Industry, states ask for no decision yet
Trump officials this week started a push to kill a stalled ruling on land protection.
The nation’s stalled rule to protect public land against harm from fracking faced multiple threats Thursday after the oil and gas industry and states, including Colorado, asked a federal appeals court to hold off indefinitely on deciding whether it is legal.
Trump administration officials earlier this week launched a rulemaking process aimed at killing the rule outright. A lower federal court had already determined the Bureau of Land Management lacks the power to make such a rule.
This is happening as companies increase production of fossil fuels by drilling across millions of acres of federal public land, mostly in the West. In Colorado, oil and gas companies have drilled 6,434 wells on federal public land.
The rule, passed in March 2015, would update an existing 35-yearold rule that BLM officials have used to guide oil and gas operations allowed on public land.
The idea was to put in place protection so that increased drilling could be done in a way that minimizes harm to air, land, water and wildlife. Federal officials felt they needed to deal with modern oil and gas production techniques, including hydraulic fracturing, which injects millions of gallons of water, sand and chemicals deep underground to coax out oil and gas.
The rule that applies today lets companies dispose of industry waste liquids in unlined open pits, with limited review of drilling plans. It doesn’t require companies to disclose the chemicals they use.
For five years, BLM officials under the Obama administration hashed out the new rule, only to see it hung up in court as the industry and states sued. The new rule would require earlier review of drilling plans, the use of storage tanks instead of pits to capture waste, tougher well testing and some disclosure of chemicals.
On Thursday, 10th Circuit Court of Appeals judges heard arguments for and against a September 2015 ruling by U.S. District Court Judge Scott Skavdahl in Wyoming.
Skavdahl determined the BLM has no authority to regulate fracking.
U.S. Department of Justice attorney Andy Mergen, representing the BLM, asked the three-judge appeals court panel for an indefinite delay while Trump officials run a multiyear process to rescind and replace the Obama-era rule. No need to decide now the issue of whether the BLM has authority, Mergen argued, noting “the president has made this a priority.”
Judge Mary Beck Briscoe asked: “How can you proceed with a rulemaking when the district court has told you you have no authority?”
Mergen said government attorneys actually do believe the BLM has authority to regulate fracking, but that federal officials still want the court to delay a ruling until the process of rescinding the 2015 rule is done.
Judge Jerome Holmes said he’s concerned executive branch officials are “jerking around our dock- et” by asking appeals judges “to hold something in abeyance for what could be forever.”
Environment groups argued the BLM has well-established authority to regulate fracking on public lands. Earthjustice attorney Mike Freeman, representing a coalition of groups including Conservation Colorado, asked the appeals judges to reverse Judge Skavdahl’s decision.
“All this rule does is update the agency’s existing regulation,” Freeman said.
Trump officials on Tuesday proposed killing the 2015 rule for fracking on federal public and tribal land. They said the rule would impose unjustifiable costs on oil and gas companies — $32 million to $45 million a year.
The court discussion Thursday revolved around which federal agencies have power to regulate oil and gas operations and the extent of allowable overlap. While the BLM oversees activities on public land, the Environmental Protection Agency traditionally has regulated activities affecting health and the environment, including pollution of water.
Judge Harris Hartz asked whether Congress intended the Safe Drinking Water Act, as opposed to the Federal Land Policy and Management Act that governs the BLM, to be the “exclusive means” of protecting water from contamination. He suggested the drinking water act may “concentrate that expertise” within the EPA.
“You can have different agencies regulating the same thing but they are doing it for different purposes,” Judge Holmes said.
Under an agreement with the BLM, state regulators in Colorado share responsibility with the feds for overseeing oil and gas operations on federal public land. State rules require limited disclosure of chemicals. But Colorado’s rules, too, allow open pits for disposal of waste, though some on federal lands must be lined to minimize leaks into soil and water.
The Western Energy Alliance industry group contends states — not federal agencies — should regulate oil and gas operations. “Not only do states have rules regulating fracking, but they also have rules regulating drinking water,” alliance president Kathleen Sgamma said.
Federal officials declined to discuss the issues on the record.
BLM spokesman Steven Hall responded to queries by email saying agency officials cannot discuss a case in litigation. But, he wrote, “BLM will continue to work with partners to ensure safe operations on federal lands” and “BLM conducts regular inspections of drilling operations on federal lands.”
And Hall wrote that BLM officials “can require that all pits be lined” or require companies to use storage tanks using a “decisionmaking process.”
Colorado Attorney General Cynthia Coffman responded to queries with an email saying she joined the legal fight against the BLM fracking rule because federal officials “intruded on the state’s expressly granted legal authority to regulate hydraulic fracturing.”
Denver-based attorney Mark Barron, representing the Independent Petroleum Association of America and the Western Energy Alliance, called the 2015 rule “a solution in search of a problem” because “it is largely duplicative of existing rules under federal and state law.”
Barron said the industry wants a rule that gives companies “operational flexibility regarding whether to use a lined pit or aboveground tanks.”
Companies oppose the federal notion that capturing industrial waste in tanks is always preferable, Barron said.
“Pits frequently offer operators greater ability to service multiple wells from one location – reducing truck traffic and surface disturbance – and frequently facilitate an operator’s ability to treat water in the field for re-use and recycling,” he said.
“A rule that optimized environmental sensitivity would have given producers, working with BLM, the operational flexibility to determine whether pits or tanks worked best for a given project,” he said.