OPEC serves as unlikely ally for the greater sage grouse


HOUSTON (Bloomberg) -- The greater sage grouse may have found an unlikely ally: OPEC.

The fowl at the center of one of the nation’s biggest conservation battles had already received good news before the Interior Department declined to classify it as endangered. With Saudi Arabia and other OPEC members pumping oil with no respite, despite crude prices below $50/bbl, drillers in the U.S. have idled more than half their rigs over the past year in western states where the grouse lives, like Colorado and Wyoming.

The sage grouse has been the center of one of the nation's biggest conservation battles.

“The big concern was the geography of the habitat was so wide and vast, it could have infringed on the growth potential of the industry,” said Peter Pulikkan, an energy analyst with Bloomberg Intelligence. “That issue has fallen off the radar with the price collapse. Drillers have got bigger issues to deal with than a boisterous bird.”

The drop in rigs has lowered the stakes around the decision about the sage grouse, whose habitat spans 165 million acres in 11 states in the western U.S. eyed by oil and gas companies, renewable energy providers and ranchers, among others.

The birds draw tourists to nesting grounds each spring to watch males puff up their flashy yellow and white chests and fan spiky brown tail feathers to lure females. Its population once numbered in the millions, but since 1985 has shrunk to no more than 500,000 birds.

Earlier this year, the Bureau of Land Management issued plans affecting about 20 million acres across 10 states, in some cases banning drilling, wind turbines and mining on some of the most pristine areas, and near the birds’ leks, the areas where they congregate during mating season. The grouse, also known as the lesser prairie chicken, avoids mating displays around tall structures like turbine towers where predators may lurk.

Other areas would get increased scrutiny before roads or other projects could be approved. In other cases, developers would need to agree to protect other lands or restore habitat before proceeding. Interior Secretary Sally Jewell said last week that she was “optimistic” those efforts have done enough to keep the bird off the endangered species list.

“Environmental issues are a big deal for President Obama, and this has really worked out well for him,” said Carl Larry, head of oil and gas for Frost & Sullivan LP in Houston. “He hasn’t had to face the typical push-back from the oil industry in the headlines here, because the oil industry took care of itself.”

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