Panel looks at coal-bed proposal

Members of the Flathead Basin Commission struggled Wednesday to understand how coal-bed methane development in the Canadian Flathead drainage could unfold in years to come.

David Grace, a liaison to the commission from British Columbia's Ministry of Environment, answered as many questions as he could at the commission's meeting in West Glacier. But often, Grace explained that British Petroleum's proposal for exploration will be not be handled by his agency; rather, the regulatory process will be "negotiated" with British Columbia's Oil and Gas Commission.

It will be an entirely different process from the one being pursued by the Cline Mining Corp. for an open-pit coal mine in the headwaters of the Canadian Flathead, said Brace Hayden, Glacier National Park's regional issues specialist.

And most importantly, Hayden said, it will be a regulatory process different from those applied in the United States and Montana.

Cline Mining Corp. had to develop draft "terms of reference" - conditions that the company must follow in developing its mine site above Foisey Creek. The draft terms were followed by a public comment period that attracted hundreds of comments, mostly negative. Cline is currently revising its draft and no activity is expected at the site this year.

Hayden and others at the meeting said BP is working to negotiate a "tenure" lease agreement with the province, possibly as soon as August. Once that agreement's in place, the company could begin its appraisal for coal gas in the Elk River Valley and the upper reaches of the Flathead Basin.

"I think it's very important the U.S. agencies weigh in on it right now," Hayden said, "because it's a negotiation process between the company and the oil and gas commission."

Grace said the negotiations would also involve Canadian First Nations, or Indian tribes.

BP described its plans in a letter to Montana Gov. Brian Schweitzer last month.

"Our project is in the very early appraisal stage, which is expected to last three to five years at a cost of approximately $100 million," the letter said. "During this stage, we will conduct comprehensive public consultation, technical and commercial appraisals, and a company-mandate environmental and social impact assessment, including environmental baseline studies and ongoing monitoring."

The "public consultation" got underway June 14, with BP officials hosting a stakeholders open house in Fernie, B.C.

Hayden came away from the meeting with a distinct impression that the company's "appraisal stage" includes exploratory drilling, a process that involves building road access for a 10-acre drilling clearing to accommodate as many as 10 methane wells. At the same time, the company would conduct its environmental assessment.

"The gentleman from BP who I spoke with the other day made it clear that it will be a concurrent process: They will be collecting baseline data while they are drilling exploratory wells," Hayden said.

Ric Hauer, a leading professor with the University of Montana's Yellow Bay Biological Station, told the commission that it is "just not possible" to collect baseline environmental data from a pristine area while exploratory development is under way in that area.

Hauer has been involved in a two-year Montana effort to inventory current ecological conditions in the Canadian Flathead Basin and downstream in Montana's North Fork Flathead River.

"If they move forward," he said, referring to BP, "it's going to compromise all the baseline work in British Columbia and Montana."

Hayden and others express some frustration that environmental work is left to the proposing companies in Canada, rather than provincial agencies.

"We need an environmental analysis that assesses impacts in Montana," said Art Compton, a member of the basin commission.

Montanans involved in the baseline research are convinced that open-pit coal mining or coal methane development will have downstream impacts on fisheries and water quality, as well as impacts on grizzly bears and other wildlife that use the drainage north and south of the border.

Grace, the commission's BC liaison, was asked whether the province has a policies regarding the huge volumes of wastewater that coal-bed methane wells produce.

"By policy, we wouldn't allow surface discharge" of the wastewater, Grace said.

The alternative, applied in other coal-bed methane production in other areas, is to re-inject wastewater into the ground.

Erin Sexton, who has been leading water quality research in the Canadian Flathead for the UM Biological Station, asked how that policy applied to an existing coal bed methane exploration project that is discharging wastewater directly into British Columbia rivers.

"There is a company that is actively discharging wastewater into the Elk and Fording Rivers as we speak," Sexton said.

Grace could not explain the conflict between the provincial policy and that project.

Sexton and members of the basin commission are doubtful that reinjection would be effective in the broad and porous floodplain of the Canadian Flathead.

"Southeastern BC is loaded with water below and above the ground," she said, predicting that injected wastewater would rapidly return to the surface.

Hayden contends that BP's exploration development is "imminent."

"Just judging by the amount of resources they are throwing into their (public relations) effort, they are serious," he said, referring to the recent stakeholders meeting and contacts with Schweitzer's office. "And the Canadian regulatory processes are very different from the ones we have here. A lot of times, they get what they want incrementally."

Reporter Jim Mann may be reached at 758-4407 or by e-mail at jmann@dailyinterlake.com