[Federal Register Volume 77, Number 135 (Friday, July 13, 2012)]
[Notices]
[Pages 41442-41444]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-16909]


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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

[LLNM910000 L13100000.EJ0000]


Notice of Availability of the Draft Order of the Secretary on Oil 
and Gas and Potash Development Within the Designated Potash Area, Eddy 
and Lea Counties, NM

AGENCY: Bureau of Land Management, Interior.

ACTION: Notice of availability.

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SUMMARY: Under the authority of the Mineral Leasing Act, as amended, 
the Bureau of Land Management (BLM) has prepared a draft Order of the 
Secretary of the Interior (Secretary's Order) to address oil, gas, and 
potash leasing and development within the Designated Potash Area in 
Eddy and Lea counties in New Mexico. The draft Secretary's Order would 
supersede the current Secretary's Order that addresses those issues. By 
this notice, the BLM announces the opening of a 30-day public comment 
period regarding the draft Secretary's Order. The revised guidelines in 
the draft Secretary's Order are designed to further promote the 
efficient development of potash, oil, and gas resources, while 
minimizing conflict between the industries and ensuring the safety of 
operations. Among other benefits, the revised guidelines are expected 
to enhance the safety of underground potash miners and allow for full 
development of oil and gas leaseholds with fewer environmental impacts.

DATES: To ensure that comments will be considered, the BLM must receive 
written comments on the draft Secretary's Order within 30 days 
following the date this Notice of Availability is published in the 
Federal Register.

ADDRESSES: You may submit comments related to the draft Secretary's 
Order by any of the following methods:
     Email: [email protected];
     Fax: 505-954-2115; or
     Mail: Bureau of Land Management, New Mexico State Office, 
301 Dinosaur Trail, Santa Fe, NM 87508.
    The draft Secretary's Order is available at the following Web site: 
http://www.blm.gov/nm/st/en/info/potash.html.

[[Page 41443]]


FOR FURTHER INFORMATION CONTACT: Tony Herrell, Deputy State Director, 
Mineral Resources; telephone 505-954-2222; address 301 Dinosaur Trail, 
Santa Fe, NM 87508; email: [email protected]. Persons who use a 
telecommunications device for the deaf (TDD) may call the Federal 
Information Relay Service (FIRS) at 1-800-877-8339 to contact the above 
individual during normal business hours. The FIRS is available 24 hours 
a day, 7 days a week, to leave a message or question with the above 
individual. You will receive a reply during normal business hours.

SUPPLEMENTARY INFORMATION: An area near the town of Carlsbad in 
southeastern New Mexico has large deposits of potash, oil, and gas. Oil 
and gas have been produced from this area since the early twentieth 
century. Potash (potassium bearing salts primarily used for fertilizer) 
was discovered in this area in 1925 and has been mined since 1930.
    The Secretarial Potash Order was first issued by the Department of 
the Interior (Department) in 1939 (4 FR 1012, February 25, 1939). That 
Order withdrew 43,000 acres of public land from oil and gas leasing in 
order to protect potash deposits. The Order was amended in 1951 (16 FR 
10699, October 18, 1951) to allow for multiple mineral development in a 
larger area and established special lease terms for use in both potash 
leases and oil and gas leases. Such lease terms were designed to 
facilitate the protection of mineral resources and the safety of 
miners. The Order was also amended in 1965 (30 FR 6692, May 15, 1965), 
1975 (40 FR 51486, November 5, 1975), and 1986 (51 FR 39425, October 
28, 1986). A correction to the 1986 Order was issued in 1987 (52 FR 
32171, August 26, 1987). The potash area designated by the corrected 
1986 Order comprises approximately 497,000 acres, and the draft Order 
would not alter the boundaries of the area.
    The potash deposits in this area occur from 800 feet to over 2,000 
feet beneath the surface and are mined by both conventional and 
solution mining methods; conventional methods require miners to be 
underground. The oil and gas in the area is found in formations below 
the potash bearing formations, so oil and gas wells must extend through 
potash formations. If potash mining breached a well casing, or if a 
well casing near a potash mine failed for other reasons, gas could 
enter the mine workings, thus endangering the miners. Additionally, 
such a breach would raise the costs of potash mining due to the need 
for enhanced ventilation techniques and specialized equipment needed to 
mine in a gassy environment. Accordingly, given these safety risks, 
while potash and oil and gas are found in the same area, they cannot 
readily be produced at the same time. Thus, there has been a long 
history of conflict between the potash and the oil and gas industries.
    This conflict has resulted in a great deal of litigation in this 
area regarding decisions made by the BLM on a variety of development 
applications. Nevertheless, over the past several years, the two 
industries have initiated efforts to work together. There have been 
productive meetings and discussions between many of the parties 
involved in these previous disputes. Additionally, there have been 
significant advances in the technology of oil and gas drilling that 
could be used to reduce the conflict between such drilling and the 
extraction of potash. Further, the economic outlook for both the oil 
and gas industry and the potash industry has recently improved. All of 
these factors have combined to encourage coordination between these two 
industries. The BLM has also worked with Sandia National Laboratories 
to investigate well logging technology, gas migration in the potash 
formations, and standards to use for estimating the mineability of 
potash and potash cutoff grades. These circumstances have led to this 
current review of the 1986 Secretary's Order.
    The draft Secretary's Order differs from the 1986 Order in several 
important ways. First, the formatting is modified to be consistent with 
the Department's style requirements for Secretary's Orders. These 
requirements were changed in 1992. See 012 DM 1 in the Departmental 
Manual.
    Next, the draft Secretary's Order is built on a foundation of ``co-
development.'' This new term is used to describe concurrent development 
of potash and oil and gas from the Designated Potash Area through a 
cooperative effort between the industries under this draft Secretary's 
Order.
    Next, the draft Secretary's Order authorizes the BLM to establish 
``Development Areas.'' Development Areas are blocks of Federal oil and 
gas leases, to be identified by the BLM, that could be developed as a 
unit from one or more ``Drilling Islands.'' The draft Secretary's Order 
envisions that the oil and gas leases in a Development Area would be 
unitized under the regulations found at 43 CFR subpart 3180, and 
developed by a unit operator or operated under a communitization 
agreement as authorized under 43 CFR subpart 3105. This would lead to 
more orderly development of the oil and gas resources in the 
Development Area and minimize impacts to surface resources and potash 
resources.
    The draft Secretary's Order also defines new terms for classifying 
lands with regard to their potash values. ``Barren Areas'' are defined 
as lands within the designated Potash Area where sufficient data is 
available to establish that the area lacks mineable potash resources. 
``Unknown Areas'' are areas within the Designated Potash Area where 
there is an absence of data to classify the potash mineralization of 
the lands. While Barren Areas may be preferred locations for Drilling 
Islands, Unknown Areas may warrant protection from oil and gas drilling 
until such time as data is available to properly classify the potash 
mineralization.
    It is envisioned that the majority of the Designated Potash Area 
will eventually be divided into Development Areas designed to minimize 
the impacts to potash mining while allowing for the development of oil 
and gas resources. It is intended that Development Areas will be 
developed with extended reach horizontal wells using the most current 
technology, consistent with applicable laws and regulations.
    As described in the draft Secretary's Order, wells would be drilled 
from a Drilling Island established within the Development Area. In most 
cases, a single Drilling Island would be established for each 
Development Area. However, when circumstances dictate, BLM could 
establish additional Drilling Islands. Drilling Islands would be 
situated in such a manner that extended-reach horizontal wells could 
access oil and gas within the associated Development Areas. Under the 
draft Secretary's Order, in areas leased for potash or containing 
``Measured Reserves'' (i.e., areas where potash is known to exist in 
sufficient thickness and quality to be mineable), the Development Areas 
would generally be larger, potentially requiring the most aggressive 
use of extended-reach horizontal wells. In other areas, Development 
Areas could be smaller, and the use of extended-reach horizontal wells 
would likely be less.
    By further utilizing a drilling island concept for oil and gas 
development that was first introduced in the 1986 Secretary's Order, 
full development of oil and gas leaseholds would occur with less impact 
to the environment because of the reduction in the number of drill pads 
and associated roads, power lines, and other ancillary facilities 
required to develop the oil and gas resource. The safety of the 
underground potash miners

[[Page 41444]]

would also be enhanced by a reduction in the number and spacing of oil 
and gas drilling locations where wells penetrate the potash formation.
    The draft Secretary's Order retains several important features of 
the 1986 Order, including the boundaries of the Designated Potash Area 
established in the 1986 Order, as corrected in 1987. The draft 
Secretary's Order also retains language of the 1986 Order for special 
terms and conditions for oil and gas leases and potash leases issued, 
readjusted, or reinstated in the Designated Potash Area. The draft 
Secretary's Order seeks to retain the wording of the 1986 Order to the 
extent practicable.
    The provisions in this draft Secretary's Order are consistent with 
the Department's regulations, onshore orders, and the oil and gas lease 
form. The Department's existing regulations and onshore orders allow 
the BLM to impose conditions of approval on permits to drill and 
require protection of other mineral resources, other natural resources, 
environmental quality, life, health, safety, and property. See 43 CFR 
subparts 3162.1, 3164.1, and 3165.1. The oil and gas lease form (BLM 
form 3100-11) provides that the rights granted in the lease are subject 
to the Secretary's subsequent formal orders when not inconsistent with 
the lease rights. The lease form also provides that lessees will take 
reasonable measures that BLM deems necessary to minimize adverse 
impacts to other resources and to other land uses or users. The 
provisions in the draft Secretary's Order are also consistent with the 
regulations governing potash leasing, exploration, and development. See 
43 CFR part 3500 and subpart 3190.
    Before including your phone number, email address, or other 
personal identifying information with the submission of your comments, 
you should be aware that your entire submission--including your 
personal identifying information--may be made publicly available at any 
time. While you may ask us to withhold your personal identifying 
information from public review, we cannot guarantee that we will be 
able to do so.

    Authority: 43 CFR 3164.1, 43 CFR 3590.2.

Jesse Juen,
New Mexico State Director.
[FR Doc. 2012-16909 Filed 7-12-12; 8:45 am]
BILLING CODE 4310-VC-P