Geothermal Energy Exploitation in Wilderness Areas: The Courts Face a Hot Issue

Although geothermal energy has been used commercially since at least 1818,¹ up until now it has received little public attention as an alternative energy source. The late energy panic has of course changed that situation, and major mineral development corporations are sending scores of field geologists scurrying into the West in search of steam. Just as prospecting techniques very from simply standing on mountaintops and looking for fumaroles to highly sophisticated passive seismology and aerial magnetic surveys, so do likely geothermal fields range from rugged glacial cirques to flat Idaho farmland.

A primary byproduct of any large scale resource development is always litigation, and the exploitation of geothermal energy will not likely prove an exception; already a small new body of geothermal law is growing.² The active wilderness advocate should brace himself for a storm, for it appears that there is at least prima facie ambiguity as to whether a resource development company may prospect for and develop geothermal resources in wilderness areas that are otherwise offered extensive federal protection.³

The Geothermal Resources Act of 1970⁴ empowers the Secretary of the Interior to issue leases for geothermal resources on the public lands. The act creates a prospecting permit and leasing system similar to that of the Mineral Leasing Act of 1920,⁵ but covering

(i) all products of geothermal processes, embracing indigenous steam, hot water and hot brines;

(ii) steam and other gases, hot water and hot brines resulting from water, gas, or other fluids artificially introduced into geothermal formations;

(iii) heat or other associated energy found in geothermal formations; and

(iv) any byproduct derived from them.⁶

While the Geothermal Resources Act specifically rules out national parks, recreation areas, wildlife refuges and native American tribal lands from its leasing provisions,⁷ it does not exclude wilderness areas, leaving them by implication subject to geothermal exploration and leasing.

Though geothermal energy offers a welcome alternative to the consumption of fossil fuels for generation of electricity, there is no doubt that unmanaged large-scale exploration and development of any resource can conflict with other desirable uses of the public lands. Geothermal power generation plants by nature must lie close to their source of energy, and can produce a number of environmentally troublesome byproducts. Geothermal facilities in a wilderness could create monumental problems of alteration of stream temperatures and salinity, visual and physical scars on delicate landscapes, intrusion of transmission towers and access roads, indiscriminate disposal of non-valuable mineral byproducts, and other degradations hardly in keeping with the purpose of a wilderness.

A strong argument may be made that the Wilderness Act did not subject such areas to any type of mineral leasing or exploration not recognized at the time of its enactment. Section 1133(d) (3) of Title 16 of the U.S. Code provides that 'until midnight December 31, 1983, the United States mining laws and all laws pertaining to mineral leasing shall, to the same extent as applicable prior to September 3, 1964, extend to those national forest lands designated by this chapter as "wilderness areas" …' (emphasis added). Since the Geothermal Resources Act did not exist prior to September of 1964, it may be argued that rights thereunder are not applicable to wilderness, effectively barring geothermal resource development in such areas.

However, the law of the public lands is notoriously rife with problems of phantom intent, and this area is no exception. One may anticipate a potential geothermal prospector's argument that by its language Congress intended to ensure that the full measure of private mineral exploration and development rights would remain applicable to the wilderness areas until 1984, and intended this section to be expansive rather than restrictive, allowing subsequent leasing acts to apply retroactively. This intent was further indicated by Congress' failure to exempt these areas from the Geothermal Resources Act. To deny application of the act to such areas would be to restrict the right of Congress to control the use and disposition of public lands under the Constitution of the United States,⁸ for had Congress intended to exempt wilderness areas, it could have done so expressly, as it did with other lands.

The wilderness protectionist's response to the statutory construction argument is obvious — he must urge strict application [4 ELR 10120] of the Wilderness Act and demand rejection of any leasing scheme not in existence prior to September, 1964. The dispute shapes up as a head-on conflict of language versus intent. The protectionist has the language of the Wilderness Act on his side, and may certainly make an arguable case that the drafters of the Geothermal Act presumed that wilderness was protected by its own statutory provisions and therefore saw no need to provide exemption.

A court facing this issue will have the difficult task of seeking to determine the intent of Congress at the time of the passage of each act.⁹ It will rely to some extent on the language of the act in interpreting its purpose, but will probably recognize that words are inexact tools at best, and will seek other indicators of purpose.¹⁰ One of these indicators is the stated purpose of the legislation,¹¹ and since both acts speak to the protection and promotion of environmental values,¹² there could be a basis for holding nonapplicability of the Geothermal Act to wilderness areas on grounds of express language and perceived intent, but such is hardly certain.

The would-be geothermal prospector could argue further that if the Wilderness Act subjected wilderness only to mineral exploration rights existing in 1964, then prospecting and development of geothermal resources in any manner then acceptable is still permissible in wilderness areas. If accepted, this "freeze" theory would require the court to deal with the prospector's rights as if the year were 1964 and no Geothermal Resources Act had yet been passed.

This premise would place the prospector in a favorable position, for there has never been a clear ruling on the applicability of the federal mining and mineral laws to geothermal resources.¹³ Courts have acknowledged that the word "mineral" is used in many senses,¹⁴ thus while a geothermal resource may be a mineral for one purpose, it may be non-mineral for another.¹⁵ There are cases holding that subterranean waters are minerals regardless of "the peculiar character and quantity of the salts and gases which happen to be in solution."¹⁶ However, there is still confusion over whether geothermal steam might constitute leaseable gas,¹⁷ a salable material,¹⁸ or a locatable mineral.¹⁹ Since geothermal resources include steams and fluids bearing minerals in solution, the question could become quite sticky — a court might easily dismiss a dry subsurface hot spot as non-mineral, but it might be persuaded that hot brine or steam bearing high mineral concentrations is indeed a locatable mineral substance.

If the court were to find that the resource is simply not a mineral, then the argument would be disposed of. But if the substance were found to be a mineral, then the court would have to determine whether private parties could acquire rights in that mineral under the laws existing in 1964.

A contention that geothermal resources in wilderness areas are open to entry under the mineral laws could prove troublesome, particularly if it is the federal government that seeks to thwart intrusion into wilderness. It is clear from government arguments in United States v. Union Oil Corp.²⁰ that the Department of the Interior would welcome a ruling that geothermal resources are minerals for the purpose of mineral reservations²¹ — could if effectively argue the opposite for purpose of leasing and location in wilderness? Probably a middle ground would be chosen — that geothermal resources are minerals, but were not locatable or leaseable under any statutory scheme prior to the Geothermal Act. Prior to 1970 the Department of Interior firmly maintained that it lacked the authority to dispose of geothermal resources on the public lands;²² a court would give such consistent agency expressions the weight due an agency's interpretation [4 ELR 10121] of its own governing statutes.²³

In refuting the application of the Mineral Leasing Act to geothermal resources the government would assert that geothermal steam is not a "gas" within the meaning of the act, for that term refers to hydrocarbon gases. The case of Reich v. Commissioner of Internal Revenue²⁴ has held geothermal steam to be a gas, but the holding was limited to the context of Internal Revenue Code resource depletion allowances, and thus would not be decisive as to the nature of the resource for purposes of the Mineral Leasing Act. Further, the Department of the Interior has defined "gas" under the Mineral Leasing Act as "any fluid, either combustible or nonocombustible, which is produced in a natural state from the earth and which maintains a gaseous or rarified state at ordinary temperature and pressure conditions."²⁵ Geothermal steam precipitates out to a liquid at "ordinary" temperature and pressure (if that term is construed to mean room temperature and pressure), thus falls outside the definition. The prospector could, of course, argue the validity of this definition on technical merits, or could assert that the liquid itself is a leaseable substance if the resource bears significant amounts of a clearly leaseable mineral in solution, such as sodium, potassium, or sulfur. However, this information would probably not be available in advance of exploration and preliminary development, a state which presumably would not have been reached in such a wilderness suit.

If the preservationist convinced the court that geothermal resources do not constitute a leaseable substance, an assertion by the prospector that the steam or heated liquids are open to location under the General Mining Law of 1872 would prove nettlesome, for while conceptually novel, steam and mineral byproducts in solution arguably do fit within the language of § 35 of Title 30, which states that 'claims, usually called "placers," including all forms of deposit, excepting veins of quartz, or other rock in place, shall be subject to entry and patent …"²⁶ (emphasis added). Even if this argument were allowed to stand on logic, it would almost certainly fall on custom, a particularly strong force in the field of mining law. Courts have held that "in deciding whether or not in a particular case exceptional substances are minerals … the true test is what that word means in the vernacular of the mining and mineral industry, the commercial world and the landowners at the time of the grant, and whether the particular substance was so regarded as a mineral."²⁷ Other cases, as well as statutes,²⁸ are littered with deference to local custom in the field of mining. Since a geothermal placer claim is hardly within the traditional concepts of mineral exploration, the courts would be loath to allow it, particularly when the Department of the Interior and the Congress have both evinced an opinion that a specialized leasing format is in order.

While the grounds for excluding geothermal exploration and development from wilderness areas appear firm, one must keep three factors in mind. First, the statutory mandate for exclusion is far from clear. Second, while the Department of the Interior has firmly maintained that geothermal resources were not disposable under pre-1970 mineral law, such a conclusion is subject to judicial review and could be rejected, possibly subjecting wilderness areas to that pre-1970 state of the law until 1984. Third, great weight is added to the side of the would-be prospector by current energy shortages. The fields of statutory construction and mineral law already display a high degree of adaptability to immediate needs — increased fossil fuel shortfalls could pave the way for the nation's first wilderness power plant.

1. For a short history of the commercial development of geothermal resources, see J. Brooks, Jr., "Legal Problems of the Geothermal Industry," 6 Nat. Res. J. 511 (1966).

2. See United States v. Union Oil Corp., 369 F. Supp. 1289, 4 ELR 20560, (N.D. Cal. 1973), appeal docketed, No. 7415-74, 9th Cir., March 31, 1974; Reich v. Comm'r of Int. Revenue, 52 T.C. 700 (1969), aff'd 454 F.2d 1157 (9th Cir. 1972).

3. Those areas established under the Wilderness Act of 1964, 16 U.S.C. § 1131 et seq. (1970).

4. 30 U.S.C. § 1001 et seq. (1970).

5. 30 U.S.C. § 181 et seq. (1970).

6. 30 U.S.C. § 1001(c) (1970).

7. 30 U.S.C. § 1014(c) (1970).

8. U.S. Const., Art. IV, § 3, cl. 2.

9. Moor v. County of Alemeda, 411 U.S. 693, 709, 93 S. Ct. 1785 (1973); United States v. Stewart, 311 U.S. 60, 69, 61 S. Ct. 102 (1940).

10. Tidewater Oil Co. v. United States, 409 U.S. 151, 157, 93 S. Ct. 408, 413 (1972).

11. United States v. Shirey, 359 U.S. 255, 260-61, 79 S. Ct. 746 (1959).

12. 30 U.S.C. § 1023(i); 16 U.S.C. § 1131 (1970).

13. Recently United States v. Union Oil Corp., supra, n.2, directly approached the question of whether geothermal resources were included in a reservation of "coal and other minerals" to the United States. Not only is the case distinguishable from the issue at hand, but the court's resolution of the problem seems to this writer to be less than satisfactory; the United States has appealed the case to the 9th Circuit.

14. Bumpus v. United States, 325 F.2d 264, 266 (10th Cir., 1963).

15. Reich v. Comm'r of Int. Revenue, supra, n.2.

16. Hathorn v. Natural Carbonic Gas Co., 87 N.E. 504, 508 (1909), citing Westmoreland N. Gas Co. v. Dewitt, 130 Pa. 235, 18 Atl. 724 (1889); Peoples Gas Co. v. Tyner, 131 Ind. 277, 280, 31 N.E. 59 (1892).

17. Under the Mineral Leasing Act of 1920, supra, n.5.

18. Under the Materials Act of 1947, 30 U.S.C. §§ 601-604, 611-615 (1970).

19. Under the General Mining Law of 1872, 30 U.S.C. § 21 et seq. (1970).

20. Supra, n.2.

21. The United States government has reserved to itself the mineral estate in vast acreages of dispositions under the Stock Raising Homestead Act of 1916, 43 U.S.C. § 291 et seq. (1970), as well as under other acts. If such a reservation includes geothermal resources, then the United States would retain control over geothermal leasing and receive royalties therefrom. The court in Union Oil found that the mineral reservation does not include geothermal resources, but some aspects of the logic used seem questionable, and the case is on appeal.

22. See 3 U.S. Code Cong. & Admin. News 5113, 5115, 5126-5128 (1970); also Dep't of Int. Mem. M-36625 (Aug. 28, 1961).

23. Investment Co. Institute v. Camp, 401 U.S. 617, 626-27, 91 S. Ct. 1091, 1097 (1971); Knowles v. Butz, 358 F. Supp. 228, 231 (N.D. Cal. 1973).

24. Supra, n.2.

25. 30 C.F.R. § 221.2(o) (1973).

26. Since such a "mineral" could hardly constitute rock in place bearing valuable minerals, and would not have clearly definable boundaries or be removed by conventional mining methods, it would be a placer rather than a lode deposit, if a deposit at all. Titanium Actynite Industries v. McLennan, 272 F.2d 667 (C.A. Colo. 1960). Some definitions of placer would seem to exclude all but the typical gravelly alluvial deposits, however; Northern Pacific R. Co. v. Soderberg, 188 U.S. 532, 23S.Ct. 367 (1903).

27. Fleming Foundation v. Texaco, 337 S.W.2d 846, 852 (Tx. Civ. App. 1960).

28. 30 U.S.C. §§ 28, 35 (1970).