Committee Report
AAPL QUARTERLY BOARD MEETING
September 13, 2015
The Montage, Deer Valley ~ Park City, UT
Committee:
Chairman:
Email:
Company:
Public Lands
Roxie Simpson
r.simpson@energyconsultantsllc.com
Energy Consulting Associates, LLC/Helis Oil & Gas
Company, L.L.C.
Committee members (including company, city/state and term expiration):
Name
Roxie Simpson
Brandon Renner
Dora Soria
Jason Warran
John Lee
Lauren Germinario
Gregory J. “Greg” Geist
Mike Thatcher
Richard Corcoran
Aly Reeser
William Jenness
Freddie Barela
Javier Mesa
Mike Flores
Dustin Bynum
Dan Naatz
Marc Strahn
Kevin R. Dickerson
Brent Schreiber
Pam Feist
Company
Energy Consulting
Associates, LLC
City
Term Expires
Billings, MT
Evansville, IN
Anchorage, AK
Kensington, MD
Billings, MT
2017
2016
2018
2016
2016
2018
2016
EOG Resources
Denver, CO
Midland, TX
Salt Lake City, UT
Farmington, NM
Denver, CO
Lansing, MI
Oklahoma City, OK
Madisonville, LA
Los Angeles, CA
Fort Worth, TX
IPAA
Washington, DC
Illingworth Renner
Independent
Attorney
Crowley Fleck
Treble Energy, LLC,
Independent
Conocho Resources
Questar
ConocoPhillips
EOG Resources
Independent
Chesapeake
Independent
Luna & Glushon
AAPL Excom
AAPL Excom
AAPL Staff
AAPL Excom
2016
2016
2016
2018
2017
2017
2018
2016
IPAA
AAPL
AAPL
AAPL
AAPL
1
Committee programs/activities:
Alaska:
 President Obama and Secretary of State Kerry are scheduled to visit Alaska in late
August to meet with legislators and citizens regarding climate change, the role of the
Arctic Council and the multi-national claims over jurisdiction of Arctic and North Pole
lands. They also plan to visit rural Alaska, some of the areas greatly affected by climate
change.
 BSEE granted Shell permits to drill in oil bearing rock in the Chukchi Sea offshore
Alaska after withholding such approval until a vessel containing a capping stack was
repaired and returned to the Chukchi Sea. Injunctions requested by environmental
organizations to halt drilling, have been denied. The Obama administration has indicated
that the US should produce its own oil instead of importing from places with lower
environmental standards and that the shift to renewable energy will not happen overnight.
Hilary Clinton has strongly spoken out in opposition to President Obama’s drilling
approvals.
 A hearing was held in Alaska among the Senate Energy and Natural Resources
Committee chaired by Alaska Senator Murkowski; Senate Environment and Public
Works Committee on Fisheries, Water, and Wildlife chaired by Alaska Senator Sullivan
of Alaska; EPA; BLM; and US Army Corp of Engineers to discuss the national wetlands
provisions of the Clean Water Act that disproportionately hamper development in Alaska
and may be contrary to protected native interests. Alaska Representative, Don Young,
has introduced legislation to establish new wetland mitigation options.
 In the continuing lawsuit over the proposed federal plan to designate an area in Alaska
larger than California as polar bear habitat, a justice department lawyer argued in appeals
court that the federal plan should be upheld despite the plan’s lack of specifics. The
187,000 square mile area covers mostly marine areas. Lawyers for the industry contend
there is no science to support the designation.
 The Alaska Conservation Trust has been newly formed as a nonprofit group to support
Alaska’s oil, gas, mining and timber resource industries and is committed to comment on
project permits, efforts to make species endangered and the creation of special habitats.
Colorado:
 Recently, the EPA accidently released more than 3 million gallons of wastewater laden
with heavy metals at the Gold King Mine near Silverton Colorado into the Animas River.
It is reported that the pollution flowed downstream to New Mexico and Utah and that the
Navajo Nation, tribal officials warned residents and farmers not to use water from the
San Juan River. It is reported that little warning was given by the EPA to neighboring
States.
New Mexico:
 The New Mexico Oil Conservation Division (OCD) gas capture rule task force will meet
the week of August 24, 2015.
 The OCD Environmental Bureau is working on new spill guidelines.
 The OCD is filling new positions and planning a new building in Artesia.
 The New Mexico State finance leader says that oil production has increased 30% over the
prior year even though prices are down 50%.
 The State Land Office expects to receive a third less in royalty payments in FY 2016.
 The BLM Potash IM is expected in August.
 Governor Martinez is said to be reviewing the draft State Energy Policy.
2
 BLM Farmington Field Office continuing with update to Resource Management Plan:
o Draft not anticipated till Q4 2015
o 4 alternatives proposed
o A number of organizations are interested in stalling the RSM but the BLM will
not honor requests for a moratorium.
 There is an ongoing issue with groundhogs. This issue is in the early stages and is being
affected by the Gunnison prairie dog bill.
 The State is revisiting the horizontal pooling rules and setbacks from lease lines. The
timing of these changes is unknown.
 There is an EIS in process for the 130 mile Pinon Pipeline despite the fact that there is an
existing ROW – no change in status is posted on the BLM site as of 8.25.2015.
 On a positive note a Federal Judge has rejected a motion for a preliminary injunction to
ban drilling activities in the Mancos Shale formation in Northwest New Mexico while the
environmental groups fight the approval of dozens of drilling permits issued over the past
two years by a federal agency. The American Petroleum Institute will be allowed to fully
participate as a party in the case that has been filed.
Utah:
 The BLM August sale has been rescheduled and combined with the November sale due
to the small amount of acreage scheduled to be offered. See Update on Master Leasing
Plans below, much of the reason why there is such a small amount of acreage being
offered.
 Update on Master Leasing Plans: Millions of acres in eastern Utah have been deferred
from oil and gas leasing over the past few years because the acreage is within large
geographical areas under study for inclusion in so-called “Master Lease Plans” (MLPs).
MLPs came about as a result of BLM’s May 2010 leasing reforms, and are essentially a
new planning tool which can be used to make amendments to Resource Management
Plans (RMPs).
 MLPs typically cover a significant amount of acreage (hundreds of thousands of acres)
and can overlap multiple field office areas. Thus one MLP may amend multiple RMPs.
BLM has so far initiated nearly a dozen MLPs in Wyoming, Colorado, and Utah (see
BLM Press Release, dated August 14, 2015).1 BLM has identified four criteria to
determine whether a MLP is needed: (1) substantial unleased acreage, (2) majority
federal mineral interest, (3) specific interest in acreage from the oil and gas industry and
high potential for oil and gas, and (4) additional analysis is required to assess the impact
of oil and gas development on other resources or values (see BLM Memorandum dated
August 14, 2015).2
 In Utah, five MLPs have been initiated, and the Utah BLM’s State Director has deferred
leasing for the acreage covered by the MLPs. According to the BLM, “millions of acres
of land with oil and gas interest have been removed from availability for oil and gas
leasing and development for the last several years, and this is likely to continue until the
MLPs are completed.”3 Of the five MLPs, one draft MLP has been published and
submitted for public comment (see Draft Moab Plan below). After completion of the
Moab MLP, BLM will then proceed with the Cisco Desert MLP, followed by the San
1
Accessed at http://www.blm.gov/wo/st/en/info/newsroom/2015/august/interior_department.html.
2
Accessed at http://www.blm.gov/ut/st/en/prog/energy/oil_and_gas/mlp.html.
3
Id.
3



Juan MLP. The Vernal MLP will be postponed while BLM decides whether to couple an
MLP with a broader RMP amendment. Finally, the San Rafael MLP will be initiated as
an EA-level MLP (as opposed to EIS-level).
For those interested in nominating federal land in eastern Utah for oil and gas leasing, the
BLM has a website devoted to MLPs, with various documents and maps available for
interested parties to determine whether any given parcel falls within one of the pending
MLPs.4 The remaining MLPs are likely to take years to complete, greatly diminishing the
number of federal acres in Utah available for leasing.
Draft Moab Master Leasing Plan Issued - The draft Moab MLP was published in the
Federal Register on August 21, 2015, beginning a 90-day public comment period. The
Moab MLP covers ~950,000 acres (785,000 of which is BLM-administered acreage),
incorporates an EIS, and proposes to amend the RMPs for the Moab and Monticello Field
Offices. The BLM’s preferred alternative in the EIS would prevent mineral leasing and
development on lands adjacent to Arches and Canyonlands National Parks, and would
prevent development in other areas with high scenic quality, recreational uses, and
special designations. Further, on lands open for development, the leasing of oil and gas
will be kept separate from the leasing of potash.
Public Land Initiative: Congressman Rob Bishop, the chairman of the U.S. House
subcommittee on public lands and environmental regulation, has spearheaded what is
known as the Public Lands Initiative, which involves drafting federal legislation aimed at
diminishing land use disputes and conflicts among various stakeholders, including
federal, state and local governments, environmental groups, sportsman groups, and
industry groups. While this initiative has been around since 2013, not until late last year
was a concrete proposal brought forward for consideration. The proposal involves land
in northeastern Utah, and would essentially involve a complex land swap of U.S. Forest
Service lands, state lands, and privately-owned lands that would result in the expansion
of existing federal wilderness areas, but with other federal acreage passing into the
ownership of the State of Utah and the County government. While the proposal has not
been presented as a bill in Congress at this time, there is a lot of support in Utah across
interests groups for resolving disputes through the Public Lands Initiative.
Wyoming:
 Despite nationwide struggles with BLM turn-around time for APDs – the WY Casper
Field Office, which has one of the highest volumes of APD’s, has had 45-day turnaround times recently. The CFO has been working with Operators and has made
recommendations to Operators for effective ways to decrease approval timelines for their
APD’s and it is paying off.
 There are rule modifications in process for Federal units regarding the continuous
development clause.
 The Wyoming Oil & Gas Commission (WOGCC) continues to be inundated with APD’s
from industry because of its rule providing that the first APD to be received by the
WOGCC from any WI owner will be the operator of the well. Any owner with even a
fraction of an acre in ownership, can apply for and will receive approval of an APD as
long as the owner is in compliance with all other State requirements for operatorship.
Therefore many operators are filing APD’s that they don’t intend to drill within the 1
year term of the APD, in order to protect operations within their own field.
4
Id.
4
Colorado, Kansas, New Mexico, Oklahoma & Texas:
 Lesser Prairie Chicken (LPC) (see attached Map for reference.)
o U. S. Fish & Wildlife Service (FWS) listed LPC as threatened on 5/12/2014 and
simultaneously issued an ESA 4(d) Special Rule providing oil and gas, and other
industries, exemption from ESA by enrolling in and complying with the Western
Association of Fish and Wildlife Agencies Range-wide Plan for the LPC
o Legislation to suspend or de-list the LPC did not pass. Environmental groups file
intent to file appeal to have LPC listed as endangered
o Litigation
 *States of OK, KS et al v FWS – Suit to overturn LPC listing, address 5 other
species, and negate “sue and settle” of the MDL Mega Settlement for > 250
species
 * Hutchison, NM Cattlegrowers et al v FWS – to overturn Threatened listing of
LPC and negate “sue and settle” of the MDL Mega Settlement for > 250 species
*2-5-2015 OK and Hutchison cases transferred from Tulsa, OK to Washington DC
under Multi District Litigation No. 2165, Judge Sullivan
 PBPA, NM counties Chaves, Eddy, Lea, Roosevelt v FWS (Midland, TX) – Suit
limited to overturn LPC listing, as violation of APA; hearing 2/24/15 on DOJ
motion to transfer venue to Tulsa, OK; if tried in Midland, decision expected
summer 2015 (the earliest for any of the cases).
 OIPA, API, IPAA, WEA et al v FWS (Tulsa, OK) – Suit like the PBPA case
 Defenders of Wildlife et al v FWS – Suit to list LPC as Endangered, not
Threatened; filed in Washington DC, then transferred to Tulsa, OK
o The outcome of these cases can build on the precedent that voluntary conservation
can prevent listing. Precedent was set by FWS decision not to list the Dunes
Sagebrush Lizard of NM and TX, and the court’s upholding that decision in suit filed
by Center for Biological Diversity et al v FWS (which they are now appealing), with
the oil and gas industry intervening on behalf of FWS. They could also strike a blow
against the “sue and settle” process of environmental activists and federal agencies.
Lesser Prairie Chicken Impacted Area Map
5
North Dakota, Montana, Wyoming, Colorado, Utah
Greater Sage-grouse (see following map)
A determination is expected regarding the listing status of the sage grouse by the
September 30, 2015. The U.S. Fish and Wildlife Service will rule on whether the greater
sage-grouse will be listed as an endangered or threatened species. The primary effected
habitat is centered in Wyoming. The plan area affects 11.6 Million acres of public lands
and 20 Million Acres of Federal Oil & Gas Minerals.
North Dakota/Montana:
 The BLM/Corps of Engineers is continuing to work on a new cadastral survey of the
Little Missouri River. Expect to have a portion of the survey completed by end 2014 with
mineral tracts being revised and entered into the TAAMS system throughout 2015.
 The MT Governor has signed a Sage Grouse initiative into law. The parties involved in
the Governor’s committee are hopeful that their plan will help to keep the Federal
government out of regulating the interaction between industry and the species.
N. Central US:
 Northern Long-Eared Bat:
The U.S. Fish and Wildlife Service is protecting the northern long-eared bat as a
threatened, but not an endangered, species under the Endangered Species Act (ESA),
primarily due to the threat posed by white-nose syndrome, a fungal disease that has
devastated many bat populations, effective 5/4/2015. The Service issued an interim
6

special rule that eliminates unnecessary regulatory requirements for landowners, land
managers, government agencies and others in the range of the northern long-eared bat.
The State of Michigan is trying to ban fracing statewide.
Eastern US/ PA:
 The BLM held a small lease sale on July 28, including 2 parcels in Arkansas, 3 in
Louisiana, and 34 in Michigan. The only notable bids were for two of the Louisiana
tracts: $1200/acre for a parcel in Caddo Parish, and $240/acre for a parcel in St. Mary
Parish. For its next lease sale, Eastern States is technically complying with the
requirement to hold quarterly sales by arranging to offer two parcels in Arkansas at the
upcoming lease sale by the New Mexico BLM office, on October 21.
 State of NY – a state court has ruled that individual towns have the authority to ban
development in their town.
 State of NY – the Governor has issued an order banning fracing statewide
 Moving forward with Resource Management Plan (RMP) for Southeastern States not
including MS and AL. Public meetings were held in Nov and Dec 2014. There is not a lot
of Federal surface but there is a significant amount of Federal Minerals. The BLM site for
Southeastern States contains a draft RMP and EIS, but the comment period has ended.
The Proposed RMP/Final EIS is due in the fall of 2015 and the Record of Decision is due
late 2016.
California:
 Background
The California BLM manages 15.2 million acres of surface and 47 million acres
of mineral estate in California. Every day more than 500,000 barrels of oil are produced
in California. As a state, California is the fourth largest oil producer. In 2014, only
Texas, North Dakota and Alaska produced more. Considering BLM administered leases
nationwide, California is the fourth largest producer.

Quick Facts
•
15.0 million barrels of oil produced annually
•
7.0 billion cubic feet of natural gas produced annually
•
565 leases on 217,313 acres
•
$176.4 million in royalties

BLM California Oil & Gas Strategy
The BLM’s comprehensive strategy for the federal oil and gas program in California
incorporates information from the Independent Science Review by the California Council
on Science and Technology (CCST); provides internal guidance for processing of
applications for permits to drill and sundry notices; and provides the results from public
scoping on oil and gas development in the Hollister Field Office.

California Lawsuit Seeks to Block Oil Drilling on Federal Land
The lawsuit was filed by Earthjustice on behalf of the Center for Biological Diversity and
Los Padres ForestWatch in U.S. District Court for the Central District of California,
challenging a plan to open large portions of federal land in central California to oil
drilling, saying it did not consider the impacts of fracing on the environment.
The lawsuit targets the Bureau of Land Management's (BLM) approval of a plan that
7
could lead to the leasing of 400,000 acres of public land and 1.2 million acres of
subsurface mineral estate in the state's most oil-rich regions.
Plaintiffs argue that the Bakersfield plan failed to consider what impact hydraulic
fracturing, or fracing, would have on air quality, water and wildlife, in violation of the
National Environmental Policy Act.

Lawsuits Versus BLM freezes Sale of Oil & Gas Leases.
Because of the pending lawsuits versus the BLM, there are no oil & gas leases that have
come on the market this year and there is no time-table for their release.

Governor Brown Declares State of Emergency as a Result of SANTA BARBARA
OIL SPILL
California Gov. Jerry Brown declared a state of emergency for Santa Barbara County
after an onshore pipeline burst, spewing thousands of gallons of crude oil into the Pacific
Ocean — blackening beaches and endangering West Coast wildlife. The area, a popular
camping spot some 20 miles from Santa Barbara, known for its palm-tree-lined seashore
and pristine surf, has been “closed indefinitely.”
A pipeline that carries oil from an onshore facility to refineries ruptured Tuesday, leaking
for hours into a culvert under a highway and into a storm drain that led to the ocean near
the Refugio State Beach. A control room operator noticed “abnormalities” in the line and
shut it down, according to the Los Angeles Times. Firefighters responded to reports of a
gasoline smell.
Texas-based oil company, Plains All American Pipeline, said up to 105,000 gallons of
crude oil may have leaked out — up to 21,000 gallons of which may have spilled into the
sea.
Nationwide:
 BLM Hydraulic Fracturing – UPDATE:
The US Department of the Interior Bureau of Land Management (BLM) recently
revised 43 CFR Part 3160; Oil and Gas; Hydraulic Fracturing on Federal and
Indian Lands. The rule's effective date was to be June 24, 2015. A copy of the official
release from the BLM regarding the revised Final Rule to Support Safe, Responsible
Hydraulic Fracturing Activities on Public and Tribal Lands is available. Let Roxie know
if you are interested in getting a copy.
The Independent Petroleum Association of America (IPAA), Western Energy
Alliance (WEA), the States of Wyoming, Colorado, and North Dakota filed
a preliminary injunction against the rule. BakerHostetler filed the suit in Wyoming
federal court on behalf of the IPAA and WEA. Wyoming U. S. District Court Judge
Skavdahl granted the government’s request for more time to file administrative record on
the hydraulic fracturing rule from its original June 24 start date because the government
had failed to provide the full administrative record from the nearly five-year rule-making
process, thereby preventing him from making a fully informed decision on a preliminary
injunction. The date for provision information has been moved from July 22 to August
28. Therefore it is thought that the implementation of the rule has now been pushed back
another month or so. If the judge denies the preliminary injunction, a new timetable
8
would be set by the BLM for compliance with the rule. If he rules in favor, the timeline
could be many months later, if at all.
 Senate Bill 2440 – BLM Permit Processing Improvement Act of 2014, which amends
Section 365 of the Energy Policy Act of 2005:
o Signed into law 12/19/2014 under National Defense Authorization Act for FY
2015
o Extends expiration of funding for additional BLM fulltime employees from FY
2015 to FY 2026
o Increases BLM APD fee to $9500 per application; inflation adjusted annually
o Fees to be used for processing of oil and gas use authorizations on federal lands
o At least 75% of the fees go to the state where they are generated
 The EPA is preparing a proposed federal regulation aimed at limiting methane gas
emissions by 40 to 45% in the next 10 years. This proposal is part of the Obama
administration’s Climate Action Plan to reduce greenhouse gases that contribute to global
warming and climate change. The proposed regulations will cut methane emissions from
new and modified natural gas wells, pipelines and other processing equipment. The EPA
rule would extend the requirement for so-called “green completions” to oil wells. In a
green completion, companies capture the gas that flows back from a well after it is frac’d.
Previous EPA standards only apply to gas wells. This could be very troublesome in an
area where pipelines do not exist. EPA officials estimated the regulations would cost
industry between $320 million and $420 million in 2025, but they say reduced health care
costs and other benefits total about $460 million to $550 million.
 An IM has been issued dated July 17, 2015 from the BLM regarding the Reengineered Communitization Agreement Approval Process, a copy of which is
attached. You will want to be sure your Land Department is aware of this IM as there are
many new instructions contained in the IM such as the submission of the CA at least 90
days before anticipated date of first production from a well or at the time of filing the
APD.
 The BLM is proposing revision to Onshore Order No. 3
(http://www.gpo.gov/fdsys/pkg/FR-2015-07-13/pdf/2015-16737.pdf)

Public Comment on this proposed rule change is being sought for 60 days, through
September 11, 2015.
It is important that we all be aware of these proposed changes because they will impact:
o Expansion of Federal APDs to Non-Federal Wells in Federal Units and CA’s
o National Designation of Facility Measurement Points
o National Standards for Commingling Approvals
o New Recordkeeping Requirements
o Administrative Burden Due to the Retroactive Effect on Existing Approvals and
Existing Facilities
o Immediate Assessments and Civil Penalties
The definition of the “Waters of the U.S.” will change on August 28 unless a federal
judge issues a preliminary injunction. This will give the EPA the authority to regulate the
water in your backyard! Thirty-one states, have filed motions with the federal courts to
block the EPA and the U.S. Army Corps of Engineers from enforcing the new “Waters of
the U.S.” rule, which represents a new interpretation of the Clean Water Act. Waters of
the U.S. was published in the Federal Register on June 29 and will become effective on
August 28. The Clean Water Act used to apply to “navigable waters”, but now,
according to attorneys filing suit, the new rule will “include almost any piece of land that
gets wet and puddles.”
9