ABSTRACT: The BLM's Oil and Gas Drainage Identification Program

Mark Milliken

The objective of the Bureau of Land Management's (BLM) drainage program is to prevent loss of oil and gas by drainage from jurisdictional lands. When such loss is not prevented, the BLM must ensure that the federal and Indian lessors are fully compensated. These objectives may be met by several alternatives, including drilling a protective well, leasing unleased parcels with drainage stipulations, paying compensatory royalties, or entering into an agreement. Relinquishment of the lease is an extreme solution but is allowed by regulation. Detailed geologic and engineering studies result in technical review, showing whether drainage is or has occurred. We then notify the lessee and allow them to submit data showing drainage is not occurring. If we concur, the case is closed If we still believe drainage is occurring or the lessee does not respond, a decision letter is sent. The decision letter may be reviewed by the BLM state director for technical and procedural quality assurance. If the decision is upheld, the lessee may appeal to the Interior Board of Land Appeals (IBLA). The lessee must submit a statement of reasons, clearly outlining his objections to the bureau's decision. The BLM technical staff must answer the statement or request that the case be remanded from IBLA. Posters illustrate a typical case study, illustrating the discovery of drainage, geology and engineering reports, the decision letter, state director review, and IBLA appeal.

AAPG Search and Discovery Article #91003©1990 AAPG Annual Convention, San Francisco, California, June 3-6, 1990