Mat-Su

Prospector resurfaces plans to drill for coalbed methane gas in the Susitna Valley

Robert Fowler made a push to drill for coalbed methane on a farm in Palmer a little over a decade ago, but no drill bit ever broke the ground.

The unsuccessful effort seemed to mark the end of several years of high-profile attempts by Fowler and other prospectors before him hoping to produce methane, the primary component of natural gas, from underground coal seams in the Matanuska-Susitna region.

Methane drilling in Mat-Su got a black eye in 2003 when Colorado’s Evergreen Resources scooped up a swath of underground state leases, some beneath homes, which triggered fears of industrialized backyards and water pollution. Fowler came later, promising more environmentally friendly tactics.

Now, Fowler is attempting to explore for methane again, this time in the Susitna Valley, in a vast backcountry area largely west and northwest of Willow.

Though it’s still early in the process and details are limited, Fowler has proposed an effort that appears to take into account some environmental concerns. Current plans include no surface release of water and no fracking, according to an email from Fowler.

But a Willow community group and others in the area say they’re still concerned about risks to drinking water, property rights and wildlife.

“We are known for the recreation we provide to all of Southcentral Alaska,” said Linda Oxley, president of the Willow Area Community Organization. “We worked hard for that and we don’t want it harmed, and we don’t want our habitat harmed.”

They also worry about whether Fowler has the financial ability to pull off what will be a costly project. His past business efforts were marred with public disputes involving business partners and, in one case, the city of San Francisco.

The plans come as the state renews efforts for a different large project in the region, the 100-mile West Susitna Access road, a proposal drawing similar concerns about potential impacts.

State’s initial report favors exploration

In 2007, Fowler owned a Palmer-based company with plans that were hailed as a relatively environmentally safe approach for getting affordable gas to homes and businesses.

But the project ended when a source of funding dried up during the Great Recession, Fowler said in an email last week. (Fowler answered some questions by email, but declined to be interviewed for this story.)

In 2017, a new company founded by Fowler, Alaska Natural Gas Corp., applied with the state for gas exploration licenses in the Susitna Valley.

In December, the state issued a 312-page preliminary decision in Fowler’s favor.

Tom Stokes, the now-retired director of the Alaska Division of Oil and Gas, determined that issuing the 10-year licenses would be in Alaska’s best interest.

Stokes’ decision says the risks of the proposed gas exploration can be reduced with protective measures, and those risks are outweighed by potential opportunities such as new jobs and more revenue to communities.

“Economically producible coalbed methane is an attractive alternative to diesel fuel, which is the main energy source for home heating and electrical power generation throughout much of rural Alaska,” the decision says.

If the state gives final approval, Fowler would have exclusive rights to explore in two areas encompassing about 915,000 acres. He would have to commit to doing $6.3 million in work, roughly split between the two areas. He would have to provide bonding to help protect the state, and pay more than $900,000 as a licensing fee, according to the decision.

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Opposition and interest in Willow

The eight-member board of the Willow community group, representing more than 2,000 residents in the Willow area, is unanimously against the exploration, Oxley said.

The group has tacked fliers decrying the proposal onto bulletin boards, highlighting concerns about threats to well water, salmon, moose and rivers. It recently wrote a letter to the state objecting to the proposed exploration.

“This intense industrial development and possible adverse consequences even with mitigation measures simply has no place within our community,” the letter says.

During a public comment period in 2017, nine of every 10 submissions, out of 133, opposed issuing the exploration licenses, the preliminary decision says.

Cindi Herman owns the Skwentna Roadhouse about 40 miles northwest of Willow, within the exploration area.

She said she supports exploration, if it’s done safely, though she needs to review this latest idea. She said she might even support drilling on her own land, if it’s far enough away from the roadhouse and she’s compensated fairly.

“We have a lot of resources that need to be used up, and the good Lord gave them to us, and we should be using them,” she said.

One fear exploration opponents have is that Fowler or any other gas prospector could drill on private property against a landowner’s wishes, to access the subsurface minerals that are often owned by the state.

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Companies hoping to use private property for access or drilling usually sign deals with landowners, said Jonathan Schick, a natural resource specialist with the Oil and Gas division. If a deal can’t be reached, the Alaska Department of Natural Resources could step in to support resource development. But that almost never happens and bonding requirements protect landowners, Schick said.

Fowler, in his previous effort to drill, signed agreements with landowners.

Unlocking methane from underground coal seams often involves pumping away large volumes of underground water that trap the methane in the coal. The process of producing methane can lead to the production of large volumes of water that are often “quite saline” and altered by other minerals associated with the coal, the decision says.

Managing that water is a major issue for coalbed methane production, the decision says.

Melissa McGill owns farmland in the area where drilling could be allowed. She said landowners are concerned the process could damage the land or other property with polluted water.

“One of our concerns is where does the water go?” she said. “Because when it’s salinated, it’s unproductive for generations. And if doesn’t go into the farmland, where does it go, into rivers?”

Fowler said in an email that the water will be managed underground. If it must be brought to the surface, it will be reinjected back underground “with the the water never touching the ground.”

The state’s preliminary decision provides a list of mitigation measures to help protect water and the environment. Requirements could include submission of detailed plans for state approval before any water can be released onto the surface.

A variety of agencies will be involved in permitting any future work, said Sean Clifton, policy and program specialist at the Oil and Gas division. “We won’t permit anything that will put fish resources, or farmland, or drinking water at risk,” he said.

Joe Wright leads the Deshka Landing Outdoor Association, which operates the Deshka Landing with access to the Susitna River drainage, about 5 miles west of Willow within the proposed license boundaries. Wright said the group is closely eyeing the gas exploration plans, and has not taken a position.

“There are a lot of people are out there who are concerned about the (drilling proposal) because there’s a big subsistence lifestyle out there,” he said.

McGill and other drilling opponents from Willow are also drawing attention to Fowler’s business record.

Fowler’s previous drilling attempt was marked by bitter disputes with business partners, and concerns about his finances when it became clear the project was not moving forward as planned.

Also, in 2003, Fowler and a company he ran was named as a defendant in a yearslong corruption case brought by the city of San Francisco. according to a 2008 Daily News article. Fowler said in an email that he was dismissed from the case and no action was taken against his company.

Details on exploration plan limited

Alaska Natural Gas’s applications for the two licenses, received from the state through a public records request, provide limited details.

For example, instead of providing habitat reports or cultural information about the proposed license area, Alaska Natural Gas said it could supply those before exploration begins. A surface water summary includes one sentence: “The entire proposed exploration license area contains a prolific amount of lakes, rivers, streams and marshes.”

As for the proposed work, the applications say the exploration will involve “coring and testing” of coal seams.

Exploration wells will be designed using a model that calls for a vertical well drilled to 6,000 feet, with five seams opened, and horizontal wells expanding the underground footprint. It calls for no gas extraction within 1,000 feet of the surface to protect the water table, and underground pipelines. There will be no fracking in exploration or production, Fowler said in an email.

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In an email, Fowler said he will provide details about the project in a plan of operations to the state if the license is granted.

Schick, with the Oil and Gas division, said the state must issue a new public notice and approve a plan of operations before any work takes place on the ground.

The Alaska Oil and Gas Conservation Commission will decide whether to permit the drilling of any wells, Schick said.

Schick said the state’s exploration program is designed to encourage exploration outside the North Slope and Cook Inlet, Alaska’s established oil and gas provinces.

“We’re hoping to get people to explore for oil and gas in the state lands, and get us data (about subsurface conditions),” Schick said.

The Oil and Gas division is accepting comment on the preliminary finding through March 14.

Alex DeMarban

Alex DeMarban is a longtime Alaska journalist who covers business, the oil and gas industries and general assignments. Reach him at 907-257-4317 or alex@adn.com.

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