| SAN FRANCISCO, April 9
SAN FRANCISCO, April 9 A court ruling that the
U.S. government must consider the environmental impact of
"fracking" on federal lands leased to oil companies offers
opponents of the technique a useful weapon in the fierce public
debate in California and other parts of the country.
In a regulatory setback for hydraulic fracturing on public
lands, a federal magistrate judge in San Jose, California, on
Monday ruled that the Bureau of Land Management (BLM) failed to
analyze its impact on 2,500 acres in Monterey County
While energy lawyers were skeptical about the ruling's
long-term impact, it was hailed as a victory for
environmentalists trying to stop fracking in the state due to
concerns about its groundwater impact and the potential for
increased fossil fuels output contributing to climate change.
The ruling could even inspire environmental groups to sue
the BLM in other states as oil companies accelerate their
leasing of federal lands for fracking, said Brendan Cummings, a
lawyer for the Center for Biological Diversity.
"While the ruling has most direct impact on public lands in
California, it also sets an important legal and policy precedent
that federal and state agencies around the country would be wise
to heed," said Cummings, whose group brought the suit with the
Celia Boddington, a spokeswoman for the BLM, said: "We are
evaluating the ruling."
Monterey county captures just part of the vast Monterey
shale formation, estimated by the U.S. Energy Information
Administration to hold 15 billion barrels of technically
recoverable oil, or four times that of the Bakken formation
centered on North Dakota.
Most of that oil is not economically retrievable except by
hydraulic fracturing, or fracking, a production-boosting
technique in which large amounts of water, sand and chemicals
are injected into shale formations to force hydrocarbon fuels to
Cummings believed the San Jose ruling would likely have
implications for a more recent and much larger lease sale of
18,000 acres for oil and gas development in the same general
Judge Paul Grewal did not hand down a remedy, instead asking
the BLM and the environmental groups to confer and submit an
agreed upon path forward by next week.
Jack Luellen, a Denver-based managing partner at energy law
firm Burleson LLP, said the potential for a time-consuming BLM
environmental impact statement would put the burden on the BLM
to "prove a negative," or that fracking would not cause damage.
"If you're anti-fracking, delaying is almost as good as
barring it," Luellen said.
But James Pardo, a partner at the law firm of McDermott Will
& Emery LLP, believed a full separate study of the Monterey
shale was unlikely to be necessary even though the geology is
different from other U.S. shale plays. But a "harder look" at
the issue would be necessary.
"The court's telling them to square those corners," he said.
"Note this judge did not void the leases ... This judge is
looking at a reasonable solution."
Bill Allayaud, California director of government affairs for
the Environmental Working Group, said the court decision could
cause the BLM to rethink how it leases land.
Oil and gas drilling on BLM lands has shot up in recent
years as advances in horizontal drilling and fracking have made
hard-to-reach deposits recoverable.
As a share of overall U.S. production, oil from federal
onshore land accounted for about 5 percent of the total last
year, and 12 percent for natural gas, according to federal data.
About 98 percent of the land under BLM control is in the
western United States, including Alaska. California accounts for
6 percent of the 247 million acres under BLM control, according
to the most recent statistics available on the agency's website.
California regulators are in the process of devising rules
It is already the subject of a state-level court battle.
That lawsuit, brought by the Center for Biological Diversity,
Earthworks, Environmental Working Group and Sierra Club, accuses
the state regulator with failing to evaluate the risks.
A hearing is due on May 1.
The state case is Center for Biological Diversity et al v
California Department of Conservation, Division of Oil, Gas and
Geothermal Resources, Case no. RG12652054, in Alameda County
Superior Court, Oakland, CA.
The federal case is Center for Biological Diversity and
Sierra Club v Bureau of Land Management, Case no. 11-06174 PSG
in the U.S. District Court for the Northern District of
California in San Jose, CA.