The Pros and Cons of Tribal Energy Resource Agreements

1
The Pros and Cons of Tribal Energy Resource
Agreements

• Energy Policy Summit
• NCAI/CERT
• Denver, Colorado
• November 11, 2007

2
Current System Secretarial Approval Required

• Any agreement that encumbers Indian land for a
  period of 7 or more years. 25 USC 81(b)
• Leases of tribal land for mining purposes. 25
  USC 396a
• Leases of tribal land for subsurface storage
  purposes. 25 USC 396g
• Rights-of-way for any purpose, with tribal
  consent. 25 USC 323, 324
• Minerals Agreements related to energy or
  non-energy mineral resources. 25 USC 2102
• Surface leases for business and other purposes.
  25 USC 415

3
Standards for Secretarial Approval

• Best Interests of Tribe short term, long term
• National Environmental Policy Act evaluation of
  environmental impacts and alternatives to
  proposed action
• National Historic Preservation Act effect of
  undertaking on object eligible for inclusion in
  the National Register
• Endangered Species Act Consideration and
  mitigation of effects on threatened or endangered
  plants or animals

4
Ancillary Factors Affecting Secretarial Approval

• Limitations in Federal Funding
• Diminishing staffs with technical expertise and
  institutional knowledge
• Increased public involvement
• Cobell concerns

5
Adverse Practical Consequences

• Delays in decision-making and project
  implementation
• Lost Opportunities
• Potential economic loss
• Dilution of tribal sovereignty

6
Tribal Energy Resource Agreements (TERAs)

• Provided for in Title V of the Energy Policy Act
  of 2005 (New Section 2604 added to Energy Policy
  Act of 1992) (25 USC 3504)
• Implementing regulations to be adopted by the
  Secretary of the Interior by August 8, 2006.
• Master Agreement between Tribe and Secretary
  outlining tribal decision-making process,
  environmental evaluation, public comment,
  record-keeping.
• Once TERA approved, Secretarial approval no
  longer required for energy related leases,
  business agreements, and rights-of-way on tribal
  lands.

7
Prerequisites to Approval of TERA Application

• 270-day approval process.
• Determination by Secretary that Tribe has
  sufficient capacity to regulate tribal energy
  resource development.
• Tribal assurances of compliance with federal
  environmental laws, and periodic Secretarial
  review of performance.
• Publicly responsive tribal environmental review
  process similar to NEPA.
• Third party complaint and petition process for
  TERA non-compliance.
• Mechanism for rescission and re-assumption

8
Advantages

• Heightened tribal self-determination.
• Elimination of administrative delays in approving
  and implementing energy projects.
• More inclusive public involvement in
  environmental evaluation of tribal energy
  projects.
• Final decisions left to tribes.

9
Disadvantages

• Tribe is responsible for negative consequences of
  negotiated provisions in subsequent leases,
  business agreements or rights-of-way
• Tribe will probably have to bear financial costs
  of TERA administration.
• Increased public scrutiny of tribal
  decision-making.

10
Pending Regulations

• Will inherent federal function exception limit
  the role that tribes may assume?
• Will other federal agencies, such as BLM, EPA,
  MMS concur in potential transfers of functions to
  tribes?
• Will potential federal enforcement of energy
  resource contract terms and protection be
  effectively provided?

11
Conclusion Self Determination or Trust
Responsibility

• Optional program
• Tribes are all different
• Opportunity for Tribal Leadership to embrace
  challenge
• Potential model for other areas