The U.S. Fish and Wildlife Service (Service) yesterday announced a proposed update to its regulations for oil and gas development in wildlife refuges. The proposed rule, which will be published in the Federal Register today, covers any development of mineral resources owned by private parties, states or tribal entities where the surface estate is administered by the Service as part of the National Wildlife Refuge System. The rule does not apply to federally owned minerals in refuges, which remain off limits to development. This is the first update of the existing regulations governing oil and gas development on refuge system lands in more than 50 years. The Service simultaneously published a Draft Environmental Impact Statement for public review and comment. Comments on both documents are due on February 9.

New Permitting Process

The proposed rule includes a requirement that operators obtain a permit (special use permit or right of way) from the Service before beginning any new operations. Existing operations will be allowed to continue, but any modification that would result in additional impacts on refuge resources would require a permit. In addition, all operators will have to acquire a permit for plugging of existing wells and reclamation of existing production sites in wildlife refuges. As an incentive for siting drilling operations outside refuges, the rule expressly exempts directional wells drilled on non-Federal lands to access non-Federal minerals.

Performance-Based Operating Standards

The proposed rule also includes new performance-based operating standards aimed at avoiding or minimizing impacts to refuge resources to the maximum extent practicable, while allowing operators flexibility to apply the methods and technological innovations they deem most appropriate. In addition, the proposed rule requires operators to provide financial assurance (bonding), proof of liability insurance, and pay access fees to the Service for any new access of refuge lands required as part of an operation.

Enforcement and Penalties

Finally, the proposed rule clarifies the various enforcement actions available to the Service if an operator fails to comply with the terms and conditions of its permit or conducts operations without an authorization by the Service. Penalties would include fines, imprisonment and/or suspension or revocation of the right to operate.
This rule is consistent with the recently published proposed rule governing oil and gas development on National Park System lands. It responds to recommendations of the Government Accountability Office reports from 2003 and 2007 (GAO-03-517 and GAO-07-829R), which highlighted opportunities to improve Service oversight of oil and gas operations in wildlife refuges.