President Obama speaks regularly about how the United States government should encourage the development and deployment of clean technology to reduce our dependence on oil, especially the oil imported from countries that hate us. I couldn't agree more. The problem is, though, that no matter who sits in the White House, there are thousands of nameless unaccountable career bureaucrats who arbitrarily stonewall the development of the very resources that the President himself is promoting. That stonewalling costs probably billions and kills off fledgling clean technology innovators.
Unfortunately, my company has become the victim of this stonewalling, except the bureaucrats doing it are not nameless; they are the Wyoming staff in the Bureau of Land Management, an agency within the Department of Interior. My company, of which I am CEO, is Luca Technologies Inc. We sustainably produce natural gas from existing wells using biotechnology. We can do this without drilling new wells, hydraulic fracturing, or destroying ground water. Our proven process, fully regulated and already approved by the EPA, recycles water into existing wells, and by adding nutrients to that water, enhances the production of methane by microorganisms that already exist within those wells. We have never applied for, or need, federal funds or tax breaks.
On its website, the BLM states as its mission is "To sustain the health, diversity, and productivity of America's public lands for the use and enjoyment of present and future generations." As part of that mission, the BLM is supposed to manage the development of the minerals on those lands, including oil, natural gas, and coal which was deeded to the federal government in the early 1900s. Under this system, established industries have a distinct advantage as massive and mindless bureaucracies can simply check pre-existing boxes. Thus, the BLM routinely issues permits to coal companies who strip mine the resource, destroying the surface above it in gigantic holes in the ground. The BLM has been issuing coal mining permits, (and collecting money) for decades, and since it is part of their daily routine, apparently doesn't give much thought to that use of the land, which certainly doesn't add to "the use and enjoyment of present and future generations." However, Luca's microbially enhanced gas production process, which does not destroy resources, and is applied in areas of the coal that will never be mined, does not fit their status quo. Because there is no pre-existing box to fit us in and since it is new, bureaucrats push us to the side, trying to avoid responsibility for a decision and hoping we will just go away.
Over a year ago, after two previous years of negotiations, the BLM actually approved a permitting process for implementation of our technology. We filed the application for well restorations over nine months ago, documenting procedures that were developed jointly with the BLM. We also paid them $40,000 to process the permit. The money is one dirty little secret about the BLM; if you need them to give you a permit for an operation, you have to open your checkbook. They are supposed to account for how the money was spent, but have neglected that little detail with Luca. The BLM then promised a permit for us to proceed by November, but after them unilaterally moving the goal posts for nine months, we're still waiting. During this time, there was lots of hand wringing and furrowed brows, but we continued to make glacially slow progress. Up until two weeks ago, we believed we were close to getting approval when, without warning, the BLM demanded a new well monitoring program, which had never been discussed, that we estimate to cost an additional $30 million, more than the value of the project. And, oh, and by the way, they needed another $40,000 to keep working.
When we didn't immediately pay up, Duane Spencer, the Buffalo Field Manager for the BLM, unilaterally rejected our application for non-payment of
ransom "cost reimbursement." With the stroke of a pen, this unaccountable bureaucrat tried to flush $90 million and eight years of work down the toilet, thinking he could kill Luca and its clean technology, just because. We were nothing short of astonished when, in this rejection letter, Spencer threatened to criminally prosecute us if we attempted to develop the resources that we already legally own, even though we've been shut down for over two years working diligently to satisfy his staff's tsunami of demands. After issuing the letter, the BLM then tried to justify its outrageous conduct by starting a misinformation campaign with the public, saying that they rejected our application for "non-payment" leaving out 90 percent of the inconvenient facts of their own neglect and bad faith. From where does such arrogance come?
What's really telling in this whole episode is that, besides the aforementioned EPA approval, Luca has received overwhelming support from the Wyoming legislature, the governor, elected federal representatives and the people of Wyoming itself. Amazingly, we've even received support from the leadership of the BLM in Washington. The EPA has actually held us up as an example of clean energy producers. Unfortunately, none of these facts seem to matter. The bureaucrats in the Wyoming BLM are only interested in keeping their own low stress jobs and maintaining the status quo; benign neglect is used as a weapon to kill any new entrant.
The BLM in Wyoming shouldn't labor under the illusion that we will just exit the state without a fight. Eight years and tens of millions of our own dollars are at stake, as well as our role in a clean energy future which is the most important goal to me personally. Instead of preparing for operations, we are preparing for a legal battle with the BLM, within the federal government in Washington, and in the courts of public opinion. In the meantime, though, there will be the difficulty of lost jobs, lost opportunity, and increasing energy insecurity caused by laziness and arbitrary inaction by unaccountable bureaucrats abusing the authority with which we entrust them. What's really sad is that while we fight this battle against our own government for clean energy, we are being welcomed with open arms in Russia, China, Indonesia, and Australia, all who want our technology now.
That's the real tragedy.
Bob Cavnar is CEO of Luca Technologies Inc, based in Golden, Colorado. He is also author of "Disaster on the Horizon," "High Stakes," "High Risks" and the "Story Behind the Deepwater Well Blowout," published in 2010.
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