Coors Energy Co. has withdrawn its application to drill a controversial oil well a few miles north of Moab - and it's no coincidence the announcement came shortly before an environmental group said it would sue the company.
The well was planned for Little Canyon, about a mile west of the entrance to Arches National Park. The project would have required widening a road used as access for the Gemini Bridges Mountain Bike Trail.To the dismay of environmentalists, the site was in the midst of an area used by bighorn sheep during part of the year and within a parcel of land proposed for wilderness protection by Rep. Wayne Owens, D-Utah.
"As part of its previously announced plans to sell all of its oil and gas properties, Coors Energy Co., a wholly owned subsidiary of Adolph Coors Co., said Wednesday that it will not drill an exploratory well" there, said Jon Goldman, a spokesman for the energy company, based at Golden, Colo.
Goldman said Adolph Coors Co. announced in September 1991 that it intended to dispose of its energy subsidiary. Since then, it sold assets in eastern Colorado to Cerrity Oil and Gas Corporation of Denver, and expects to close a sale on western Colorado properties with a company called Gasco Inc. in July.
"Efforts to dispose of remaining properties are continuing," Goldman said. "Coors Energy has asked the Bureau of Land Management to withdraw its application for permit to drill at the site."
Steve Koteff, staff attorney for the Southern Utah Wilderness Alliance, said Thursday, "We have for the last few days been preparing a lawsuit against the BLM and Coors Energy, and in fact were preparing to file the lawsuit yesterday."
SUWA fought the drilling plans for more than a year.
After an environmental assessment concluded the project would not cause serious, damage, SUWA sued. In June 1991, the group won a temporary restraining order from U.S. District Judge J. Thomas Greene to stay the project pending a hearing. The next month, the BLM rescinded its permission to drill, and prepared a second assessment.
Koteff contends a full-blown environmental impact statement would be required, but that the BLM issued a finding of no significant impact.
Koteff said the Utah Division of Wildlife Resources warned that the project could stress the sheep, and that the stress could cause disease. If some of the sheep became diseased, presumably the ailment could spread to the herd.
"This is the last viable native bighorn herd in Utah," he said.
According to Koteff, SUWA was preparing to carry the suit to federal court on Wednesday, when the group decided to notify Coors Energy.
"We called Coors and said, `We're going to sue you.' And it was only after that, that they made this announcement that they weren't going to drill."
Goldman acknowledged that SUWA's threat prompted Coors Energy to make the announcement on Wednesday.
"In order to alleviate the strain on the court system and alleviate the strain on their time and money, and our time and money, we thought it would be best to let them know" that Coors Energy didn't plan to drill there, he said.
But the threat didn't force Coors Energy into abandoning its plans to drill, he said; only the timing of the announcement was affected by it.
Coors Energy was formed in 1980, when energy supplies seemed uncertain, Goldman added. Adolph Coors Co. wanted its own source of energy for its businesses, he said.
"Obviously the world has changed in the last 12 years and now energy is readily available from other sources." In light of that, the company felt it was best to spend its money in pursuing other business interests.
Drilling the Little Canyon well would have cost $500,000 to $1 million, he said. "When you're selling off the company you don't invest a lot of money."
Koteff criticized Coors Energy for the way it has handled the pull-out. "They let BLM go through this whole EA process all over again. It cost BLM lots of time and money . . . and now Coors says, `Oh never mind. We don't want to drill,' " he said.
Asked why Coors Energy didn't tell the BLM about the change in plans before the second assessment was written, Goldman said, "We wanted to market these properties." The company decided to continue going through the regulatory steps, keeping the leases marketable.
Although the energy company's interests in Colorado are being sold, the lease near Moab has no prospective buyer. It "probably will not be sold at this point," Goldman said.