National Wildlife Refuges: Opportunities to Improve the Management and Oversight of Oil and Gas Activities on Federal Lands
Published: 2003-08-28T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The 95-million acre National Wildlife Refuge System contains federal lands devoted to the conservation and management of fish, wildlife, and plant resources. While the federal government owns the surface lands in the system, in many cases private parties own the subsurface mineral rights and have the legal authority to explore for and extract oil and gas. GAO was asked to determine the extent of oil and gas activity on refuges, identify the environmental effects, and assess the Fish and Wildlife Service's management and oversight of oil and gas activities.
section_title: What GAO Found
paragraphs: About one-quarter (155 of 575) of all refuges have past or present oil and gas activity, some dating to at least the 1920s. Activities range from exploration to drilling and production to pipelines transiting refuge lands. One hundred five refuges contain a total of 4,406 oil and gas wells--2,600 inactive wells and 1,806 active wells. The 1,806 wells, located at 36 refuges and many around the Gulf Coast, produced oil and gas valued at $880 million during the last 12 month reporting period, roughly 1 percent of domestic production. Thirty-five refuges contain only pipelines. The Fish and Wildlife Service has not assessed the cumulative environmental effects of oil and gas activities on refuges. Available studies, anecdotal information, and GAO's observations show that the environmental effects of oil and gas activities vary from negligible, such as from buried pipelines, to substantial, such as from large oil spills or from large-scale infrastructure. These effects also vary from the temporary to the longer term. Some of the most detrimental effects of oil and gas activities have been reduced through environmental laws and improved practices and technology. Moreover, oil and gas operators have taken steps, in some cases voluntarily, to reverse damages resulting from oil and gas activities. Federal management and oversight of oil and gas activities varies widely among refuges--some refuges take extensive measures, while others exercise little control or enforcement. GAO found that this variation occurs because of differences in authority to oversee private mineral rights and because refuge managers lack enough guidance, resources, and training to properly manage and oversee oil and gas activities. Greater attention to oil and gas activities by the Fish and Wildlife Service would increase its understanding of associated environmental effects and contribute to more consistent use of practices and technologies that protect refuge resources.

section_title: Letter
paragraphs: The mission of the National Wildlife Refuge System, as expressed in its  governing legislation, is to “administer a national network of lands and  waters for the conservation, management, and where appropriate,  restoration of the fish, wildlife, and plant resources and their habitats  within the United States for the benefit of present and future generations  of Americans.” The system is unique in that the 95 million acres of land in  the system are the only federal lands managed primarily for the benefit  of wildlife, providing habitat for native plants and animals, including  endangered or threatened species, as well as important way points for  migrating species, such as ducks, cranes, and eagles. The system, which  represents more than 14 percent of all federal lands and has a presence  in every state, is administered by the Department of the Interior’s Fish  and Wildlife Service and includes both land that has always been federally  owned and land that has been acquired from others. While the federal  government owns almost all the surface lands in the system, in many  cases the federal government does not own the subsurface mineral rights.  Subject to some restriction, owners of subsurface mineral rights have the  legal authority to explore for mineral resources such as oil and gas and,  if such resources are found, to extract them.
In October 2001, we reported that the Fish and Wildlife Service recognized  some type of oil and gas activity on 77 of the 567 refuges and wetland  management districts within the National Wildlife Refuge System in calendar year 2000. However, our report recognized that this accounting  of activities might be incomplete because the data were based on refuges’  self-reporting. Therefore, to gain a more complete assessment of oil and  gas activities, you asked us to (1) determine the nature and full extent of  oil and gas activities in the National Wildlife Refuge System, (2) identify  environmental effects of oil and gas activities on refuge resources, and  (3) assess the Fish and Wildlife Service’s management and oversight of  these activities.
Our updated information on the extent of past and present oil and gas  activities within current wildlife refuge boundaries is based on a variety of  sources. Using national geographic information databases, we determined  how many documented oil and gas wells and transit pipelines were located  within or immediately proximate to refuge boundaries. We also used  Fish and Wildlife Service records to identify other evidence of oil and  gas activities. Premier Data Services, a firm with extensive experience in  computer-based geographic information systems and oil and gas leasing,  aided our data acquisition and analysis (see app. IV). Our analysis is more  extensive than any undertaken by the Fish and Wildlife Service or the  Department of the Interior, and at their request, we are providing our  database to them for future use.
We visited 16 refuges, representing a range of type and scale of oil and gas  activities and environmental effects. At each refuge, we asked the refuge  manager to describe the range of environmental effects of these oil and gas  activities, obtained any available studies of the effects, and visited selected  locations of oil and gas activity to observe actual conditions.
To assess the authority of the Fish and Wildlife Service to manage and  oversee oil and gas activities on refuges, we obtained information from the  Department of the Interior’s Office of the Solicitor and reviewed the laws  and regulations pertaining to the Fish and Wildlife Service and other  federal land management agencies and recent court cases concerning  private mineral rights on federal lands. To assess the Fish and Wildlife  Service’s management and oversight of oil and gas activities, we obtained  information on policy, guidance, and practices from headquarters and the  7 regional offices and documented the actual practices in use at the  16 refuges we visited.
subsections: section_title: Background
paragraphs: The refuge system comprises 538 refuges, 37 wetland management districts  (an administrative system of thousands of Waterfowl Production Areas and  conservation easements, primarily in the north central United States), and  50 coordination areas. The Fish and Wildlife Service (FWS) owns the  surface lands and, in some cases, the mineral rights of National Wildlife  Refuges and Waterfowl Production Areas, while conservation easements  and coordination areas are owned or managed by others. Day-to-day  management of wildlife refuges is the responsibility of local refuge  managers, subject to the direction of seven regional refuge chiefs and  the Chief of the National Wildlife Refuge System (see fig. 1 for a map of  FWS regions). Of FWS’s nearly $1.3 billion budget in fiscal year 2002,  about $319 million was devoted to the operations and maintenance of the  refuge system. In fiscal year 2002, $99.13 million from the Land and Water  Conservation Fund was used for the acquisition of additional refuge lands.
Over the years, we and others have examined the effects on the refuge  system of secondary activities, such as recreation, military activities,  and oil and gas activities—which include oil and gas exploration, drilling  and production, and transport. Exploring for oil and gas involves seismic  mapping of the subsurface topography. Seismic mapping, regardless of the  technology employed, requires surface disturbance, often involving small  dynamite charges placed in a series of holes, typically in patterned grids.  If seismic mapping reveals potential oil or gas deposits exploratory drilling  begins. Oil and gas drilling and production often requires constructing,  operating, and maintaining industrial infrastructure, including a network of  access roads and canals, local pipelines to connect well sites to production  facilities and dispose of drilling wastes, and gravel pads to house the  drilling and other equipment. In addition, production may require storage  tanks, separating facilities, and gas compressors. Finally, transporting  oil and gas to production facilities or to users requires transit pipelines.  Typically buried, these pipelines range in size, with some as large as  30 inches in diameter. Pumping stations and storage tanks may also be  needed for pipeline operations.
Under the National Wildlife Refuge System Administration Act of 1966,  as amended, FWS is responsible for regulating all activities on refuges.  The act requires FWS to determine the compatibility of activities with the  purposes of the particular refuge and the mission of the refuge system and  not allow those activities deemed incompatible. However, FWS does not  apply the compatibility requirement to the exercise of private mineral  rights on refuges. Department of the Interior regulations also prohibit  leasing federal minerals underlying refuges outside of Alaska, except in  cases where federal minerals are being drained by operations on property  adjacent to the refuge.
Nevertheless, the activities of private mineral owners on refuges are  subject to a variety of legal restrictions, including FWS regulations.  A variety of federal laws affect how private mineral rights owners  conduct their activities. For example, the Endangered Species Act of 1973  prohibits the “take” of any endangered or threatened species and provides  for penalties for violations of the act; the Migratory Bird Treaty Act  prohibits killing, hunting, possessing, or selling migratory birds, except in  accordance with a permit; and the Clean Water Act prohibits discharging  oil or other toxic substances into waters of the United States and imposes  liability for removal costs and damages resulting from a discharge.
Also, FWS regulations require that oil and gas activities be performed in  a way that minimizes the risk of damage to the land and wildlife and the  disturbance to the operation of the refuge. The regulations also require  that land affected be reclaimed after operations have ceased. Whether  FWS has authority to impose permitting requirements on private oil and gas  activities is discussed later in this report.
section_title: Extent of Oil and Gas Activities in Refuges
paragraphs: At least 155 of the 575 refuges of the National Wildlife Refuge System  have some past or present oil and gas activities—exploration, drilling and  production, or transit pipelines. Many of these activities are concentrated  around the Gulf Coast of Louisiana and Texas. We found that oil and gas  exploration has occurred at 44 refuges since 1994. We also determined  that there are 4,406 wells on 105 refuges, though only 41 percent of  the wells at 36 refuges are active, with the other wells either plugged  and abandoned or temporarily idle. Active wells on refuge lands produce  roughly 1.1 percent and 0.4 percent of domestically produced oil and gas  from onshore wells, with an approximate value of $880 million based on  2001 prices. In addition, active oil and gas transmission pipelines cross at  least 107 refuges. Bordering refuges, another 4,795 wells reside within  one-half mile outside refuge boundaries, in some cases on lands that FWS  may acquire in the future.
subsections: section_title: One-Quarter of All Refuges Have Past or Present Oil and Gas Activities
paragraphs: About one-quarter, or 155, of the 575 refuges (538 refuges and 37 wetland  management districts) that constitute the National Wildlife Refuge System  have past or present oil and gas activities—exploration, drilling and  production, transit pipelines, or some combination of these (see table 1).  Since 1994, FWS records show that 44 refuges have had some type of oil  and gas exploration activities—geologic study, survey, or seismic work.  More than one-half of these exploratory activities occurred in the  southeastern and southwestern regions of the United States. We also  identified 105 refuges with inactive or active oil and gas wells and  107 refuges with transit pipelines. Exploration or drilling and production  activities occurred at 120 of the 155 refuges.
In total, we identified 4,406 oil and gas wells within 105 refuges. The  number of wells per refuge ranged from 1 dry hole well drilled at Willapa  Bay National Wildlife Refuge (NWR) in Washington to 1,120 wells at Upper  Ouachita NWR in Louisiana. Although refuges with oil and gas wells are  present in every FWS region, they are more heavily concentrated in the  Gulf Coast of the United States (see fig. 2). More than one-half of the wells  (2,512) are located on refuges in FWS Region 4 and a majority of these are  in Louisiana.
Wells are also concentrated among a minority of the system’s units.  For example, five refuges contain 57 percent of all the wells in the system,  as shown in table 2.
section_title: A Minority of Wells in Refuges Are Actively Producing, Yielding About 1 Percent of the U.S.’s Total Onshore Production
paragraphs: About 4 out of 10 wells located on refuges are actively producing. Of the  4,406 wells, 1,806, or 41 percent, were known to be actively producing oil  or gas or disposing of produced water as of the most recent reporting  time period as of January 2003. Of the 105 refuges with oil and gas wells,  36 refuges have actively producing wells. The remaining 2,600 wells did  not produce oil, gas, or water during the last 12 months; many of these  were plugged and abandoned or were dry holes. Gas wells were the most  common type of well as indicated in table 3.
Active wells on refuge lands produced a total of 23.7 million barrels of  oil and 88,171 million cubic feet of natural gas during the most recent  12 months as of January 2003—about 1.1 percent of the 2.117 billion  barrels of oil and 0.4 percent of the 24,532,514 million cubic feet of natural  gas produced during 2001 (see table 4). The 1,806 active oil and gas wells  on refuge lands were roughly 1 percent of the approximately 148,750 active  onshore oil and gas wells in the United States in 2001. The value of all  refuge-based production, based on 2001 average prices, was over  $880 million. However, in addition to levels of production and oil and gas  prices, the net benefit of oil and gas activities depends on a number of  factors, including size of the investment in infrastructures and any adverse  effects on the environment, recreation, and tourism.
At least 273 miles of transit pipeline from 49 different oil and gas pipelines  cross 28 of the 138 refuges for which data are available. These pipelines  are almost exclusively buried and generally require right-of-way permits  from FWS. The pipelines vary in size, up to 30 inches in diameter and  carry a variety of products, including crude oil, refined petroleum products,  and high-pressure natural gas (see table 5). While pipelines cannot be  constructed across refuge lands unless FWS determines that the pipelines  are compatible with the purposes of the refuge and issues a right-of-way  permit, some pipelines were constructed before FWS acquired the  property. These pipelines did not undergo a compatibility determination  and may not have received a right-of-way permit.
Transit pipelines may also have associated storage facilities and pumping  stations, such as those we toured at Delta NWR in Louisiana (see fig. 3), but  data are not available to identify how many of these are on refuges.
section_title: Additional Wells and Pipelines Are Located within One-Half Mile of Refuge Boundaries
paragraphs: A total of 4,795 wells and 84 transit pipelines reside just outside refuges,  within one-half mile of refuge boundaries. The 4,795 wells bound  123 refuges, 33 of which do not have any resident oil and gas wells.  The 84 pipelines are 186 miles long and border 42 different refuges.  While FWS does not own the land outside refuge boundaries, lands  surrounding refuges may be designated for future acquisition. For example,  at Deep Fork NWR in Oklahoma, 606 wells are within one-half mile outside  current boundaries, and some of this land is within approved boundaries  for future acquisition (see fig. 4).
section_title: Overall Effects of Oil and Gas Activities Are Unknown, but Those Activities Have Diminished Some Refuge System Resources
paragraphs: The overall environmental effects of oil and gas activities on refuge  resources are unknown because FWS has conducted few cumulative  assessments and has no comprehensive data. Available information  indicates that refuge wildlife and habitat have been harmed to varying  degrees by spills of oil, gas, brine, and industrial materials as well as  through the construction, operation, and maintenance of the infrastructure  necessary to produce oil and gas. Routine oil and gas activities can  contaminate a refuge and reduce the quantity and quality of habitat  available for wildlife. Over the years, new environmental laws and  improved industry practices and technology have reduced some of the  most detrimental effects of oil and gas activities; however, some harm  to refuges continues to occur and some effects from earlier events have  not been reversed and continue to diminish refuge resources. In addition,  oil and gas operators have taken steps, in some cases voluntarily, to  reverse damages resulting from oil and gas activities, but operators have  not consistently taken such steps and the adequacy of these steps is not  known. FWS does not have an accurate record of the number of spills  on refuges and has conducted few studies on the effects of refuge-based  oil and gas activities and, therefore, does not know the full extent of the  problem or the steps needed to reverse them.
subsections: section_title: Oil and Gas Activities Have, to Varying Degrees, Diminished Refuge System Resources
paragraphs: Available studies, anecdotal information, and our observations show  that some refuge resources have been diminished to varying degrees by  spills of oil, gas, and brine and through the construction, operation, and  maintenance of the infrastructure necessary to extract oil and gas. The  damage varies widely in severity, duration, and visibility, ranging from  infrequent small oil spills and industrial debris with no known effect on  wildlife, to large and chronic spills causing wildlife deaths and long-term  soil and water contamination. Some damage, such as habitat loss because  of infrastructure development and soil and water contamination, may  last indefinitely while other damage, such as wildlife disturbance during  seismic mapping, is of shorter duration. Also, while certain types of  damage are readily visible, others, such as groundwater contamination and  reduced habitat quality from infrastructure development, are difficult to  observe, quantify, and associate directly with oil and gas activities. Finally,  oil and gas activities may hinder FWS’s ability to manage or improve refuge  habitat, such as seasonal flooding of wetlands or prescribed burns, or  hinder public access to parts of the refuge.
subsections: section_title: Spills
paragraphs: Spills of oil, gas, and brine have harmed refuge wildlife and habitat. Oil  and gas can injure or kill wildlife by destroying the insulating capacity of  feathers and fur, depleting oxygen available in water, or exposing wildlife  to toxic substances. Long-term effects of oil and gas contamination are  difficult to determine, but studies suggest that effects of exposure include  reduced fertility, kidney and liver damage, immune suppression, and  cancer. Even small spills may contaminate soil and sediments if they  occur frequently. For instance, a study of Atchafalaya and Delta NWRs in  Louisiana found that levels of oil contamination near oil and gas facilities  are lethal to most species of wildlife, even though refuge staff were not  aware of any large spills. Figure 5 shows an ongoing clean up of a  relatively small oil spill that occurred at Delta NWR in 2002. Brine spills  can also be lethal to young waterfowl, damage birds’ feathers, kill  vegetation, and decrease nutrients in water. Based on well data from  Premier Data Services, over 19.8 million gallons of brine were produced  from active wells on NWRs during the most recent 12-month reporting  period as of January 2003. Much of this brine was reinjected back into the  ground to prevent surface damage.
The 16 refuges we visited reported oil, gas, or brine spills, although the  frequency and effect of the spills varied widely. For instance, Hopper  Mountain NWR in California reported two oil spills in 1990, the only spills  since 1974, and refuge records indicated that the operator cleaned up each  spill quickly and that refuge staff detected no effect on wildlife. In contrast,  Anahuac NWR in Texas reported at least 7 oil spills since 1991, including  1 pipeline spill that killed over 800 large fish such as mullet and redfish  and over 180,000 menhaden, a small but ecologically important fish. FWS  officials said that natural gas leaks generally pose a lower risk to habitat  than oil spills, but a gas leak in 2000 at Sabine NWR in Louisiana killed  fish, crabs, and amphibians. Brine spills have also damaged refuges. For  example, Atchafalaya and D’Arbonne NWRs in Louisiana reported that  brine spills had killed vegetation in the area of the spill. At these refuges,  salt concentrations in the soil have remained high and continued to spread  for decades after a spill, and some sites do not support vegetation  years afterwards.
The exact number and size of oil and gas spills on NWRs is not known.  Nationally, FWS reported that 348 oil and gas spills were located on or  near refuges during fiscal year 2002, although there are limitations to this  figure. First, it includes spills resulting from activities not associated with  oil and gas production or transit pipelines, such as shipping accidents.  Second, FWS calculated the number of spills by reviewing spill reports  from the National Response Center and other parties that did not always  identify if a refuge is affected. Third, not all spills are required to be  reported. Clean Water Act regulations require operators to report spills of  any quantity if they cause a sheen to form on waters subject to federal  jurisdiction. Other spills are subject to state reporting requirements,  which vary. For instance, Texas requires operators to report spills over  210 gallons, while Louisiana requires operators to report spills over  42 gallons. Finally, refuge staff told us that they knew of spills that  operators never reported.
section_title: Infrastructure
paragraphs: Constructing, operating, and maintaining the infrastructure necessary to  produce oil and gas can harm wildlife by reducing the quantity and quality  of habitat. At Kenai NWR in Alaska, for instance, oil and gas wells and  associated facilities have eliminated at least 524 acres of habitat, while  other infrastructure, such as access roads and pipelines, has eliminated an  additional 424 acres. While this loss of habitat represents a very small  proportion of total refuge acreage, refuge staff determined that it  eliminated food sources that would have supported between 41 and  136 cow moose and 411 snowshoe hares. In other instances, habitat lost  to infrastructure development is negligible—for example, the presence  of a wellhead or pipelines, such as the wellhead at Delta NWR shown in  figure 6.
Infrastructure development can reduce the quality of habitat by  fragmenting it and, in some cases, by changing the hydrology of the  refuge ecosystem or contaminating it with toxic substances. Habitat  fragmentation occurs when a network of roads, canals, and other  infrastructure is constructed in previously undeveloped areas of a refuge.  Fragmentation increases disturbances from human activities, provides  pathways for predators, and helps spread nonnative plant species. For  example, the endangered California condor is particularly susceptible to  disturbances from human activities. Condors have been observed landing  on oil pads on the refuge, which poses a safety risk to the birds and reduces  their fear of humans. In addition, FWS estimated in 1980 that oil and gas  activities at Hopper Mountain NWR eliminated about 63 percent of the  potential feeding habitat for condors on the refuge. The current refuge  manager said that the effect of this loss on the condor population may  not be significant because the importance of the feeding habitat provided  by the refuge may not be as great as previously thought. Corridors that  oil and gas operators have developed assist predation—for example,  among songbirds, and allow a pathway for invasive species, a significant  management problem for FWS. Finally, officials at Anahuac and  McFaddin NWRs in Texas said that disturbances from oil and gas activities  are likely significant and expressed concern that bird nesting may be  disrupted. However, no studies have been conducted at these refuges to  determine the effect of these disturbances.
Infrastructure networks can also damage refuge habitat by changing the  hydrology of the refuge ecosystem, particularly in coastal areas. For  instance, tens of thousands of acres of freshwater marsh at Sabine NWR,  and elsewhere in Louisiana and Texas, have been lost due to saltwater  intrusion. Saltwater intrusion may change the types of plants in the  marsh and can cause erosion that creates an open water habitat that  is less biologically productive than the marsh. While several factors  contribute to the saltwater intrusion, construction of canals to access oil  and gas facilities is considered by many scientists to be significant. Seismic  studies for oil and gas exploration in coastal marshes can also contribute  to saltwater intrusion. Seismic studies are typically conducted in a grid  pattern and may cover large portions of a refuge. Preparing and conducting  seismic studies may require heavy equipment that can compress the marsh,  which changes the plant community and could allow saltwater to intrude  into the marsh, particularly during droughts that decrease freshwater  flows. At McFaddin NWR, the grid pattern from a 1995 seismic study was  clearly visible from infrared aerial photographs taken after the seismic  study was completed (see fig. 7).
Moreover, industrial activities associated with extracting oil and gas have  been found to contaminate wildlife refuges with toxic substances such  as mercury and polychlorinated biphenyls (PCB). D’Arbonne, Kenai, and  Upper Ouachita (Louisiana) NWRs reported mercury contamination, and  Kenai NWR reported PCB contamination from oil and gas activities that  must still be cleaned up by FWS if the responsible parties cannot be  found. Mercury and PCBs were used in equipment such as compressors,  transformers, and well production meters, although generally they are no  longer used. Mercury has been linked to brain, kidney, and reproductive  system damage, and PCBs are known animal carcinogens.
section_title: Legal and Industry Changes Have Reduced Some of the Environmental Effects of Oil and Gas Activities
paragraphs: New laws prohibiting some of the most harmful industry practices have  helped diminish the adverse effect of current and recent oil and gas  activities on refuge resources. For example, Louisiana now generally  prohibits using open pits to store production wastes and brine in coastal  areas or discharging brine into drainages or state waters. Another example  is Texas, which requires operators to install screens or nets over open  tanks and pits to protect birds from contacting hazardous fluids. Texas also  now requires operators to remove oil and gas infrastructure, such as tanks,  which will not be actively used in the continuing operation of a lease and to  contour closed sites to reduce water contamination.
Improvements in industry practice, including improved technology,  have also reduced the damage caused by oil and gas activities. For  example, where feasible, directional drilling allows (1) operators to  avoid placing wells in sensitive areas such as wetlands and (2) several  wells to be drilled from the same pad, thus reducing the amount of habitat  damaged. Another example is improved geologic mapping through 3-D  seismic technology. While 3-D seismic studies require more vehicle traffic  and may damage more vegetation than 2-D studies, improved geologic  mapping may reduce the number of wells drilled that do not produce oil or  gas and ultimately reduce the amount of habitat damaged. Furthermore,  the impact of 3-D seismic studies has been reduced through other  improvements, including using vehicles less damaging to the surface,  reducing the number of vehicle trips necessary, hand carrying seismic lines  to avoid vehicle damage altogether, and scheduling seismic operations to  avoid sensitive times.
While the relative impacts of the activities have been reduced in  recent years, the effects have not been eliminated. For instance, oil and  gas infrastructure continues to diminish availability of refuge habitat for  wildlife, and spills of oil, gas, and brine that damage fish and wildlife  continue to occur. In addition, several refuge managers reported that  operators do not always comply with legal requirements or follow best  industry practices such as constructing berms (earthen barriers) around  tanks to contain spills, covering tanks to protect wildlife, and removing pits  that temporarily store fluids used during well maintenance.
section_title: Reversing Environmental Damages Is Inconsistent
paragraphs: Environmental damage from oil and gas activities may be partially reversed  by remediating contamination or by reclaiming a site to its prior condition  after oil and gas activities cease. However, oil and gas operators have not  consistently taken steps to reverse environmental damages that have  occurred from oil and gas activities on NWRs. In some cases, officials do  not know if remediation following spills is sufficient to protect refuge  resources, particularly for smaller oil spills or spills into wetlands. In other  cases, FWS has been satisfied with the response. According to refuge  officials and industry representatives, when small oil spills occur, operators  may contain the oil and then remove the oil and the contaminated soil, but  in some cases operators leave the oil and cover it with dirt. In contrast, the  effects of larger spills may be evaluated systematically and remediated by  the operator. For example, in 2000, a ruptured pipeline spilled nearly  200,000 gallons of crude oil at John Heinz NWR in Pennsylvania, damaging  several species of wildlife and covering a frozen pond. In response, the  operator removed the oil and the contaminated soil, replanted damaged  vegetation, funded scientific studies to determine the effect on refuge  wildlife, compensated the refuge for the value lost to visitors during the  spill; and the operator is negotiating with FWS to identify an appropriate  restoration project to compensate for the ecologic value of refuge  resources lost while the refuge recovers from the spill.
Similar to spill remediation, reclamation of oil and gas facilities following  their use is also inconsistent. For instance, an operator at McFaddin NWR  removed a road and a well pad that had been constructed to access a new  well site and restored the marsh damaged by construction after the well  was no longer needed. Figure 8 provides an aerial view of the road and the  well pad shortly after they were constructed and a photo of the same site  following reclamation. Other refuges, however, reported that storage tanks,  debris, and access roads remained long after use (see fig. 9). Refuge staff  cited several reasons for some sites not being reclaimed, including  difficulty identifying the responsible parties, operator insolvency, potential  future use because other locations in the same field remained in operation,  and uncertainty of their authority to require operators to reclaim sites.  Finally, several states do not require operators to reverse the effects of oil  and gas activities. For instance, Texas law does not require operators to  remove all buried flowlines or access roads. Several states, such as  Oklahoma and Texas, have established programs to clean up abandoned oil  and gas sites, but funds are limited.
Because operators do not consistently or entirely reverse environmental  damages resulting from oil and gas activities, FWS has had to clean up sites  at its expense or leave sites unreclaimed. FWS spent $387,100 to clean up  14 oil- or gas-related sites between fiscal years 1991 and 2002 and is  planning to spend an additional $108,000 at 3 sites in fiscal year 2003. These  cleanup projects included removing oil- and gas-related debris, plugging  unused gas wells, and addressing mercury contamination at 9 refuges in  Arkansas and Louisiana. Other sites remain to be addressed. There are  2,600 inactive wells on refuges, including an unknown number that have  been abandoned but not plugged, and some sites also have unused tanks,  flowlines, and debris that should be removed. The estimated cost of  cleanup at a site at Anahuac NWR is $1.1 million and currently is deferred  until fiscal year 2009. Refuge managers at some refuges we visited  expressed concern that as oil and gas production declines, operators will  abandon more infrastructure and FWS will have to reclaim these sites.
section_title: FWS Documentation of Environmental Effects Is Limited and Inconsistent
paragraphs: FWS has conducted few studies to quantify the extent of the damage  caused by oil and gas activities. FWS identifies and assesses contaminant  threats to refuges by conducting Contaminant Assessment Process (CAP)  studies and other studies of contamination. Although CAP studies are  FWS’s primary formal mechanism for identifying potential sources of  contaminants on refuges, the studies do not quantify the extent of any  contamination or its biological effects. Moreover, CAP studies have not  been conducted at all refuges with oil and gas activities, including  many refuges that have significant activities. FWS established the CAP  process in 1996, and to date studies have been completed at about  193 refuges (about 34 percent of all refuges), including 67 of the  155 refuges (43 percent) with oil and gas activities. The number of refuges  with oil and gas activities that have completed CAP studies varies by  region. For instance, in Region 2, which includes Texas, 20 of 28 refuges  (71 percent) had completed CAP studies, while in Region 4, which includes  Louisiana, 11 of 45 (24 percent) had completed CAP studies. The national  coordinator for CAP said that the studies are sequenced to coincide with  each refuge’s comprehensive conservation planning process, which, in  turn, is prioritized within each region based on factors including primary  threats, staffing levels, and funding. Finally, the comprehensiveness of the  studies varies widely. The CAP for Kenai NWR lists over 330 known spills  and describes other potential contamination sources from oil and gas  activities. In contrast, the CAP study for Deep Fork NWR did not list oil and  gas activities as a potential source of contamination, even though there are  over 360 wells on the refuge and the refuge’s comprehensive conservation  plan previously identified concerns over oil and gas activities, including  unplugged wells. The CAP program manager stated that, in this case,  FWS staff did not follow the procedures established in the CAP manual,  which requires that all potential sources of contamination be identified.
If contaminants are identified at a refuge, FWS may conduct additional  studies through its contaminants program. Since 1988, FWS has funded  at least 33 studies at 47 national wildlife refuges nationwide that have  examined the effects of oil and gas activities. The scope of the studies  ranged from general investigations to document the presence and  concentration of a variety of contaminants, including those associated  with oil and gas activities, to specific studies to examine the impact of  oil and gas activities on particular refuges. In some cases, contamination  concerns identified in a general investigation may lead to a more detailed  study. For instance, a contaminants survey at Hagerman NWR identified  contaminants from oil and gas activities, but the survey was insufficient  to determine the effects on fish and wildlife. A later study determined  that brine and oil contaminant levels did not appear to be of concern.
In addition to conducting its own studies, FWS uses studies conducted by  other government agencies and universities, in some cases at its request.  For instance, the U.S. Geological Survey is studying the effects of a 3-D  seismic study at Sabine NWR to determine the long-term effects of seismic  activities on refuge plant species, and Drexel University is studying the  impact of an oil spill on wildlife at John Heinz NWR, including any effects  on a rare turtle species.
The lack of information on the effects of oil and gas activities on refuge  wildlife hinders FWS’s ability to identify and obtain appropriate mitigation  measures and to require responsible parties to address damages from  past activities. For instance, the Chief, Division of Environmental Quality,  stated that FWS does not always know the effects of oil and gas activities  on wildlife or habitat and, therefore, does not know what actions should  be required of operators to reduce those effects. Lack of sufficient  information has also hindered FWS’s efforts to identify all locations  with past oil and gas activities and to require responsible parties to  address damages. FWS does not know the number or location of all  abandoned wells and other oil and gas infrastructure or the threat of  contamination they pose and, therefore, its ability to require responsible  parties to address damages is limited. While recognizing the value of this  type of information, the Chief, Division of Environmental Quality, said that  in some cases FWS lacked the budget to fund environmental studies and  that, in other cases, the cost of obtaining the information was  disproportionate to its management value. In those cases where FWS  has performed studies, the information has proved valuable. For example,  FWS funded a study at some refuges in Oklahoma and Texas to inventory  locations containing oil and gas infrastructure, to determine if they were  closed legally, and to document their present condition. FWS intends to  use this information to identify cleanup options with state and federal  regulators. If this effort is successful, FWS may conduct similar studies on  other refuges. In other cases, refuges have requested studies that have not  been funded. For instance, proposals to examine the effects of oil and gas  activities on a wetland management district in Montana and to identify  unknown oil and gas locations at Kenai NWR have not been approved, in  part, due to lack of funds. In the case of Kenai NWR, refuge staff said that  current operators may be responsible for cleaning up historic sites but that  FWS had to identify the sites before it could make this determination.
section_title: FWS Management and Oversight of Oil and Gas Activities Varies Widely
paragraphs: FWS’s management and oversight of oil and gas activities varies widely  from refuge to refuge. Effectively managing these activities across the  refuge system would entail, at a minimum, identifying the risks posed by  the activities, establishing operating conditions to minimize damages, and  monitoring the activities with trained staff to ensure compliance. While  some refuges have adopted comprehensive management and oversight  practices, others have done little. Variation in refuges’ management and  oversight of oil and gas activities stems from differences in FWS’s  regulatory authority depending upon the nature of the mineral rights and  from inadequate guidance, resources, and training for refuge staff. In  addition, on a related management issue, FWS’s policy requiring a complete  and thorough assessment of potentially contaminated property prior to  acquisition is not always adhered to because of inconsistent interpretation  of the requirements by FWS, placing the federal government at risk of  assuming unknown cleanup costs in the future.
subsections: section_title: Management and Oversight Varies Among Refuges
paragraphs: FWS’s objective in managing oil and gas on refuge lands is to protect  wildlife habitat and other resources while allowing oil and gas operators  to exercise their mineral rights. Meeting this objective requires basic  management controls. Under the Federal Manager’s Financial Integrity  Act of 1982, we have issued management control standards that apply  to all federal agencies. These standards require agencies to identify risks,  develop procedures to protect against these risks, and monitor adherence  to the procedures. For refuges, doing so would mean identifying the nature  and extent of oil and gas activities on a refuge and the risks they pose to  refuge resources, adopting risk-reduction procedures such as issuing  access permits with conditions to protect refuge resources and securing  financial assurance that reclamation will occur, and overseeing oil and gas  operations with trained and dedicated staff to ensure compliance with laws  and permits.
The refuges we examined varied in the extent to which they identified  risks, adopted procedures to minimize those risks, and monitored oil and  gas activities. First, some refuge staff did not have complete information on  the extent of oil and gas activities occurring on their refuges. For example,  at Deep Fork NWR refuge staff estimated that there were 600 or more  abandoned wells but knew the location of very few of these wells. Further,  as noted earlier, only 67 of the 155 refuges with oil and gas activities and  10 of the 16 refuges we visited (see table 6) had completed CAP studies  identifying the possible sources and types of contamination on the refuges.  In contrast, at Kenai NWR refuge staff had detailed information on oil and  gas wells and activities on the refuge, had completed an exhaustive CAP  study, and was completing an Environmental Impact Statement on the  effects of oil and gas activities.
Second, permits, which grant oil and gas operators access to specified  areas of a refuge and contain conditions to protect refuge resources, such  as seasonal or vehicle restrictions, to protect air quality, soil, water and  wildlife habitat, were applied to varying degrees at 11 of the 16 refuges we  visited. FWS can require permits if the mineral rights are federally owned,  the property deed allows it to, or the operator voluntarily agreed to one.  In the other five cases, refuge staff did not believe they had authority to  require permits. In addition, five refuges obtained financial assurance in  the form of bonds for the future costs of reclamation, or rely on bonds  administered by another federal agency. The other 11 refuges rely instead  on state bonds, which are allowed under FWS guidance, but may provide  different degrees of financial assurance than federal bonds. For example,  the bonds in some states may or may not cover damages caused by oil  and gas activities if the effects are considered to be reasonable impacts  to the land. Reasonable impacts are not consistently defined among  states because impacts to property are determined by what is usual and  customary practice in the area.
Finally, we found little correlation between the scale of oil and gas  activities on refuges and the presence of dedicated staff to oversee them.  Two of the refuges we visited have a fully dedicated staff person to oversee  oil and gas operators—two of the only three in the entire refuge system.  These two refuges in Louisiana collect fees from operators to help pay for  these staff. In contrast, refuges with greater levels of activity do not have  dedicated staff.
section_title: FWS’s Authority to Require Permits Varies, Depending on the Nature of the Mineral Rights
paragraphs: FWS’s legal authority to require oil and gas operators to obtain permits  varies considerably, depending upon the nature of the mineral rights.  Permits granting access to specified areas of a refuge can be used to  establish reasonable operating conditions for private mineral owners to  exercise their rights while protecting refuge resources. Variation in  authority to require such permits, and the uncertainty that this sometimes  creates among refuge staff, partly accounts for differences in management  and oversight we found at refuges. At one end of the spectrum, FWS has  broad authority to deny or regulate access to oil and gas on wildlife refuges  when the federal government owns the mineral rights. Under Department  of the Interior regulations, access to federal mineral rights  underlying refuges requires the approval of the Secretary of the Interior  with the concurrence of FWS as to the time, place, and nature of the  activities. These regulations also prohibit leasing of federal minerals  on refuges outside of Alaska, except in cases where federal minerals are  being drained by operations on property adjacent to the refuges.
In contrast, FWS’s authority is not nearly as broad or as clear with respect  to private owners of mineral rights. FWS’s authority to require permits from  private mineral owners depends on the nature of the private rights and, in  some cases, whether the property deed contains specific language. Private  mineral rights may be either “reserved” or “outstanding.” Reserved rights  are created when the property owner retains the mineral rights at the time  that the surface property is transferred to the federal government.  Outstanding rights are created when the mineral rights are severed from  the surface lands prior to the surface property’s transfer to the federal  government and, thus, a third party owns the rights. FWS’s authority to  regulate oil and gas activities of private owners of reserved mineral rights is  limited under current law. The Department of the Interior takes the  position, with which we agree, that FWS can require permits for reserved  rights only if the deed transferring surface ownership to the federal  government contains language that subjects these rights to permitting  requirements. The department’s position was first expressed in a 1986  opinion by the Office of the Solicitor, which, that office recently advised  us, continues to reflect the department’s position. The department’s  position is largely based on a section of the Migratory Bird Conservation  Act that makes reserved rights subject to government regulation if the deed  includes specific requirements, such as permitting requirements, or states  that the rights are subject to regulations prescribed by the Department  “from time to time.” Any expansion of FWS’s authority over the owners  of reserved mineral rights, to include cases in which deeds do not contain  such provisions, would thus require a change in the law.
By contrast, it does not appear that the Department of the Interior has  taken a formal position, and the Solicitor’s Office recently declined to take  a position, regarding FWS’s authority to require a permit for private owners  of outstanding mineral rights. The Solicitor’s Office advised us that it would  only provide an opinion on FWS’s authority over outstanding mineral rights  if FWS requested one. Nonetheless, we believe that FWS has broad general  authority, similar to that of the Forest Service and the National Park  Service, to require owners exercising outstanding mineral rights to obtain permits that contain conditions to protect a refuge and its wildlife. Both  amendments to the National Wildlife Refuge System Administration Act  of 1966 (1966 Act) and court decisions since the department issued its  1986 opinion support this conclusion. The National Wildlife System  Improvement Act of 1997 (1997 Act) amended the 1966 Act to provide  for a more effective process for determining which secondary uses would  be compatible with refuges and to allow refuges to be managed more like  national forests and parks. The 1997 Act established as a mission of the  National Wildlife Refuge System “conservation, management, and where  appropriate, restoration of [fish and wildlife] for the benefit of present and  future generations of Americans.” In separate cases involving the Forest  Service and the National Park Service, federal courts relied on language  similar to that in the 1997 Act to find that these agencies had authority to  require private owners of outstanding mineral rights to obtain permits  before conducting oil and gas activities. We believe the same conclusion  follows with respect to FWS’s authority.
As a result of these differences in legal authority, there is a considerable  gap in FWS’s management and oversight of oil and gas activities, but  neither FWS nor we know precisely at how many refuges this is occurring.  Because some refuges may consist of hundreds of individual deeds, it is not  possible without considerable investigation to determine the relative  prevalence of reserved and outstanding mineral rights or the extent to  which property deeds allow FWS to require owners of reserved mineral  rights to obtain a permit, according to FWS officials. FWS officials also said  that differences in FWS’s authority to require permits do not provide for a  consistent way of managing and overseeing oil and gas activities.
section_title: Refuges Lack Sufficient Guidance, Resources, and Training to Manage and Oversee Oil and Gas Activities
paragraphs: In addition to FWS’s inconsistent or undefined authority to require permits  and oversee oil and gas activities, FWS cannot improve its management  and oversight of those activities without better guidance, resources, and  training. According to refuge managers and officials in the Department of  the Interior’s Office of the Solicitor, national guidance is insufficient for  refuge staff to know what authority they have to manage oil and gas  activities, or how to carry out that authority. To supplement the national  guidance, three of FWS’s seven regions have developed more detailed  guidance to assist in managing and overseeing oil and gas activities. For  instance, while the national guidance describes only FWS’s authority to  require permits, guidance in Regions 2 and 6 provides specific examples of  conditions the refuge manager should include in a permit to protect refuge  resources. Staff at Sabine NWR have also drafted, in conjunction with  headquarters staff, more detailed national guidance on managing and  overseeing oil and gas activities, including a detailed description of FWS’s  authority to require permits and many specific conditions to include in  permits. However, FWS has not approved this draft guidance.
Refuge staff we interviewed also cited a lack of staff resources as an  obstacle to properly managing oil and gas activities because staff do not  have time to become familiar with federal and state laws or manage and  oversee oil and gas operations. For example, when FWS purchased  property for Deep Fork NWR, the property deed contained assurances that  FWS would be able to issue permits governing private mineral rights, yet  that information was never conveyed to refuge staff. To determine FWS’s  permitting authority, refuge staff would have to research each individual  property deed. Refuge staff said that they do not have time to do this  research because they must address other management concerns, such as  law enforcement. In contrast, Sabine NWR has a staff person dedicated to  managing oil and gas activities. As a result, this person has sufficient time  to become familiar with applicable laws and to work with operators and  state regulators to manage and oversee oil and gas activities to reduce their  effects on the refuge. This oversight has encouraged the operator to  identify and restore sites damaged by past oil and gas activities.
Refuges that have access to their own funding mechanisms to recover  damages are better able to manage and oversee oil and gas activities. It is  standard industry practice for operators’ conducting seismic activities to  pay exploratory fees to surface landowners. However, only refuges in  Louisiana and Texas have authority to assess and retain such fees to  cover potential damages caused by seismic activity. Refuges in  Louisiana routinely collect these fees to aid management and oversight  and fund restoration efforts, but Region 2 has retained existing policy  preventing refuges in Texas from assessing these fees. To address this  lack of consistency, FWS headquarters officials told us they are drafting  guidance to clarify how these regions should apply their authority to collect  and retain fees. One of the refuges that collects these fees is Sabine NWR,  which uses these fees to fund a staff person specifically dedicated to the  management and oversight of oil and gas activities and to fund mitigation  projects to reduce the effect of oil and gas operations. Figure 10 shows a  recent mitigation project, funded by oil and gas operators at Sabine NWR,  that is designed to restore a marsh damaged by saltwater intrusion due in  part to earlier oil and gas activities. Officials in the Department of the  Interior’s Office of the Solicitor support the use of fees as a more efficient  mechanism than litigation to compensate for damages.
Trained staff are integral to effective oversight, yet refuge staff we met with  said their principal duties and training as wildlife managers do not prepare  them for managing oil and gas activities. FWS has offered only one  workshop in the last 10 years for refuge staff nationwide that is specific to  managing oil and gas activities on refuges. This 3-day workshop in June  2001, attended by 36 FWS officials, provided information on possible  sources of spills, effects of oil on wildlife, enforcement avenues, and  damage recovery; however, there was limited discussion of FWS’s  regulatory authority. Refuge staff lack training on standard industry  practices, state and federal laws, and identification of oil- and gas-related  problems. For example, at Atchafalaya NWR, the refuge manager has not  been able to enforce special use permits, citing a lack of training about  applicable state and federal laws.
section_title: Acquired Property Is Not Always Adequately Assessed for Contamination
paragraphs: FWS has not always thoroughly assessed property for possible  contamination from oil and gas activities prior to its acquisition. The FWS  manual requires a thorough investigation of potential contamination prior  to acquisition of any property so that the full present and future costs of  cleanup can be determined. However, some FWS regions have interpreted  the guidance more narrowly than others. As a result, FWS has not always  conducted a thorough investigation of properties to be acquired, resulting  in unexpected future cleanup costs.
FWS’s guidance requires a complete environmental site assessment to  determine “the likelihood of the presence of hazardous substances or other  environmental problems associated with the property and any remediation  or other clean up costs.” According to FWS contaminant and realty  officials, a thorough investigation as required by the FWS manual would  include an assessment of both the surface and subsurface properties for  contamination. Some regions consistently conduct adequate assessments,  while other regions’ investigations are not as thorough. For example,  Region 6 assesses both the subsurface and surface properties for  contamination, even when acquiring only the surface portion. In two  cases, Region 6 did not acquire property, even when offered as a  donation, because of subsurface contamination from oil and gas activities.  In contrast, FWS Regions 2, 3, and 4 do not always thoroughly investigate  all properties for contamination prior to acquisition. For example, not  examining the subsurface soils for contamination or investigating further  if there is some indication of the presence of contaminants. FWS realty  officials told us that the acquisition guidance needs to be clarified and that  the oversight of regional implementation needs to be improved to ensure  that all new property is thoroughly investigated for contamination.
In one instance, FWS acquired property that is contaminated from oil and  gas activities and is now paying unexpected cleanup costs because staff  did not conduct an adequate assessment of the subsurface property prior  to acquisition. At the Patoka River NWR in Indiana (Region 3), during an  acquisition, FWS staff conducted an initial contamination investigation  and used a state certification of well closure as assurance that the land  was cleaned and closed and did not investigate further, even though they  were aware that the land had contained oil wells and an oil storage facility.  After acquiring the property, FWS found that large amounts of soil were  contaminated with oil. FWS has thus far spent $15,000 and a local  conservation group spent another $43,000 cleaning up contaminated soil.
section_title: Conclusions
paragraphs: The National Wildlife Refuge System is a national asset established  principally for the conservation of wildlife and habitat. While federally  owned mineral rights underlying refuge lands are generally not available  for oil and gas exploration and production, that prohibition does not  extend to the many private parties that own mineral rights underlying  refuge lands. The scale of these activities on refuges is such that some  refuge resources have been diminished, although the extent is unknown  without additional study.
Some refuges have adopted practices—for example, developing data  on the nature and extent of activities and their effects on the refuge,  overseeing oil and gas operators, and training refuge staff to better  carry out their management and oversight responsibilities—that limit  the impact of these activities on refuge resources. If these practices were  implemented throughout the agency, they could provide better assurance  that environmental effects from oil and gas activities are minimized. In  particular, in some cases, refuges have issued permits that establish  operating conditions for oil and gas activities, giving the refuges greater  control over these activities and protecting refuge resources before  damage occurs. However, FWS does not have a policy requiring owners  of outstanding mineral rights to obtain a permit, although we believe  FWS has this authority, and FWS can require owners of reserved mineral  rights to obtain a permit if the property deed subjects the rights to such  requirements. Expanding or confirming FWS’s authority to require  reasonable permit conditions and oversee oil and gas activities, including  cases where mineral rights have been reserved and the property deed does  not already subject the rights to permit requirements, would strengthen  and provide greater consistency in FWS’s management and oversight. Such  a step could be done without infringing on the rights of private mineral  owners. Finally, FWS’s land acquisition guidance is unclear and oversight is  inadequate, thereby exposing the federal government to unexpected  cleanup costs for properties acquired without adequately assessing  contamination from oil and gas activities.
section_title: Recommendations for Executive Action
paragraphs: To improve the framework for managing and overseeing oil and gas  activities on national wildlife refuges, the Secretary of the Interior  should direct the Director of the Fish and Wildlife Service to take the  following steps:  Collect and maintain better data on the nature and extent of oil and gas  activities and the effects of these activities on refuge resources.
Determine what level of staffing is necessary to adequately oversee oil  and gas operators and seek necessary funding to meet those needs,  through appropriations, the authority to assess fees, or other means.
Ensure that staff are adequately trained to oversee oil and gas activities.
Clarify guidance and better oversee FWS’s land acquisition process so  that all hazardous substances and environmental problems and future  cleanup costs are fully identified prior to acquisition and unexpected  costs are avoided.
As part of the process of improving the framework for managing and  overseeing oil and gas activities on national wildlife refuges, we further  recommend that the Secretary of the Interior and the Director of the Fish  and Wildlife Service work with the Department of the Interior’s Office of  the Solicitor to (1) determine FWS’s existing authority to issue permits and  set reasonable conditions regarding outstanding mineral rights, reporting  the results of its determination to Congress, and (2) seek from Congress, in  coordination with appropriate Administration officials, including those  within the Executive Office of the President, any necessary additional  authority over such rights, and over reserved mineral rights, so that FWS  can apply a consistent and reasonable set of regulatory and management  controls over all oil and gas activities occurring on national wildlife refuges  to protect the public’s surface interests.
section_title: Matter for Congressional Consideration
paragraphs: In light of the Department of the Interior’s perceived limitation to its ability  to seek expanded legislative authority over private mineral rights, Congress  may wish to consider providing that authority. Ensuring that FWS has legal  authority to issue permits to holders of both outstanding and reserved  mineral rights would improve FWS’s ability to consistently regulate and  oversee oil and gas operations on wildlife refuges.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided an opportunity for the Department of the Interior and  U.S. Fish and Wildlife Service officials to review a draft of this report.  The comments of the department as expressed by the Acting Assistant  Secretary for Fish and Wildlife and Parks were mixed. The department  agreed that FWS’s acquisition policy and guidance should be improved.  However, the department was silent on our recommendations that the FWS  should collect and maintain better data on oil and gas activities and their  effects and that it should ensure that staff are adequately trained to oversee  oil and gas activities. We continue to believe these recommendations are  still warranted. The department did raise a concern in regards to two of  our recommendations. First, the department questioned whether hiring  additional dedicated staff would be the most cost-effective solution to  improving oversight. However, the department apparently misinterpreted  our recommendation for FWS to determine what level of staffing necessary  to oversee these activities as a call to hire additional dedicated staff. If the  department determines that there are more cost-effective means to ensure  adequate staffing, such as the use of contractors or temporary staff, it could  pursue those actions and be responsive to this recommendation. Second,  while the department was silent on whether it would review the FWS’s  authority to regulate surface access to refuges for owners of outstanding  mineral rights, the department did raise concerns about GAO’s  recommendation that it seek additional authority from Congress to  regulate reserved mineral rights. According to the department, it would be  unconstitutional for it (as an executive branch department) to make such  a request to Congress, because doing so would infringe upon the  President’s authority to recommend legislation to Congress under the  U.S. Constitution’s Recommendations Clause. We fully anticipated in  making this draft recommendation that the department would coordinate  its legislative proposals with the President. In order to make this explicit,  we clarified the recommendation to recognize that the department  should coordinate its legislative request to Congress through appropriate  Administration officials, including those within the Executive Office of  the President.
Further, as a legal matter, while the Recommendations Clause explicitly  provides for the President to make recommendations to Congress, it  does not deny that same freedom to others. The courts have ruled that  “. . . anyone can propose legislation.”
The department also disagreed with our characterization of lost condor  habitat at Hooper Mountain NWR in California. The department asked that  we cite the source for this characterization and include additional  clarification and explanation of the effect of oil and gas activities on the  condor reintroduction program at this refuge. FWS itself, in 1980, made the  determination that 70 percent of critical condor habitat was lost due to oil  and gas development at Hopper Mountain NWR. However, this calculation  included both refuge and off-refuge lands. Considering only refuge lands,  lost habitat totaled 63 percent and the report has been revised accordingly.
In an attachment to the letter, the Department of the Interior raised  three additional concerns with our report. These involve our  characterizations of FWS’s land acquisition practices, our inclusion of oil  and gas pipelines in the scope of the report, and the significance of  problems associated with oil and gas activities. First, FWS concurred that  its acquisition policy and guidance could be improved and that regional  implementation has at times been inadequate. Nevertheless, FWS took  exception to our citing problems we found at Patoka River NWR and with  that region’s adherence to established policy in conducting its site  assessment. However, our review clearly indicated that the FWS failed to  conduct additional contamination investigation of lands that FWS officials  knew had supported oil and gas extraction and storage, as required by their  policy. As a result, the FWS acquired lands that are contaminated and has  incurred expenses to remediate that contamination.
Second, the department’s Office of the Solicitor raised a concern that  including oil and gas pipelines as an oil and gas activity overstates the  prevalence of oil and gas activities. We disagree; pipeline leaks have  contributed to refuge contamination and affected refuge operations in  other ways. We believe that inclusion of oil and gas pipelines on refuges is  an important factor in assessing the overall scale of oil and gas activities  on refuges. Nevertheless, we have added additional information to the  report that allows readers to differentiate among the types of activities  on refuges, including pipelines.
Third, the department’s Office of Policy Analysis expressed the view that  our reporting of refuge-based oil and gas activities not previously known to  FWS overstated the problem because we did not link these activities to  “significant detrimental” effects. The department also suggested that any  problems associated with oil and gas activities on refuges should be  considered relative to other problems faced by these refuges. However, our  report already states that FWS has not conducted a cumulative assessment  of the effects of oil and gas activities on individual refuges or the refuge  system as a whole. Identifying the presence of these activities should be the  first step toward any such assessment. Comparing these impacts relative to  other threats to refuges is outside the scope of this report.
Finally, the department included a number of technical comments from the  FWS and various department offices that have been incorporated within  the report as appropriate. The Department of the Interior’s letter and our  comments on the letter appear in appendix V.
We conducted our work from June 2002 through March 2003 in accordance  with generally accepted government auditing standards. Appendix IV  contains details of our scope and methodology.
As agreed with your offices, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies of this report to the Secretary  of the Interior and the Director of the U.S. Fish and Wildlife Service.  In addition, the report will be available at no charge on the GAO Web site at  http://www.gao.gov. If you have any questions about this report, please call  me at (202) 512-3841 or William Swick at (206) 287-4851. Key contributors  to this report are listed in appendix VI.
section_title: Refuges with Oil and Gas Activities
paragraphs: N.C.
Tex.
Tex.
Colo.
N.D.
La.
Tex.
N.D.
Ark.
La.
La. 6 Mont. 6 Mont.
Tex.
La.
Ind.
Calif.
N.M.
La.
La.
N.M. 6 Mont. 6 Mont.
Tex.
La.
Ariz.
Tex.
Calif.
Ark.
La. x 5 W.V.
S.C.
La.
Ala.
Ariz.
Calif.
Ill.
N.D.
Ill. 4 Miss.
La. 2 Okla.
Calif.
La.
N.D. 3 Minn.
N.D.
Fla.
Ill.
Penn.
Nev.
Ark.
Kans.
Fla. 4 Miss.
La.
Va.
Calif.
Tex. 6 Mont. 6 Mont.
La.
Tenn.
Ariz. 6 Mont. x 4 Miss.
Calif.
Calif.
N.D.
N.D.
Penn.
Calif. 3 Mich.
Kan.
Ariz.
La.
Tex. 6 Mont.
La. 6 Mont. 3 Wisc. 3 Minn. 2 Okla.
N.D.
La.
Tex.
La.
Ill.
Tex. 4 Miss.
N.C.
Tex. 6 Mont. 6 Mont.
Calif.
Ill.
Fla. 3 Minn.
Miss. 4 Miss.
N.Y.
Tex. 6 Wyo. 1 Wash. 5 W.V. 2 Okla.
Ark. 4 Miss.
Ind.
N.C.
Calif.
Ark.
Kan.
Colo.
La.
Calif. 1 Wash. 2 Okla.
Calif.
Tex.
Calif.
Calif.
Tex.
Calif. 2 Okla. 3 Minn. 3 Mich. 3 Mo. 4 Miss.
Nev.
Calif.
Calif.
Fla.
La.
Tex. 2 Okla.
Tex. 3 Wisc.
La.
N.D. 2 Okla.
Ala.
Ark. 3 Wisc. 1 Wash. 3 Minn.
section_title: Summary of Oil and Gas Activities at Refuges Visited
paragraphs: Feeding habitat for endangered  California condors on refuge  reduced by 63 percent. Minor  soil contamination from oil spills.
County issues conditional use  permits and works closely with  the Fish and Wildlife Service  (FWS).
Old and unused infrastructure  and numerous unplugged wells.  Brine spills have killed  vegetation.
Although the property deed  stipulates that a special use  permit and bond are required,  the refuge does not require  permits or bonds.
Old and unused infrastructure  and numerous unplugged wells.
All oil and gas activities are  permitted through the Army  Corps of Engineers with  FWS input.
Oil spills have killed wildlife and  brine spills have killed  vegetation. Abandoned  infrastructure, including flow  lines and storage tanks remain  at site.
Refuge sometimes issues  voluntary permits. Do not require  operators to post bonds, but in  one case, has collected fees for  damage that exceeded the  conditions of the special use  permit.
Soil and groundwater  contamination from oil spills.  Abandoned infrastructure  remains at site.
Refuge issues voluntary special  use permits with conditions to  protect refuge resources.
Refuge does not require  voluntary use permits or bonds.
Soil and water contamination  from oil spills. Abandoned  infrastructure remains at site.
Sediment contaminated by oil  spills. Saltwater intrusion due to  subsidence. Abandoned  infrastructure remains at the site.
Refuge issues special use and  right-of-way permits with  conditions imposed by FWS and  collects mitigation fees. One staff  dedicated to oversight activities.
Brine spills have killed  vegetation. Old and unused  infrastructure, including storage  tanks, remains at the site.
Although the property deed  requires a special use permit  and an approved plan of  operations, the refuge has not  requested a plan of operations.  In the past, the refuge has  issued special use permits, but  the current operator refuses to  agree to their conditions.
Nature and extent of oil and  gas activity  59 wells (8 active)  4 production pads with storage  (100 miles) and 40 active flow  lines (50 miles)
Pipeline spill caused wildlife  fatalities and contamination.  Habitat loss from saltwater  intrusion and construction of  roads, canals, and other  facilities. Habitat fragmentation  has contributed to increased  number of predators.
The refuge collects fees from  operators to fund full-time  oversight position. Voluntary  permits issued to manage  operator activities.
139 wells (51 active)  1 storage and injection facility  5 transit pipelines (75 miles)  and numerous flow lines  (199 miles)
Soil and vegetation damage  from brine spills and old disposal  pits. Mercury contamination.  Numerous abandoned wells  remain at the site.
The refuge does not issue  permits for any of the gas  activities and relies on operator  cooperation.
1,120 wells (908 active)  No production pads  13 transmission lines  (31 miles) and numerous flow  lines (313 miles)
Soil and vegetation damage  from brine spills and old disposal  pits. Mercury contamination.  Numerous abandoned wells  remain at the site.
The refuge does not issue  permits for any of the gas  activities and relies on operator  cooperation.
Large pipeline spill resulting in  wildlife deaths and soil and  sediment contamination.
The refuge issues permits for  maintenance activities.
Minor soil contamination from oil  spills.
The refuge staff have developed  regional management policy and  attach conditions to federal  permits. The refuge assesses a  fee for seismic activities.
Unknown soil contamination  from oil spills.
The refuge staff have developed  regional management policy and  attach conditions to federal  permits. The refuge assesses a  fee for seismic activities.
Minor soil contamination from oil  spills.
The refuge staff have developed  regional management policy and  attach conditions to federal  permits. The refuge assesses a  fee for seismic activities.
Soil and water contamination  from numerous oil spills.  Mercury and polychlorinated  biphenyl contamination. Lost  habitat from infrastructure  development.
The refuge issues right of way  and special use permits and  requires bonds.
section_title: Analysis of Legal Authority of the Fish and Wildlife Service to Impose Prospective Permit Requirements
paragraphs: The Fish and Wildlife Service’s current authority to regulate, prospectively,  the oil and gas activities of private owners of “reserved” and “outstanding”  mineral rights FWS’s  authority over owners of reserved mineral rights is limited by statute, to  those instances in which the deed transferring the land from the mineral  rights owner to the federal government includes language either requiring  permits or requiring compliance with regulations the Department of the  Interior may adopt in the future, including permitting regulations. FWS’s  authority over owners of outstanding mineral rights is limited in the sense  that FWS’s regulations do not currently require permits. Two of FWS’s  sister land management agencies—the National Park Service and the  United States Forest Service—have regulations that require outstanding  mineral rights owners to obtain permits before engaging in oil and gas  activities on federal lands they manage. FWS, on the other hand, has no  such regulations. As discussed below, while it appears that the Department  of the Interior has not taken a formal position on whether FWS has legal  authority to promulgate such regulations, we conclude it has such  authority, under its statutes and related case law.
Privately owned mineral rights within wildlife refuges may be “reserved” or “outstanding.”  Reserved mineral rights are those that were reserved by the owner when ownership of the  surface land was transferred to the federal government. Outstanding mineral rights are  those that were reserved before the surface was transferred to the federal government, and  thus are owned by someone other than the party making the transfer to the government.
subsections: section_title: Reserved Rights
paragraphs: The Department of the Interior believes, and we agree, that FWS has legal  authority to require private owners of reserved mineral rights located  within “acquired federal refuges” to obtain “entry permits” only in limited  circumstances, in order to obtain access to the refuge for minerals  exploration and removal. The department’s position was originally set out  in a 1986 legal opinion issued by the department’s Office of the Solicitor  (1986 Opinion), and the office recently advised us that the 1986 Opinion  continues to reflect the department’s position. The 1986 Opinion concluded  that FWS generally lacks statutory or other authority to require entry  permits for reserved rights owners and can do so only when the deed  transferring the surface property to the federal government has included  either specific permitting requirements or language subjecting the exercise  of the reserved mineral rights to regulations promulgated by the  department, including permitting regulations. The department’s position is  based on language in the Migratory Bird Conservation Act that was added  by amendment in 1935, making reserved rights subject to requirements  specifically set out in the deed or, if the deed so states, to regulations  prescribed “from time to time” by the Secretary of the Interior. If the deed  does not contain such provisions, the exercise of the reserved rights cannot  be subjected to permitting requirements.
As the 1986 Opinion explains, prior to the 1935 amendment, the Migratory  Bird Conservation Act had made all reserved rights subject to regulations  that were prescribed by the department “from time to time.” The House  Report associated with the 1935 amendment explains that “some owners of  very desirable tracts are unwilling to convey  on such indefinite  and uncertain terms as regulations made ‘from time to time.’ ’’ The purpose  of the change was to provide those who reserved rights in lands they  transferred to the United States with some contractual certainty, and to  protect them from being required to abide by permitting regulations that  were not in effect when the deed was issued.
section_title: Outstanding Rights
paragraphs: The foregoing limits in the Migratory Bird Conservation Act on how the  department may regulate reserved mineral rights do not apply to the  department’s regulation of outstanding mineral rights. A number of other  legal authorities in related areas indicate, in our view, that FWS has  statutory authority to regulate the exercise of outstanding mineral rights on  federal lands.
In Dunn McCampbell Royalty Interest, Inc. v. National Park Service,  964 F. Supp. 1125 (S.D. Tex. 1995), aff’d on other grounds, 112 F.3d 1283  (5th Cir. 1997), the court ruled that the National Park Service has authority  to reasonably regulate private owners’ access to their oil and gas interests  located beneath park system lands, by requiring approval of a plan of  operations before commencement of exploration or production activities.  The court relied on language in the National Park Service Organic Act  directing the Park Service to “protect and regulate” national parks so as to  “conserve the scenery and the natural and historic objects and the wildlife  therein and to provide for the enjoyment of the same in such manner and  by such means as will leave them unimpaired for the enjoyment of future  generations,” as well as language directing the Department of the Interior to issue regulations “as . . . deem necessary or proper for the use of the  parks . . . under the jurisdiction of the National Park Service.”
Similarly, in Duncan Energy Co. v. United States Forest Service,  50 F.3d 584 (8th Cir. 1995), the Eighth Circuit court ruled that although the  Forest Service may not completely deny access to private owners of  mineral interests located within National Forest System lands, the Forest  Service may impose reasonable conditions on the use of the federally  owned surface and thus may require mineral owners to obtain approval  before exploring for or developing minerals. The court relied on language  in the Bankhead-Jones Farm Tenant Act that directs the Department of  Agriculture (the Forest Service’s parent agency) “to develop a program of  land conservation and land utilization” and to issue regulations necessary  to “regulate the use and occupancy of property acquired [for the National  Forest System] in order to conserve and utilize it.” The court also relied  on the Forest Service’s “special use” regulations providing that “ll uses of  National Forest System lands . . . are designated ‘special uses’ [and must be  approved by an] authorized officer.
The statutes addressed in Dunn McCampbell and Duncan bear a number  of similarities to the National Wildlife Refuge System Administration Act  (Refuge System Administration Act), which governs the National Wildlife  Refuge System. Notably, language added to the Refuge System  Administration Act by the National Wildlife Refuge System Improvement  Act of 1997 is very similar to the language of the National Park Service  Organic Act relied upon by the Dunn McCampbell court. As amended in  1997, the Refuge System Administration Act now provides that the mission  of the NWRS is to administer lands for the “conservation, management, and  where appropriate, restoration of  for the benefit of  present and future generations of Americans” and directs the Secretary of  the Interior to “ensure that the biological integrity, diversity, and  environmental health of the System are maintained for the benefit of present and future generations of Americans.” The Refuge System  Administration Act also explicitly authorizes the Secretary of the Interior to  issue regulations to carry out the act. Similarly, as in the statute relied on  by the Duncan court regarding the Forest Service’s permitting authority,  the 1997 amendments to the Refuge System Administration Act added  language directing the Secretary of the Interior to “provide for the  conservation of fish, wildlife, and plants, and their habitats within the   System.”
Thus, as with the statutes at issue in Dunn McCampbell and Duncan, the  1997 amendments to the Refuge System Administration Act authorize the  Department of the Interior to manage the National Wildlife Refuge System  with the same type of policy direction and management standards with  which the Park System and the Forest System are managed, including  issuance of permitting regulations. The legislative history of the Refuge  System Administration Act confirms Congress’s concern for ecosystem and  fish and wildlife conservation and for ensuring that uses of the refuges are  compatible with their purposes. Although neither the Administration Act’s  1997 amendments nor their legislative history specifically refers to  regulation of the activities of private oil and gas operators, the overriding  purpose of the amendments—providing better management to protect  the refuges—together with the reasoning of the courts addressing similar  statutes in Dunn McCampbell and Duncan indicate that FWS has current  authority to require private owners of outstanding mineral rights to obtain  permits before conducting oil and gas operations.
section_title: Scope and Methodology
paragraphs: To identify the nature and extent of oil and gas activities resident within  the National Wildlife System, we relied on several sources of information.  We began with our 2001 report, which identified 77 units with oil and  gas activities based on the Fish and Wildlife Service’s reported activities  in the year 2000. We used the same information source, FWS’s Refuge  Management Information System (RMIS), and reviewed exploration,  production, and pipeline activities for the years 1994-2001. This  information is self-reported by refuges and, by FWS officials’ admission,  incomplete. In addition, RMIS does not indicate the scale of activities  present on a refuge—for example, whether there is one well or hundreds  of wells. Therefore, we contracted Premier Data Services of Englewood,  Colorado, to provide more accurate and comprehensive data on the extent  and type of oil and gas activities occurring on refuges. Premier maintains  a national database of oil and gas wells collected from well permit data  compiled by each state’s oil and gas regulators. Premier recently  contributed to a study for the Departments of Interior, Agriculture, and  Energy under the Energy Policy and Conservation Act, providing a  comprehensive review of oil and gas resources and constraints on their  development in five basins in the interior West.
To determine the number of wells residing on FWS lands, Premier  compared a county-by-county listing of wells against a list of counties with  refuge system lands provided by FWS. For those refuges in counties with at  least one well, Premier either obtained digital maps of the refuges’ current  land status from FWS or, in those cases where FWS had not digitized the  refuge boundaries, converted paper maps into digital format. Premier then  overlaid the geographic plots of wells nationwide with the digitized maps  to identify wells within refuge boundaries and to identify wells within  ½ mile outside the boundaries. (See fig. 11 for a sample plot of the Butte  Sink Wildlife Management Area.) In addition to obtaining information on  the location of oil and gas wells, we also obtained information on the  status, type, and amount of production of oil, gas, and water (brine) from  each well. We eliminated from the database permitted wells that were not  drilled, while wells with any production in the most recent reporting period  we categorized as active; all other wells we categorized as inactive.
To identify pipelines transiting refuge lands, we relied on the National  Pipeline Mapping System (NPMS), which is maintained by the Office of  Pipeline Safety in the Department of Transportation and on FWS’s RMIS.  We overlaid the NPMS data on the 138 refuges for which we had digital  refuge boundary data because they also had wells inside or just outside  their boundaries. The FWS had not finished digitizing refuge maps for the  other refuges in the system. NPMS is based on data reported to the Office  of Pipeline Safety by pipeline owners. NPMS includes 99 percent of the  nation’s hazardous liquids (including oil and other petroleum products)  pipelines and 61 percent of natural gas pipelines in the United States.
NPMS does not include local gathering lines or pumping and storage  facilities that supplement these lines. To supplement this information, we  included refuges identified in RMIS as having transit pipelines. However,  there may be other refuges with pipelines, not recorded in NPMS, RMIS, or  for which we did not have digital maps.
As part of FWS’s review of this report, they identified additional refuges  that may have oil and gas activities or updated the status of activities at  the refuges listed, but did not offer corroborating documentation. While  this information may have been more current than the Premier or the  Department of Transportation databases, we chose to keep these data  intact and did not make additional adjustments.
We attempted to identify information regarding the overall environmental  effects of oil and gas activities on national wildlife refuges. However,  because FWS had conducted few studies and did not have information  regarding what the overall environmental effects of oil and gas activities  on refuges were and how those effects have changed over time, we  selected at least one refuge in each of FWS’s seven regions for physical  inspection. In making these selections, we attempted to choose a cross  section of refuges considering the type and scale of oil and gas activities,  range of environmental effects, and extent and type of management and  oversight. In total, we visited 16 refuges containing 1,510 active and 2,695  total oil and gas wells, about 84 percent and 61 percent, respectively, of all  oil and gas wells we identified on refuges. For a complete list of refuges we  visited, see appendix II. At each refuge visited, we asked the refuge  manager to describe the effects of oil and gas activities on the refuge,  obtained any available studies of these effects, and visited locations of oil  and gas activity selected by the refuge manager to represent a range of  effects. In addition, we contacted state regulators and industry and  environmental representatives and reviewed state laws, FWS contaminant  reports, and scientific and industry and environmental group reports. To  identify reclamation and remediation performed at the refuges visited, we  reviewed files at each refuge, discussed actions taken with refuge officials,  and reviewed information FWS provided from its cleanup and maintenance  databases. To identify steps FWS has taken to document the environmental  effect on refuge resources, we reviewed Contaminant Assessment Program  studies and additional information FWS provided from its contaminants  database. We also discussed these efforts with FWS officials.
To assess FWS’s management and oversight of oil and gas activities in the  National Wildlife Refuge System, we obtained information on policy,  guidance, and practices from headquarters and the seven regional offices  and documented the actual practices in use at the 16 refuges we visited.  To determine the authority of the FWS to require private mineral owners  to obtain permits containing conditions to protect refuge resources from  damage and to oversee oil and gas activities, we obtained information  from the Department of the Interior’s Office of the Solicitor and reviewed  the laws and regulations pertaining to the FWS and other federal land  management agencies and recent court cases concerning private mineral  rights on federal lands. We also identified the type and amount of training  the FWS staff had received and reviewed mechanisms for funding positions  to manage and oversee oil and gas activities. In addition, we interviewed  officials and obtained documentation on FWS’s coordination with, and the  involvement of, other federal and state agencies in the oversight of oil and  gas activities on refuges. Finally, we reviewed the acquisition policies and  practices used by FWS for adding lands to the refuge system, especially  those that contain current or historical oil and gas activities.
section_title: Comments from the Department of the Interior and U.S. Fish and Wildlife Service
subsections: section_title: GAO’s Comments
paragraphs: 1. We provided opportunity for the Department of the Interior and the  U.S. Fish and Wildlife Service officials to review a draft of this report.  To protect against the possibility of early disclosure of the report, we  did not provide the department copies of the draft report to retain, but  did give agency officials ample opportunity to review and take notes on  the draft. We allowed department and FWS officials to review a draft of  the report in Washington, D.C.; Denver; Atlanta; and Portland without  restriction as to the time, number of personnel, or note-taking. 2. See our response in Agency Comments and Our Evaluation section on  page 44. 3. See our response in Agency Comments and Our Evaluation section on  page 45.
section_title: GAO Contacts and Acknowledgments
subsections: section_title: GAO Contacts
section_title: Acknowledgments
paragraphs: In addition to the names above, Mary Acosta, Paul Aussendorf, Robert  Crystal, Sandra Davis, Jonathan Dent, Doreen Feldman, Chalane Lechuga,  John Mingus, Mehrzad Nadji, and Cynthia Norris made key contributions to  this report.
section_title: GAO’s Mission
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section_title: To Report Fraud, Waste, and Abuse in Federal Programs
section_title: Public Affairs