and what
it does. And all this, we kind of like said that this is so
confusing that a lot of times we just don't understand how this
money flows.
And I think from you being a Senator and being the chair of
this committee, that this really needs to be looked into. And
there needs to be something done on this. There's got to be a
shorter way to do this.
And talking about direct payments, we know that that can be
done somehow. And even though there's an organization that
exists now, and I think they talk about it, they talk about it,
they talk about but never resolve anything. But we need this to
be resolved in some way.
And we need the checks going directly to the land owners,
to the allottees, instead of going from there to there to there
to there. When we had this May 3 meeting, I talked to all the
department heads, the people that work in these departments,
like Denver, Albuquerque, Gallup, and even Farmington.
I talked to each one of them and I told them we need to
work together. What I understood from that meeting is that
these departments don't have a good communication going, see?
Like everybody blames this department and they just blame each
other, is what I understood. So I told them in order to resolve
the problem that they all need to work together somehow, even
Navajo Nation needs to be involved.
To me, the Navajo Nation don't have anything in place.
That's what I see. And that's the reason why we have this
problem. And we live on Navajo country. We don't really call it
reservation, we call it Navajo country. Because of the land
status, the way the lands are in our area. And those are the
reasons why we--any--any projects, anything like that, like
running the water lines, we have to run to that. And power
lines, same thing. And we just have to work through it. And it
takes years in order to do something. But I know it can be
resolved some way.
And from where you stand as a Senator and chair of the
Energy and Natural Resource Committee, would you please do
something for us?
The Chairman. Okay.
Mr. Ray. It should be looked into and to be resolved and to
shorten this process, please. Thank you.
The Chairman. Thank you very much. We have Tom Etcitty. Is
Tom here and does he wish to speak?
Ada Etcitty?
Is this Tommy Lou, is that right? Tommy Lee? Excuse me.
Tammy Lee?
Pauline McCauley?
Ms. McCauley. They said get it all out, so I will.
The Chairman. Thank you.
STATEMENT OF PAULINE McCAULEY
Ms. McCauley. Thank you, Senator, for taking your time to
come out here to listen to our problems. I think I met with you
at Nageezi one time.
I have a letter here that I want to give to you. There's a
little corrections on it, but----
The first thing is when President Bush encouraged more oil
and gas development and all this, and then the Judge comes
around and puts the Secretary of the Interior in contempt of
court for not doing the Indian job. Then it goes further, shuts
down all the Indian royalties while the rest of the Nation,
they still got their royalties.
I was talking to Tweeti. She was saying she still got her
royalty, Tweeti Blancett. And she is still being paid. And she
said even by Burlington. And this to me is like eating ice
cream in front of your family.
The Chairman. When they do not have ice cream?
Ms. McCauley. Yes. They all have the ice cream, we just sat
there and drooled.
And then in October, we used to get some $800 to $1,000 a
month. Last summer. Then starting in October, it started going
down to less than $100 a month. And they keep telling us this
was the drop-off for all gas prices. And I don't know why it
dropped so much. We had communitizations, like two wells on one
allotment. And still the payment didn't increase, still stayed
the same.
And I was saying here, Mr. Senator, Honorable Senator, I
only wish you had a Navajo census number and an IIM account,
you'd know the frustrations we're going through.
We go to BIA, we know they have their trust
responsibilities on our allotments. But yet it seems like they
just completely ignore us from the area level. And then the
agency level, the people try to work with us, but things are at
Window Rock, and it just makes things harder.
These people at the agency level is like having their hands
tied and not doing anything unless the area tells them to. We
are so frustrated for not getting paid.
I, too, am one who thanks the Navajo Nation for my
assistance of the grant money they got, only now I hear them
saying I want that money back. And I say don't take it from us.
And then the Indian Minerals came out and gave us like an
estimated payment for 2 months. Then when this money came by,
when the court lifted its order, we kept saying we are going to
get paid every week. Well, every week I've been paying back
what was advanced to me. I finally got $18, and nothing after
that.
And the Farmington Indian Minerals Office has taken a lot
of rap from all the allottees when they do not have the
Internet back to their office. Because right now, the Internet
just goes to IIM in Gallup, Window Rock. And the Farmington
Indian Minerals Office, they have to drive by vehicle to Window
Rock to try to get some of this information to us.
And I don't think that--and then what I wanted to see was
maybe the Bureau, or all these people who handle our royalties
and leases, they should be centralized in one place. Right now
if we go to Farmington Indian Minerals, we get what we want.
But yet the information we want, they know how much the oil
companies have paid, and then they send that money to BIA, and
it seems like that's where the hang-up is.
And to me, that's the way I look at it. And we don't get
the money in Window Rock and Gallup. They don't have like a
public or open office atmosphere. You go over there, you come
to doors that's shut off, you have to stand out in the hall.
That's no way to follow people on something like this.
I would suggest that they centralize this in the Farmington
office, because this is the most centralized location. And
that's what I'm asking.
And then we have the Mescal case that you're familiar with?
Well, I was one of those. We owned the skin, but now we own the
whole thing. And thanks to the court for giving us that.
And then this one here, for some reason or another, the
Mescal case was paid at the end of the month, not with the
other royalties. And it's all manually done at Window Rock. And
when we come out here to Indian Minerals, everything is
automated.
And I believe that they should go to automation to get
better and faster service. Just like today, I mean, let's see--
Wednesday I went to the Indian Minerals Office, and I asked
them if they had seen anything on the Mescal cases coming up.
And they said no, that the one person who handles those
accounts was on leave at Window Rock, so no payments were going
to go out.
So in the meantime, I've been picking on Tweeti, and I told
her, I said, I pawned my belongings, and I think one went
there, and Tweeti has it all.
And now, people are being--like I said, being threatened
with repossessions. And a lot of people are pawning their
belongings. And then there's places where these people are
being reported to the Credit Bureau for bad credit. And I think
that all that is unnecessary.
And I even went to an Indian Minerals Steering Committee
meeting, and their area regional director told me this Mescal
case, we had to take it back to court to get things the way we
wanted. So I wrote to Paul Fry and I asked him about it, and he
said it's not necessary for it to go back to court. This kind
of stuff is going on. I don't like it.
I am an ex-Bureau employee. I used to help people even
through my lunch hour. There was people who complained because
I was working there too long. They said I was getting--but we
were there to serve the Navajo people, and that's what I
believe in. And you remember the late Ed Plummer?
The Chairman. Right.
Ms. McCauley. He backed me up and told me, he says, you're
doing the right job, so keep at it.
So this is what I have here, and I wish that something
would be done centralizing this leasing and IIM and Indian
Minerals Office all in one location where when we want to talk
about IIM stuff, we don't have to go to Gallup, or we don't
have to go to Crownpoint, the agency staff there will want to
help you, but yet they said your records are at Window Rock.
And you go to Window Rock--this was before one of them retired,
I went to her office. And I asked her about my allotted status
and leases and all that, and she says--and I was affected by
the Indian Irrigation Project.
And I went over there asking for that, too, and she says
well, when I find your allotment, I'll look into it. And she
had a stack of allotment files around the wall. And I thought
this was confidential information. And I didn't like that, and
I just came back. And I was just disappointed.
And to this day--maybe they have corrected it, but the last
time I saw it, that's the way--I hope those files are in a file
cabinet under lock and key. So this is one reason why I want to
see this thing centralized, so we don't have to run to Window
Rock and Gallup, and then--and they pay us. I don't mind that
part. They can stay where they want if they pay us, but--as
long as they pay us. But this information has to come out and
quit being withheld from us.
Thank you for----
The Chairman. Thank you very much.
Ms. McCauley. Thank you.
The Chairman. I appreciate it. The last person we have--
well, we have two others here. Alice Jordan? Is Alice here? And
Louise Blackie? Okay. I guess they're not here at this point.
We have one more person who wants to make a statement.
Could you make it in just a few minutes, and then we'll let the
witnesses make their--oh, excuse me. Are you Louise?
Ms. Blackie. Yes.
The Chairman. Why don't you go right ahead, Louise.
STATEMENT OF LOUISE BLACKIE
Ms. Blackie. Good morning, every one of you, and the
Senator. We appreciate being here. I had an estimated payment,
but they told us to pay it back. I checked with the people at
La Plata Office, I found out money goes back into my account.
So I'm concerned about it. And this has just been going on and
I haven't been paid for 6 months. Last year, I get more money,
and I had a question. How much does the oil costs today? Does
anyone know?
The Chairman. How much--what is the price of oil today?
Ms. Blackie. Yes, a barrel.
The Chairman. I don't know. I think it's what, $25 a
barrel, $26 a barrel, something like that. This is on the world
market you're talking about?
Ms. Blackie. Yes.
The Chairman. Yes.
Ms. Blackie. So some years ago, the oil was $25, and I get
more money. So when I read it in the newspaper, the oil price
is $25 and $26 a barrel. So I expect I should have more money.
So that is a concern for me today. Thank you, Senator. Help us
today.
The Chairman. Thank you very much. Yes, sir? Please come
give us your comments.
STATEMENT OF CHESTER BENALLY
Mr. Benally. Chester Benally. I'm sorry I didn't put my
name in it. I wanted to say something all along, but I guess
after sitting through some of the statements that individuals
are making here, I began to wonder if I should also say
something on behalf of my mother. She's living in Utah. And I
see there's some other individuals that are from Aneth area.
A lot of times I think these type of concerns that we're
talking about and addressing here is--I guess the idea is more
relevant to Nageezi's area. There's also families in Aneth area
that have IIM accounts, too.
I have just only recently become--I hate to say owner, but
through probate--my father is deceased, and I investigated the
IIM. I didn't know what it was and I didn't really want to
express any concern over that, because for the longest time
since his death about 8, 10 years ago, we've been getting
statements that we have a dime in the account.
And my brothers and sisters, they probably have a dime or
maybe eleven cents. And I often wondered why it was the case.
You're out there every day, you see oil wells pumping, there's
activities taking place, and yet you only have a dime. I often
wonder if there was at any time MMS, BIA, ever had the
fortitude to go out and really try to verify the production
that is taking place out in the oil field.
I often wonder if the companies that operate out there
truly and honestly report the amount of production that they're
making to MMS. If no one is doing it, I think something needs
to be done there, too.
Perhaps maybe this is one of the reasons why these people
here are complaining about not getting their money. Maybe
there's dishonesty on the part of the companies. That needs to
be followed through.
And I was just amazed to listen to this lady over here
saying that we have a hard time identifying owners of these
leases. Every month when a report comes in, I sit here and
wonder: If these owners have been on the books for 10, 15, 20
years, and they're the same people every month, why is it so
hard to identify the lease owners of that piece of property?
Why should you have to go through to identify that when the
paperwork is already in place and the identity of the lease
number is there? Why is it so hard not to coordinate those two
papers to identify the names of the individuals that own that
property? It just seems like it's just another excuse for them
to sit back and say that we can't identify them.
This is not something that's changing every single day. And
the lady that came before me asked the price of oil. Most of
us, and probably about 99\1/2\ percent of the people here, have
an ownership of a vehicle. As we gas up every day, the price
jumps from a dime, nickel--whatever is the case on a daily
basis. The fluctuation of the price is so much that we have to
reach in deeper just to pay for the price of gasoline. And yet
the prices that were maybe perhaps negotiated a hundred years
ago is still the same amount of price that is being paid to
these individuals. And maybe perhaps that is the reason for the
low statements that they have, the amount of funds that they
have in their account.
I often wonder why BIA has to continue to approve leases on
the lands that we have. Why should they have to be continued to
be our fathers when perhaps maybe that they could work for us,
or perhaps we should do it and negotiate the prices of the
product that is being produced from these lands. Maybe then can
we get better funding and have a better accounting of what is
in our account.
The Chairman. Could you go ahead and summarize your
remaining points?
Mr. Benally. Yes, yes. I had not thought, you just got me
lost now. But anyway, this is a great concern that I have, and
I wish that somebody, Senator perhaps, under your
administration, in the program, and doing this, a lot of these
problems will be identified. And I think the concerns are
legitimate and that we need your help, we need everybody's
help. I'm thankful for the Navajo Nation to be a part of this.
So I do thank you, thank you for coming.
The Chairman. Thank you for your comments very much.
Matilda Lizer? Is that----
Ms. Lizer. Yes.
The Chairman. Matilda?
Ms. Humphrey. No, Mary.
The Chairman. Mary, are you going to speak, too? I didn't
know that. Matilda first, and then Mary. And you'll be last. Go
ahead.
STATEMENT OF MATILDA LIZER, WINDOW ROCK, AZ
Ms. Lizer. Good morning, Senator and staff members. My name
is Matilda Lizer, and I'm coming in from Window Rock, Arizona.
And I'm wondering--there's two that's under the Mescal account.
I have two questions, one for Kathy. Why under the Mescal
account with the PNM Coal don't I have a listing like the oil
and gas estimated listings for the feet of coal?
Ms. Martinez. I'm sorry, could you repeat your question?
It's very hard to hear.
Ms. Lizer. Okay. I was wondering why the Mescal account
with the PNM Coal has no estimated listings, just like the oil
and gas?
Ms. Martinez. Your question was what?
The Chairman. Yes. The Mescal account, I guess, involves
coal production, right?
Ms. Lizer. Coal, yes.
The Chairman. And she was asking why there is not a similar
ability to determine what's owed on that as there is in oil and
gas.
Ms. Martinez. Your question is that you're not getting an
explanation of payments on the coal leases?
Ms. Lizer. Yeah. Yes.
Ms. Martinez. My understanding of the Mescal settlement is
that it is still to be treated as a Federal lease. We collect
the money and then we tell OTFM about it. And I really don't
understand the mechanics of why you're not getting any EOPs,
but I did write Pauline's name down. Is she still here? She had
some issues and questions about Mescal, and I'd be glad to talk
to her about that.
The Chairman. If you would give her your information here
right after the meeting, then she could get back to you with an
explanation.
Ms. Lizer. Okay. And then I had another question. I'd like
to know, because like they said I received my last payment back
in November also. And then from that time, you know, I'm one of
the persons that lost a vehicle already. And then my--because,
you know, this Mescal account was my only source of income. And
then my employment also, but it's not enough. And is there a
letter that can be written or some information for creditors
not to ruin your credit for the Credit Bureau type?
The Chairman. This would be information about what you are
owed or what you are likely to be paid? Is that what you mean?
Ms. Lizer. Yes.
The Chairman. Again, I think--why don't you ask when we
conclude the hearing, and they'll tell you anything they can
about what is owed or expected to be paid.
Ms. Lizer. Okay. Thank you.
The Chairman. Thank you very much. Mary, did you wish to be
the last witness? Please.
Ms. Humphrey. Well, I hope not to be the last.
The Chairman. No, I think you're the last.
Ms. Humphrey. Really? Oh, no. Well, let's see how much time
we got. Plenty of time.
The Chairman. No, we don't want you to take all this time.
Ms. Humphrey. No?
The Chairman. We want to have some time for these people to
give final comments.
STATEMENT OF MARY HUMPHREY
Ms. Humphrey. Oh, okay. Well, it's good to see you again
and everybody here. I wanted to ask some questions about my
IIM. It seems like every time I call, they either say well, the
check's in the mail. And then when that time comes, they say
you'll get it tomorrow or by Friday. When the time comes, I go
and there's no checks. And then I call back, and then they tell
me well, on this listing that we got, your name is not on it.
So that really gets me upset. And I ask how come? And they said
that you had borrowed money from somebody I don't even know,
somebody I'm sure that don't know me. And they say we're
getting your IIM money and paying that money back. And they
tell me you got, I think, 251 cents to go until you're all
paid.
To who, to what? I never even talked to this person, and
I'm sure that that person don't know me. Don't know my IIM
account, don't know nothing about me. And I think that is
wrong. Because it is my civil rights are being all stepped on,
name it. It's been done.
And also, they also tell me my brother has got a sheep that
he took back over there, over there to the IIM Department over
there in Farmington, and they told him that he was all paid up
for what he's got. He's all paid off. He doesn't owe nothing
else.
Why is his different than mine when we both get equal
amounts? And to this day--my brother's here, he tells me why,
if they tell me that I am already paid up, why have they not
sent me a check? This is what I want to ask.
The Chairman. Have you had a chance to talk to the ladies
who have the list of what is owed to each allottee who could go
over this with you?
Ms. Humphrey. I'll do that.
The Chairman. They're in the next room. And I think if you
would sit with them and go through this, they could give you
whatever information they have, both about your account and
about your brother's account.
Ms. Humphrey. Well, what I don't understand is how come his
is paid off and mine's not, and he's still not getting a check?
The Chairman. Well, that's a good question. But you'll need
to ask them that question, I don't have the answer. And I think
the only ones who would are the folks that have that list.
Ms. Humphrey. All right. Thank you for your time, Senator.
The Chairman. Thank you very much, appreciate you being
here.
Let me do this: Let me just ask if any of the people who
have been on our panel here have some concluding remarks,
anything they would like to make. Mr. Garcia, Mr. Begay, Mr.
Trujillo, Mr. Lords?
Let me just have the microphone passed over. And maybe we
would go in the reverse order that we went before, so that--why
don't you make your concluding remarks in a couple of minutes,
if you could, each one, and then we would conclude the hearing.
Mr. Garcia. Thank you, Senator. Seems listening to various
testimonies being given and observing the whole environment
here, I don't think this is any different than what we have
heard as chapter leaders in these affected communities.
I personally believe that there is a problem all the way
from MMS as far as the oil companies paying their share for
their production leases or whatever.
Also, the next biggest problem is up to the BIA. I don't
believe the BIA has the resource and a meaningful way to
expedite these payments. And I don't really blame the Office of
Trust Funds Management. I think they're in a position after
they receive the data from the BIA to process these checks.
I do believe, however, that the BIA has a trust
responsibility to ensure that our Navajos, our community
members, receive a fair and honest amount. But I believe the
system is not working. It's going to take coordination on
behalf of the Navajo Nation, various departments of the
Interior, and all players need to come together and coordinate.
And this has been ongoing for numbers of years, this is not new
to these people.
And the other thing that really bothers me here is if you
heard all the testimony, none of these people are receiving
what they normally have been getting prior to the shutdown. So
there's still something wrong where maybe the companies are not
paying. Well, who's monitoring that? Who is the person to
ensure that these companies pay the rightful amount to these
land owners? And I think the more we wait, we're going to see
some very tragic things are going to happen, both socially and
financially. And I'd like to summarize, Senator, really
briefly, in Navajo.
[Navajo spoken.]
And I'd like to thank Mr. Brunner from the Senator's
Office, and everyone else. This is from the Albuquerque, the
chairperson, and they have made every effort to ensure that our
comments and our problems be heard. And we have met with them
at our Chapter House, and I'd like to thank you for making that
time and making that effort to ensure that our people be heard.
[Navajo spoken.]
This is a problem for us. We need your input, we need your
participation. And as a Chapter leader advocating on my behalf
for the community, our Navajo Nation will take 100 percent
effort to ensure that this problem be corrected and make this
service efficient to all these people here. Thank you.
The Chairman. Thank you very much.
Mr. Trujillo.
Mr. Trujillo. Thank you, Senator.
The Chairman. Mr. Trujillo, could you make yours short? We
are about out of time.
Mr. Trujillo. Thank you, Senator. Very quickly, just a
couple of observations here.
One, I think it's very apparent through your questioning
that the community members from the eastern agencies, as well
as the other allottees, are wondering. They're used to a
certain payment coming within a certain time period. And
because of this, that's been disrupted and there's been a
change.
As a result, as with anything else, people are reacting to
that change. Yet, I think it's becoming somewhat apparent that
the explanations are not coming forward as to why these changes
are happening. And because of that, there's still a tremendous
amount of confusion as to what's happening, when it's going to
be resolved, and how it will be resolved.
So one, I would ask that you continue to work in this area.
And if there's any way that you would require the assistance of
the President of the Navajo Nation or his staff to assist you
in that, we would be willing to assist you with that.
The other point I'd like to also make is that again, the
Navajo Nation is continuing to focus on how we can assist
individuals within the Navajo Nation. As with any other entity,
there are a tremendous amount of needs. One very important one
right now that we're working on is the drought. So at times we
feel some gain.
We need to help these communities and these families. But
on the other side of it, as we take money to do that, as we go
into the drought season, that may impact us even more.
So again, to reiterate one point as we go through this
process and watch it completed, we will go through audits, but
I think we'll be looking to see the Federal Government
reimburse us for the money that we're trying to help the
communities with.
But to clarify that, I don't want those dollars to impact
the communities. This is a Federal Government issue. They
should pay for it, not the people out here.
So those are the two things that we are looking at. Again,
I appreciate your time, Senator.
Mr. Begay. Thank you, Mr. Chairman. Quickly, there have
been suggestions that there should be a consolidation of
various agencies to relocate in one area. I guess that it's an
easy suggestion to be made. All of us here must remember that
Secretary Norton, under her leadership, had proposed to
reorganize this effort. But as for the Navajo Nation, it's
going to have a tremendous impact. Just, for example, if the
Trust Manager is all housed under one roof, then Navajo Nation
has--Navajo Region Office is going to have to give up 200 FTEs,
$12 million in our budget in order to be part of the
consolidation.
Because on the initial planning, it was going to cost $300
million to reorganize under one roof with that concept. Because
this will impact the Navajo Nation. That's why we resist that.
So I think there should be another alternative that could be
reviewed for that consideration. Thank you.
The Chairman. Thank you. Mr. Lords, you have the final word
here.
Mr. Lords. Thank you, Mr. Chairman. Thank you for inviting
the Department of the Interior to your hearing, I'll make my
comments very quick.
For the people who are part of Mescal settlement, OTFM
received its first lease file yesterday, since the Internet
shutdown. There should be credits going into allottee accounts
today. The total for that file was approximately $750,000.
Just because we make weekly distributions, Senator, does
not mean that everyone gets a weekly credit to their account.
As Mr. Garcia stated, that depends on which lands MMS receives
funds for.
And then lastly, based on what I heard today, I will go
back and will look at what we can do to update the account
holders on the estimated payments and what was offset so that
we get something to them so they have some information in hand.
The Chairman. Good. Let me get the microphone again.
Well, let me just thank everybody who has given us
information today. I think even though there are a lot of
problems, and there clearly are, with the way we are having
this administered, the way it's been set up, I think that the
people who have been here today have been trying to give us
information about their view of what needs to be done.
I do believe it would be helpful to see if we can improve
the communication about what people are owed and what people's
accounts reveal, about what's going into these accounts. And
anything that can be done along those lines would be very much
appreciated.
We are going to regroup with the Department of the Interior
officials when we get back to Washington and try to find ways
to get these problems resolved and get them resolved as quickly
as possible. This is something which I know has been an ongoing
issue for a long time.
I hope we can work cooperatively with the Department of the
Interior to get the problem solved so that people do get their
payments, get them quickly, and get their full payments. And
that people also have confidence that the oil companies are, in
fact, paying the full royalties that are owed to the royalty
owners. That's something that people need to have confidence
of, and we obviously haven't been giving people enough
information to give them that confidence up until now.
Let me once again just indicate Terry Brunner, who is over
here by the door. He works with me and my staff, and I know he
has met with Mr. Garcia and some others here. He is available
to continue working with you on this, and we look forward to
helping get this resolved as quickly as possible.
I thank you all for coming, and I hope that some of the
information here has been useful. And again, I thank the City
of Bloomfield for providing this facility and all the help
they've given us to make this happen.
So this concludes our hearing and thank you very much.
[Whereupon, at 12:05 p.m., the hearing was adjourned.]
APPENDIX
Additional Material Submitted for the Record
----------
Eastern Navajo Agency,
Nageezi Chapter--District 19--#92,
Nageezi, NM, May 31, 2002.
Hon. Jeff Bingaman,
Hart Senate Office Building, U.S. Senate, Washington, DC.
Dear Senator Bingaman: The Navajo Allottee's in the Nageezi
Community are deeply concerned and disappointed that some Individual
Indian Monies (IIM) has not resumed payments since the computer
shutdown on November 21, 2001.
The Department of the Interior through the Bureau of Indian Affairs
(BIA) has mismanaged billions of dollars through royalty payments from
the Navajos, also known as Individual Indian Monies.
What will make the Bureau of Indian Affairs to account for all
missing funds and return it to the rightful owners?
It was over a century ago that the United States Government
obligated to have the ``trust responsibility'' to ensure Native
Americans with protection and management of their affairs.
Most of our elderly rely on this income to meet their basic
living needs and to care for their livestock. This income is
deeply needed by our community to supplement what income they
have, if any.
A great percentage of our Indian Allottee's have not
received or resumed any royalty proceed since the shut down,
which created critical financial hardship. Some resorted in
selling their personal possession, livestock or other items of
value.
On May 3, 2002, the Navajo Allottee's conducted a meeting
with Mineral Management Service from Denver, Colorado, Office
of Indian Trust Funds Management of Albuquerque, Bureau of
Indian Affairs of Gallup and Farmington Indian Mineral Office
of Albuquerque. It was evident at that time that some oil
companies were not making payments to MMS on Indian Land for
production and leases. Mineral Management Service personnel
confirmed the discrepancies, which resulted in non-payment to
Navajo Allottee's.
Speaking on behalf of Navajo Allottee's, there are numerous
problems with the current program operation on Indian Trust Management
operation. Secretary Norton's plans to reorganize and consolidate
Indian Trust Asset Management functions into a separate new
organization unit will not work unless each tribe develops a realistic
and workable plan with individual input. Creating another department
with current Department of the Interior personnel will only create
further bureaucracy thereby hindering improvement and customer service.
Our recommendation to you as our Senator, is to support the
following:
1. Allow our Navajo Allottee's to utilize the Indian Self-
Determination Act by creating a local Individual Indian Monies (IIM)
payment distribution preferably in Farmington, New Mexico. Current
process for payment are distribute as follows: Oil Companies to Mineral
Management Service (Denver, Colorado) to Area Bureau of Indian Affairs
(Gallup, New Mexico) to Office of Trust Funds Management (Albuquerque,
New Mexico) to Indian Allottee's.
2. Coordinate proposed plan and set up with Farmington Indian
Mineral Office (Farmington, New Mexico). Plans are as follow: Oil
Companies make direct payment to Navajo Allottee's. The Farmington
Indian Mineral Office will monitor and ensure that oil companies make
proper and timely payments.
3. Develop a Feasibility Economic Plan, which will enable the
Navajo citizens to have a direct impact utilizing mineral extraction
for employment and other positive means. SUGGESTION: Since our
community averages a pay out over $650,000.00 a month, would it be
feasible to have our own Navajo Refinery?
We urge you to support and seek ways to improve the system that has
failed our people for many years. There are ways to prevent wasteful
and unnecessary government bureaucracy in hindering direct service to
our community members. Please give this matter your highest priority.
May we hear from you very soon with your plans?
Sincerely,
Calvert Garcia,
President.
______
Statement of Dr. Stephen C. Torbit, Senior Scientist, Rocky Mountain
Natural Resource Center, National Wildlife Federation
introduction
My name is Stephen C. Torbit, and I appreciate the opportunity to
submit this statement to the Committee on Energy and Natural Resources.
I am testifying today on behalf of the National Wildlife Federation,
Wyoming Outdoor Council, Biodiversity Associates and myself.
On March 13, 2002, I testified before the Committee on Government
Affairs on the Impact of the National Energy Plan on Western Public
Lands and submitted this statement for the record. Today's field
hearing will address similar issues outlined in my earlier testimony
before the Committee on Government Affairs. Therefore, I would like to
request that this statement be submitted for the record.
The National Wildlife Federation (NWF) is the nation's largest
member-supported conservation education organization. For more than 65
years, millions of NWF members and supporters from across America have
invested their time, energy, passion, and grassroots action in
conserving and restoring the living legacy we will bequeath to our
children--in keeping the wild alive.
Established in 1967, the Wyoming Outdoor Council is the state's
oldest and largest independent statewide conservation organization.
Their mission is to protect and enhance Wyoming's environment by
educating and involving citizens and advocating environmentally sound
public policies and decisions.
Biodiversity Associates is a Wyoming-based conservation group
dedicated to preserving wildlife and wild places. This group serves as
a voice for native species and public lands in the Red Desert and other
parts of the Intermountain West and Great Plains.
I earned my Ph.D. in Wildlife Ecology from Colorado State
University in 1981, and have worked as a wildlife educator, researcher
and biologist for the Colorado Division of Wildlife, the Wyoming Game
and Fish Department and the U.S. Fish and Wildlife Service. I currently
am the Senior Scientist for the National Wildlife Federation.
I am a native of the west and have been involved with energy
development on western public lands for more than 20 years. I am here
today to discuss this Administration's National Energy Policy and its
impacts on our western landscape. Although this Congress is currently
considering legislation to enact this National Energy Policy, I can
assure you that significant pro-energy development policies have
already been put in place by this Administration. These radical changes
have completely reversed the logical sequence of environmental
analysis, public input and agency decision. This has occurred in a
vacuum of no public input and in a manner that compromises unbiased
environmental analysis and disregards the other public-trust resources
on the federal estate.
I also understand the debates in this Congress concerning the
opening of the Arctic National Wildlife Refuge for oil and gas
development. NWF has been actively engaged on this issue and has been
working to protect the wildlife values of this unique area. Its
addition to the Arctic Refuge, NWF is extremely concerned about the
many other actions already threatening wildlife and other resources on
our western public lands. In my testimony, I will illustrate some of
the impacts of the Administration's energy policies on an area that is
personally and professionally very important to me, Wyoming's Red
Desert.
As a professional biologist, I have been engaged with wildlife
issues in Wyoming's Red Desert since the late 1970s. Additionally, I
have used the Red Desert personally for recreation including hunting,
hiking, photography and camping. The Red Desert epitomizes the west;
its wide-open spaces and its abundant wildlife resources allow me to
reconnect to my western heritage. I have harvested significant numbers
of mule deer and pronghorn antelope from the Red Desert and those
animals were an important source of food for my family when we resided
in Wyoming. I continue to hunt, hike and camp in the Red Desert
although I no longer live in Wyoming.
wyoming's red desert
Despite its name and its appearance to the uninitiated, the Red
Desert is not an empty wasteland. The Red Desert of Wyoming is truly an
ecological, geological and wildlife wonder. The Greater Red Desert
region includes the largest undeveloped high elevation desert left in
the United States, the continent's largest active sand dune system,
two-thousand-year-old rock art and Shoshone spiritual sites, portions
of the Oregon, California and Pony Express Trails and 10 Wilderness
Study Areas. This special area is rich in wildlife because of the
integrity of the habitat. More than 350 wildlife species call this area
home including the largest desert elk herd in North America, and the
largest migratory game herd in the United States outside of Alaska
consisting of some 45,000-50,000 pronghorn. The Red Desert also
provides important habitat for mule deer, sage grouse, numerous small
mammals and nesting and wintering habitat for birds of prey. It was
principally because of the integrity and viability of these habitats
that the Department of the Interior chose not to list ferruginous hawks
under the authorities of the Endangered Species Act of 1973, as
amended.
Since 1898, there have been efforts to set aside and protect
portions of the Red Desert and the wildlife habitat it supports. In
1935, the Governor of Wyoming proposed establishing the Great Divide
Basin National Park. In 1973 and again in 1976, the National Park
Service reviewed Adobe Town, a series of badlands formations on par
with Badlands and Bryce Canyon National Parks, for designation as a
National Natural Landmark. The reviewers concluded, ``the greatest
natural value of this area is that it is still a `howling wilderness,'
'' (1) and rated the area as having the highest rating for ecological
and geological values, a rating that reflects the ``high degree of
national significance,'' (2).
But now this area rich in ecological, geological and cultural
wonders is at risk from multiple entities that would cast aside these
public values and dominate the landscape with energy development.
expedited energy development
Our public lands already provide a substantial amount of oil and
gas from an estimated 57,800 producing oil and gas wells. According to
a 1999 report published by the National Petroleum Council, roughly 95%
of BLM lands in the Overthrust Belt of the Rocky Mountains are already
open for mineral leasing and development.
While this Congress considers and debates the National Energy
Policy, many actions are already accelerating energy extraction on the
Red Desert and other public areas in a way that will permanently alter
the character and resources of these public lands. Currently, public
land managers are not considering the multiple assets of public lands
and are not working proactively to balance conservation of these assets
with energy development demands. Rather, this Administration is using
its discretionary authorities to totally skew decisions toward
domination of the landscape by extractive industries. Indeed, we are
witnessing the rapid industrialization of our western public lands.
recent executive orders
There is ample evidence to justify our concern. Until now, federal
land managers were expected to fully evaluate the impacts of their
proposed decisions on the environment, to disclose those impacts to the
public and consider public input prior to finalizing their decision. In
decisions to lease or permit drilling, prescriptive restrictions were
often attached to minimize or avoid impacts to public resources (water
quantity and quality, air quality, historical and wildlife resources,
etc.). In essence, the logical framework was to ``look before you
leap'' to assure no irretrievable commitments of resources were
unknowingly made.
However, this Administration has turned this entire process on its
head by ordering agencies to first analyze whether any proposed actions
(e.g. winter range improvement for wildlife) will impede or accelerate
energy development on public lands before issuing a final decision.
Specifically, Executive Orders 13211 (3) and 13212 (4) now require an
``Energy Effects Statement'' to specify ``any adverse effects on energy
supply, distribution or use . . .'' of federal actions. Furthermore,
for energy related projects, agencies are encouraged to ``expedite
their review of permits or take other actions as necessary to
accelerate the completion of such projects . . .'' This message has
been heard clearly by those who manage the federal estate. The result
is that certain actions are discouraged if they impair the federal
government's ability to extract energy reserves. If environmental
protections are already incorporated into existing energy development
decisions, federal managers are encouraged to be creative in
circumventing those protections to benefit energy extraction.
threats to the red desert
Examples of what this new policy of expedited development has meant
to the Red Desert include:
The BLM released a proposal in June 2001 to allow up to
3,880 coal-bed methane wells in the Atlantic Rim Project Area,
an area of critical importance to wintering wildlife.
Consistent with new policies to accelerate oil and gas
development on public lands, the BLM is proposing piecemeal
development of up to 200 wells before completing a thorough and
comprehensive environmental analysis of the entire proposal.
This piecemeal approach is designed to leverage the ultimate
decision by establishing a ``beach head'' for energy
development by first minimizing the environmental impacts of
these smaller projects.
In August 2001, the BLM approved seismic exploration in the
Adobe Town area. Seismic trucks drove through roughly 50,000
acres of citizen-proposed wilderness areas in September through
December 2001, degrading this fragile landscape, laying the
foundation for future development and thus undermining the
integrity of the citizen's proposal. Exploration continued
within crucial wildlife winter ranges during the winter months,
in violation of agency commitments to avoid the area during
that sensitive time.
The BLM proposed in December 2001 to permit an eight-mile
long hand-laid seismic study entirely within the boundaries of
the Adobe Town Wilderness Study Area. Thereby, BLM may have
undermined wilderness designation for Adobe Town.
the administration's national energy policy
There are more examples of the Administration expediting permits
evaluating impediments to leasing public lands and removing these
impediments as ``unnecessary'' obstacles to energy production. These
examples come from many areas in the west in the new rush for energy
development, including:
BLM authorizing seismic exploration in Utah's Dome Plateau,
just outside of Arches National Park. The Interior Office of
Hearings and Appeals (OHA) halted this project finding it was
likely that BLM had inadequately considered the environmental
impacts of this action on public lands.
In January 2002, the Wyoming State BLM Director presented an
Award for Excellence to the Buffalo Field Office. This one
field office was recognized for approving more drilling permits
than all other BLM offices combined, excluding New Mexico. This
one area of northeastern Wyoming is proposed to soon be home to
tens of thousands of gas wells. The Buffalo Field office was
praised for working ``diligently'' and ``creatively'' with
industry in approving the record number of oil and gas permits.
BLM is characterizing wildlife lease stipulations as
obstacles to production. These minimal measures are now the
only wildlife mitigation measures found on drilling permits and
leases. They are intended to balance natural resource values
against energy development and protect critical wildlife
habitats, such as crucial winter ranges, migration corridors,
calving and nesting grounds. If these protections are stripped,
the vast array of wildlife species calling the Red Desert home
will diminish in the onslaught of energy development.
Overturning lease stipulations designed to protect important
wildlife habitats. The Wyoming BLM has already approved nearly
70 percent of the 88 requests for exceptions to lease
stipulations requested by the natural gas industry for the
Green River Basin this winter. These waivers follow two years
of extensive drought when wildlife and wildlife habitat is
already stressed.
Opening ``all public lands'' regardless of existing
environmental safeguards as promoted by the National Energy
Policy. This attitude is manifested by BLM's seismic testing
operations in federally designated Wilderness Study Areas in
the Red Desert. It is important to point out that all of the
seismic operations in the Red Desert were proposed after the
Administration's National Energy Policy was released.
Previous legislation enacted by Congress, approved by other
Administrations and consistently upheld in the courts, promote multiple
uses of public lands where a mix of resource values are developed or
maintained across the public estate. The provisions of the National
Energy Policy ignore the multiple use mandate and propose to eliminate
even the token balance between resource conservation and energy
exploitation and substitute a dominant use for-multiple use.
Certain special areas on our public lands are simply too wild to
waste. These areas include our National Parks, National Monuments,
National Wildlife Refuges, roadless areas, and lands with special
values such as Wyoming's Red Desert, Montana's Rocky Mountain Front and
Colorado's Vermillion Basin.
Well-planned, responsible development can balance our country's
energy needs with the conservation of wildlife habitat and other
natural treasures for future generation to enjoy. Responsible
development requires thorough pre-leasing environmental review, full
compliance with all environmental and land management laws, measures to
protect wildlife migratory routes and other sensitive lands, full
reclamation of developed areas once operations cease and minimization
of road building.
Unfortunately, rather than encouraging a thoughtful, strategic and
balanced approach to energy development, the Administration's National
Energy Policy is recreating the chaos of the western gold rush of the
1800s. Like that archaic approach, these new tactics give no
consideration for other users or resources. Like the old western gold
rush, this new ``western energy rush'' will leave impoverished natural
resources and cleanup as the legacies for future generations. I invite
the members of this committee or their staff to come to Wyoming with me
and visit Adobe Town, Jack Morrow Hills and other unique and valuable
areas of the Red Desert to view these areas and the consequences of
industrialization.
I appreciate the Committee's interest in these critical issues and
urge you to take action to ensure that we do not replicate the mistakes
of the past and instead manage the public lands in the public interest
not only for today but for tomorrow as well.
______
Bloomfield, NM, May 30, 2002.
Senator Bingaman: The negative impact of oil and gas operations in
San Juan County is extensive. Pipeline rights-of-way are wide and,
coupled with adjacent roads, affect the movement of wildlife. These
rights-of-way are supposed to be reclaimed by revegetating but seem
mostly to grow more invasive weeds, if anything at all. A one time
planting may not be enough to restore what has been denuded; those
responsible must check later to see if reseeding was successful, and,
if not, must work to correct the problem.
Compressors not only are multiple additional man-made units in wild
areas but are also noisy beyond what is acceptable. In addition, New
Mexico EPA recently advised the public in San Juan County that the
county is nearing non-attainment status for ozone and that compressor
emissions are a part of the problem. It seems that recently we are
seeing these units scattered in large numbers throughout the county. We
are concerned because the public is not being asked about installations
nor are expressed concerns being positively addressed. We do not
consider the legals in the newspaper adequate notification. Many local
land owners, primarily ranchers, believe their concerns are being
ignored and their rights overrun. It is important to remember that
these ranchers serve our nation by putting food on our tables. Judging
from what we see on our birding expeditions into the wild areas of San
Juan County, we believe their concerns are justified.
If current laws are inadequate to protect the land, both public and
private, then we may need to look at new or additional legislation to
correct the problems.
More is often not better. The oil/gas industry would go a long way
by minimizing the areas they use and by seriously addressing the
problems of restoration. BLS must be more diligent in the permitting
process and in approving revegetation efforts.
Janet and John Rees.
______
Aztec, NM, May 31, 2002.
gas wells along the animas river
Dear Senator Bingaman; My wife and I are schoolteachers (along with
our two children) living near the Animas River at Cedar Hill, New
Mexico, about nine miles north of Aztec. We are very concerned with the
potential environmental impact from the recent and future down spacing
of gas wells.
Our river community has been impacted in years past from methane
migrating through porous alluvial soil taking the path of least
resistance into water wells, agricultural land, or into the river
itself. Some landowners have settled through litigation, but the Animas
River and riparian ecosystems cannot defend itself.
How can the oil and gas industry be allowed many exemptions from
hazardous waste and drill in our backyards or along the banks of a
fragile river? We desperately need state and federal legislation passed
establishing no-drill buffer zones along America's rivers. The effluent
from leaking wells or accidental chemical spills (some wells are
literally on the banks of the Animas) leave little or no response time.
A conflict of resources exists. Oil and gas should never have priority
over our precious water. With four billion cubic feet of gas being
produced daily in the San Juan Basin our ``community share'' of the
economic resources is small in comparison to our ``disproportionate
share'' of the spillover costs.
While some Oil and Gas CEO's and stockholders may enjoy the quiet
and privacy of their posh gated communities, we see the continued
depletion and deprivation of irrigated farmland, the damage to river
ecosystems and hear the unnerving relentless sound of compressors. We
have the technology, but not the political will, to establish a no-
drill buffer zone at least a half-mile away from either side of our
rivers. We have had to absorb the spillover costs from ``government
subsidized'' coal seam wells, why not subsidize a ``Riparian protection
zone''. The every-day citizens living in the river valleys of the San
Juan Basin deserve to be ``equal partners'' at the negotiating table.
Government should not exist as a private club for lobbyists
representing the corporate elite.
Sincerely,
Ken Stanley.
______
Farmington, NM, May 30, 2002.
As a teacher in San Juan County for the past 25 years, I have taken
many field trips with students into our BLM lands. Over the years, I
have seen a remarkable increase in the land damage that the oil and gas
industry has caused. This primarily includes a huge increase in noxious
weeds, erosion at poorly maintained road sites, and oil/chemical spills
at well locations. The increase in roads then opens up illegal dumping
sites for trash, dead animals, etc. It is a raping of our land with
little thought of preserving the natural beauty of our fragile
ecosystem. The billions ($2.49 to be more precise) of dollars that our
land generates needs to be used in a timely manner to repair this
damage as soon as possible.
Kathy Price.