In the summer of 2003, Usibelli Coal Mine Incorporated, a family owned corporation
located in Healy, filed lease applications with the State of Alaska to explore for coalbed methane.
In November 2003, a moratorium was placed on these leases, after problems with the
nature and pace of coalbed methane exploration developed in other parts of the State.

The proposed leases, in eight areas, surround Usibelli's present coal leases to the east, northeast, and west, and include the town of Healy (and the Tri-Valley subdivision), Otto Lake, and lands west to roughly the eastern boundary of the Panguingue subdivision.

Methane is often touted as a "clean-burning" fossil fuel superior to coal or oil for emissions. However, the means of extraction has been very controversial in many areas of the lower 48 because of adverse environmental impacts and impacts on surface landowners that occur when states or the federal government lease the sub-surface rights beneath private lands. In Alaska, the State retains sub-surface mineral rights. A private property owner in reality owns only the surface rights, and in a case of conflict, the sub surface rights legally take precedence.

Unlike traditional gas and oil extraction, methane is recovered by installing a wellhead every 80 acres, with the possibility of closer spacing. A small road is built for each well pad. The methane is extracted by pumping out large amounts of groundwater, which causes a change in pressure, and allows the gas to flow to the wellhead. Approximately every 10 wells are tied together by a pipeline that feeds a compressor station. From there, the gas is trucked or piped to either a local power plant or to market.

Map courtesy of UCM. Lease areas 7 and 8 underlie the greatest
concentration of residences. Click here to see entire lease map.

In Alaska the sub surface mineral rights owner (the gas developer) holds legal precedence over the surface estate owner (the private property owner.)
In its comments to the Division of Oil and Gas on the Usibelli lease application, DCC requested that the lease require the mining operator to negotiate surface use agreements with every property owner individually, and that no one should be forced into such an agreement where significant hardship or loss of property value can be demonstrated. To read the DCC comments on the lease application click here

Possible Impacts of Coalbed Methane Development
It is possible that Usibelli will not find commercial quantities of gas when it begins exploratory drilling, but the Denali Citizens Council is monitoring the process in an effort to determine whether the problems encountered in the lower 48 would be applicable to the Usibelli project if it goes forward. Issues that have been reported in Wyoming, Montana, Colorado, and New Mexico include the following:

• Reduction of groundwater flow as water is pumped to the surface, impacting drinking water wells.
• Contamination of drinking water wells with methane.
• Contamination of surface water by toxins in groundwater pumped to the surface (news reports indicate that regulations in Alaska require re injection of the wastewater).
• Methane leakage into structures (release of pressure doesn't necessarily cause the gas to go up the well - it can go other places too), causing potentially explosive build-ups of gas in homes and businesses.
• Roads, drilling pads, and compressor stations built on private land over the objections of surface landowners with attendant noise of generators, well pumps, compressors, and regular servicing by trucks.
• Insufficient bonding to induce producers to remove the industrial infrastructure after extraction is finished, so that it is less expensive to surrender the bond and abandon the developments.
• Large-scale carving up open space and wildlands by roads and industrial facilities.

On the positive side, some surface landowners have received benefits from coalbed methane by way of payments for infrastructure siting, construction of roads or driveways where they needed them, irrigation water, and severance tax revenues to help pay for local services. DCC continues to monitor the situation and will provide periodic updates to this site.

In the summer of 2004 Usibelli re-applied with DNR to explore for gas (either shallow gas or coalbed methane) on approximately 208,000 acres around Healy. Under new rules adopted by the State of Alaska, this application would require a Best Interest Finding. There was a call for preliminary scoping comments in spring of 2003.
Scoping Comment period closed on March 11, 2005,
Best Interest Finding may be out in April 2005

TO SEE DNR’S CALL FOR COMMENTS, VISIT THE DNR WEBSITE AT http://www.dog.dnr.state.ak.us/oil/products/publications/healy/healy.htm
Scoping comments will be considered in preparation of the Best Interest Finding document. This document is planned for release in April 2005, followed by two more meetings in Healy. The dates of these meetings are unknown at this time. The Best Interest Finding will seek to determine if gas development in the Denali Borough is in the best interests of the citizens of the State of Alaska.
To view DCC's comments, click here.
For information you may call Pat Galvin at the Department of Natural Resources at 907-269-8775.

Friends of Matsu
www.foms.net

Extensive website chock full of information
on both Mat-Su and statewide citizen concerns
http://www.gasdrillingmatsu.org/

Other useful Web links on Coalbed Methane

To learn more about coalbed methane development in Alaska
and the current development of guidelines, visit the state Division of Oil and Gas at www.dog.dnr.state.ak.us

To read more about the Denali Borough,
where the above lands are located, click here