Buffalo, WY

Reaching an Agreement:  Luck of the Draw

By Pete Dube

My wife and I own an outfitting business in Buffalo, Wyoming, and about six years ago we bought 5,000 acres in Campbell County as a place to run cows and winter the horses we use for outfitting. The bulk of the minerals under our land are owned by the Federal Bureau of Land Management (BLM).

My experience with coalbed methane was a two-year nightmare of negotiations. CMS, one of the biggest coalbed methane "players" in the Powder River Basin, approached us with a proposal to develop the southwest corner of our land. The company asked us to sign a surface use agreement that was one and one-half pages long. I came back with a more detailed agreement that would have required the company to prepare a water discharge plan prior to drilling, only use existing two track roads, bury all electrical lines, and monitor our two water wells. It took me more than two years to reach an agreement with the company, and I spent at least $5,000 in lawyer's fees.

Then I discovered methane gas seeping up the side of my stock well. I was forced to dismantle the well cover to relieve the pressure of the venting gas, and the pipes to my stock tank froze. Finally CMS responded by fencing off the well and posting the enclosure with danger signs.

My well problems coincided exactly with coalbed methane drilling by CMS on a neighbor's property, but the company initially refused to take responsibility. They were trying to tell me it was just a coincidence, and that my well had been improperly drilled. What irks me is you have to be the one to prove the company caused the problem. The company finally installed a new pump, and solved the problem.

It's kind of the luck of the draw whether or not you can reach a good surface use agreement with a company. If you get a rancher friendly company, you might get along alright; if you get one that's not, you're in for a fight. If an agreement is not reached all the company has to do is post a bond to cover capping the gas wells and they can come on your property.

If I had the mineral rights there would be no development on this land. I don't blame my neighbors for wanting to make some money on this. That's their business. But for me, this is not about money. This is the only ranch I've got. I was out riding and looked down at what's happening to the country, and I thought this must be how the Indians felt when they saw the covered wagons coming.

There goes the neighborhood.