Important Victory on the BLM Fracking Rule

by Kathleen Sgamma, Vice President of Government and Public Affairs on June 24, 2015 - 12:45pm

courtroomYesterday, IPAA and Western Energy Alliance were joined in court by the states of North Dakota, Wyoming, Colorado and Utah to argue for a preliminary injunction of BLM’s hydraulic fracking rule. The judge ordered a stay of the rule, originally intended to go into effect today, until he can review the full administrative record, which means likely the rule will not go into effect, if at all, until mid-August.

Mark Barron of BakerHostetler did an outstanding job of making industry’s case, and Paul Seby and Andrew Emrich of Holland and Hart did likewise for the State of North Dakota. Dan Naatz of IPAA was excellent on the witness stand showing how the last minute inclusion of provisions on frack communication was not part of public notice and comment. I also enjoyed taking the witness stand.

Our legal team of Mark, Poe Leggette and Alex Obrecht put together a brilliant case to convince the judge that our arguments have merit and that we’ve met the standard of irreparable harm if BLM implements a rule that may ultimately be overturned. By gathering intelligence from IPAA and Alliance members and staff or attending in person, they presented the confused guidance from various state and field offices that shows BLM is struggling as much as industry is to implement a duplicative rule that is arbitrary and capricious. 

The Ute Indian Tribe has recently intervened in the case, and is strongly supportive. The Southern Utes have filed a related lawsuit in the District of Colorado. The Interior Department, which maintains a financial trust responsibility, cannot easily ignore the tribes like they do industry. 

Next Steps

The government has until July 22nd to submit the full administrative record. At that point, all the lawyers have a week to comb through it to fully cite their arguments to the record. Approximately two weeks after that, the judge will rule up or down on the preliminary injunction. The hearing schedule on the merits of the full case will likely be set shortly thereafter.

If the government gets the administrative record together before July 22nd, the schedule will move quicker. However, that is unlikely given the fact that BLM had already asked for more time to compile it. The government seemed to indicate, by its disorganized arguments and even body language, that it just expected to be given deference by the court, and did not feel the need fully counter state and industry arguments.  The state lawyers, in their rebuttal, mentioned how the government’s flippant dismissal of economic harm and infringement on sovereignty was insulting. We don’t expect the government to make the same mistake at the next hearing, so their lawyers are likely to take the entire time period to more fully prepare.

What does that mean for companies operating on federal lands? If you have plans to frack in the next few weeks, you will continue as usual complying with existing BLM and state regulations. The schedule for compliance of the new rule will be adjusted if the judge decides in August not to grant the full preliminary injunction, so stay tuned for more information.