Commission asks BLM to fast-track Fram’s Whitewater project proposal

A well pad with a producing oil well, and a rig to drill another well, are seen at a well site on Purdy Mesa road.



Work on approving an oil-drilling project near Whitewater should take precedence over other work by the Grand Junction office of the Bureau of Land Management, the Mesa County Commission said.

Mesa County Commission Chairman John Justman said the commission hoped the federal agency would reshuffle its priorities and push the project proposed by Fram Exploration ASA ahead of another project.

The Grand Junction office also is revising its resource management plan, a project it undertakes every 20 to 25 years.

The two projects — Fram and the resource management plan — are unrelated, BLM spokesman Christopher Joyner said.

“We are very interested in getting (Fram’s Whitewater) project out,” Joyner said. “We understand that it’s a major economic driver.”

Katie Stevens, the BLM’s Grand Junction Field Office manager, earlier this year said she hoped to have the Fram project complete by March or April.

It’s now looking as though the decision will be mid- to late May, Joyner said.

The issue, however, isn’t whether the agency put one project in front and the other on the back burner, Joyner said.

Rather, the long winter set back the BLM’s efforts to analyze a new route that came to the fore from comments made during the environmental study of the project, Joyner said.

“The weather held us back considerably” in analyzing the alternate route along B Road, instead of the originally proposed C Road route, Joyner said.

Analyzing the B Road route involves archaeological and other surveys that couldn’t be completed while the ground at the base of Grand Mesa was covered with snow, a condition that lasted longer than normal, Joyner said.

In most cases, the BLM staff working on the resource management plan wouldn’t be working on the Fram project, Joyner said.

The county would like to see the federal agency divert effort from the resource management plan to Fram’s development, Justman said.

Mesa County needs the employment that would come with the Fram project as soon as possible, and the resource management plan can wait, Justman said.

“As far as Mesa County is concerned, the BLM should complete the Fram master development plan permit process now, and assist the community by allowing all opportunities for much-needed jobs in Mesa County,” says a letter signed last week by all three commissioners to the BLM.

Fram owns 95.6 percent of a working lease of 54,000 acres within the 90,445 lease. The company plans to drill 108 wells on 12 pads.


COMMENTS

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I hope that there are some conditions placed on this fast track. Fram’s proposal is very close to the source of Grand Junction’s drinking water. Any spill has the potential to pollute the very water that the city drinks, and Fram has little or no ability to pay for any clean up. Their most recent on-line financial statement, issued a year ago, has a note to the financial statements that questions the ability of this Norwegian company to continue as a going concern. That kind of note to the financial statement scares off most investors, and is extremely rare in the world of auditing. Our County Commissioners are putting our drinking water at risk for the sake of a Norwegian company with no skin in the game—they are depending on other people’s money (investors) to do anything. Do our commissioners honestly think that generating profits for a failing oil and gas company is in their job description? You can see the financial statement here (Page 53 has the going concern note.) http://www.framexploration.no/assets/files/financial/Fram_Annual_Report_2012.pdf To be fair, they announced just this month an agreement ($40 million) that will get them two drilling rigs and support for their US operations. That statement includes this info: “In Whitewater, Colorado, two near horizontal wells were drilled in 2013. Both wells encountered significant amounts of sand, confirming the modeled meandering channel systems. Logs and swabbing documented presence of oil. To date it has not been possible to get the oil to flow. A detailed review of the drilling and completion method indicates that use of water based mud and heavy overpressure in drilling is the probable cause of the lack of flowing oil. A revised drilling and completion plan has been designed for future wells in the area.” That doesn’t give me much confidence in the ability of this company to develop the field because they don’t understand the technology needed and do not have the financial prowess to buy better technology.

Sorry, I meant to include the link to the announcement of new capital for Fram, but hit send before I did so. Here it is: http://www.framexploration.no/fram-exploration-raises-usd-41.4-million-in-new-equity

More temporary jobs.  When are the Commissioners going to understand that “fast-buck” energy jobs are not real economic development.  How many boom-and-bust cycles will it take?

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