Idaho ranchers view the $22 million deal a major natural gas company struck with two environmental groups that oppose public lands grazing as a pact with the devil.
The company views it as a necessary compromise that was necessary for a mega pipeline project that will create 5,000 jobs and provide millions of dollars in property tax, sales and other tax revenues for counties along the route to proceed.
And the environmental groups view the deal as a means to help protect the environment in the four states where the 680-mile Ruby Pipeline will be located.
Though the pipeline won’t run through Idaho, El Paso Corp., the parent company of Ruby Pipeline LLC, agreed in July to provide the Idaho-based Western Watersheds Project $15 million in exchange for the group not litigating the project.
Western Watersheds was formed in 1993 with the stated goal of ending public lands grazing in the West. The group’s successful track record since then makes Idaho cattlemen particularly concerned about the recent deal.
El Paso also agreed to provide $7 million to Oregon Natural Desert Association, also in exchange for a promise not to sue to stop the $3 billion project, which will install a 42-inch interstate natural gas transmission pipeline with an initial capacity of 1.5 billion cubic feet per day.
A joint news release announcing the deals stated that the money would be used to fund sagebrush habitat protection and address potential environmental impacts arising from the construction of the pipeline, which will run from Wyoming to Oregon, crossing through the northern parts of Utah and Nevada.
Idaho ranchers, as well as ranchers in other states, worry Western Watersheds will use its $15 million as a war chest to run them out of business.
“We’ve been pretty upset about that deal. It allows this money to be used to retire grazing permits,” says Idaho Cattle Association President Carl Ellsworth.
The July 15 news release states the money will be used to “protect and restore sagebrush habitats by purchasing and retiring federal grazing permits offered by willing sellers....”
“When the deal was first announced, we thought it was extortion, basically,” says Idaho Farm Bureau Federation spokesman John Thompson. “We’re scared that money will be used to put ranchers out of business. It’s a scary amount of money.”
Western Watersheds founder Jon Marvel did not return phone calls for this article, but in the news release announcing the deal, he called it “an innovate collaborative effort to restore sagebrush landscapes across the American West.”
“Western Watersheds Project welcomes this opportunity to assist in the restoration of our shared western landscapes,” Marvel stated.
The deal with the conservation groups riled the ranching community as well as county commissioners and state legislators. A multi-county coalition has demanded El Paso back out of the deals and that group has threatened its own lawsuits if that doesn’t happen.
The group met in Salt Lake City Aug. 12 to discuss their objections and formulate a game plan. The permitting process for the project began in January 2008 and the Federal Energy Regulatory Commission gave its go-ahead to start construction on July 30.
Some counties have asked for copies of the agreements, which have not been released, and they strongly hinted they could reconsider permits they issued for the pipeline if that doesn’t happen.
A coalition of local governments unhappy with El Paso’s agreements with the conservation groups have requested a review of the BLM’s record of decision and rights-of-way approval.
El Paso spokesman Richard Wheatley says the company was surprised by the widespread opposition to the deals.
“We were not expecting the adverse reaction we received,” he says. “Our goal was not to put any ranchers or ag interests out of business. That’s not what we do.”
Wheatley says the company viewed the deals as necessary to avoid lawsuits that would stop the project from advancing.
In response to the outcry, the company has been meeting with ranching interests to ensure their concerns are met. One result of those meetings is a similar $15 million agreement in principle recently reached with the Public Lands Council, which represents public lands ranchers in the West.
That money establishes an endowment to “protect, enhance and preserve the public lands grazing industry.”
Wheatley says the company admits it could have done a better job of explaining the situation and the reason behind the deals, but it’s now making amends.
“We’re trying to mend fences here ... because there was a considerable amount of misunderstanding (about the initial deals),” Wheatley says.
Wheatley points out the money will be used to set up two trust funds, each with a three-person board of directors. One of those board members will be from El Paso Corp. Each trust will also have an advisory council and though those councils have yet to be formed, they could include ag interests as well as environmental interests.
“We see this as a good way to provide a real check and balance” on how the money is used, Wheatley said.
Thompson says many ranchers believe the company may have opened up a Pandora’s box with the deals, as other groups will line up to file suit and try to reach similar deals.
The Center for Biological Diversity, a Western Watersheds ally, filed a motion for an injunction in the Ninth Circuit Court of Appeals Aug. 19 to stop construction of the pipeline.
And a Sierra Club chapter in Nevada recently announced it would appeal rights-of-way for the project approved by the U.S. Bureau of Land Management.
“We think El Paso made a huge mistake by making a deal with these groups that bring nothing to the table except the threat of litigation,” Thompson says. “We think they’ve opened up a huge can of worms.”