DENVER -- Yesterday, Western Energy Alliance, the Independent Petroleum Association of New Mexico, New Mexico Oil and Gas Association, North Dakota Petroleum Council, Petroleum Association of Wyoming, and Utah Petroleum Association filed a lawsuit challenging the Bureau of Land Management’s (BLM) Fluid Mineral Leases and Leasing Process rule in the U.S. District Court for the District of Wyoming. The leasing rule’s impact will deter development of federal oil and gas, disproportionately affect small companies, effectively close eligible and available lands to new leasing, and violate BLM’s duty to promote oil and gas development as a multiple use of federal lands. Because the rule is procedurally deficient, arbitrary and capricious, and contrary to law, the associations ask the court to invalidate and vacate it. The associations are represented by Alexander K. Obrecht, Mark S. Barron, and L. Poe Leggette of Baker & Hostetler LLP. “BLM issued a final rule that prices small producers out of the market and off public lands,” said Kathleen Sgamma, president of Western Energy Alliance. “The bonding amounts are excessive when there are just 37 orphan wells out of more than 90,000 wells on federal lands. Increasing bonding amounts 20-fold in order to take care of a problem on just .04% of wells is way out of proportion. Companies are already responsible for reclaiming wells, and one of the primary reasons there are so few orphan wells on federal lands is because our members clean up old wells even when they weren’t the party that abandoned them in the first place. This is another rule by the Biden Administration meant to deliver on the president's promise of no federal oil and natural gas. We’re pleased to be joined by our sister trade associations in challenging a rule that has such a detrimental economic impact in states across the West.” "IPANM believes this legal action is necessary to preserve the foundational intent of the BLM to promote fair and equal public land use. IPANM is disappointed Secretary Haaland fails to consider the negative economic ramifications of this overreaching rule to those already in poverty in her home state," said Jim Winchester, executive director of the Independent Petroleum Association of New Mexico. “NMOGA supports the goal of ensuring fair returns for the American public from activities on federal lands, but this approach is an overreach that could impact U.S. energy security, the economy, and the full potential of the lands' multi-use possibilities,” said Missi Currier, president and chief executive officer of the New Mexico Oil and Gas Association. “Eighty percent of Wyoming’s operators are small businesses, and together they produce a third of Wyoming’s oil,” said Pete Obermueller, president of the Petroleum Association of Wyoming. “Rules like this one will fall hard on the smallest of Wyoming’s operators, making it economically impossible for many of them to continue to produce. PAW joins this challenge to protect Wyoming’s small operators from the heavy hand of an Administration intent on forcing them to close their doors.” "Utah has abundant federal land and serves as a shining example of how natural resource development can and does coexist harmoniously with other uses like recreation and conservation,” said Rikki Hrenko-Browning, president of the Utah Petroleum Association. “This rule is punitive, unnecessary, and overreaching, and as a result, Utah will face outsized negative consequences from this rule due to our large federal land footprint. We're confident the courts will agree with us and rightfully strike it down.” For more information, the coalition’s legal petition is available online. # # #
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