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Targeted by the EPA

Don't mess with Texas.

Jun 6, 2011, Vol. 16, No. 36 • By BETH HENARY WATSON
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A three-inch lizard scuttled into the spotlight in December after the U.S. Fish and Wildlife Service proposed moving it onto the Endangered Species List. The dunes sagebrush lizard’s habitat covers just eight counties on the Texas-New Mexico border, right in the heart of the Permian Basin, a major oil-producing region. Particularly in Texas, industry leaders and local businesses see the action as hostile​—​another Obama administration environmental policy targeting their successful, energy-sparked economy. 

Targeted by the EPA

U.S. Fish and Wildlife Service

“This is a lizard versus families,” says Bill Hammond, president of the Texas Association of Business, the state’s largest business interest group. “Nothing is more important than a job.”

Setting 1980s Dallas stereotypes aside, oil and gas production is between 12 and 15 percent of the Texas economy. It’s more than 70 percent of the economy in the vast and sparsely populated Permian Basin. The 17-county basin produces nearly 20 percent of all domestic crude oil. Of the eight counties in the lizard’s habitat, four are in Texas. All those are among the top ten oil-yielding counties in the state.

In its proposal to list the lizard as endangered, U.S. Fish and Wildlife argues that several activities fragment the creature’s habitat. Together these constitute a clean sweep of the region’s economic drivers: oil and gas (particularly exploration), wind turbine erection, and agriculture. The dunes sagebrush lizard resides only in areas with sandy dunes covered by low-lying shinnery oak trees. 

A public comment period closed May 9, and U.S. Fish and Wildlife will decide by mid-December whether to put the lizard on the Endangered Species List. An “endangered” finding triggers an assessment period to define the lizard’s range and identify protection strategies. At that time, new surface-disrupting economic activity and perhaps maintenance of existing wells and windmills could be hampered.

Steve Pruett, president and CFO of Midland-based Legacy Reserves LP, explains that stifling exploration threatens the most jobs. He hires subcontractors to operate his rigs, the towering structures used to drill wells. Legacy runs just one rig in the lizard’s presumptive habitat, but 131 other rigs are active, each of which drills two wells a month and employs about 150 people.

“We wouldn’t be contracting as many wells to be drilled,” Pruett says. “Not to mention the general loss of confidence of our investors. We would have less production and less cash to pay out.”

According to Permian Basin Petroleum Association president Ben Shepperd, wells produce at diminishing rates, making new exploration vital to retaining blue-collar workers like roughnecks and roustabouts. He cites a study that found a majority of jobs even in the cities of Midland and Odessa depend on oil and gas production.

“If oil and gas were to stop out here, these West Texas towns would just dry up and blow away,” Shepperd says. Excluding giants like Chevron, the average Permian Basin Petroleum Association member employs about 10 people. 

Texas opponents of listing the lizard dispute the thoroughness of U.S. Fish and Wildlife’s science and say they will work cooperatively to rehabilitate the population. Conservation agreements​—​another way to restore species populations​—​are already in place in New Mexico. With the agreements, private landowners, businesses, and the government follow a prearranged plan, although Sheppard says signing on can cost an oil business as much as $20,000 per well.

Texas land commissioner Jerry Patterson told an industry rally in Midland in late April that the state’s landowners and businesses need a chance to work out agreements with the fish and wildlife service. The state currently enforces mitigation for turtle populations near drilling along the Gulf Coast, an arrangement that followed a court battle. “We can plant a lot of shinnery oak if we need to,” Patterson said. “It’s not the lizard or us. It’s both of us.” 

Even if Texas, with New Mexico’s help, is able to avoid endangered species classification for the dunes sagebrush lizard, a proposed listing for another species in the Permian Basin, the lesser prairie chicken, lurks in the future.

Hammond, with the business association, says the effort to list the lizard as endangered is but one grievance his group has with the Obama administration, which he says is engaged in a “job-killing enterprise” against Texas. 

Texas’s showdown with the Environmental Protection Agency over air permitting is the major concern.

“Industry has spent literally trillions of dollars to bring air quality to a level that is perfectly acceptable,” according to Hammond.

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