The American Petroleum Institute (API) this week issued its first-ever set of “good neighbor” standards for oil and gas developers. API Director of Standards David Miller said,

“the API’s community engagement guidelines will serve as a gold standard for good neighbor policies that address community concerns, enhance the long-term benefits of local development, and ensure a two-way conversation regarding mutual goals for community growth.”

Good Neighbor Agreements mean someting along the Beartooth Front
The concept of corporate good neighbor policies has great meaning along the Beartooth Front. The Good Neighbor Agreement with the Stillwater Mining Company is a legally binding contract that has established a process for citizens to regularly meet with company representatives to address and prevent problems related to mining impacts, reclamation, wildlife, and other issues. It set aside land in conservation easements, instituted a program to reduce traffic on winding valley roads, and provided for independent environmental audits.

The Good Neighbor Agreement has demonstrated that it’s possible to run a responsible, profitable mining operation while protecting natural resources.

But the API’s good neighbor guidelines seem a lot more like a publicity stunt than a set of meaningful guidelines.

On paper, there’s a lot to like. (You can download a copy of the guidelines here.)

Oil and Gas Project Life Cycle     (click to enlarge)

About the API standards
The document defines a five-phase cycle of oil and gas development, and considers tools for companies to use at every phase. Overall, it says, oil and gas development can result in a positive experience for communities if development development activities are aligned with community concerns and priorities “grounded in responsible practices and lessons learned from former experiences.”

The document outlines key principles for communication, including

• Promote education, awareness and learning;
• Provide clear, concise information to all key stakeholders including community members and local authorities and regulatory agencies in addressing challenges and issues that can impact them.
• Provide structured forums for dialogue, planning, and implementation of projects and programs affecting the greater regional area. Involve neighboring operators and those sharing adjacent properties or leaseholds in opportunities to work cooperatively on engagements.
• Establish a process to collect, assess, and manage issues of concerned stakeholders. Inform stakeholders on the preferred methods for communication, perhaps providing national toll-free phone number, or by offering contact information for the local field office or corporate personnel responsible for community/stakeholder relations.
• Design and carry out a communication strategy that addresses the community, cultural, economic, and environmental context where a project occurs, and that considers the norms, values, and beliefs of local stakeholders, and the way in which they live and interact with each other.

Throughout the entry phase, which is the one we are in today, the document encourages frequent one on one meetings and community forums with local residents to talk about things like road safety and traffic, providing communication materials that lay out the company plans. They also suggest a way for local citizens to communicate concerns and for the company to provide feedback on those concerns in a public way. There are suggestions for working with local authorities on workforce development, defining likely jobs and ways for residents to prepare for those jobs.

The list goes on. The document includes many good suggestions that could make a huge difference in how a community sees the likely impact of oil and gas drilling.

What we’ve experienced is nothing like these standards
Now let’s compare that to what we’ve experienced along the Beartooth Front.

• Last October Energy Corporation of America (ECA) CEO John Mork announced plans to “Bring the Bakken to the Beartooths,” and that’s pretty much the last we’ve heard from him.
• There has been a single public forums in Red Lodge. There has been no follow up to concerns presented at the meeting.
• When the Board of Oil and Gas held a public hearing on the first permit in the area, ECA challenged the community’s right to be heard, and didn’t show up for the hearing.
• After the permit was granted and ECA began drilling on the well in Belfry, they immediately got into a dispute with local neighbors over water use, and were temporarily shut down by the Montana Department of Natural Resources.
• In Dean, ECA constructed a well pad months ago across from Montana Jack’s on Nye Road, but there has been no indication of the company’s plans beyond that.

In other words, when it comes to the Beartooth Front, the API’s good neighbor guidelines are just a fantasy story.

Why oil and gas good neighbor agreements don’t work
There’s a significant reason why oil and gas companies will never make a serious effort to engage with this community the way the Stillwater Mine has. The answer lies primarily in the oil and gas cycle pictured above. Companies come in for a quick profit. At most they stay a few years, and their complicated financial relationships with other companies mean that much of their work is subcontracted to others. Their employees come and go, frequently without families, often living in temporary housing.

The Mine, by contrast, is in the community for the long term. They have a small number of locations, their employees live in the community and send their children to local schools, and as a result the company and its employees have to live with the consequences of the way they run their business. It makes sense to work with the community as good neighbors.

The API is a public relations arm for the oil and gas industry. They have written a document that has many positive elements, but has little chance of being adopted by oil and gas operators, who are much more interested in a hit and run kind of approach.

Let’s not be fooled. The law is tilted far in favor of oil and gas extraction at the expense of local property owners. If we want these companies to be good neighbors, we’re going to need to force them into it by enacting local laws that govern their behavior.