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Every 15 to 25 Antrim wells are linked to a compressing station, like this
one in Manistee County's Bear Lake Township, that are powered by loud
1,000 horsepower engines.
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(continued from previous page)
- Lack of State Oversight -
The explosive growth of the Antrim development has overwhelmed state authorities charged with
overseeing the industry. Even as the Engler Administration was investing millions of dollars in subsidizing the
development, it also was downsizing state government. In 1992 alone, more than 2,000 wells were permitted
by the Geological Survey Division, the agency responsible for regulating oil and gas development. During a
public meeting in Manistee County in 1995, Hal Fitch, now the chief of the GSD, candidly assessed the
situation. "Basically, it was kind of pandemonium out there for awhile," he said.
• Under the Engler Administration, the Geological Survey Division underwent one of the sharpest drops in
personnel of all the state's agencies. In 1988, when the Antrim development was starting, the Division had
128 employees. In 1995, when the GSD was transferred from the DNR to the new Department of
Environmental Quality, it had 63 employees.
• In 1995 a state review found that the GSD had met just 18% of planned well site inspections, and 48%
of the planned inspections for production facilities.
•The review also found that the Division was meeting 100% of its goals for reviewing drilling
applications. In 1995, 1,523 applications came before the GSD, and more than 95% were approved.
How was it that a decade after rising to the occasion to set a model land use policy fit for the 21st century,
Michigan then sunk to a level of management neglect that more closely resembled the cut-and-run lumber era
of the 19th century? The answer lies with a vastly changed political climate, an important difference in energy
industry leadership, a state environmental community diverted by other issues, and media indifference.
ADifferent Political Era
-The Swing to the Right -
In 1990, Michigan elected a governor, John Engler, who believed government should have only a limited
role in regulating business. Mr. Engler also opposed environmental regulations that he considered too
complicated and costly for business. Moreover, he was intent on transforming the state's nationally-recognized
stewardship policies into an economic development program for industry.
Gov. Engler executed this strategy flawlessly, and without much political opposition. Early in his first term
he issued an executive order that raised barriers to public involvement by eliminating several key citizen a
dvisory boards and drastically diminishing the authority of the Natural Resources Commission. He then
weakened the DNR by appointing in 1991 an ineffective leader, and demoralized the agency with extensive
budget and staff cuts.
Gov. Engler's efforts on behalf of the oil and gas industry are well-documented:
•The DNR's Geological Survey Division has lost one-third of its staff since the governor entered office in
1991. This was the very same period when the number of gas wells being drilled in the Antrim Shale
formation reached record levels.
• Furthermore, although he had campaigned on a free-market message, Gov. Engler's administration
actively began to subsidize Antrim development. In 1993, oil and gas industry executives and senior DNR
staff members privately negotiated an agreement that allowed energy companies to deduct millions of dollars
a year in production costs before paying state royalties. The agreement, which cost Michigan residents more
than $5 million a year, was established without the knowledge of the NRC, the Legislature, or the public.
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