American Oil and Gas Reporter - December 2016 - 98

all fellow oil and gas producers to stand
united as we begin the long road to repair
the damage done by this blatant federal
overreach," the Alliance declares. "From
wellhead to burner tip, the Texas Alliance

commits itself to demanding the use of
science, fact and due process from all
federal regulators during all federal regulatory actions and rule makings.
"We ask all Texans to join with us in

the effort to stand against misguided federal policies (and) assist us in working
with our new political leadership to repair
the damage that has been done," the Alliance resolution concludes.
r

Industry Rips USFWS Mitigation Policy
WASHINGTON-Several oil and gas
trade associations say they are just as interested as is the U.S. Fish & Wildlife
Service in improving conservation program
efficiencies, but they warn that the agency's
draft policy doesn't have the clarity, predictability or transparency it thinks it
does.
USFWS released a proposed mitigation
policy in March and unveiled its draft
compensatory mitigation policy six months
later (see "USFWS Releases Mitigation
Guidelines," AOGR, October 2016). The
agency says the second proposal will
allow it to effectively and sustainably
protect endangered or threatened species
while allowing continued economic activity.
The proposed policy's guiding principles include ensuring that, at a minimum,
an action results in no net loss toward
achieving conservation outcomes for resources, or provides a net benefit in conservation outcomes, whenever the situation
merits and doing so is allowed by law,
the agency states.
The policy's most significant feature
is moving the agency from project-byproject mitigation to strategic mitigation
planning at the landscape level, USFWS
says. The proposal expands coverage to
all compensatory mechanisms: permittee-responsible mitigation, conservation
banking, in-lieu fee programs, habitat
credit exchanges, and other third-party
mitigation arrangements.
The American Petroleum Institute,
American Exploration & Production Council, Independent Petroleum Association
of America, International Association of
Geophysical Contractors, and Western
Energy Alliance say they share the
agency's interest in improving the efficiency of conservation programs under
the Endangered Species Act.
"However, we are concerned that the
draft compensatory mitigation policy will
not bring forth the clarity, predictability,
or transparency that the service anticipates," they write. "Indeed, we believe
the draft policy . . . is too complex, would
only deter participants from engaging in
compensatory mitigation, and would make
the service's approach to mitigation more
costly, burdensome, opaque, and unpredictable."
98 THE AMERICAN OIL & GAS REPORTER

Key elements of the compensatory
mitigation policy violate multiple statutes
and regulations, the industry groups allege,
pointing to the no net loss/net gain requirements, mitigation ratios and advance
mitigation requirements, and definition
of "at-risk" species as violating federal
environmental and wildlife statutes and
policies.
"The procedures by which USFWS is
promulgating the compensatory mitigation
policy are impermissible," the comments
state. "The draft policy is impermissible
because it cannot be credibly construed
as a mere policy statement or simply
guidance to service personnel. It is a proposed rule that, if finalized, would change
fundamentally the service's compensatory
mitigation requirements, create substantive
new obligations, and expand the jurisdiction of USFWS through interpretations
of numerous statutes."
Compensatory Mitigation
In the draft policy, published in the
Sept. 2 Federal Register, USFWS says it
defines compensatory mitigation as compensation for remaining unavoidable impacts after all appropriate and practicable
avoidance and minimization measures
have been applied, by replacing or providing substitute resources or environments
through restoring, establishing, enhancing,
or preserving resources.
The draft policy encourages USFWS
offices to work with federal agencies and
other entities to establish compensatory
mitigation programs based on landscapescale conservation plans. It encourages
using market-based compensatory mitigation programs, such as conservation
banking, in conjunction with plans designed to achieve a no-net loss or net
gain mitigation goal.
"Taking a landscape approach to mitigation will assist the service to modernize
our compensatory mitigation procedures
and practices, and will better meet the
challenges posed by the growing human
population's demands on our natural resources and changing conditions, such
as those resulting from climate change,"
the draft policy states.
USFWS admits its authority to require
compensatory mitigation under ESA is
limited, and its authority to require a net

gain in listed or at-risk species has little
or no application under the act. However,
it maintains it can recommend using compensatory mitigation to offset the impacts
of actions under ESA as well as other
authorities, including the Fish and Wildlife
Coordination Act and National Environmental Policy Act. The service points
out such recommendations are consistent
with presidential guidance, the Department
of Interior's proposed mitigation planning
goals, and the ESA itself.
The agency says compensatory mitigation must provide benefits beyond those
occurring through routine or required
practices or obligations needed to satisfy
legal or contractual agreements. A compensatory mitigation measure is "additional" when its benefits improve on the
base-line conditions of the impacted resources in a demonstrably new way, and
which would not have occurred without
the compensatory mitigation measure,
USFWS adds. Those additional benefits
may result from:
* Restoring or enhancing habitat;
* Preserving habitat that lacks adequate protection; or
* Using management actions that
protect, maintain, or create habitat.
"Base-line conditions for the habitat
relevant to the species must be assessed
prior to implementing the compensatory
mitigation project for comparison with
conditions after completion of the compensatory mitigation project in order to
quantify and verify the additional benefits
derived from the mitigation project," USFWS says.
Industry Push Back
Citing oil and gas company participation in compensatory mitigation programs,
the industry groups recommend USFWS
allow stakeholders to use all tools in the
conservation toolbox, and not use the
draft policy to favor specific mitigation
instruments.
"The adverse policy outcomes that
would result from this draft policy are
the unfortunate product of the service's
attempt to exercise authority beyond what
Congress has conferred through the ESA
or any other statute," the groups say.
"Under the draft policy, compensatory
mitigation will be required in contexts in



American Oil and Gas Reporter - December 2016

Table of Contents for the Digital Edition of American Oil and Gas Reporter - December 2016

Contents
American Oil and Gas Reporter - December 2016 - Cover1
American Oil and Gas Reporter - December 2016 - Cover2
American Oil and Gas Reporter - December 2016 - Contents
American Oil and Gas Reporter - December 2016 - 4
American Oil and Gas Reporter - December 2016 - 5
American Oil and Gas Reporter - December 2016 - 6
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