Coal-Bed Methane Puts Basic Needs of Water, Energy at Odds

Strange things are happening to the water supplies here in the San Juan Basin.

Carl Weston noticed sugar foaming on homemade lemonade; he lit a match, held it close and watched the flame flare high. The water bubbled in Mentor Goehring’s well; the pines and cottonwoods died near his log cabin. At Ron and Mac Burkett’s ranch, an artesian well dried up after generations of gushing 1,000 gallons every minute.

They all think they know why. This slice of southwest Colorado and northern New Mexico is the hub of an emerging industry that harvests natural gas from waterlogged underground coal beds. Energy companies pump the ground water out, reducing the pressure that trapped methane vapors in the coal. Then rigs extract the liberated gas.

From the Rockies to the Appalachians, America’s coal beds contain so much methane that recovering just 15% would yield a trillion-dollar bonanza, enough to meet the entire country’s natural gas needs for more than 11 years. Coal beds already provide at least 6% of the nation’s natural gas, and geologists predict that could double as new fields are developed.

But moving all that water may exact a price. As coal-bed development spreads, complaints have surfaced in at least four states of apparent side effects: Methane jets spurting above the ground. Fire smoldering below. Salty coal-bed water dumped in rivers. Toxic hydrogen sulfide leaking into streams.

Coal-bed methane has created some new twists in long-running tensions over tapping the nation’s energy sources. It offers far more potential than Arctic oil--and burns cleaner--but its perceived risks are posed not on isolated tundra but in vast populated areas. And Western ranchers, who are seldom aligned with green activists, have been among the first and loudest to complain about the effect of drilling.

At stake are two basic but competing needs: abundant energy and fresh water.

Policies on the table in Congress, placed at industry’s urging, favor ramping up. Environmental groups urge slowing down.

Senate proposals include a tax credit that even some producers say they do not need and an environmental exemption that is at odds with a federal court decision.

Among the winners if both pass: Dominion Resources, which poured more than $907,000 into both parties in the last election cycle, and Halliburton Inc., the energy services conglomerate whose CEO was Vice President Dick Cheney until last summer.

“What we have is a blind rush forward,” said Travis Stills, staff attorney for the Oil and Gas Accountability Project, an environmental advocacy group. “We don’t want to stop the drilling altogether, but take a look at what the impacts are and proceed cautiously.”

In southwest Virginia, more than 100 residents in Buchanan County have filed complaints alleging that the 1,500 coal-bed sites there have fouled or dried up their water wells.

In Wyoming, some ranchers contend that dumping high-sodium coal-bed water into the Powder River has hampered their ability to irrigate alfalfa and hay, which their cattle need to survive.

The industry emphasizes there is no proof that coal-bed development damages nearby water. Yet even experts who are fervent boosters say it’s possible that coal-bed operations could cause some of the described effects.

“There is really no data. It’s obvious that we need to look at this,” said Indiana University geologist Maria Mestalerz.

In the Senate Republicans’ omnibus energy bill this year, Sen. Frank H. Murkowski (R-Alaska) has proposed resurrecting a coal-bed tax credit that expired in 1992. The nearly $7.1-billion price tag over five years makes the revived credit a target for taxpayer groups.

Some energy companies will not defend a credit. “We can’t justify it,” said Don Duncan, a lobbyist for Phillips Petroleum, which is developing coal-bed methane sites in Wyoming. “Gas prices are sky high. That’s incentive enough.”

Dominion Resources, by contrast, is lobbying heavily for a safety net in case the bottom drops out of the natural gas market. Company spokesman Dan Donovan said a tax break would probably prompt Dominion to develop at least two more coal-bed fields.

“We’ve got the technology now; it’s feasible,” he said. “But to continue it, we need help. Let’s not turn off the spigot.”

Murkowski worked closely with Cheney’s office to craft the GOP package. Cheney will present his own energy plan to President Bush late next month and “is aware of the [coal-bed] issue,” Donovan said.

Indeed, while Cheney was still running Halliburton, the company sought to enter a federal court battle in Alabama over a process it provides to stimulate production in coal-bed wells. An environmental legal foundation was trying to force the Environmental Protection Agency to regulate that process, and a Halliburton attorney wrote that federal restrictions “could have significant adverse effects” on the firm’s business.

The lawsuit began after an Alabama resident blamed coal-bed stimulation for long, oily strings streaming from a faucet and a strong sulfur smell in his shower.

Last year, the court ordered the EPA to regulate the process, but the ruling applies only to Alabama. The Domestic Petroleum Council, an industry group concerned about the precedent, prevailed upon Sen. Jeff Bingaman (D-N.M.) to introduce a bill exempting that process from EPA restrictions in all other states for two years. Bingaman has drafted a measure he intends to introduce soon.

Experts say the combination of tax breaks and the exemption could set off a coal-bed rush.

Even without the credit, new coal-bed projects are planned in Indiana, near Anchorage, Alaska, and in Montana, about 40 miles north of Yellowstone National Park. Companies are also eyeing coal formations in Utah, West Virginia, Michigan, Kansas, South Texas, northern Oklahoma and additional portions of Colorado and Wyoming.

The North Slope of Alaska holds about 35 trillion cubic feet of natural gas reachable by conventional means, said Charles Barker, a U.S. Geological Survey geologist. That pool is plenty big enough to prompt industry interest, but it is a small percentage of the 200 trillion cubic feet trapped in the slope’s coal beds.

For now, 80% of the nation’s methane comes from the San Juan Basin.

Coal-bed wells are as much a part of the dramatic landscape as bald eagles, wild turkeys, unshorn sheep and grazing cattle. Hundred-foot drilling rigs and 30-foot pump-jacks labor mechanically against a looming phalanx of snowy peaks. From the air, well pads are visible on fields gouged from the slopes themselves.

Along the Animas River, popular with kayakers and rafters, signs warn: “Danger. Harmful levels of hydrogen sulfide are seeping from the ground in this area.” The postings add that the highest concentrations “can cause eye and lung irritation, along with headaches and nausea even with brief exposure.”

Fumes were first noticed in the early 1990s as coal-bed drilling got underway on the cliffs above. Gail Aalund, executive director of the La Plata Energy Council, a producers’ group, notes no link was ever proved. But county planners suspect drilling amplified any natural seepage.

Because the region’s population is growing by about 2% a year, the oil companies’ mineral rights fall increasingly near houses and schools.

One gas well, for example, perches at the edge of the Alpine Shadows subdivision near Durango. Water there slowed so much that some residents plan schedules for flushing toilets, taking showers and running half a load of laundry at a time.

To the east, BP Amoco bought and leveled four houses after owners blamed coal-bed drilling five miles away for methane in their basements and water wells. The oil firm, admitting no responsibility, settled to avoid a lawsuit, Aalund said.

In neighboring New Mexico, the Southern Ute Indians recognized hot ground and drooping vegetation as signs of subterranean coal fires. Potential dangers include “explosion, fire, toxic and caustic gases and collapse of the surface into underground caverns,” the tribe and federal government wrote in an environmental report.

Still, coal beds produce lots of money for the tribe--more than its casino--and the Southern Utes say there is no proof that the coal-bed operations caused the fires. They want to double the number of wells to four per square mile.

Coal-bed methane likewise accounts for nearly half the property tax revenues in Durango’s La Plata County. Nevertheless, Josh Joswick, a county commissioner, fears a speedup.

“That really has been my nightmare,” Joswick said. “Every place is going to be a little bit different because the geology is different. But I guarantee you there are going to be problems.”

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Times researcher Sunny Kaplan in Washington contributed to this story.