Contact: William Perry Pendley, 303/292-2021, Ext. 30

June 11, 2014 – DENVER, CO. A small Colorado energy company that holds valuable federal oil and gas leases, but was denied its right to explore them, today filed additional pleadings in its administrative appeal of the denial. WillSource Enterprise, LLC, an oil and gas exploration company in Denver, holds eight oil and gas leases in the White River National Forest in Mesa County, Colorado, just west of an area commonly referred to as the Thompson Creek Divide. In its appeal filed with the U.S. Department of the Interior Board of Land Appeals (IBLA), WillSource challenges a January 2014 decision by Colorado State Director of the Bureau of Land Management (BLM) upholding the June 2012 retroactive cancellation of three of its leases and seeks a stay of the decision. WillSource appealed the 2012 ruling and made a formal presentation on its appeal in January 2013; a final BLM ruling was pending for a year. Environmental groups used various political and legal tactics to prevent development of 80 federal oil and gas leases in the Divide.

“The plethora of mistakes by federal employees deprived inequitably our client of its right to hold potentially productive oil and gas leases,” said William Perry Pendley, president of Mountain States Legal Foundation (MSLF); MSLF represents WillSource. “Equity demands the relief we seek.”

In 1995, WillSource was issued eight oil and gas leases, seven of which are in the Willow Creek Unit, which was approved in 2003 and consists of 8,643 acres of federal leases; WillSource is the designated operator. Environmental stipulations limit drilling in the unit to five months each year. In November of 2004, WillSource completed a well. Applications for Permit to Drill (APDs) two other wells in the unit were approved in 2004; both wells were granted yearly extensions from 2004 to 2009 as a result of conflicting and shifting BLM and U.S. Forest Service regulations, primarily as to a Forest Road the agency required WillSource to reengineer and rebuild so as to be allowed to drill. WillSource’s 2009 request for an extension was denied.

WillSource sought a “paying well determination” and approval of a participating area (PA), which the BLM granted by determining “Little Beaver #1-20 well” was capable of producing energy in paying quantities. The BLM made its determination in September of 2010, effective November of 2004.
In 2011, the Forest Service imposed new requirements on WillSource, including the hiring of a third party, licensed, road engineer and obtaining a $500,000 bond, which required a $300,000 collateral, funds WillSource lacks.

In November of 2011, the BLM wrote WillSource, “all lands not within the . . . [PA] . . . were automatically eliminated from the unit area effective November 11, 2009,” which invalidated three of WillSource’s seven leases.

Mountain States Legal Foundation, founded in 1977, is a nonprofit, public-interest legal foundation dedicated to individual liberty, the right to own and use property, limited and ethical government, and the free enterprise system. Its offices are in suburban Denver, Colorado.