Washington (Platts)--16Dec2008

Colorado Senator Ken Salazar, widely seen as President-elect Barack
Obama's choice for US Interior Department secretary, has opposed many Bush
efforts to open the West to increased energy development.

But he has also shown a willingness to support energy development at a
slower pace, and has already drawn fire from environmental groups, as well as
praise from the petroleum industry.

The Center for Biological Diversity, an environmental group which has
fought many legal battles with Interior during the Bush administration, called
Salazar a "disappointing choice."

"The Department of the Interior desperately needs a strong, forward
looking, reform-minded Secretary," said Kieran Suckling, executive director of
the Tucson-based Center. "Unfortunately, Ken Salazar is not that man"

CBD took issue with votes Salazar has made against increased fuel
efficiency standards, the removal of tax breaks for oil companies, and his
support of Interior officials viewed as antagonistic to environmental
concerns.

Not all environmental groups have found Salazar an egregious choice,
however. While he has shown a willingness to compromise between energy and
environmental concerns, the League of Conservation voters, in its most recent
review, found that he voted in line with their "environmental scorecard" 100%
of the time.

Some drilling industry groups were buoyed by the pick, including the
Independent Petroleum Association of Mountain States.

"IPAMS has worked with Senator Salazar for many years and we are
confident that he views natural gas development in the Intermountain West as
an important long-term element in national and regional energy supply,"
according to IPAMS Executive Director Marc Smith.

The American Petroleum Institute also supported the pick, saying he was
"well-qualified" and that he understood the oil and gas industry.

Despite the optimism from industry, Salazar has often been at odds with
the Bush administration's aggressive pro-drilling agenda over the past eight
years.

He has used his position on the Senate Energy and Natural Resources
Committee to oppose controversial drilling on the Roan Plateau, as well as a
plan by the Bush administration to restart oil shale development in several
western states.

MUSCLE FLEXING ON INTERIOR

However, he has also left open the possibility of allowing more drilling
in federal waters on the Atlantic and Pacific coasts that until October were
off limits to oil and gas development.

The Interior secretary oversees oil and gas leasing on public lands
through the Bureau of Land Management and offshore through the Minerals
Management Service, as well as endangered species decisions through the Fish
and Wildlife Service.

Colorado newspaper the Denver Post reported late Monday that Salazar had
accepted the position, but neither the senator nor the Obama transition office
could be reached for comment.

As a senator, Salazar has not shied away from forcing Interior to
consider Colorado's interests in oil and gas leasing plans. In 2007, Salazar
held up the Senate confirmation of Bureau of Land Management Director James
Caswell to force Interior to give the Colorado governor more time to consider
a BLM oil and gas leasing plan on the Roan Plateau. The area is rich in
natural gas that some estimates suggest could be worth billions of dollars.

Salazar supported a plan for the Roan put forward by Colorado Department
of Natural Resources, which would have set aside about 36,000 of the Roan's
73,000 acres for environmental protection, instead of the 21,000 proposed by
BLM.

Salazar also opposed Interior's efforts to finalize regulations on oil
shale development in Utah, Wyoming and Colorado, arguing that water-use
demands and potential economic impacts were not sufficiently considered, and
that the pace of development should be much slower.

But on offshore oil and gas development, Salazar appeared receptive to
considering opening more areas to drilling than had been allowed under federal
bans in effect from the 1980s to October 1 of this year.

Some of Salazar's past legislative efforts may also dovetail with Obama's
priorities. In his picks for Energy secretary and the White House
environmental team, Obama has placed an emphasis on combating climate change
and the greenhouse gas emissions that are widely blamed for that change.

While at the Senate, Salazar has pushed for the alternatives to oil-based
transportation fuels, has been a proponent of alternative energy and has
supported efforts to better understand the storage of carbon dioxide from
power plants.

Salazar is a former attorney general and natural resources director in
Colorado. Obama is expected to formally announce his pick for Interior
secretary this week.

--Derek Sands, derek_sands@platts.com