PDR group looks at balancing conservation easements, oil and gas exploration
December 9, 2011
3 more easements
In addition to the Camilletti and Sons easement approved by the county this week, there were three more:
■ Finger Rock will preserve 365 acres visible from Colorado Highway 131. Connected to a wetland mitigation bank approved by the Army Corps of Engineers, the new easement allows the owner to conserve 620 acres rather than contemplating future home development (one home site is on the land). PDR funding: $450,000 (48.6 percent) with the owner contributing 51.4 percent of the easement value.
■ Pankey Ranch on the border of Routt and Moffat counties. Preserves 634 acres with a PDR contribution of $575,000 (56.5 percent) against a contribution by the owners of 43.5 percent of the appraised value.
■ Redmond Ranch in South Routt. PDR funds of $328,000, or 49.9 percent of the total appraised value of $655,500.
Steamboat Springs — Leaders of Routt County's Purchase of Development Rights program plan to ask county residents how they feel about pursuing conservation easements on properties that have the potential to become the site of new oil and gas wells.
"In the new year, the PDR board will solicit public comment as it starts its planning" for future conservation easements, PDR board member Claire Sollars confirmed last week.
Her comments came minutes after the Routt County Board of Commissioners voted to approve spending $2.1 million in dedicated property taxes to help place conservation easements on four rural parcels — two in South Routt and two in West Routt. Those transactions had not closed as of Tuesday and are not final until they do.
Geoff Blakeslee, Yampa River project director for The Nature Conservancy, said this week that there is an existing oil well lease on one of the four parcels approved by the commissioners for PDR funding.
The Nature Conservancy will hold the conservation easement on that parcel, a piece of the Camilletti Ranch that borders the Yampa River west of Milner.
"We did approve a surface use agreement with the lessee, which is Quicksilver (Resources)," Blakeslee said. "They agreed to leave the majority of the eased property untouched. We identified a 20-acre parcel and a 5-acre portion within that" where surface disturbance would take place if a well is drilled on the site someday.
Blakeslee was careful to say that it is not the role of The Nature Conservancy to negotiate the surface-use agreement; that was the role of ranch owner Ed Camilletti. However, The Nature Conservancy was able to influence the terms in discussions about the conservation easement. He added that the lease (different from the surface-use agreement) had been consummated before the conservation easement was contemplated. He added that in this case, the surface land rights are not severed from the mineral rights, meaning the ranch owner controls both.
The PDR program is funded by a 1.5-mill property tax that was reapproved by voters in 2006, nine years after the program originally was approved for a 10-year period. The 2006 renewal is good for 20 years.
The 437 acres identified as Camilletti and Sons Inc. involves a family ranch that supports aquatic and bird species. The land is visible from U.S. Highway 40 west of Steamboat Springs where the Yampa River parallels the highway, according to a memo to the county commissioners from the PDR Advisory Board.
Blakeslee said the identified well pad site would be on a hillside to the south and above the river bottom at a distance of about a half-mile from the river itself.
An appraiser placed the value of the conservation easement at $2.185 million, an increase from the preliminary valuation of $1.935 million, according to county documents. In addition to the PDR program's contribution of $750,000 (34.3 percent of the value) toward the easement, the Farm and Ranchland Protection Program contributed $450,000 (20.6 percent). The property owners contributed $985,000, or 45.1 percent of the appraised value.
Not the 1st
The Camilletti Ranch is potentially the second site where Fort Worth, Texas-based Quicksilver Resources, with an office in Steamboat, would drill on a conserved parcel secured by PDR funds.
Quicksilver has drilled the Pirtlaw Well about eight miles west on Wolf Mountain where another The Nature Conservancy easement is in place on a sagebrush- and grass-covered mountainside that contains Columbian sharp-tailed grouse mating leks as well as highly productive elk habitat.
Commissioners Doug Monger and Diane Mitsch Bush voted to approve the permit for Sunterra to drill the well. Commissioner Nancy Stahoviak was recuperating from an automobile accident and did not cast a vote. Sunterra subsequently sold the approved well to Quicksilver.
The energy company was required by the terms of its approval from Routt County to abstain from drilling during grouse mating and chick-rearing activity from March through July.
Brent Romick, who represents Wolf Mountain owner Bob Waltrip, said the energy exploration activity so far is co-existing successfully with the conservation goals of the ranch.
The well was approved by the county commissioners and drilled about six miles northeast of Hayden and six-tenths of a mile from a lek, or courtship ground, used by the struggling Columbian sharp tailed grouse. The 3-acre well site is within the boundaries of a 1,757-acre conservation easement on Wolf Mountain Ranch.
The permit from Routt County was issued in February to another company, Sunterra, which subsequently sold it to Quicksilver.
Monger said in February that county regulations don't provide for treating conservation easements differently from other land in the county when it comes to approving oil and gas wells.
"I don't believe our zoning regulations put conserved lands any higher than non-conserved lands," Monger said. "We have a letter from The Nature Conservancy's land conservation project director Jennifer Herrington suggesting we give this property additional protection. I don't believe our current land-use regulations allow us to do that."
Blakeslee said at the time that the plight of the sharp-tailed grouse makes this conservation easement important. He said his research confirmed that the birds have lost 90 percent of their historic range and that in Colorado, they are confined to Routt, Moffat and Rio Blanco counties.
"These easements are special and we think they deserve special consideration," Blakeslee said. "It's our responsibility to protect their conservation values. We're willing to work with industry in this case to limit impacts."
This week, Blakeslee said the desirability of wildlife habitat along the Yampa on the Camilletti Ranch made it worth working out the terms of the conservation easement.
However, he added that The Nature Conservancy is having discussions at the state and national levels about how to approach similar easements in the future.
"There may be some circumstance when we think the potential for damage is too great," Blakeslee said. "We're discussing that intently right now."
To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com