County officials worry that millions in oil revenue will disappear with Anvil cleanup

RBC — Anvil Points — site of an oil shale research project that started in the 1950s and lasted for 40 years — is back in the news.
In a letter last week to the director of the Colorado State Office of the Bureau of Land Management, Club 20, an organization representing 22 counties in western Colorado, expressed concern about the cleanup project.
“… we are very concerned about the Department of Interior’s lengthy delay in certifying the satisfaction of the financial obligation related to the Anvil Points cleanup,” the Club 20 letter stated. “We are equally concerned about the apparent and dramatic increase in the estimated costs associated with this cleanup.”
Anvil Points was a pilot oil shale program. The research station, located near Rifle, has a waste pile containing spent shale and other material, including arsenic and other heavy metals, from oil shale mining and processing. The estimated 300,000 tons of waste is a threat to ground and surface water, including the Colorado River, less than two miles from the site.
“Anvil Points was the location of an oil shale pilot program in the 1950s through the early 1990s,” said Rio Blanco County Commissioner Ken Parsons. “It was dismantled and removed, but there are shale tailings in which heavy metals are in a mobile state.”
A 1997 federal law transferred land where the Anvil Points research site was located — known as the Roan Plateau — to control of the BLM. As part of the deal, royalties from oil and gas development in the area went into a trust fund to pay for cleanup of the site.
“The Department of the Interior has been holding FML (federal mining leasing) revenues from gas drilling on these oil shale lands until sufficient funds accumulated to finance the cleanup,” Parsons said. “That occurred in March 2007, and the FML revenues are still accumulating and will do so, apparently, until the cleanup is accomplished.”
In July, the BLM awarded a $15.4 million for the cleanup to a company from Idaho. Cleanup is scheduled to start this fall.
The balance of the trust fund money was to be split between the federal government and the state of Colorado. Or, at least that’s what local officials thought.
“The remaining money was supposed to be split on a 50-50 basis,” said Rio Blanco County Administrator Pat Hooker. “The feds get 50 percent and the state gets 50 percent.”
Western Colorado politicians have lobbied to have the state’s portion split between the four impacted counties — Garfield, Mesa, Moffat and Rio Blanco. Rio Blanco and Garfield — the two most affected counties — would receive 40 percent, and the other two counties 10 percent.
Hooker estimated Rio Blanco County’s allocation to be about $13 million.
“The DOI (Department of the Interior) now claims that dollars in this fund are ‘different’ from all other FML categories and 100 percent of the excess is theirs until the cleanup is done,” Parsons said. “Then and only then will the FML (money) be split, as per standard law.”
Local officials are not optimistic Rio Blanco County will receive any of the leftover cleanup money anytime soon.
“Now, rumor has it the interior department has already spent the surplus,” Hooker said. “And it’s doubtful the counties will ever receive a dime of the surplus.”
Parsons remains skeptical as well.
“The jury is still out on all of this,” the county commissioner said. “I personally believe it will be a cold day when we see one cent of this.”