Audubon, drillers: an unlikely alliance?

Opening Rainey sanctuary to gas development would finance marsh restoration

BY STEVE QUINN FOR GREENING OF OIL

How is this for an unlikely alliance? The oil and gas industry teaming up with the National Audubon Society for exploration and production along Louisiana’s Gulf Coast.

It’s not that farfetched at the Audubon’s Paul J. Rainey Sanctuary in southwestern Louisiana, where the Audubon is reviewing such an option to re-open the refuge to natural gas development. At more than twice the size of Manhattan, Rainey is the organization’s largest sanctuary.

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Money earned from natural gas leasing and production would finance marsh restoration and other construction projects that the group cannot afford without additional revenue.

There are no deals on the table and the preservation group insists granting access to the 26,000 acre spread is not a sellout to the oil and gas industry.

The organization is simply looking at some options that its neighbors—private landowners—are already doing by leasing land for natural gas production, the cleanest fossil fuel.

“This is still speculative,” said Roger Still, vice president of Mississippi River programs of National Audubon Society. “We are committed to large-scale restoration of the coast, but we don’t have those revenues in hand.”

The Rainey sanctuary is “one of the best managed properties in the United States,” Still said. “We are looking at the implications of oil and gas exploration; not only do we make a difference on our property but in the larger context of coastal Louisiana.”

Study produced three options

Established in 1924, the Rainey sanctuary is in Perry, La., and sits at the end of the Intracoastal Water way and Vermillion Bay, west of New Orleans in Vermillion Parish.

It’s a place thousands of migratory birds use as a resting place when going south for the winter, as well as home to deer, muskrat and otter.

The Audubon commissioned a study that presented the group with three options to consider for the sanctuary, Still said.

They are:

• Adhere to the standing policy and not allow any new oil and gas development anywhere on the property.
• Allow oil and gas development on the gas-prone acreage, carefully monitoring activity and the environmental footprint it leaves.
• Sell oil and gas rights with the stipulation that drill sites must be located outside the sanctuary, employing relatively new horizontal drilling technology that can drill sideways a few miles to reach pockets of oil and gas beneath environmentally sensitive sites. Multiple horizontal, or directional, wells can be drilled from one drill site, also known as a drilling pad.

Thus, horizontal drilling, which is widely used by the oil and gas industry, reduces the environmental impact of exploration and production and—if the distances are not too great—can also reduce the cost of both.

Audubon looking to understand development, best practices

“What we are trying to do is understand the context of the development and what the best practices might be,” Still said. “Then we’ll need to make a decision about what we want to do.”

Any development in Rainey sanctuary would have to entail mutual trust and significant compromise, perhaps even a break from traditional stances and exceeding state and federal regulations, said Denise Reed, a coastal scientist from the University of New Orleans.

“Both sides will be demonstrating the art of the impossible,” she said. “On the industry side, it’s can we can do this in an environmentally friendly way. What kind of compromises might we make from the business side; what kinds of flexibility might we give on the environmental side.

“The Audubon Society has a lot to lose if this goes wrong. The oil company has potential large costs to bear relative to any additional practices that are not the usual way of doing things.”

The prospects of an agreement should not be a great surprise said Bill Walsh, a spokesman for the American Petroleum Institute.

He cited projects where the industry helped establish turtle sanctuaries in Malaysia, protecting coral reefs in the Gulf of Mexico and restoring lynx habitat in Spain as examples of the industry considering the environment.

“The industry works hard to be a good steward of the environment, employing a whole range of advanced technologies,” he said. “Oil and natural gas are found and produced with minimal disruption to the ecosystem. Some of the revenues flowing out of development then go back into projects producing environmental benefits in the same location or elsewhere.”

The Gulf Coast is rich in resource development with the sanctuary’s neighboring property owners seeking royalty agreements—almost a grabbing of low-hanging fruit—offered from the industry. 

Not first time: Gas produced from Rainey for nearly 50 years

As for the Paul J. Rainey Sanctuary, it wouldn’t be the first natural gas drilling and production within its borders.

Gas development ran nearly five decades, yielding millions for the National Audubon Society. That lasted until 1999 when the leases expired.

Now with horizontal drilling technology in play, natural gas can be extracted from beneath portions of the sanctuary once considered too sensitive to tap, potentially providing the society with the money it needs to repair the marshes damaged by Hurricane Rita.

“We need to understand what’s going on and we have to protect ourselves, protect the refuge, protect Audubon,” said Paul G. Kemp, director of the Audubon’s Gulf Coast Initiative.

Additionally, he said, if gas production means reaping financial dividends in a way that is safe to the sanctuary, it warrants consideration.

“Theoretically, we could have minerals taken out from under our property; it’s not smart to keep our eyes closed.”

Kemp cited an explosion on property being developed near the sanctuary as a reason for needing to understand development outside the boundaries.

“It was only a couple thousand feet off the property line a few years ago,” he said. “We were fortunate that they hit a steam pocket rather than a gas pocket.

“It didn’t cause any serious damage, but it was an eye-opener for us. Our boundaries are important, but the habitat really extends well beyond our boundaries.”

Reed said both sides must understand any potential agreement is “about making things work beyond the regulatory environment.

“If these two groups can come together it will be borne out of developing the right plan for that piece of land and for those prospects,” she said.

“I would suggest they go beyond regulatory requirements; it could be worth it,” she said, “but it would have to be a business decision the company would have to make.”

Links of interest

National Audubon Society’s Louisiana Coastline Initiative

National Audubon Society Home page

Contact Steve Quinn at squinn@gmail.com