So what do you get when you put an environmentalist, an oil and gas official, a farmer and a consultant for energy and agriculture in the same room?

Several things come to mind, including the possibility of fisticuffs, EMTs and bail bondsmen.

The reality, however, may be much less entertaining but significantly more productive.

David Wolfe, with the Environmental Defense Fund, says putting stakeholders together to discuss issues and look for sometimes elusive common ground sometimes pays off with solutions that produce, “positive, sustainable outcomes” that benefit wildlife, farmers and ranchers and the energy industry.

Wolfe took part in a panel discussion at the Southwest Ag Issues Summit in Oklahoma City. Joining him on the panel were Steve Manning, a consultant with Natural Resources Solutions; Jim Sipes, a Kansas farmer and representative of the Kansas Farm Bureau; and Linda McDonald, Sand Ridge Energy. Shawn Wade, Plains Cotton Growers Inc., moderated the panel, which concentrated on a habitat exchange program proposed to protect habitat for the Lesser Prairie Chicken. Across the five states—Colorado, Kansas, Oklahoma, New Mexico and Texas— included in the Lesser Prairie Chicken range, 20 million acres are considered habitat.

 

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The exchange program, in a nutshell, would allow farmers, ranchers and other landowners with land in the prairie chicken’s native habitat, to submit bids to set aside acreage to preserve habitat as mitigation for energy companies who disturb habitat with drilling. Energy companies would pay farmers and ranchers an annual fee per acre to set aside habitat.

“It’s a way to take a liability and turn it into an opportunity,” Manning said.

“It’s a market-based solution,” Wolfe added. Conservation programs are “most effective when they include incentive-based solutions. It’s better for wildlife, private landowners and energy.”

Energy companies have to find means to mitigate environmental impacts of drilling operations. This proposal provides “tools for mitigation. It has weaknesses. It doesn’t provide an opportunity for mitigation offsets.”

Wolfe also noted that to be successful a large number of landowners would have to cooperate to provide necessary habitat for the Lesser Prairie Chicken. “The habitat exchange program is voluntary for farmers and ranchers who would provide credits for energy companies. It will have to be financially competitive to be successful.”

“If we have a five-acre (drill site), we have to get mitigation before we can drill,” said McDonald. With oil and gas drilling, energy companies are affecting private land, not federal acreage, she said. “We work with private land owners to develop habitat for the prairie chicken, and we can’t expect them to do that for free.”

Fees paid by energy

Energy companies will bear the brunt of the cost for mitigation though any company or individual that alters Lesser Prairie Chicken habitat will be subject to mitigation. Anything that takes habitat would provide funding for mitigation. That would include wind farms or anyone who puts up a building on prairie chicken habitat. But the plan is not designed to have agriculture bear much of the cost, and agriculture offers a good place to provide credits for energy companies.

Sipes says this program “benefits stakeholders. That’s the power of the plan. It’s a private plan and is more readily accepted and it provides for confidentiality. It’s also market driven. If it does not attract enough acres, the price goes up.”

The program “has to work for agriculture or landowners will not sign up for it.” It’s also good for industry and the communities that rely on oil and natural gas for economic survival. “Some plans call for energy avoidance; this plan works for the energy industry.”

The issue came to a head recently following a lawsuit from environmental groups claiming that the U.S. Fish and Wildlife Service was moving too slowly in listing endangered and threatened species, as mandated by the Endangered Species Act. That lawsuit resulted in “a massive settlement,” Manning said, “and put 900 species moving their way through the process of being listed as endangered or threatened.” The Lesser Prairie Chicken had been of concern since 1998. “Now it’s on the fast track to be listed as threatened or endangered, possibly as early as March, 2014. And it affects private land. Agricultural producers and oil and gas will be affected and this is only the beginning.”

ESA changes

“Changes in how Fish and Wildlife lists endangered species has changed,” Wade said, “and agriculture now is likely to be affected by the Endangered Species Act. The Lesser Prairie Chicken is an example.”

Manning said the Endangered Species Act was enacted 40 years ago but until recent lawsuits did not affect private lands as much as federal holdings. That has changed.

“I’ve had a little experience with the Endangered Species Act,” said Sipes. He cited an issue in Kansas with a shiner (small minnow) that was proposed to be protected “in a dry river bed. We got the listing removed from that area but it took an effort. The U.S. government doesn’t always make sense.”

He and McDonald would like to see changes made in the way the U.S. Fish and Wildlife Service determines what species should be listed and on what properties. “They will not consider the economic impact,” he said. “They will consider a challenge to their science, but we don’t have biologists to challenge their science.”

Maybe industry should hire some, said McDonald. “I believe more research and science would be helpful. I think science is on our side. Currently, (Fish and Wildlife) makes decision based on ‘best science available,’ even if it goes back to 1930.”

She says industry needs “a system in place that’s sustainable over time. We need metrics to measure across the range of habitat, and we need to pull together a science committee from agriculture, oil, academia, environmental organizations and state agencies—a broad group of scientists—to work out differences and develop a product that addresses all concerns.”

She said her company drills more than 100 wells a year in the habitat range. “Consultation over one well takes a month and that limits our ability to produce energy. We can’t spend the huge amount of time on each new well or each new species listed. We have to develop a product that works.”

Sipes said the system needs a means of “de-listing” a species after it recovers. “And we need consideration of economic impact.” He said state plans failed because “they did not need our help in developing them.”

The proposed system would work similar to the Conservation Reserve Program but likely will offer more per acre. “As a benchmark, we would start at about $50 per acre,” Manning said. “We think we have a positive message and are creating another revenue source, but it has to be competitive.”

“This is an incentive-based solution,” Wolfe said. “We needed agriculture and industry at the table. The numbers of agriculture and industry stakeholders is huge. This proposal could serve as a model for other species.”

Work remains to be done. “No plans have yet been approved by U.S. Fish and Wildlife Service,” Wade said. “Final listing decision is delayed until March 2014. State's plan has been submitted for consideration; the Stakeholder plan that was discussed at the (Summit) is being finalized and will hopefully be able to be considered in near future.”

 

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